SHREVEPORT, La. (AP) - A recent community meeting outlined two critical tools to improve both economic and downtown development: historical preservation and tax credits.
Representatives from the Louisiana Division of Historic Preservation and the Louisiana Trust’s Revolving Fund program described how tax credits can help cut costs for companies or individuals who wish to rehabilitate their businesses or homes, while also creating jobs and community revitalization.
Brian Davis, manager for the Revolving Fund, said information about the tax credit programs was well received at the Oct. 11 meeting, which was attended by about 75 residents. Davis said Shreveport has “tremendous potential” for using both the rehabilitation tax credit program as well as the Louisiana Trust’s revolving fund.
“Areas like the Highland Neighborhood have a large stock of historic buildings that could also support more mixed-use renovations, where the owner lives and works in the same building,” Davis said. “For a single-practitioner or small business owner just starting out, this creates an ideal situation.”
A tax credit is a dollar for dollar reduction in the amount of money a taxpayer must pay in state income taxes in a given year. The tax credit programs, run through the Louisiana Division of Historic Preservation and the Louisiana Department of Revenue, exist to provide incentives to preserve historic sites while increasing economic development in cities and towns. Three specific programs relate to rehabilitating historic buildings:
- The Federal Historic Rehabilitation Tax Credit applies to income-producing buildings determined by the secretary of the interior to be “certified historic structures.”
- The State Commercial Tax Credit applies to redevelopment of income-producing historic buildings in Louisiana’s downtown development districts.
- The State Residential Tax Credit applies to personal residences that meet eligibility criteria.
The tax credit programs have leveraged more than $3.7 billion in Louisiana since their inception in 2002, according to the Louisiana Division of Historic Preservation’s website.
In 2015, the state leveraged more than $438 million in historic tax credits, of which more than $37 million came from Shreveport, and invested in more than 200 of Louisiana’s historic buildings.
Liz Swaine, executive director of the Downtown Development Authority, said historic tax credits are one of the best solutions toward increasing economic development.
“I love historic tax credits because they ask us to focus on buildings that have life left in them, something that has the ability to continue to serve the community,” Swaine said. “Without historic tax credits, we wouldn’t see the resurgence of downtown areas in cities around the state.”
The tax credit programs took a hit in the 2015 legislative session, when the amount allocated to statewide projects was reduced from $10 million to $7.2 million. The amount permitted toward each project was also reduced from $25,000 to $18,500.
Alison Saunders, tax incentives director with the Louisiana Division of Historic Preservation, said the cuts most likely occurred because the state was facing “extraordinary budget shortfalls.”
Swaine said Louisiana’s history of rampant overall tax credit programs might have provided the incentive for legislators to go after sweeping cuts.
“Tax Credits, by all accounts, had run pretty wild in Louisiana. I believe I once heard there were more than 400 different tax credits in the state,” Swaine said. “Not all tax credits are equal in what they return to the state and citizen taxpayers. Lawmakers know this and are always looking at ways to rein them in.”
Swaine said that every year for the past five legislative sessions, the Downtown Development Authority has gone to the legislature to highlight the importance of keeping the state commercial historic tax credit program. She uses the 600 and 700 blocks of Texas Street, which include popular locations such as the Robinson Film Center and ArtSpace, as an example of how tax credits are economic drivers for the downtown area.
Since 2002, when the tax credit programs were improved in Louisiana, Swaine said, 23 permits have been issued- a more than 1,000 percent increase over 15 years - for a net investment of more than $37 million. She added that seven buildings in the two Texas Street blocks were awarded historic tax credits, and 19 total buildings were improved or completely rehabilitated.
“Those blocks are seeing a tremendous revitalization and resurgence, and most of those buildings are back on the tax market,” Swaine said.
Other buildings renovated with the tax credits include the Ogilvie Hardware Lofts on Jones Street and the Shreveport Times building on Lake Street.
Davis said many residents choose to apply for historic tax credits as a way to improve their homes and their communities.
“It’s a point of pride in their community. This is a way for the everyday person, with tax credits, to make a difference,” Davis said. “Historic buildings are really the fingerprints of our communities, places with identity. Keeping historic buildings is a sign that the city is thriving.”
Highland Restoration Association President Tom Arceneaux said that the Highland neighborhood needs historic preservation, but that several challenges face residents who wish to renovate using tax credits, including surrounding property values and stricter eligibility requirements.
“An awful lot of restoration in Highland is not done that way because property values don’t support the renovations,” Arceneaux said. “But there are people who are doing it, who are passionate enough to take the risk.”
Saunders said Louisiana ranked first in the nation for number of buildings certified as historic, the number of proposed projects approved and the number of certified historic rehabilitations completed in 2015. Shreveport was no exception.
“We’ve always had great success with rehabilitation tax credits in Shreveport, and particularly downtown,” Saunders said. “If you’re interested in putting any money into rehabilitating a historic building, give our office a call.”
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Information from: The Times, https://www.shreveporttimes.com
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