State Historic Tax Credits to be Heard MONDAY & TUESDAY!

PRC supports the extension of the State Historic Tax Credits until 2016. We’re appreciative of Rep. Walt Leger’s leadership on the tax credit for owner-occupied structures, which we posted about HERE. Below are details on the tax credit for income-producing properties.

TAKE ACTION! Contact your Legislators and ask them to co-author House Bills 348 and 349. Locate your Legislators HERE.

FACTS ON THE STATE HISTORIC TAX CREDIT (S-HTC)

THE STATE HISTORIC TAX CREDIT (S-HTC) IS A UNIQUE PROGRAM THAT:

• Transforms dilapidated aging structures into productive historic buildings
• Cleans up neighborhoods
• Create jobs
• Stimulates tourism
• Preserves Louisiana’s special Culture and History
• Significantly increases the tax base

***The State Historic Tax Credit Program for Commercial Property Expires at the end of 2011***

NEED: Four-year extension of the existing Historic Building Rehabilitation programs, which sunset at the end of this year

BACKGROUND: Louisiana is one of 31 states to offer a Commercial Historic Tax Credit.  The 25% tax credit was first enacted in Louisiana in 2002. It has already been extended twice, and a consortium of preservationists, Downtown Development groups and other interested parties is asking for an additional 4-year extension during this current legislative session. This effort will be bi-partisan and statewide. Without that extension, the commercial Historic Tax Credit will sunset (end) in December of this year. The tax credit for owner-occupied structures, which we posted about HERE, will expire in December 2012 unless it is extended this session.

WHAT’S ELIGIBILE FOR THE COMMERCIAL S-HTC?

• Most buildings constructed in 1960 or before in Downtown Development District and Cultural Districts are eligible for Historic Tax Credits.
• The building in question must be used for income-producing purposes.
• Eligible expenses must exceed $10,000.
• A taxpayer or entity affiliated with that taxpayer can earn up to $5 million in credits for rehabilitation work.

S-HTCs PROMOTES REHAB PROJECTS AND MOVES PROPERTIES INTO COMMERCE: Older buildings, especially those that have been vacant for some time, are challenging to rehabilitate back into commerce. Without this tax credit, many developers would walk away from proposed projects and those buildings would either continue to sit idle or be under-utilized.  Vacant buildings generate no jobs, no sales taxes, and little property taxes and are a burden on the municipality that has to secure them for health and safety reasons. Vacant older buildings are magnets for transients, trash and deterioration, and negatively impact the value of the buildings around. Nearby properties become harder to sell, and when they do, prices are generally lower

WHO WILL BE AFFECTED LOCALLY BY THE LOSS OF THE S-HTC? Realtors and brokers who sell the buildings, mortgage brokers and banks who help put the deals together, building owners, cities, parishes, the school board and all entities that receive taxes and benefits from renovated buildings, the Downtown Development Authorities, Cultural Districts and Chambers of Commerce that are trying to spur economic and cultural development, and citizens that are denied the jobs and opportunities that come with renovated properties

STATEWIDE IMPACT: Baton Rouge, Shreveport, Monroe, Alexandria, New Orleans, Lafayette and many other communities, small and large, have significantly benefitted from this highly effective program and most if not all have popular projects on HOLD until the program is extended

COMPETITIVENESS: Mississippi has just passed a strong 25% State Historic Tax Credit Law.  If Louisiana does not extend its State Historic Tax Credit, it is at a competitive DISADVANTAGE.  Funding for historic renovation projects may move out of state

CREATES JOBS: The completed projects supported by the S-HTC have created 11,034 construction jobs and 5,711 permanent jobs in the State

CREATES NEW STATE TAX REVENUE: In total, the construction and operations of the projects supported by the S-HTC created a total of $142.51 million in new State tax revenue

CREATES NEW LOCAL TAX REVENUE: In total, the construction and operations of the projects supported by the S-HTC created a total of $104.76 million in new tax revenue for local governments

HIGH ROI FOR THE STATE: For every dollar that the state has invested in the program it has or will collect $3.22 in new tax collections, measured in 2011 dollars

STIMULATES PRESERVATION SPENDING: The S-HTC program has already generated $651.13 million in historic restoration construction at the cost of $140.59 million in tax credits

PRESERVES CULTURE: Restoration of Historic Structures preserves the unique architecture and culture of our state

THE POLITICS ON BOTH TAX CREDITS:

• The Lt. Governor will lead the effort for the extension
• The Governor is supportive
• The bills (HB 348, 349 and SB 63) have broad-based bi-partisan, geographically diverse support because the program provides critical funding for communities, large and small

THE LEGISLATION: HOUSE BILL NO. 349 (HB 349)–By Representatives Leger, Moreno, Jane Smith, and Talbot and SENATE BILL NO. 63 (SB 63)– by Senator Murray co-author Sen. Adley. Please also check out details on HB 348, the tax credit for owner-occupied homes HERE, by Rep. Leger, co-authors Rep. Brossett and Morrell.