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Historic Preservation Tax Credits
Tax credits for historic preservation (Photo credit: 401(K) 2012)
The basic benefits of Historic Preservation Tax Credits in the United States are widely publicized – encouraging preservation, assisting with the viability of a project, increasing the value of an under- or un-utilized building and returning it to the tax rolls, and improving neighborhoods, among others. But a recent article published by the National Trust for Historic Preservation highlights one architect, Robert Verrier, who asserts that he has saved over 150 places in the past thirty-plus years and the key to his business and his success, is historic tax credits.Verrier states that, not only is preservation one of the greenest activities as well as an activity that can embody and save the collective memory of a place or entire community, but he notes that “the recent debate over historic preservation tax incentives is … short on common sense. The benefits of these tax credits are indisputable. By redeveloping historic buildings, tax credits save our architectural heritage and spur new private investment, create construction jobs, and set the stage for new economic activities, such as tourism.”
Historic buildings often anchor communities or serve as a gateway into them. Revitalizing these buildings can bring an area back to life. In addition to providing jobs through the revitalization and resulting use of an old building, adjacent activity also rises – often resulting in a domino effect creating even more jobs, community investment, commercial activity, or housing for example. These buildings, with strong bones and strong roots, need someone with a vision who will in turn likely need the assistance of historic preservation tax credits in order to make the vision a reality.
Preservation, sustainability, and economics stand hand in hand
Numerous studies and even more websites have been produced linking the economic benefits of preservation, but the connection of sustainability in this grouping should not be ignored. Historic preservation is an inherently green activity, and is slowly but surely gaining recognition in today’s sustainability-conscious world. Coherently summed up by the Illinois Historic Preservation Agency, “both preservation and green design share a concern about resource conservation and the goal of making a better future. Preservationists begin by identifying places that have enduring value and deserve to be part of the future. Green design begins as a response to the future challenges of resource depletion, population growth and climate change.” Further summed up in the article, are many of the green benefits of historic preservation, including the fact that many preservationist have knowledge of the fact that many historic buildings were constructed with features considered green today, such as the use of local materials compatible with climactic conditions and operable, well-placed windows for fresh air and daylight – some even featuring systems to collect and utilize rainwater. Not only are many historic buildings green, but their placement and the planning of historically developed areas also exhibit green qualities including compact arrangement, pedestrian friendliness and both mixed-use and mixed-income blended into one area creating an accessible and walkable community. Utilizing this existing infrastructure is not only environmentally-conscious, but is an economic win for any community
A study in West Virginia demonstrates the strong, positive economic impacts produced by historic preservation, which also result in additional positive impacts such as the revitalization of small town business centers – an undeniably green benefit. Wanting to not only test this theory, but gain from its benefits, numerous programs across the United States have been put into place such as the Green Pilot Project in West Union Iowa. The project focussed primarily on creating a green, sustainable community infrastructure – doing so in the greenest way possible: by rehabilitating the existing town center, utilizing and highlighting what they already had. Project planners realized that utilizing the existing downtown building stock would not only help to preserve cultural, architectural and historical assets, but would strengthen the smart planning and growth concepts already a part of their built environment by providing valuable retail space on the street level (keeping spending local and producing jobs) and by reclaiming the much-needed residential space already in place on many of these building’s upper levels. Some of this work was made possible by a further economic benefit provided by historic preservation: the use of historic tax credits.
The cost-benefit of building rehabs… beneficial both environmentally and economically
Rehabilitation makes environmental and economic sense (Photo credit: JWSherman)
A recent study published by the National Trust for Historic Preservation titled, The Greenest Building: Quantifying the Environmental Value of Building Reuse, has inspired a great deal of discussion. One discussion in particular, an article by Blythe Lawrence published in The Seattle Times (Seattle, WA USA), provided a follow-up comparison of the environmental value and the economic value of rehabilitating an existing building versus constructing a new one. The study looked at the effects a building has on the environment (such as runoff) and the use of nonrenewable resources (like fossil fuels) as well as energy and and resource extraction, and found that “even the most energy efficient new buildings have to stand as long as 80 years before their energy savings offset the negative impacts of constructing them,” as summarized in The Seattle Times article. The article continued to note that, “from an environmental perspective [building reuse is] a no brainer.”
Going one step further, the article noted that if an existing building has a good envelope the cost of rehab is about the same as the cost of new construction for a similar-sized building. If an existing building needs to be demolished as part of a new construction project, in order to clear the property for a replacement building, the economic and environmental costs increase exponentially. Though many, including developers, are often reluctant to accept or acknowledge the viability of rehab projects, the article sums up the reality of the situation stating that “development is about obtaining the maximum return from a piece of property. You don’t have to build a new building to make money.”
Heritage Business Journal 