WEDA Legislative Update: 2025-26 Legislative Session Recap

As previously reported in various WEDA updates, the Wisconsin Legislature recently adjourned for the 2025-26 session (although they could meet in a special or extraordinary session on a narrow list of issues, including tax relief or redistricting). But more importantly, WEDA finished the legislative session on a highly successful note, with several of WEDA’s legislative priorities being passed by the Legislature and signed into law by Gov. Evers in the last few months of the session. Please find below a recap of these new laws that enhance the state’s economic development toolbox:

Assembly Bill 194 (2025 WI Act 237) – Workforce Housing Revolving Loan Fund Repair Bill: This legislation, authored by Rep, Dave Armstrong and Sen. Romaine Quinn, makes critical improvements to three workforce housing revolving loan fund (RLF) programs – funded with $475 million and administered by the Wisconsin Housing and Economic Development Authority (WHEDA) – which were created in 2023 to increase affordable housing options statewide. This bill updates project eligibility criteria and maximum loan amounts to make the programs more attractive and usable for developers and communities. Most importantly, this bill will repeal the “anti-stacking” language in current law that prohibits pairing financing from these programs with Tax Increment Financing (TIF) or historic rehabilitation tax credits, removing a major barrier to project feasibility. CLICK HERE to read the Legislative Council Act Memo

Assembly Bill 280 (2025 WI Act 78) – Business Development Tax Credit Enhancement Bill: This legislation, authored by Rep Dave Armstrong and Sen. Dan Feyen, enhances the housing and childcare tax credit incentives under the Business Development Tax Credit (BTC) program to encourage greater workforce housing and childcare investment by Wisconsin businesses. The new law will allow BTC investments in workforce housing and childcare to include contributions made by eligible businesses to a third party for those purposes. By expanding eligibility beyond capital expenditures, it also gives employers the flexibility to make creative, community-oriented investments in partnership with local organizations. In addition, the law will allow workforce housing development and childcare programs driven by the tax incentives to benefit entire communities rather than just the employees of BTC eligible companies. CLICK HERE to read the Legislative Council Act Memo

Assembly Bill 375 (2025 WI Act 238) – Historic Tax Credit Modernization Bill: This legislation, authored by Rep Dave Armstrong and Sen. Dan Feyen, enhances Wisconsin’s Historic Preservation Tax Credit (HTC) program, a proven economic development tool that attracts private investment and supports downtown revitalization, job creation, and tourism. This bill, which lowers administrative barriers to increase program access and promote additional historic preservation, will make the following changes to the program: 1.) Decouple the state HTC from the federal HTC for projects applying only for the state credit. This will allow smaller projects to qualify for the state credit without meeting the much higher federal expenditure threshold; and 2.) Modify the current $3.5 million project cap to allow reapplication every 15 years for new restoration work on the same parcel. CLICK HERE to read the Legislative Council Act Memo

Assembly Bill 453 (2025 WI Act173) – TIF Housing Extension Bill: This legislation, authored by Rep. Dave Armstrong and Sen. Jonn Jagler, includes numerous provisions aimed at boosting housing development, including changes to community comprehensive plans and requests to change zoning classifications. The bill also includes the following key provisions to provide communities with more flexibility to use Tax Increment Financing (TIF) to promote residential development: 1.) Increase the current law TIF housing extension for TIDs at the end of their lifespan from one to two years; 2.) To clear confusion related to use of TIF for residential development, define “newly platted residential development” to mean residential development on a parcel that has not previously been the site of permanent structures other than agricultural structures. CLICK HERE to read the Legislative Council Act Memo

Senate Bill 376 (2025 WI Act 183) – Employer Provided Childcare Tax Credit Bill: This legislation, authored by Sen. Dan Feyen and Rep. Dave Armstrong, creates a new non-refundable state tax credit for businesses that provide or support childcare for their employees, matching an existing federal incentive. Under current federal law, employers can receive a tax credit for helping build, expand, or operate childcare facilities, or for covering childcare referral and support services. The credit percentage for qualified expenditures is 40% for large businesses and 50% for small businesses. This legislation allows Wisconsin employers who already qualify for the federal credit to also claim the same amount against their state income taxes. CLICK HERE to read the Legislative Council Act Memo

Senate Bill 480 (2025 WI Act 235) – Residential Tax Increment District Bill: This legislation, authored by Rep Dave Armstrong and Sen. Dan Feyen, will create a new Residential Tax Increment District (TID) in Wisconsin. Under this proposal, municipalities will be provided with a new TIF tool specifically designed to promote owner-occupied housing development and finance residential infrastructure. The bill provides additional TIIF flexibility for communities by exempting Residential TIDs from the current law 12% TIF equalized value limit. Instead, the total value of all Housing TIDs in a municipality would be capped at 3% of the municipality’s equalized property value, allowing communities to address housing needs without crowding out traditional economic development TIDs. CLICK HERE to read the Legislative Council Act Memo

Assembly Bill 182 (2025 WI Act 236) – Changes to the Low-Income Housing Tax Credit: CLICK HERE to read the Legislative Council Act Memo.
Assembly Bill 676 (2025 WI Act 191) – Insurer Tax Credit for Community Development Investment: CLICK HERE to read the Legislative Council Act Memo.
Assembly Bill 737 (2025 WI Act 120) – Special Assessment Approved by a Neighborhood Improvement District: CLICK HERE to read the Legislative Council Act Memo.