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Bill

HB 765

Modify the affordable single-family home credit

136th Legislature (2025-2026) Introduced by Andrea White and 1 co-sponsor

Allows private developers to own and claim per-dwelling affordable credits (up to 35% of cost) as each home is completed, shortening affordability to seven years.

Referred to committee
#economicdevelopment #housingandrealproperty #taxation
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Bill Summary · HB 765

Overview

HB 765 (Same as introduced in the 136th General Assembly) amends Ohio law to modify the affordable single-family home credit. The bill shifts who can access the credit, changes when and how the credit is awarded and claimed, and reduces ongoing administrative and affordability obligations for developers. It also expands transferability of the credit and shortens the affordability period.

Main purpose and intent

  • Modernize and expand the affordable single-family home credit to involve private project developers directly, rather than restricting eligibility to government or quasi-public entities.
  • Simplify and accelerate the timing of credit issuance and claimability, moving away from a 10-year, project-wide credit schedule to per-dwelling, upfront eligibility.
  • Increase flexibility in how credits are calculated, awarded, and utilized, with fewer ongoing compliance and reporting burdens.

Key provisions and changes

  • Eligibility and ownership
    • Allows eligible private developers (defined as certain nonprofit corporations or private entities where the general partner/manager is a nonprofit) to apply for and own the qualified project, rather than requiring a local government or quasi-public entity to own the project.
  • Credit reservation and amount
    • The reservation amount is set at 35% of the total estimated development costs (as opposed to OHFA’s prior appraisal-based calculation).
    • The director can award credits competitively, subject to annual and total program caps, and the program would terminate reservations after June 30, 2027 (as currently structured in law).
  • Timing and claiming the credit
    • The most significant shift: the credit may be claimed for each dwelling as it is completed and sold, instead of being spread over a 10-year period following project completion.
    • For each dwelling, the credit is the lesser of 35% of the dwelling’s development cost or the amount needed to fill the affordability gap or appraisal gap.
    • The credit can be claimed all at once (not amortized over 10 years) and may be aggregated across multiple dwellings within a project.
  • Gaps and affordability
    • Appraisal gap and affordability gap definitions remain, but the credit calculation emphasizes per-dwelling gaps rather than a project-wide determination by OHFA.
    • The affordability period is shortened from 10 years to seven years, with potential rule-based exceptions.
  • Transfers and recapture
    • Transfers of individual credits between taxpayers are allowed (not limited to government recipients), with notices to the tax commissioner and the superintendent of insurance.
    • The bill largely removes ongoing recapture provisions tied to project noncompliance, though OHFA may still require certain team members to support affordability through mechanisms like deed restrictions or subordinate mortgages.
  • Reporting and compliance
    • The bill reduces annual reporting requirements by the project development owner and eliminates some ongoing risk-sharing and servicing obligations.
    • The “designated reporter” concept remains for administrative reporting, but the process is streamlined.

Who would be affected

  • Private eligible developers (nonprofits and certain private entities partnering with nonprofits) could obtain and claim credits.
  • Investors and equity owners in project development entities (including pass-through entities) would be able to transfer and claim credits directly.
  • Homebuyers in qualified projects benefit from potential affordability and quicker credit realization per dwelling.
  • OHFA, the Ohio Tax Commissioner, and the Superintendent of Insurance would administer and monitor credits under revised rules.

Timeline and procedural aspects

  • The program would continue with existing annual and total credit caps, but credits could be issued per dwelling as projects are completed.
  • The bill specifies that no new credits may be reserved after June 30, 2027, under the current framework.
  • The updated framework would require OHFA to approve cost certifications and issue certificates within 90 days of finalizing per-dwelling costs.

Note: This summary reflects the bill’s As Introduced text and its stated intent to modify the existing affordable single-family home credit framework.

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

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