By Chris Fields
Historic tax credits have funded multifamily and affordable housing development in older buildings for decades. Missouri’s recent legislative changes have now expanded this funding source. Gov. Mike Kehoe signed HB3080 on July 13, 2026, restoring and expanding the state’s Historic Preservation Tax Credit program under a new name: the Missouri Historic, Rural Revitalization and Development Act.
For developers working on adaptive reuse and historic rehabilitation projects, the changes are significant. The credit rate for qualifying rural projects, those located outside St. Louis and Kansas City, rises from 25 to 35 percent of qualified rehabilitation expenditures (QRE).
Combined with the federal historic tax credit, which provides a 20 percent credit on QRE costs, projects in rural areas can now access a combined credit rate of up to 55 percent. For investors, the higher rural rate means more deals can be financed in smaller markets. Projects that weren’t viable at 25 percent now work at 35 percent, expanding sourcing opportunities outside St. Louis and Kansas City.
Combining federal and state historic tax credits is a well-established strategy in Missouri. However, it is not always well understood by developers working with the program for the first time.
City Foundry STL, a $217 million redevelopment of a 1929 foundry in Midtown St. Louis, illustrates how federal and state historic tax credits can be combined. Foss & Co. invested in $30.8 million of federal historic tax credits and $22.4 million of Missouri historic tax credits generated by the rehabilitation. Those credits provided a source of equity that would not have been available for a comparable ground-up development.
Why Rural Markets Matter
Missouri’s historic tax credit program dates to 1998, one of the earliest state-level programs in the United States.
For most of its history, credit-funded projects concentrated heavily in St. Louis and Kansas City, leaving smaller markets like Joplin, St. Joseph and Hannibal without the same access to capital for historic rehabilitation. Since fiscal year 2001, the state has completed 2,169 federal historic tax credit projects, according to the 2026 National Park Service data compiled by the National Trust for Historic Preservation.
St. Louis and Kansas City account for roughly 1,750 of these projects, about 80 percent of the statewide total. Outside of the two major cities, St. Joseph has completed 53 projects, Joplin has done 16 and Hannibal has finished 10. This documented pattern has fed a perception in smaller communities that the program mainly benefits the state’s biggest cities. For investors, it also reflects a concentrated deal history that has left rural markets underserved.
HB3080’s rural rate increase is designed to correct the imbalance between rural and urban areas. Affordable and workforce housing developers face this problem directly: older buildings in Missouri’s smaller cities can often be too costly to rehabilitate without a credit, even though the same buildings would be too expensive to replace with new construction.
A higher credit rate can change that math, particularly for adaptive reuse projects converting former commercial, industrial or institutional buildings into housing. Investors benefit from this shift through a wider range of projects that become financeable once the credit rate improves the underlying deal economics.
Even adaptive reuse projects in large cities, like The Brewery Apartments in St Louis, depend on tax credit financing to make the rehabilitation costs work, since older industrial building conversions can cost more than new construction. In this case, the historic Columbia Brewing Company complex, which consists of a brewery and warehouse buildings, was converted into a community of 139 units of market-rate and affordable housing. The rural rate increase now makes the same attractive financing options available in smaller markets.
Streamlining the Approval Process
Beyond the rate increase, HB3080 addresses a longstanding complaint from developers: unpredictable review timelines at the state level. The legislation establishes a 60-day determination period for the State Historic Preservation Office to act on tax credit applications. If the office doesn’t act within that window, the application moves forward to the National Park Service without further state comment, and the state loses its opportunity to weigh in.
For developers financing projects with layered federal and state credits, faster and more predictable reviews can reduce one of the more frustrating sources of delay in an already complex financing structure. Multifamily projects, in particular, which can often involve multiple capital sources, construction loan timing and tight development schedules, benefit from more certainty early in the process.
A stalled state review can hold up a federal application, which can hold up equity closing. For investors, predictable state review timelines add clarity to the financing timeline for projects using layered federal and state credits.
The legislation also makes nonprofit organizations eligible for the credit. Previously, many nonprofits faced structural barriers because the credit was tied to tax liability. The expanded eligibility opens the program to community development organizations and mission-driven housing developers that work in historic buildings but lack the tax liability needed to use the credit under the prior rules. This change opens a new borrower category for tax credit investors, particularly organizations focused on affordable housing and community revitalization that have historically lacked the tax appetite to use credits directly. For affordable housing sponsors that often operate as nonprofits or work through nonprofit partners, this is one of the more consequential changes in the bill, even if it has drawn less attention than the rate increase.
What the Expansion Means for the Pipeline
Missouri’s expanded program adds capacity to a market that has been capital-constrained outside St. Louis and Kansas City. According to National Park Service data compiled by the National Trust for Historic Preservation, rural areas have accounted for less than 20 percent of the state’s historic tax credit projects since 2001, a disparity the expanded program is designed to address.
For multifamily and affordable housing developers evaluating historic rehabilitation projects in Missouri’s smaller cities and towns, the combination of a higher credit rate, faster state review and broader nonprofit access creates a more workable financing picture than existed even a year ago. For tax credit investors specifically, the expanded rural cap and nonprofit eligibility broaden the range of investable projects beyond the two metros that have historically dominated deal history.
Industry groups like Historic Revitalization for Missouri (HRM), the statewide association representing developers, architects, contractors and other professionals in the historic redevelopment industry, were vocal advocates for the bill’s passage. HRM President Jim Farrell has said the legislation makes Missouri a national leader in historic redevelopment and expects the streamlining provisions to draw national developers and investors into communities from St. Louis to Joplin and Kansas City to St. Joseph.
Chris Fields is an acquisitions agent at Foss & Co., a national tax equity investor and fund sponsor.