The New Hampshire Senate has voted to allow cities and towns to designate tax-break areas for affordable-housing development, sending the bill to Gov. Chris Sununu’s desk.

Sununu has supported affordable housing tax breaks in the past.

House Bill 154, which passed on a voice vote, would enable cities and towns to make any area within their borders into a “community revitalization” area and set tax incentives for development.

Towns can already create community revitalization tax breaks — whether for economic development, historical preservatio, or housing — but they’re limited to setting those areas in the downtown area.

Under current law, a town or city can set up a tax-break program with the approval of its residents by adding the proposal to a town meeting warrant article or city ballot initiative.

That program allows the town’s governing body to approve applications for property-tax relief on a property-by-property basis for up to five years.

HB 154 would allow those tax breaks to be used for housing developments anywhere within the town, but only if a third or more of the units qualify as affordable housing.

Housing advocates say the measure could be a powerful tool for towns that are interested in spurring development, and could provide geographic flexibility for cheaper options for housing.

Some 59 cities and towns currently have taken advantage of the community development incentive programs, according to the New Hampshire Housing Finance Authority.

If signed by Sununu, the bill would take effect April 1, 2022.

— ETHAN DEWITT/ NEW HAMPSHIRE BULLETIN