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HB 3297

Creates several new provisions for property development

2026 Regular Session Introduced by Anthony Ealy

The bill creates tax exemptions for affordable housing portions in new multifamily projects (75% or 100% depending on income), with strict eligibility and annual applications.

Referred: Emerging Issues(H)
#politicalsubdivisions #taxationandrevenue-property
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Bill Summary · HB 3297

Overview

House Bill 3297 (Missouri, 2026) introduces new provisions to facilitate affordable housing development and expands property tax exemptions for qualifying multifamily projects. The bill adds two new sections to Chapter 67 (67.5460 and 67.5465) and includes penalties for improper exemptions. It aims to streamline development in commercial/industrial/mixed-use zones and provide targeted tax incentives to support affordable housing.

Main purpose and intent

  • Promote affordable multifamily and mixed-use residential development by reducing regulatory barriers in zones currently designated for commercial, industrial, or mixed use.
  • Encourage higher inclusion of affordable units in new developments without triggering additional zoning approvals.
  • Create a property tax exemption framework for portions of multifamily projects that deliver affordable housing, with annual application requirements and penalties for noncompliance.

Key provisions and changes

67.5460 – Allowable uses and development standards

  1. A political subdivision must authorize multifamily and mixed-use residential as allowable uses in areas zoned for commercial, industrial, or mixed use if at least 40% of the residential units are affordable for at least 30 years (per state-defined affordability). For mixed-use projects, at least 65% of total square footage must be residential.
  2. The subdivision cannot require zoning or land-use changes, special exceptions, conditional use approvals, variances, or comprehensive plan amendments for building height, zoning, and densities authorized under this section.
  3. Density restrictions cannot be lower than the highest density allowed on unincorporated land where residential development is allowed.
  4. Height restrictions cannot be lower than the highest currently allowed height for nearby commercial or residential development within one mile or three stories, whichever is higher.
  5. Developments meeting these criteria may be administratively approved if they comply with the county’s land development regulations (except for density, height, and land-use provisions) and standard setbacks/parking.
  6. Parking requirements may be reduced if the development is within 1/2 mile of an accessible public transit system.

67.5465 – Tax exemption for affordable housing portions

  1. Portions of multifamily projects that provide affordable housing to eligible tenants may qualify for an ad valorem property tax exemption if:
    • The units are within a newly constructed multifamily project with more than 70 units dedicated to affordable housing.
    • The affordable units are rented at amounts not exceeding HUD-determined rents.
  2. If a previously exempt unit becomes vacant, it remains eligible if restricted to affordable housing and efforts are made to lease it to eligible tenants.
  3. Tax exemption levels:
    • 75% exemption for properties housing households with income between 80% and 120% of area median income (AMI).
    • Full exemption for households at or below 80% AMI.
  4. Annual application required by March 1, using a form prescribed by the Department of Revenue, with details on:
    • Units and rents
    • Proof of rental limits
    • A sworn plan restricting the property to eligible households for at least three years
  5. Penalties for improper exemptions: 50% of unpaid taxes per year plus 15% annual interest; clerical mistakes without fault incur no penalty or interest.
  6. Effective starting tax year 2027.

Who is affected

  • Local political subdivisions (cities, counties) in charge of zoning and land-use regulations.
  • Developers of multifamily and mixed-use rental housing in zones currently allowed for commercial/industrial/mixed use.
  • Tenants and prospective tenants of affordable housing units (income-qualified households).
  • Property owners of qualifying multifamily projects seeking tax exemptions.

Procedural and timeline notes

  • The affordability requirements and administrative approvals apply to developments proposed under the new section 67.5460.
  • Tax exemptions under 67.5465 begin with tax year 2027.
  • Annual tax exemption applications are due by March 1 each year, with specified documentation.

Sponsor and status

  • Sponsor: Representative Ealy (co-sponsor: Anthony Ealy)
  • Referred to Emerging Issues (H) on 2026-05-15
  • Bill introduced and read in the First Time (H) on 2026-02-12; Read Second Time (H) on 2026-02-16

Note: Provisions include bolded text in the bill indicating new language; brackets denote text not enacted.

Compiled from official sources — confirm details with the bill’s official record.

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