Missouri spends more on its Low-Income Housing Tax Credit program than nearly any other state, but of the $140 million it spends per year, less than half actually goes to housing. The political fight over the widely criticized program showcases a complex subsidy that has stymied most other economic development legislation.
Only 43 cents of every dollar is used for construction, an inefficiency that has been cited in audits and criticized by state senators and Gov. Jay Nixon. The rest of the money is lost in an accounting haze or flows to federal taxes, investors and middlemen.
Yet bills scaling back the program have died in the Legislature repeatedly in the last four years. A group of financiers and developers has fended off changes and appears poised to do so again, despite pressure from the governor.