New York Governor David A. Paterson signed legislation yesterday which will strengthen the New York State Historic Preservation Tax Credit, improving a program that will stimulate investment in urban neighborhoods and revitalize historic areas.
The rehabilitation tax credit program provides incentives to developers, municipalities, businesses and residents to make investments in distressed areas by rehabilitating historic properties that are listed on the State and National Registers of Historic Places.
“New York has a wealth of historic properties, particularly in our small cities, that are falling into disrepair or are underutilized. The enhanced Historic Rehabilitation Tax Credit will breathe new life into the State’s historic downtown areas while creating jobs and revitalizing the economy,” said Governor Paterson. “As we move forward toward the New Economy, it is critical that we continue to use our State resources to leverage private investment dollars to take our distressed historic areas and return them to vibrant centers of commerce and culture.”
While New York’s preservation tax credit was adopted in 2006, the program did not provide adequate incentives to attract sufficient investment to struggling municipalities, particularly those Upstate. The enhancements signed yesterday will provide the following tax incentives for qualified historic properties:
Gradually increase over five years the cap on the commercial credit value from $100,000 to $5 million and the residential credit value from $25,000 to $50,000;
Target the credit in “distressed” areas -- those located within a Census tract identified at or below one hundred percent of the median family income;
Increase the share of qualified rehabilitation costs that commercial property owners can claim for the credit from 6 percent to 20 percent;
Offer the Preservation Tax Credit as a rebate for lower income homeowners to provide them with a stronger financial incentive with relatively smaller tax liability.
The program will apply to taxable years beginning January 1, 2010, and will sunset in five years on December 31, 2014.