Dear Preservation Friends:
One of the most important tools for saving historic buildings is the Rehabilitation Historic Tax Credit. Since the late 1970s, federal tax law has allowed for a 20% tax credit for certified rehabilitation of certified historic buildings. This program encouraged developers, large and small, to reprogram underutilized historic buildings around the country and put them into a new use for future generations. The program increased economic development and reinvestment, developed jobs, and put new life into our historic properties.
In Galveston, the credits offered investment incentives to save important buildings such as the Jean Lafitte Hotel, Hendley Row, and other properties in the Strand Mechanic Historic District. More projects are planned or underway including the Medical Arts Building, Falstaff Brewery, and the Moody Building on Strand. With the relatively recent Texas credit for historic rehabilitation, more properties are underway as the combined federal and state credit offers 45% credit back to the developer.
As you may know, the Historic Tax Credit is under assault…in fact, it’s been repealed in the Tax Cuts and Jobs Act (TCJA) or H.R. 1 now before Congress. It’s disappointing and a surprise—given the overarching instructions to the tax writers and the popularity of the tax credits. Our understanding is that the Senate is expected to release its tax reform bill shortly after the Ways and Means Committee finish its markup, which is likely to conclude sometime Thursday.
The advocacy staff from the National Trust for Historic Preservation in Washington suggest that we all pursue several strategies to help save the tax credits:
- Reach out to Ways and Means Committee Republicans and urge them to find an opportunity to put the HTC back in the bill;
- Work with supportive off-Committee House Republicans, including Cong. David McKinley from West Virginia, to urge Chairman Brady to include the credit into the bill before the bill moves to the House floor;
- Contact your Senators and Representatives and encourage them to vocalize support for the historic tax credit to Chairman Hatch and Majority Leader McConnell;
Our colleagues in Washington want to keep historic tax credit advocacy focused on retaining the credit AS IS. We are at the beginning of the legislative process and there is still plenty of opportunities to fight for the historic tax credit.
This message is primarily intended for the developer audience, but it is important we are all clear on the message and that we step up to communicate our support for these incentives.