National Trust: Bill Would Encourage Greater Investment in Historic Main Streets
Statement by Paul Edmondson, interim president and CEO of the National Trust for Historic Preservation
New legislation was introduced in the U.S. House of Representatives that would enhance the value of the federal historic tax credit and help ensure that historic rehabilitation activity continues unabated after changes were made to the program in the 2017 Tax Cuts and Jobs Act. The following is a statement from Paul Edmondson, interim president and CEO of the National Trust for Historic Preservation:
“The National Trust applauds the leadership of Representatives Blumenauer, Kelly, Sewell, LaHood, Higgins, and Turner in advancing legislation that will strengthen the federal historic tax credit and provide communities with new opportunities for revitalization and economic growth. Over the course of three decades, the federal historic tax credit has consistently demonstrated its ability to kickstart job creation and attract private investment while preserving nationally significant historic buildings.”
“The Historic Tax Credit Growth and Opportunity Act effectively builds on the program’s long track record of success and positions it to be even more impactful in revitalizing and creating jobs in our cities as well as our rural areas and Main Street communities.”
About the Federal Historic Tax Credit
For more than three decades, the federal historic tax credit (HTC) has successfully implemented a national policy of preserving our historic resources. It is the most significant investment the federal government makes toward the preservation of America’s historic buildings. Since 1981, the credit has leveraged $144.6 billion in private investment, created more than 2.5 million jobs, and preserved more than 44,000 historic buildings that form the fabric of our nation.
About the Historic Tax Credit Growth and Opportunity Act
The Historic Tax Credit Growth and Opportunity Act (H.R. 2825), proposes important improvements to the federal historic tax credit, including several that will make the credit more accessible to smaller projects typically found in historic Main Street districts and more rural areas. It eliminates the HTC Basis Adjustment requirement, which currently requires that all building owners subtract the amount of HTCs from a rehabilitated building’s basis (the amount a property is worth for tax purposes). Eliminating this requirement will bring more value to all HTC projects by increasing the basis of rehabilitated historic buildings for building owners, provide additional depreciation and other tax benefits, and attract more capital from tax credit investors. The bill would also: increase the credit from 20 to 30 percent for projects with rehabilitation expenses of less than $2.5 million; simplify the application process for small developers by allowing a onetime transfer of the credits as a tax certificate; make it easier to meet the substantial rehabilitation test; and create greater flexibility for nonprofit organizations in partnering with developers in redevelopment projects.