Even, or especially!, in tough times, Michigan extends its historic tax credit

Michigan Gov. Jennifer Granholm yesterday signed legislation that revises the state’s historic rehabilitation tax credits. The new opportunities for funding will spur construction, and thus job growth, supporters said.  The bill increases the state credits available and allows them to be refunded, sold or carried forward.  In the improved tax credit program, credits can be stacked with the federal credit, which means developers can get up to 40 percent total credits to put toward a historic rehabilitation project.

Historic rehab of the former Orphanage building in Grand Rapids, MI, used state historic tax credits with other incentives to rehab into headquarters of the nonprofit Inner City Christian Foundation (ICCF), a leader in affordable housing development

If Michigan, reeling under huge job losses and the meltdown of the American auto industry, sees the economic stimulus and “green” value of an investment in historic rehabilitation, why can’t New Jersey?  Enact the NJ Historic Porperties Revitalization Act NOW!

 

NJ economic stimulus, development legislation moves; tax credit should be included

The NJ Senate Committee on Economic Growth sent two bills forward to the Budget Committee today as part of the legislature’s efforts to move programs that will stimulate growth and development in an economy deeply shaken by recession and Wall Street “meltdown.”

Bills that broaden local authority to create revenue allocation districts, a form of tax increment financing, and expand the Urban Transit Hub tax credit program were characterized in testimony at the Committee hearing this morning as critical to efforts by Newark and several other cities to attract large scale new investment in rehabilitation or new construction.

What hasn’t yet been recognized is the potential for still more economic stimulus with enactment of a historic rehabilitation tax credit, as has been advocated by the NJ Heritage Development Coalition.

In written testimony submitted to the Committee by Coalition member Preservation New Jersey, legislators were reminded that neighborhoods and Main Streets in our city and town centers have declined often because rehabilitation costs did not make the existing buildings that give them character attractive to development. But sustainable development must happen in existing communities, where the vast majority of the thousands of historic buildings exist in New Jersey and where many thousands of heritage visitors spend their millions of tourism dollars every year.

The Beacon, formerly the Jersey City Medical Center, a historic adaptive use project, could benefit from equity funding from a state historic rehabilitation tax credit.

Reinvesting in these areas and spurring development will make a significant impact on their future economic health and vitality. And burgeoning landfills argue for reuse rather than demolition of existing buildings and their embodied energy for more stable, livable and greener communities.

 

Ohio revives highly successful historic tax credit

Ohio Gov. Ted Strickland recently signed a $1.6  billion economic stimulus bill that, among other provisions, offers $120 million in tax credits for developers to preserve and renovate historic properties, most of which are in urban areas. A Cleveland Plain Dealer editorial declares “Ohio has done the right thing by strengthening a program that will enable hundreds of millions of dollars worth of historic buildings to be rehabbed, create jobs and return revenue to public coffers.”

Delayed while the legislature and Governor worked to revive the historic tax credit program, the project to adapt the historic East Ohio Gas Co. Building (Cleveland) for new uses should now move forward.

Earlier this spring, state budget crunchers had proposed a drastic reduction in the historic tax credit program, but leadership from State Reps. Jay Hottinger (Columbus) and Matt Dolan (Russell) and Lt. Gov. Lee Fisher led to a strengthened program that will finance a backlog of at least 60 historic preservation projects across Ohio.  As Rep. Hottinger relates in a recent news article, the state stands to “actually turn a profit on any project that is undertaken. Testimony given to the House Finance and Appropriations Committee showed that before any tax credit was paid out, taxes already have recovered 24 cents for every dollar of the tax credit that will be awarded.”  By year nine, according to the legislator, “the state could see a profit from this tax credit.”

 

Huge redevelopment project in Providence relies on state/federal tax credits

The New York Times this week covered the massive urban development project in Providence, RI undertaken by Streuver Bros. of Baltimore, using state and federal preservation tax credits: “Vowing to bring back a section of Providence that has been strewn with enormous vacant factories and piles of industrial debris for more than 30 years, a Baltimore developer is creating a $300 million mixed-use development on 18.5 acres on the Woonasquatucket River, about a mile from the city’s downtown.

Called the American Locomotive Company Works, or ALCO for short, after a factory that once produced trains there, the project is one of the largest in Providence’s recent history. Using a combination of historic rehabilitation and new construction, ALCO envisions as many as 500 condominium and rental units and nearly two million square feet of commercial and retail space.

Construction began in 2006. The project is being built in phases over several years by Struever Brothers, Eccles & Rouse, a development company founded in 1974 that is known mainly for projects that transform urban areas. … Phase One, completed in early 2007, rehabilitated five historic buildings on the east end of the site to create 200,000 square feet of retail and office space. Forty to 50 percent of that space has been leased to nine tenants, including the state’s economic development agency and a law firm…. The site went on the National Register of Historic Places in 2005. Struever then received state and federal historic tax credits for the rehabilitation.”

 

Colorado renews historic tax credit for 10 years

News from Colorado Preservation, Inc. (www.coloradopreservation.org)

Colorado State Rehabilitation Tax Credit Renewed!

On June 5, 2008, Governor Ritter signed HB 1033, reauthorizing Colorado’s state historic preservation tax credit.

This year, the Colorado legislature passed HB08-1033 which reauthorizes the historic preservation tax credit for 10 more years. The tax credit for historic preservation was first established in 1990 and it serves as an important incentive to encourage the rehabilitation and preservation of historic buildings throughout the state. By restoring buildings statewide, local companies can become involved in the preservation process which helps the state’s economy. The credit can be taken for up to 20% of qualified rehabilitation costs up to a maximum of a $50,000 credit per qualified property.

Since 1991, over 500 Colorado property owners have taken advantage of the tax credit, with over 90% of these being single family homeowners. The credit has been an incentive for both owner-initiated designation of historic properties and sensitive rehabilitations. Throughout the legislative process of renewing this tax credit, the preservation community worked together by making phone calls, testifying on the bill, and working with various legislators. Colorado Preservation Inc. and its members worked with State Representative Claire Levy (D-Boulder) and State Senator Paula Sandoval (D-Denver) to run legislation in the 2008 session to reauthorize the State’s Income Tax Credit for Historic Preservation projects.

 

Maine passes new tax credit bill – broad coalition credited

Maine Preservation News reports that the Maine legislature passed Rep. Ted Koffman’s Tax Credit for Rehabilitation of Historic Properties, which had been included in Gov. Baldacci’s State of the State Address. The bill fundamentally changes the existing state tax credit. Among the changes is the creation of a small projects provision for taxpayers who do not claim the federal tax credit but who could claim the state credit, and the inclusion of an added incentive for the creation of affordable housing.

Speaker of the House Glenn Cunningham’s Chief of Staff had hosted a weekly conference call of an unprecedented coalition of bi-partisan elected officials, non-profit organizations, construction professionals, environmental organizations and community leaders from across the state to strategize for the bill’s passage. Even after it passed, members asked to vote on the bill separately, reportedly so that some who had voted against the budget could go on record as supporting the tax credit!

Coalition members included numerous developers: Niemann Capital, Saco Island LLC, Lockwood Mills, Housing Initiatives of New England, Mattson, Eagle Point Companies, Monks & O’Neil Development, Paul Boghossian and Roger Pomerleau. Regional and statewide nonprofit organizations joining the coalition included: Avesta Housing, Friends of Midcoast Maine, Greater Portland Landmarks, GrowSmart Maine (which chaired the coalition), Maine Archives and Museum Assoc., Maine Center for Economic Policy, Maine Community Foundation, Maine Merchants Assoc., Natural Resources Council of Maine, Southern Maine Regional Planning Commission and more. Contractors, architects and planners were also a part of the coalition.

 

NJ Historic tax credit bill stalls in Legislature

Administration opposition and the excuse of a poor budget climate caused the long-awaited NJ historic rehabilitation tax credit bill – HPRA, A791, S468 – to stall in the legislature without any committee hearings, as of the summer recess. While the Governor and legislature struggled with controversial legislation, promoted by the real estate development industry, that was billed as “smart growth” solutions to the state’s economic woes, the tool proven in 29 states to be one of the best and greenest economic development and community revitalization instruments was completely ignored.

In a recent column, Neil Peirce quotes civic leaders in St. Louis regarding the amazing comeback of that city’s downtown, almost entirely spurred by Missouri’s historic tax credit: “As Richard C.D. Fleming, president of the St. Louis Regional Chamber and Growth Association and a leader in getting the Missouri Legislature to pass the credit explains: “The total new investment in downtown is almost $5 billion. And close to 90 percent of it is historic preservation — great old structures rehabilitated for offices, condos and more — not just a bunch of new megastructures.”

Great historic buildings in New Jersey towns and cities, large and small, go unrestored and languish. And state and local governments continue to sponsor wholesale teardowns in Camden and elsewhere – a failed urban revitalization strategy in city after city across the country.

It’s time for legislators and the Governor to start learning from places that are succeeding at community and economic revitalization, like St. Louis, Baltimore and Providence! MORE INFO on the Historic Properties Revitalization Act

 

More groups join NJ tax credit coalition

New Jersey Future, the statewide research and policy group advocating Smart Growth principles and programs, and Downtown NJ, the association for New Jersey downtowns, have joined the NJ Heritage Development Coalition.  The Coalition is a network of organizations involved in real estate, development, construction, preservation, planning, architecture, housing and urban revitalization that is committed to Smart Growth and is advocating for adoption of a New Jersey historic rehabilitation incentive program.

 

Maryland Governor proposes supplemental money for state tax credit

from Preservation Maryland:

Governor O’Malley included $10 million dollars for the Heritage Tax Credit program in the supplemental budget presented to the General Assembly on March 31, 2008.

The Heritage Structure Rehabilitation Tax Credit Program is One of the State’s Most Powerful Economic Development and Community Revitalization Tools. Through 2006, the tax credit program has leveraged private sector investment in over 2,600 residential and 550 commercial rehabilitations statewide. The projects represent a combined total of $1 billion in private investment.

It is a crucial program to the development of historic communities and Main Streets across Maryland. The Tax Credit program is also a key Smart Growth program. Every county in Maryland contains a Tax Credit project.

 

Smart Growth & Development advocates support R.I. tax credit

Grow Smart Rhode Island, the smart growth advocacy organization, and other supporters of the state’s historic rehabilitation tax credit program have released a new report quantifying the program’s impact on the state. The report, commissioned by a 57-member group that calls itself the Coalition for Neighborhood & Economic Renewal and includes businesses, municipalities and civic groups, shows that from 2002 through 2012, the credit will cost the state $460.16 million in tax revenue and generate $2.46 billion in economic activity – that is, $5.35 for every $1 invested. In addition, the program is expected to add $767 million to the tax base of local communities and generate $297.6 million in additional property-tax revenue over the next 20 years.

Meanwhile, Speaker of the Rhode Island House William Murphy recently reaffirmed his longstanding support of a strong, predictable and transparent state Historic Tax Credit. In remarks before the Greater Providence Chamber of Commerce at its February 7th legislative luncheon, the Speaker highlighted the value of the tax credit program and his opposition to the R.I. Governor’s proposed retroactive cap on the program.

It is anticipated that House Majority Leader Gordon Fox will introduce legislation soon that will incorporate the major tax credit proposals by Grow Smart Rhode Island and the Coalition for Neighborhood & Economic Renewal as an alternative to the Governor’s tax credit cap proposal.