Supporters of historic state extension tax credit lobby – Albert Lea Tribune

0

Project in Albert Lea as part of the program

Proponents of Minnesota’s Historic Rehabilitation Tax Credit are again advocating with the state Capitol for an expansion of the program, which proponents say gives developers an economic feasibility to preserve historic buildings.

The credit provides a 20% reimbursement fee for developers of historic buildings listed on the National Register of Historic Buildings and was originally created as a bipartisan initiative in response to job losses suffered during the Great Recession. The state tax credit parallels a federal rehabilitation tax credit program that has existed since the 1980s.

Although the Legislature and Gov. Tim Walz last year approved extending the credit by one year under the omnibus tax bill, this year supporters are calling for an eight-year extension.

Heidi Swank, executive director of Rethos, formerly known as the Preservation Alliance of Minnesota, said the one-year extension into 2021 makes sense in light of all the other funds needed to support the COVID-19 pandemic. , but now she hopes lawmakers will recognize the need for a longer extension because the benefits of the program are clear.

A new report released by Minnesota’s State Historic Preservation Office indicates that each tax credit dollar created approximately $11.30 of economic activity in the state.

In 2021 alone, the historic tax credit generated $1.4 billion in economic activity, including $6.93 million in labor income, including 9,660 jobs, the report said.

Since the Minnesota Historic Tax Credit was created in 2011, it has created more than $5 billion for the state’s economy and saved more than 170 historic buildings in communities across the state.

At Albert Lea, the tax credit program is currently part of a project to transform 131 and 137 E. Clark St. – known historically as the Rasmus Jensen Building and the Danish Brotherhood Society Lodge 75 – into 20 loft-style apartments.

Other Southern Minnesota projects that have benefited from the historic tax credit in recent years include a project in New Ulm that converted the vacant New Ulm High School into affordable housing and a project in Faribault that updated the industrial space at the Faribault Woolen Mill Co. The Greater New Ulm Arts and Culture Center also received a landmark tax credit.

Swank said 70% of the cost of a building rehabilitation project is labor costs.

“These are jobs for people, money that stays in Albert Lea and in this economy,” she said.

She said the more reuse of historic buildings can be encouraged, the more jobs they can increase in the area, which in turn gives people more disposable income to spend in restaurants and other businesses in the community.

Historic buildings also carry with them precious memories of youth or times spent with family members or friends, she said.

“Old buildings are like memories that we can touch,” Swank said, noting that it’s important to keep buildings around and ensure they can still be used for the next generation to create new memories. .

She compared historic buildings that have been demolished in the state of Nevada, where she previously lived, with those in Minnesota and said she can tell the difference in how many buildings have been saved in Minnesota thanks to its tax credit program.

She also pointed out that the money is not paid out in tax credits until the project is complete.

“The developer pays the money up front and then the state steps in and only pays the tax credit after the whole project is complete,” Swank said. “It shows a good sense of responsibility. These are our raised dollars, and we need to be careful how we spend them.

The state report showed developers filed 34 tax credit claims in 2021, which was a record for the program, largely due to the program’s scheduled end. These developers have announced planned expenditures of $890 million to complete their projects.

2021 economic impact of the historical tax credit

$1.4 billion: future economic activity generated by the projects

34: Applications submitted by developers

$890 million: Planned spending by developers


Source link

Share.

Comments are closed.