CINCINNATI -- The fate of one of the main tools that Cincinnati has used to revitalize run-down parts of town is now in the hands of a small group of Republican Congressional leaders. Sen. Rob Portman is one of them.
The New Market Tax Credit, which allows developers to recoup 39 percent of their investment in blighted neighborhoods through federal tax credits, was eliminated in the tax reform bill approved by the House.
The Senate’s version of the tax reform bill kept the tax credit largely intact.
Both tax bills passed their respective chambers exclusively with Republican votes. In turn, Republican leaders in a conference between the two chambers are now tasked with reconciling the bills before the full House and Senate vote on the final version.
The tax credits are cited by developers, local elected officials and historic preservationists as critical to the renaissance of Over-the-Rhine, Walnut Hills and other older neighborhoods that have been plagued by blight for decades.
Cincinnati Development Fund has financed $187 million worth of projects using New Market Tax Credits since 2004, according to Executive Director Jeanne Golliher.
They include the transformation of Washington Park in Over-the-Rhine, construction of the Warsaw Federal Incline Theater in Price Hill and creation of Nehemiah Manufacturing in Lower Price Hill.
Nationally, the tax credits have been used in 5,000 projects that injected $82 billion into the economy, according to New Markets Tax Credit Coalition.
Portman in the room where it happens
Portman, a Terrace Park Republican, told WCPO, “In my role as Conferee, I am fighting to make sure that our new tax code will retain the NMTC in the final bill negotiated between the House and Senate.”
Sen. Sherrod Brown, a Cleveland Democrat, is hopeful the tax credits will be preserved in the conference committee given that they were left in the Senate version.
There’s unanimous interest among Cincinnati’s congressmen and senators to preserve the tax credit, though Rep. Steve Chabot and Rep. Brad Wenstrup voted yes on the House version that eliminated the tax credit.
Representatives weigh in
Chabot and Wenstrup signed a letter urging House Speaker Paul Ryan to restore the New Market Tax Credit as well as the Federal Historic Tax Credit in negotiations with the Senate.
“These tax credits are critically important to jump-starting economic activity, especially in economically depressed areas, and putting people back to work,” the letter stated.
Wenstrup has been reaching out to conference committee members making a case in favor of the tax credits, according to his office.
Chabot’s office said they heard the conference committee has been working on “big-ticket” items like individual tax rates and whether to preserve the requirement that Americans buy health insurance. Specific credits and provisions will come later.