TOLEDO – Tornado victims left homeless could benefit from $100 million in tax credits approved Thursday to rebuild low-income rental housing in the Joplin and St. Louis areas. The state's latest housing plan includes new incentives to develop homes for people with mental and physical ailments.
The 2012 housing incentive plan approved by the Missouri Housing Development Commission takes a markedly different approach from many of its past versions, dedicating about 40 percent of its primary tax credit program to tornado relief and -- for the first time -- earmarking one-third of its total tax incentives for housing projects tailored to people with special needs.
One of the biggest beneficiaries will be the Joplin area, where a May tornado killed 160 people and damaged about 7,500 homes, a majority of which were occupied by people with low-to-moderate incomes.
The commission voted to allot the Joplin area $90 million of the $250 million of state and federal tax credits to be awarded under its primary incentive program during 2012, and an additional $10 million in state and federal tax credits to the St. Louis County community of Berkeley which was hit by a tornado in April. Although the actual tax credits are spread out over a 10-year period, developers typically generate cash upfront by selling their tax-credit vouchers on a discounted basis.
Commission staff members have said the tax credits could finance about 450 housing units for people displaced by tornadoes, assuming developers spent about $120,000 per unit and received a typical price for the sale of the tax credit vouchers.
The commission's operations director, Tina Beer, said Thursday that the residents of about 575 Joplin homes damaged or destroyed by the tornado still do not have places to live.
"The tornado could not have picked a worst path to go through as it relates to affordable housing" in Joplin, Beer said. "The poverty level is real."
The commission set an Oct. 14 deadline for developers to apply for the tornado-related housing tax credits, with a goal of voting on specific projects as soon as December. But even if the process moves quickly, Beer said it could be a year from now before people are able to live in the rental units.
Republican Lt. Gov. Peter Kinder, who is a member of the housing commission, expressed concern that he still lacked enough documentation to ensure the $90 million in tax credits matched the actual need for state-subsidized construction of rental housing in Joplin. But Kinder ultimately joined all the other commissioners present for the meeting in voting for the plan.
The commission's 2012 tax credit program also sets a goal of awarding 33 percent of all of its tax credits statewide for housing targeting people with "special needs," which it defines to include the mentally ill, physically disabled, homeless and youths about to exit the foster care system because of their age.
State Treasurer Clint Zweifel, who had pushed for the special needs earmark for more than a year, said all of those categories of people are at a greater risk of becoming homeless. Missouri has an estimated 24,000 homeless people, Zweifel said, and the tax credits could help finance about 400 housing units for people with special needs.
"For the first time ever in Missouri, we're making a significant investment of resources to really tackle the problem of homelessness," Zweifel said.