08 Nov Historic Tax Credit Fuels Housing Development
The federal historic tax credit helped rehabilitate or produce more than 6,000 low- and moderate- income housing units in fiscal 2018, according to a new National Park Service (NPS) report.
Administered by the NPS and the Internal Revenue Service, in partnership with state historic preservation offices, the program provides a 20% federal tax credit to property owners who undertake a substantial rehabilitation of a historic building in a commercial or other income-producing use, while maintaining its historic character.
The historic tax credit has been an important tool to convert older buildings, including abandoned schools and mills, into housing. The report reveals the program rehabilitated 6,994 housing units and created 12,527 units, including 6,152 low- and moderate-income units.
Since fiscal 1977, more than 587,000 housing units have been rehabilitated or created, including 166,210 low- and moderate-income homes.
The NPS-funded report by Rutgers University’s Center for Urban Policy Research also reveals that in fiscal 2018:
· The historic tax credit program provided more than $7.7 billion in total rehabilitation investment.
· The program contributed more than $14.4 billion in output in goods and services to the U.S. economy.
· 51% of the certified rehabilitation projects were located in low- and moderate-income areas, and more than 75% were located in economically distressed areas.
· Officials also pointed out the program is not just for large projects in large cities. Almost half of all projects were less than $1 million in rehabilitation costs, and 18% were less than $250,000. A quarter of all certified rehabilitation projects were located in communities with a population of less than 50,000 people and 15% in communities with a population of less than 25,000 people.
· Historic tax credit projects generated approximately 129,000 jobs.
Thirty-five states have their own state historic tax credit program that can be used in tandem with the federal program. Hawaii lawmakers approved a state credit to support the rehabilitation of historic properties earlier this year. In California, a bill to create a historic state credit passed the state Assembly and Senate and was sent to Gov. Gavin Newsom in September.