Resolution supporting California State Assembly Bill No. 1265, introduced by Assembly Member Matt Haney, which will create a new State Housing Tax Credit program to prohibit the maximum credit amount from exceeding $5,000,000 per taxpayer, no longer allow a 5% credit uplift for specified priority projects, and eliminate the credit set aside for smaller projects.

This resolution expresses the San Francisco Board of Supervisors' support for California State Assembly Bill No. 1265 (AB 1265), introduced by Assembly Member Matt Haney. The bill aims to create a new State Housing Tax Credit program by extending the existing Historic Tax Credit (HTC) through December 31, 2030, for taxable years beginning on or after January 1, 2027, and before January 1, 2031.

Key changes proposed by AB 1265 include:

• Standardized Credit Rate: Aligning the state HTC with the federal program by adopting a standard 20% credit rate for qualified rehabilitation expenses.
• Maximum Credit Cap: Establishing a $5,000,000 per-project cap to improve allocation predictability and ensure statewide distribution.
• Elimination of Uplifts: Removing the 5% credit uplift for specified priority projects and eliminating the credit set aside for smaller projects (under $1,000,000) and qualified residences.
• Extended Review: Continuing the Legislative Analyst's review of the program's effectiveness through January 1, 2031.

The Board supports AB 1265 as it is expected to enhance predictability, increase access and equity for historic rehabilitation projects (including affordable housing and mixed-use developments), and align state credits more closely with federal HTC. This is seen as beneficial for projects statewide, particularly in urban areas like San Francisco, and aligns with the City's goals for reducing greenhouse gas emissions, fostering urban density, and preserving architectural heritage.