Thursday, December 25, 2014

Tax credits may be key to save historic buildings

Pennsylvania has more designated historic structures than almost any other state. So it’s good to see it finally take a proactive step that could help save a lot more of them from the wrecking ball.

Tax credits may be key to save historic buildings

Philadelphia´s Divine Lorraine Hotel could benefit from the historic-preservation tax credit. (MICHAEL S. WIRTZ / Staff Photographer)
Philadelphia's Divine Lorraine Hotel could benefit from the historic-preservation tax credit. (MICHAEL S. WIRTZ / Staff Photographer) MICHAEL S. WIRTZ / Staff Photographer

Pennsylvania has more designated historic structures than almost any other state. So it’s good to see it finally take a proactive step that could help save a lot more of them from the wrecking ball.

Gov. Corbett has signed into law a generous incentive to preserve historic buildings: a 25 percent tax credit. The tax credits should help attract developers to blighted communities around the state.

The tax credits represent a major victory for preservationists, who have been pushing for the legislation for 16 years.  Pennsylvania becomes the 30th state to provide such a tax credit. Lawmakers in New Jersey approved a similar bill in 2011, but unfortunately it was vetoed by Gov. Christie.

The Pennsylvania law sets aside $3 million in tax credits for the rehabilitation of structures statewide, starting in July 2013. With per-project credits capped at $500,000, only a handful of projects may benefit from the credits program. So if the effort is successful, lawmakers will want to increase those amounts.

Coupled with an existing federal tax credit, the state’s new incentive could help spur large-scale redevelopment projects across Pennsylvania and change the landscape in neglected corridors.

To qualify, a structure must be listed on the National Register of Historic Places or be within a district recognized as historic on the National Register. Only commercial projects are eligible, however, which leaves historic residential properties vulnerable to demolition.

Philadelphia in particular could benefit from the new tax credits, with such vacant behemoths as the Divine Lorraine Hotel. Built in 1894 as the Lorraine Apartments, the building was purchased in the 1940s to become a non-segregated hotel for followers of Father Divine’s Universal Peace Movement. But the sprawling 118-year-old structure on North Broad Street has long been threatened with demolition.

Given its small rooms and that it isn’t as close to either Temple University or Center City as desirable, even the tax credits may not save the hotel. But just the availability of  credits for  developers has raised hopes for the continued revival of that section of town.

With so many historic buildings in the state, it makes sense for Pennsylvania to provide tax incentives to preserve the past while putting these structures to use for future generations.

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