A bill that has been introduced multiple times to the Illinois Legislature since 2020 is making a return as the state grapples with a critical shortage of affordable housing. According to Northern Public Radio, the Build Illinois Homes Tax Credit Act, first introduced in 2020, aims to offer a state tax credit to developers who construct affordable homes within Illinois.

With a price tag of around $20 million annually, proponents of the bill argue that the financial risk to the state is minimized, as tax credits are not issued until a development is completed. The bill's original sponsor, former State Rep. Delia Ramirez (D), introduced it to address the growing housing crisis. Since her election to the U.S. House of Representatives in 2022, the bill has been taken up by state Reps. Dagmara Avelar (D) and Ryan Spain (R).

“The rising cost of housing is squeezing families across our communities, and too often, new affordable developments just aren’t keeping pace with demand,” said Avelar in a statement. “By incentivizing new construction, we can expand housing options, bring down costs, and give families a real shot at homeownership.”

In an interview with Northern Public Radio, Avelar explained that one of the primary challenges in previous legislative sessions was securing enough attention amid other pressing budget priorities. However, she believes that the bill’s potential to generate jobs and incentivize private investments will make it more appealing this time around. Avelar also noted that the bill has been “scaled down” from previous versions, and it is estimated to help develop at least 1,000 additional affordable homes for qualifying Illinois residents.

The Illinois Housing Council, an affordable housing advocacy group, has played a key role in shaping the bill’s language. Executive Director Allison Clements noted that the proposed state tax credit is modeled after the federal Low-Income Housing Tax Credit (LIHTC) program, which has been widely used across the country but does not fully address the specific needs of Illinois. Clements emphasized the importance of the state-based credit to help fill gaps that the federal program cannot.

“[The LIHTC] is the most important resource we have available to build and preserve affordable housing throughout the state and country,” Clements said. “But that resource always needs additional gap funding to make developments really cross the finish line. So, we have gotten behind this model that has already been implemented in over 25 other states around the country and has proven to be a successful tool to build and preserve affordable housing.”

Rep. Ryan Spain’s involvement in the bill’s sponsorship adds bipartisan support, with the backing of the Republican minority leadership in the Illinois House. Spain, who serves as deputy minority leader, expressed strong support for the bill, saying that it could create a path forward for new housing developments in Illinois, which has seen slow progress in recent years.

“We need to make sure that we’re providing opportunities to make the development of housing more successful, and it’s been slow in Illinois for many years now in terms of new housing starts,” Spain said. “And so, we’ve got to do something to change the calculation for developers and for families so that we can bring more housing solutions forward.”

Although previous versions of the bill garnered Republican support, they never received a floor vote. Spain remains optimistic that the current climate—despite the state’s projected $3 billion budget deficit—will still allow for a renewed focus on addressing Illinois’ housing crisis.

“We have a lack of affordable housing to the tune of over 300,000 units,” Spain said. “And we need to make some investment and indicate our priorities so that this can be corrected. And if we do it well, we can facilitate population growth in Illinois that would greatly improve our current fiscal situation.”

The renewed push for this bill underscores the urgency of addressing the state’s housing shortage and finding ways to encourage the construction of affordable homes. With strong bipartisan support and the backing of affordable housing advocates, this bill may provide a viable solution to help meet the needs of Illinois residents.

Originally reported by Chris Clow in Housing wire.