The field of preservation isn’t one you’d think was politically charged. After all, what could be more bi-partisan and apple pie than rehabilitating historic places? What’s not to love about creating jobs, honoring culture, and reusing massive amounts of materials?
But little-noticed outside of the Washington, D.C. Beltway, a bill was proposed this year by House Ways and Means chairman Dave Camp (R-Michigan) for a massive tax overhaul aimed at reducing the overall corporate tax rate. It included the complete removal of the federal Historic Tax Credit (HTC), the 20% income tax credit for the certified rehabilitation of historic commercial buildings.
The loss of this credit, in place since 1976, would virtually pull the plug on the most catalytic preservation projects nationwide.
Though the bulk of historic redevelopment projects are funded by private investors, major projects that go beyond basic paint and awnings to address structural issues such as code compliance, ADA access, seismic upgrades, electrical and HVAC systems simply do not pencil out financially without the 20% credit of the HTC. And many projects also need state and local incentives on top of that.
Though the bill did not make it out of committee, most expect it will be revisited after the November elections. Clearly it’s time for the preservation community to take action to ensure that the Historic Tax Credit stays in place, fulfilling its purpose of creating jobs and revitalizing historic buildings.
With that in mind, the National Trust for Historic Preservation invited Restore Oregon to come to Washington, D.C., last week to lobby our delegation and spotlight the fact that the HTC generates significantly more revenue for the government than it costs (see Rutgers University report) and is essential to communities across Oregon who are working to revitalize their historic downtowns.
In fact, its impact would be multiplied with the passage of Restore Oregon’s proposed state Rehabilitation Tax Credit which, when coupled with the federal credit, will make scores more projects like the St. Francis Hotel in Albany financially viable. (See our Special Report on Revitalizing Main Street.)
Interestingly, Oregon will play a pivotal role in the pending tax debate, as Senator Ron Wyden is now chair of the Senate Finance Committee, through which any tax reform bill must pass. Needless to say, a top priority is to ensure Senator Wyden is fully aware of the positive impact made by the HTC in Oregon!
As we navigated the Capital complex to meetings with Wyden, Blumenauer, Bonamici, Walden, Schrader, and DeFazio’s staff, I was glad to draw upon the experience of our colleagues at the National Trust, Shaw Sprague (Government Affairs) and Michael Phillips (NTCIC tax credits subsidiary). At the meetings we found levels of support ranging from mild to strong, but we left with the representatives having specific economic impact data and a list of the places in Oregon that have been transformed thanks to the Historic Tax Credit.
We will continue to monitor the situation in Washington DC even as we move forward with our state Rehabilitation Tax Credit initiative. And we’ll certainly call upon our members and friends to raise their voices when the time is right.