2025 could be a landmark year for housing reforms in New Hampshire as Republicans and Democrats alike consistently report that housing is a top concern for their constituents and signal their political will to address it. In fact, according to the most recent Granite State Poll, when asked to name the most important problem facing New Hampshire, Granite Staters said “housing” five times more than the poll’s second most important problem, education.
Of course, long before this issue came into focus in Concord, Granite State churches had been providing shelter for those in need and working to alleviate the lack of affordable housing in their communities. Governor Ayotte even stated that empowering churches to build more housing was a component of her housing plan. However, numerous churches and religious organizations around the state face ongoing challenges to using their property for housing. Thus, the need to truly empower churches in this capacity cannot be understated, and SB 291 would do just that.
Introduced by Senator Daryl Abbas, SB 291 incentivizes churches to provide housing by expanding New Hampshire’s church tax exemption to cover housing on the church lot. Currently, this exemption applies for a parsonage, a building on the church’s lot that houses its pastor. However, it cannot be applied when the very same building houses others. SB 291 would expand the exemption to cover housing that is provided for church employees and participants of residential programs or rental housing provided as part of the church’s religious mission.
As community-oriented institutions, churches are uniquely positioned to help with the housing crisis, but our current law penalizes them for doing so. For instance, many pastors do not reside at their church’s parsonage, but if the church allows another employee, missionary, or seminarian to live there, it loses its tax exemption. This bill not only prevents churches from losing money when they offer employee housing, it also incentives them to build housing in their communities.
Additionally, SB 291 expands New Hampshire’s zoning protection for churches to prevent zoning discrimination of churches that offer rental housing. Lest Granite Staters think this is a solution in search of a problem, its necessity is demonstrated by SB 265, a bill introduced this session to repeal nondiscriminatory zoning protections for churches. Under SB 291, churches that build housing would still need to comply with objective zoning rules such as the height of structures.
On February 12th, the Senate Ways and Means Committee held a hearing on SB 291 and members will vote on whether to recommend the bill to the full Senate in an upcoming executive meeting. Ask members of the committee and your senator to help empower churches to alleviate New Hampshire’s housing crisis by voting OTP on this bill.
If churches don’t pay taxes on income from housing, wouldn’t localities lose revenue?
The great benefits that churches bring to their communities far outweigh the trivial amount of tax revenue that localities will lose when they can no longer tax fractions of church-owned property. Churches that have this additional revenue stream are going to respond by expanding their charitable activities and programs—investing that money back into the community.
Pastor Sean Foster from Crossing Life Church in Windham testified to this exact goal of Granite State churches at the Senate hearing on SB 291.
Why does the bill text refer to “workforce housing?”
This language has nothing to do with federal “workforce housing” programs, but rather refers to RSA 674:58 in New Hampshire law. It means that rental housing must be affordable to an average 3-person household in the community to qualify for tax exemption when housing is not used for church employees or participants in residential programs.
Doesn’t this bill give churches an unfair advantage over investors and developers providing housing?
Since the expanded tax exemption only applies to “workforce housing,” churches must offer housing to non-employees below the market rate in order to qualify for the tax exemption. This provision is intended to ensure housing is offered as part of the religious mission of a legitimate church. Furthermore, unlike other landlords and companies providing housing for net profits, churches are non-profits that reinvest revenue in the community by providing countless social services.
