My Turn: Save historic preservation tax credits
Rehabilitation and repurposing of the Historic Loray Mill, converting and renewing the abandoned Gaston Memorial Hospital for senior housing, and restoration of the Armstrong Apartments were all made possible by Historic Rehabilitation Tax Credits for investment properties. But now, this essential preservation and community reinvestment tool is planned for extinction by the GOP tax bill.
I have firsthand knowledge of the financial structure of these private redevelopment projects and can assure the reader that neither would have happened without multiple sources of financing, including necessary private equity induced by Historic Tax Credits. Each of these heritage buildings would have long ago gone to the landfill in the absence of this reinvestment tool. Instead today, they are preserved for generations to come, serving new community and economic purposes, and are playing a key role in revitalizing areas of our community which have been overlooked by the market.
Historic tax credits are necessary because they mitigate higher costs and greater design challenges, and most importantly, provide equity to help fill the financial gap needed in weaker market locations.
Beyond preserving the historic legacy of our communities, historic preservation projects have a better economic impact than greenfield development. Preservation project costs average about 60 percent labor and 40 percent materials, while new construction averages about 60 percent materials and 40 percent labor. More jobs are generated, plus materials are more likely to be locally sourced, consequently 75 percent of their economic benefits are locally retained. As private developments they contribute significantly to local tax coffers.
But, contrasted with greenfield developments, they demand little in added municipal services because they typically occur where such services and infrastructure are already present. Historic tax credits are not only a winner at the local level, but also at the state and the national level. They return to the U.S. Treasury roughly $1.25 for every tax dollar invested. Results include $131 billion in private capital investment, 2.4 million jobs, and preservation of 42,293 buildings important to local, state and national heritage. If we want to grow our economy through tax reform, eliminating the Historic Preservation Tax Credit is heading the wrong way. We must reinvest in the physical assets of our center cities, our main streets, our small towns and the built heritage embodied on our community landmarks — that which makes each community special and defines its history. This will help grow our economy and return significant dividends to our taxpayers.
Preservation tax credits involve over $100 million in Gaston investment including other projects such as Mayworth School Senior Apartments in Cramerton, Dallas High School Apartments, and buildings in the downtowns of Gastonia and Belmont. Communities across North Carolina have seen over 653 projects, totaling $1.8 billion in investment, producing 31,000 jobs and providing $392 million in taxes. We cannot let this policy so vital to communities be eliminated, for there will be more projects to come, whether it’s repurposing of more old factory buildings, iconic downtown structures, or plans now before our communities.
So, it is no wonder Historic Preservation Tax Credits have enjoyed broad bi-partisan support. When President Regan signed a law making this policy permanent, he put it well, “Our tax credits have made the preservation of our older buildings not only a matter of respect for beauty and history, but of economic good sense.”
If you agree that Historic Preservation Tax Credits are good policy, act today to call or email Congressman Patrick McHenry and Sens. Burr and Tillis.
Jack Kiser is a resident of Gastonia and has long been involved in historic preservation.
(Gaston Gazette, 11/9/17)