Restore Oregon is tracking carefully the status of the federal Historic Tax Credit (HTC) which provides a 20% tax credit to offset the cost of historic rehabilitation projects. Without the HTC, more than 90 redevelopment projects in Oregon like the White Stag Block in Portland or the Post and King Building in Lakeview would not have happened – nor would the 100s of jobs and community revitalization. Retaining the HTC is imperative.
Congressman Earl Blumenauer is co-chair of the Historic Preservation Caucus in the House of Representatives and a sponsor of the Historic Tax Credit Improvement Act that would make the program more accessible to smaller Main Street-sized projects. We will send out an alert when the time is right for individuals to contact their legislators in favor of the bill.
Historic Tax Credit Advocacy Alert-November 2016
Written by Michael Phillips at the National Trust Community Investment Corporation
Tax Reform Outlook
As we move through another Presidential election cycle, Historic Tax Credit advocates are once again watching two candidates with very different approaches to reforming the tax code, stimulating the economy and creating jobs. The Ways and Means Committee of the House meanwhile, is continuing to add legislative text to Speaker Ryan’s “A Better Way” tax reform blueprint and setting the stage for tax reform becoming a major topic of discussion in 2017.
Depending on the result of the Presidential election and which party controls the House and Senate, there are four likely outcomes: (1) quick action at the start of the year to move a comprehensive tax reform bill, (2) a longer, more methodical back and forth negotiation to achieve bipartisan tax reform, (3) a narrowly focused tax bill that will seek to reform international corporate taxation, (4) or continuation of the gridlock we’ve witnessed in Congress that renders broader tax reform unlikely for the foreseeable future.
In the first three scenarios there is at least some potential to update and improve the HTC program, while at the same time, protecting the HTC in the tax code.
Despite this list of most plausible scenarios, advocates will continue to encounter members of Congress that will prioritize “broadening the base, lowering the rates and eliminating special interest loopholes.” Since most corporations are paying an effective tax rate after deductions well below 35%, in order to make tax reform “worth it,” Congress must at least propose a tax rate below 25%. To generate the large across the board tax cut it will require the elimination of tax incentives well beyond “corporate loopholes,” putting community development tax credits at risk. Despite its documented economic development track record, recent discussions with Republican House leaders indicate that the HTC may be more at risk than the Low Income Housing or New Markets Tax Credits because it does not target social needs in low-income areas.
In recognition of the opportunity for comprehensive tax reform in 2017, the campaign has focused on building support for the Historic Tax Credit Improvement Act. Support has been built by organizing in-district meetings and tours of HTC projects with members of Congress and their staff during congressional recesses and district work periods. This fall it will be critical to continue advocacy, respond to the changing political dynamics of the election and be ready to hit the ground running in the 115th Congress.
Historic Tax Credit Improvement Act
The House version of the bill (H.R. 3846) continues to enjoy strong bi-partisan support on the Ways and Means Committee and presently has 49 members of Congress (22 Republicans, 27 Democrats) supporting the bill, directly demonstrating support for the Historic Tax Credit. There are 17 members of the Ways and Means Committee on the bill (10 Republicans 7 Democrats). The Senate version of the bill (S.2655), sponsored by Senator Susan Collins (R-ME) and Senator Ben Cardin (D-MD), was introduced last March. Presently the Senate bill has 7 Senators supporting the legislation (2 Republicans and 5 Democrats). The 114th Congress will likely adjourn sometime in December. The 115th Congress will begin with a new President, and possibly new majorities, in January 2017. It is important to get as many co-sponsors on to the bill before the 114th Congress has adjourned. The bill will have to be reintroduced in the 115th Congress.
A one-pager on the HTCIA legislation
House HTCIA Co-Sponsors:
Senate HTCIA Co-sponsors