Syracuse, New York – With more than one out of every four construction workers still out of work across the country, U.S. Senator Kirsten Gillibrand, Congressman Dan Maffei, and Syracuse Mayor Stephanie Miner today announced federal legislation that would modernize and expand tax credits to renovate historic buildings. The Community Restoration and Revitalization Act would harnesses private investment to create jobs, revitalize older communities, and promote sustainable development.
“Thousands of construction workers in New York are out of work through no fault of their own,” said Senator Gillibrand. “We need to partner with private businesses to create good-paying jobs for people who want to work. This is a common sense solution that will put New Yorkers back to work and help Syracuse thrive.”
“Revitalizing downtown Syracuse will strengthen our local economy directly and have positive ripple effects for the whole region,” Rep. Maffei said. “We’ve got a trained work force ready to get back to work and a stock of historical buildings and houses that need attention. This bill makes a lot of sense, and I want to thank the Senator for the opportunity to work together on a great piece of legislation.”
“This legislation will serve as a powerful tool for economic development in the City of Syracuse and the surrounding region,’’ said Mayor Miner. “I applaud Senator Gillibrand, Congressman Maffei, and our entire federal delegation for leading the charge in helping us to put our people back to work and our properties back on the tax roll.”
“The Community Restoration and Revitalization Act holds the potential to benefit Syracuse and cities with underutilized historic building stock all across the country,” said Robert M. Simpson, president and CEO of the Metropolitan Development Association of Syracuse and Central New York. “Expansion of this tax credit will stimulate new private investment by filling the financial gap on critical redevelopment projects in our urban cores.”
The Community Restoration and Revitalization Act promotes economic development by converting underutilized existing structures into redevelopment anchors in older communities. It would create jobs in Central New York and rely on local suppliers. Last year nationwide, rehabilitation tax credits leveraged $4.7 billion and created almost 71,000 jobs.
The expansion of the tax credit would include energy-efficiency projects, creating jobs that are based on emerging energy technologies. The provisions would also expand the reach of the tax credit to broaden its economic impact by allowing individuals to transfer credits to attract more private investment and include buildings that are owned or leased by non-profits or religious entities.
This bill will further enhance heritage tourism, the second largest economic sector in New York State. Heritage tourism attracts visitors to areas throughout New York State, from the Hudson Valley to Niagara Falls, and New York City to the Adirondacks.
|
PROVISION |
IMPACT |
|
30% Small Deal Credit – limited to small projects with up to $5 million in Qualified Rehab Expenditures. Small Deal Credits would be freely transferable outside the real estate partnership. |
Reduce the transaction costs of small deals thereby providing more subsidy to the costs of rehabilitation. Promote greater use of the HTC in rural areas and small towns. |
|
Energy Efficiency Supplement – for properties that achieve a 30-50% increase in energy efficiency, provides a $2.00-5.00 per square foot supplemental credit. |
Encourage developers of historic properties to maximize the use of conventional energy saving materials. |
|
Twinning HTCs and Renewable Energy Credits – allows same twinning of Section 47 and 48 credits currently allowed for LIHTCs and NMTCs. |
Encourage developers of historic properties to use alternative energy sources for HVAC and hot water. |
|
Moderate Rehab – by lowering the “substantial rehab test” to 50% of adjusted basis, would allow moderate rehabilitation. |
Expand the stock of eligible HTC properties and incentivize new property owners to undertake rehabilitation. |
|
Improve the 10% Credit – Index eligibility to properties 50 years or older and allow the use of the 10% credit for housing. |
Expand the stock of eligible non-historic properties. Provide needed affordable and market rate housing |
|
Expand Non-profit Use of the HTC – eliminate restrictions on non-profit and government agency tenancy in HTC properties. |
Improve leasing potential of HTC properties that depend on access to the entire market of prospective tenants. |
|
Increase the Value of State HTCs – eliminate federal taxation of the proceeds of State HTCs. |
Increase the pricing of State HTCs to the level of the federal HTC ($.90-1.00 per tax credit dollar). |
Over the last few decades, much development has centered on suburban growth, moving homes and businesses out of city centers. Old factories, theaters, homes, and shopping centers are now boarded up structures. Renovating these historic buildings is a key component to revitalizing New York’s cities.
New York State has a rich heritage of historic buildings, with more than 94,000 buildings on the historic preservation register and thousands of non-listed historic structures that are eligible for expanded rehabilitation tax credits. Once a historic building is renovated, the surrounding neighborhood undergoes a similar revitalization.
The rehabilitation tax credit concentrates development in existing buildings instead of suburban sprawl, helping to create vibrant communities with mixed-use developments.
For example, the Landmark Theatre is the last remaining depression-era movie palace in Central New York. In the mid-1970’s, Loew’s announced the theatre’s closing. With demolition threatened, community leaders, city officials and cultural agencies established an ad hoc committee to study possible community acquisition. In an effort to protect the theatre and make it eligible for preservation funding and to discourage commercial development by disallowing certain tax incentives, the facility was permanently listed on the National Register of Historic Places in 1977. They are using a $2.7 million federal tax credit to help transform the Landmark Theatre into the premiere performing arts center in Central New York. With the expansion, they will be able to leverage more money into the project. By offering state-of-the-art facilities including expanded stage and back-house areas, the Landmark Theatre will attract shows that currently by-pass the area. Currently, the Landmark Theatre contributes $14 million to the local economy thru hotel nights, parking and restaurants.