Last week, Governor Wolf signed a tax bill which included the “Mixed Use Tax Credit,” known as RECLAIM, a financing mechanism that Regional Housing Legal Services (RHLS) has worked to develop for the past two years. With our partners Brian Hudson, Rebecca Peace, and Bryce Moretsky at the Pennsylvania Housing Finance Agency (PHFA); Rob Stephany at the Heinz Endowments; Larry Swanson at ACTION-Housing, I
nc.; and Dave Gibson at PNC Bank; the “Mixed Use Tax Credit” was created to support the redevelopment of blighted and vacant residential/commercial properties throughout the Commonwealth.
RECLAIM is partially based on Pennsylvania’s Mixed-Use Facility Financing Initiative, or MUFFI, which provided easy access to financing for nonprofit developers interested in revitalizing commercial corridors in disinvested communities. This program resulted in an investment of over $85 million into 77 different projects across the Commonwealth. When RHLS commissioned an independent evaluation of the effectiveness of the MUFFI program, the Urban Ventures Group, Inc. concluded that tax credit dollars helped developers significant leverage public subsidy dollars. Further, many anecdotal reports of neighborhood improvement, such as resident and investor confidence, were cited.
The program will be administered by PHFA, with $2 million in credits allocated for the initial launch of the program, with hopes for expansion in future years. PHFA has begun the process of drafting program guidelines.
RHLS is thankful to our partners who assisted in this effort and we look forward to continuing work on a program that will provide new and exciting opportunities for community development to serve low-income communities in Pennsylvanians.