Bill Text: IL HB3403 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Illinois Housing Development Act. In provisions concerning the affordable housing tax donation credit program, provides that the administrative housing agency must establish a goal of awarding a specific amount of tax credits for donations to sponsors that are minority-owned businesses, women-owned businesses, or businesses owned by persons with disabilities.

Spectrum: Partisan Bill (Democrat 3-0)

Status: (Introduced) 2023-03-10 - Rule 19(a) / Re-referred to Rules Committee [HB3403 Detail]

Download: Illinois-2023-HB3403-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 HB3403 Introduced , by Rep. Elizabeth "Lisa" Hernandez SYNOPSIS AS INTRODUCED:
20 ILCS 3805/7.28
Amends the Illinois Housing Development Act. In provisions concerning the affordable housing tax donation credit program, provides that the administrative housing agency must establish a goal of awarding a specific amount of tax credits for donations to sponsors that are minority-owned businesses, women-owned businesses, or businesses owned by persons with disabilities.
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A BILL FOR
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AN ACT concerning revenue.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Housing Development Act is amended
by changing Section 7.28 as follows:
(20 ILCS 3805/7.28)
Sec. 7.28. Tax credit for donation to sponsors. The
Authority may administer and adopt rules for an affordable
housing tax donation credit program to provide tax credits for
donations as set forth in this Section.
(a) In this Section:
"Administrative housing agency" means either the Authority
or an agency of the City of Chicago.
"Affordable housing project" means either:
(1) a rental project in which at least 25% of the units
have rents (including tenant-paid heat) that do not
exceed, on a monthly basis, maximum gross rent figures, as
published by the Authority, that are:
(i) based on data published annually by the U.S.
Department of Housing and Urban Development;
(ii) based on the annual income of households
earning 60% of the area median income;
(iii) computed using a 30% of gross monthly income

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standard; and
(iv) adjusted for unit size and at least 25% of the
units are occupied by persons and families whose
incomes do not exceed 60% of the median family income
for the geographic area in which the residential unit
is located; or
(2) a unit for sale to homebuyers whose gross
household income is at or below (A) 60% of the area median
income (for taxable years beginning prior to January 1,
2022) or (B) 120% of the area median income (for taxable
years beginning on or after January 1, 2022) and who pay no
more than 30% of their gross household income for mortgage
principal, interest, property taxes, and property
insurance (PITI).
"Donation" means money, securities, or real or personal
property that is donated to a not-for-profit sponsor that is
used solely for costs associated with either (i) purchasing,
constructing, or rehabilitating an affordable housing project
in this State, (ii) an employer-assisted housing project in
this State, (iii) general operating support, or (iv) technical
assistance as defined by this Section.
"Employer-assisted housing project" means either
down-payment assistance, reduced-interest mortgages, mortgage
guarantee programs, rental subsidies, or individual
development account savings plans that are provided by
employers to employees to assist in securing affordable

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housing near the workplace, that are restricted to housing
near the workplace, and that are restricted to employees whose
gross household income is at or below 120% of the area median
income.
"General operating support" means any cost incurred by a
sponsor that is a part of its general program costs and is not
limited to costs directly incurred by the affordable housing
project.
"Geographical area" means the metropolitan area or county
designated as an area by the federal Department of Housing and
Urban Development under Section 8 of the United States Housing
Act of 1937, as amended, for purposes of determining fair
market rental rates.
"Median income" means the incomes that are determined by
the federal Department of Housing and Urban Development
guidelines and adjusted for family size.
"Project" means an affordable housing project, an
employer-assisted housing project, general operating support,
or technical assistance.
"Sponsor" means a not-for-profit organization that (i) is
organized as a not-for-profit organization under the laws of
this State or another state and (1) for an affordable housing
project, has as one of its purposes the development of
affordable housing; (2) for an employer-assisted housing
project, has as one of its purposes home ownership education;
and (3) for a technical assistance project, has as one of its

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purposes either the development of affordable housing or home
ownership education; (ii) is organized for the purpose of
constructing or rehabilitating affordable housing units and
has been issued a ruling from the Internal Revenue Service of
the United States Department of the Treasury that the
organization is exempt from income taxation under provisions
of the Internal Revenue Code; or (iii) is an organization
designated as a community development corporation by the
United States government under Title VII of the Economic
Opportunity Act of 1964.
"Tax credit" means a tax credit allowed under Section 214
of the Illinois Income Tax Act.
"Technical assistance" means any cost incurred by a
sponsor for project planning, assistance with applying for
financing, or counseling services provided to prospective
homebuyers.
(b) A sponsor must apply to an administrative housing
agency for approval of the project. The administrative housing
agency must reserve a specific amount of tax credits for each
approved project. Tax credits for general operating support
can only be reserved as part of a reservation of tax credits
for an affordable housing project, an employer-assisted
housing project, or technical assistance. No tax credits shall
be allowed for a project without a reservation of such tax
credits by an administrative housing agency for that project.
(b-5) The administrative housing agency must establish a

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goal of awarding a specific amount of tax credits under this
Section for donations to sponsors that are minority-owned
businesses, women-owned businesses, or businesses owned by
persons with disabilities, as those terms are defined in the
Business Enterprise for Minorities, Women, and Persons with
Disabilities Act.
(c) The Authority must adopt rules establishing criteria
for eligible costs and donations, issuing and verifying tax
credits, and selecting projects that are eligible for a tax
credit.
(d) Tax credits for employer-assisted housing projects are
limited to that pool of tax credits that have been set aside
for employer-assisted housing. Tax credits for general
operating support are limited to 10% of the total tax credit
reservation for the related project (other than general
operating support) and are also limited to that pool of tax
credits that have been set aside for general operating
support. Tax credits for technical assistance are limited to
that pool of tax credits that have been set aside for technical
assistance.
(e) The amount of tax credits reserved by the
administrative housing agency for an approved project is
limited to $32,850,352 in State fiscal years 2022 and 2023 and
shall increase by 5% each fiscal year thereafter. The City of
Chicago shall receive 24.5% of total tax credits authorized
for each fiscal year. The Authority shall receive the balance

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of the tax credits authorized for each fiscal year. The tax
credits may be used anywhere in this State. The tax credits
have the following set-asides:
(1) for employer-assisted housing projects, $2
million; and
(2) for general operating support and technical
assistance, $1 million.
The balance of the funds must be used for affordable
housing projects. During the first 9 months of a fiscal year,
if an administrative housing agency is unable to reserve the
tax credits set aside for the purposes described in subsection
(e), the administrative housing agency may reserve the tax
credits for any approved projects.
(f) The administrative housing agency that reserves tax
credits for an affordable housing project must record against
the land upon which the affordable housing project is located
an instrument to assure that the property maintains its
affordable housing compliance for a minimum of 10 years. The
Authority has flexibility to assure that the instrument does
not cause undue hardship on homeowners.
(Source: P.A. 102-175, eff. 7-29-21.)