For the third time in the history of the Michigan Historic Preservation Network (MHPN), historic tax credits (HTC) have become a major focus of its efforts. The credit was first passed in 1999 and provided for a 25-percent credit patterned after the existing federal credit, but also included historic homeowners if they met certain requirements (federal credit is limited to income-producing properties).
Once the credit was in place, there was an issue of removing the sunset clause (a term-limit for laws). The sunset was safely removed and Michigan embraced the ability of the credit to make projects, largely in our urban centers, a reality.
Although pleased to have added a great feature to the developer’s rehabilitation tool kit, it was evident the HTC could be even better. Concerns over limitations to ownership of the credit, and the inability to get more than a 5% credit if the project also qualified for the federal credit inspired MHPN and its friends to seek improvements to the law in 2007-2008. While the new law didn’t include quite everything on the wish list, the improvements were clear. Improved assignability of the credit and the new potential for up to 15% above the 25% credit based on decision making by the State Historic Preservation Office (SHPO) dramatically enhanced its desirability.
Like the first law, the enhanced HTC also came with a sunset clause. As work began to remove this feature, Governor Snyder announced his new budget plan — including the plan to not remove the sunset clause but to remove the credit totally! Once again, MHPN finds itself in a position of working to protect the tax credit program. Although there are so many things that MHPN as the statewide non-profit historic preservation for the State of Michigan has many other things that it would rather expend its limited time and financial resources on, tax credits is once again be the focus of our energy. Programs such as continuing and even expanding the hands-on public school education programs, the hands-on education geared to teach Michigan’s under- and unemployed workers the skills to repair historic wood windows, or efforts on any of the other of our numerous programs to educate and assist the state residents with their historic properties would all be put on hold.
Still, protecting the HTC is something that MHPN cannot ignore. Jobs have been created by this program. Money has come in to the state from the federal government directly because of this program. Communities have benefited from the HTC.
And, yet again, we have to justify the program. As preservationists, this is something that we deal with all the time. Even though historic preservation much as we know it today was codified at the federal level with the passage of the Historic Preservation Act in 1966, and even earlier if you consider the development of historic districts in New Orleans and Charleston, we still find that the benefits of historic preservation have to explained again and again. It has even come to the point that first we have to discuss the economic viability of preservation over new construction.
But, we are strong, and we can do this. However, this time the “we” MUST be more than MHPN. This time we need every person in the state who believes that historic preservation and the economic tools it provides are important and need to be kept as part of the development tool kit in Michigan. This time, we need you TOO!
Read more about the efforts of MHPN at www.mhpn.org. Here you can learn more about the other programs of MHPN, become a member, or make a contribution!
Elaine H. Robinson