According to the National Low Income Housing Coalition report The Gap: A Shortage of Affordable Homes (March 2021), “only 37 affordable and available rental homes exist for every 100 extremely low-income renter households."

Research and Process

The research I conducted depended heavily on a series of conversations with industry experts both internally at the National Trust and externally. By listening to their perspectives and learning about their experiences , I began to understand which policies worked or could be improved upon in the world of SHTCs. I met with National Trust staff members in the Preservation Services and Outreach and Government Relations departments and the National Trust Community Investment Corporation (NTCIC).

A critical part of the project included speaking to the tax credit program coordinators in each case study’s state historic preservation office (SHPO) to learn about their perspective on the relevant provision. Having worked with a SHPO before in a different capacity, it was eye-opening to see how different states operated. One of the most valuable experiences of the summer was being able to go through an SHTC statute with my supervisor, Senior Director of Outreach and Support Renee Kuhlman, sentence by sentence to truly understand this type of policy. Not having focused on preservation law in my graduate studies, I was grateful for the time and opportunity to further my understanding.

Building the Report

Each state’s methodology varied with its own advantages and disadvantages.

Delaware had the most generous program in that the original credit could be increased from 30 percent to 35 percent, or 35 percent to 40 percent, if affordable housing was included in the project. These are some of the highest returns out of all SHTCs.

Massachusetts’ data showed how a state with a competitive program due to an overall aggregate cap can spur a tremendous amount of activity from setting aside a portion of the overall program for affordable housing. Although only 25% is set aside for creating housing, data gathered by the state preservation nonprofit, Preservation Massachusetts, revealed that 80 percent of all Massachusetts HTC applications include some component of affordable housing in their projects. With it being generally understood that the full credit is never guaranteed, many projects include the affordable housing to give their application a competitive edge in the process.

Maine’s statute centers around reliability and accountability. Because the state has no annual aggregate cap for the program, as long as a project abides by all the rehabilitation standards and follows all the rules, they are guaranteed their credits. The law also requires that all projects that utilize the affordable housing provision must keep those units affordable for the next 30 years or else they must repay their tax credit.

By ensuring the longevity of affordable units, the state’s accountability clause protects the housing units it helped create. This is necessary when many affordable housing developments are being created in the heart of previously economically blighted neighborhoods. If an affordable housing project were to switch to market rate five years after rehabilitation, the structures could become agents of gentrification that many have associated historic preservation with in the past. The accountability provision prevents this from happening and keeps development sustainable.

At the end of June, the National Trust hosted a webinar addressing the case study states, “Using State Historic Tax Credits to Create Affordable Housing.” The webinar featured key players in each case study state as they shared their experiences and successes with the provision.

This research delves into the successes and best practices of SHTC and affordable housing provisions. With its publication, this information can help many policymakers evaluate the benefit of including an affordable housing provision in their SHTC programs. These specific credit programs reap a variety of rewards: creating jobs and lessening our carbon impact through adaptive reuse, while providing safe, affordable homes for our communities.

The data and research speak for themselves in furthering the conversation around how historic preservation and affordable housing can be mutually beneficial. I am grateful for the opportunity I had to expand my knowledge about state historic tax credits. Having written my graduate thesis on the intersection of historic preservation and affordable housing through the use of university housing cooperatives, the research I conducted for the National Trust has been instrumental in shifting my understanding of how these causes can be advocated for within legislature.

An Ethical Obligation Going Forward

As affordable housing continues to be a nationwide crisis, the field of historic preservation has a moral and ethical obligation to advocate for affordable housing, especially when our communities have underutilized structures that can be converted into affordable units.

The inclusion of affordable housing provisions in SHTC, legislatively asserts that affordable housing should be prioritized and dignified.

Editor’s Note: For more on efforts related to affordable housing and preservation, read the recent issue brief from the Preservation Priorities Task Force.