HTC Advocacy Leaders Eye Upcoming Economic Package
as Marker for Bipartisan Tax Deal Later this Year

May 16, 2023: Despite national attention focused on the debt limit negotiations between House Republicans and President Biden, the Historic Tax Credit Growth and Opportunity Act (HTC-GO) is steadily gaining support from both Republicans and Democrats.

In March, Representatives Darin LaHood (R-IL) and Earl Blumenauer (D-OR) and Senators Ben Cardin (D-MD) and Bill Cassidy (R-LA) introduced HTC-GO (H.R.1785/S.639). The House and Senate bills include four permanent provisions that will add value to the Historic Tax Credit (HTC), improve access to the credit, and increase investment in smaller rehabilitation projects. The House bill also includes a provision that will temporarily increase the tax incentive amount to help address the significant challenges currently facing historic rehabilitation projects throughout the nation. Presently, the legislation has 20 cosponsors in the House and eight cosponsors in the Senate.

The House Ways & Means Committee is expected to mark up a partisan economic package soon, the scale of which remains to be seen. The bill will likely include individual and small business relief, an extension of certain expired tax provisions (e.g., bonus depreciation, deductibility of business interest and Research & Development expensing), and Inflation Reduction Act repeal. This package is expected to be voted upon by the full House as early as June.

DC advocacy coalitions are determining if community development improvements can be added to these discussions and be considered in the legislation. Democrats will not support many of the provisions and how the provisions are funded. This bill will serve as a Republican marker for possible future tax bill negotiations later this year. HTC advocates will continue to monitor these efforts to determine what legislative tax vehicle might come forward this summer and later this year. An abundance of Members of Congress demonstrating support for HTC-GO through cosponsorship will elevate HTC-GO’s chances of being considered in any year-end tax legislation.

Join us for HTC Lobby Day in DC on Wednesday, June 14th

The Historic Tax Credit Coalition is hosting its annual HTC Lobby Day in DC on June 14th. If you are a resident in any of the following states: AL, AZ, AR, CA, FL, ID, IN, IA, KS, KY, LA, ME, MS, MO, MT, NE, NY, NC, ND, OH, OK, OR, SC, SD, TN, TX, WV, WI, WY, please consider participating to voice strong support for HTC-GO provisions to be included in future moving tax legislation. Since June 14th is the day before many in the HTC industry are in town for the IPED Historic Tax Credit Conference, the Coalition anticipates a strong showing from the historic rehabilitation industry and Main Street and preservation advocates on Capitol Hill.

The Coalition will set up your meetings and provide educational materials, including maps and lists of projects for each state and congressional district. To allow most participants to fly in on the morning of the 14th, the Coalition will host a mid-morning breakfast briefing and then head to Capitol Hill between 11 am – Noon for an afternoon of meetings.

CLICK HERE for more details on upcoming HTC advocacy events!

Originally published by Silicon Ranch Corporation 

NASHVILLE, TENN (APRIL 11, 2023) – NT Solar, a nationwide solar tax credit syndicator and investor, joined Silicon Ranch Corporation, Vanderbilt University, Nashville Electric Service (NES), and Tennessee Valley Authority (TVA) today to “flip the switch” on the Vanderbilt I Solar Farm, a 35-megawatt (MWAC) solar facility located in Bedford County, Tennessee.

NT Solar, a subsidiary of the National Trust Community Investment Corporation (NTCIC) and an affiliate of the National Trust for Historic Preservation, provided syndication and investment services for the Solar Investment Tax Credits (ITC) generated by the development through their Climate Impact and Revitalization Fund. Karin Berry, Managing Director of NT Solar, and Suzanne Brown, Interim President of NTCIC, attended the event to share in the celebration. Read more about our investment here.

“NT Solar is delighted to be part of the Vanderbilt I Solar Farm project, a testament to the powerful synergy of community and renewable energy,” said Karin. “Our collaboration with Silicon Ranch Corporation embodies our shared dedication to bolstering local economies, fortifying communities, and restoring environmental health. This project not only brings renewable energy on a substantial scale but also opens up job opportunities, prioritizing local residents and the military veteran community. It truly illustrates the impact that strategic renewable energy initiatives can have on a community, and we are thrilled to play a part.”

“The Vanderbilt I Solar Farm not only represents a major step toward our own goals at Vanderbilt but also provides a model of collaborative, forward-thinking solutions that we hope other higher educational institutions will adopt and replicate across this country,” said Daniel Diermeier, Chancellor of Vanderbilt University. “We look forward to the educational and research opportunities this project and our pursuit of carbon neutrality will yield for our faculty and students at Vanderbilt. We thank Silicon Ranch, NES, and TVA for supporting us on this bold journey.”

“TVA is proud to dedicate the first project ever developed under our Green Invest program, and we are thrilled to do so with NES and Silicon Ranch,” said Justin Maierhofer, Regional Vice President at TVA. “Together with 153 local power company partners, TVA is building the energy system of the future, and Green Invest positions us to bring together customers and renewable energy partners who are investing in communities across the Tennessee Valley.”

“As one of the eleven largest utilities in the nation, NES is committed to listening to the needs of our customers, and the Vanderbilt I Solar Farm illustrates our ability to innovate in response to help our customers achieve their desired outcomes,” said Teresa Broyles-Aplin, President and CEO of NES. “NES is proud to collaborate with Vanderbilt, TVA, and Nashville’s own Silicon Ranch to reduce carbon emissions in our region.”

“Bedford County wishes to thank Vanderbilt, Silicon Ranch, NES, and TVA for making this substantial investment in our community possible,” said Chad Graham, Mayor of Bedford County. “We are pleased to welcome Silicon Ranch, who not only built this world-class facility, but also collaborated with the Shelbyville-Bedford Partnership to support our successful efforts to bring Duksan Electera here as well.”

About NT Solar

NT Solar, a women-led subsidiary of the National Trust Community Investment Corporation, raises and manages solar investments that create meaningful community impact and cost-effective energy options nationwide. Since its inception in 2010, NT Solar has provided tax credit financing of over $650 million in capital for transactions nationwide, with a focus on the growing Community Solar market. Our varied network of partners and extensive experience in diligence and structuring provides our developers with competitive pricing and stable returns for our investors. To learn more, visit nt.solar.

About Silicon Ranch

Founded in 2011, Silicon Ranch is a fully integrated provider of customized renewable energy, carbon, and battery storage solutions for a diverse set of partners across North America. The company is one of the largest independent power producers in the country, with a portfolio that includes more than five gigawatts of solar and battery storage systems that are contracted, under construction, or operating across the U.S. and Canada. Silicon Ranch owns and operates every project in its portfolio and has maintained an unblemished track record of project execution, having successfully commissioned every project it has contracted in its history. Silicon Ranch has the largest utility scale agrivoltaics portfolio in the country under Regenerative Energy® its nationally recognized holistic approach to project design, construction, and land management. This model incorporates regenerative ranching and other regenerative land management practices to restore livelihoods and soil health, biodiversity, and water quality. In 2021, Silicon Ranch acquired Clearloop, which helps businesses of all sizes reclaim their carbon footprint with a direct investment in building new solar projects while helping to bring renewable energy and economic development to distressed communities. To learn more, visit siliconranch.com and clearloop.us.

About Tennessee Valley Authority (TVA)

The Tennessee Valley Authority is a corporate agency of the United States that provides electricity for business customers and local power companies, serving nearly 10 million people in parts of seven southeastern states. TVA receives no taxpayer funding, deriving virtually all of its revenues from sales of electricity. In addition to operating and investing its revenues in its electric system, TVA provides flood control, navigation, and land management for the Tennessee River system and assists local power companies and state and local governments with economic development and job creation.

About Vanderbilt University

Vanderbilt University is a globally renowned research university located in Nashville, Tennessee. Ranked No. 13 among national universities, Vanderbilt offers an immersive living-learning undergraduate experience, with programs in the liberal arts and sciences, engineering, music, education, and human development. The university also is home to nationally and internationally recognized graduate schools of law, education, business, medicine, nursing, and divinity and offers robust graduate-degree programs across a range of academic disciplines. Vanderbilt is committed to inclusive excellence, drawing the world’s brightest students, faculty and distinguished visitors from across all cultural and socioeconomic backgrounds, and provides a collaborative atmosphere of discovery that drives positive change in the world. Learn more at www.vanderbilt.edu.

About NES

Nashville Electric Service (NES) is the 11th largest public electric utility in the nation, distributing energy to more than 420,000 customers in Middle Tennessee. For more information, visit nespower.com or nespowernews.com.

Talking Points, Outreach Guides, and Resources for HTC-GO Advocacy

Now more than ever, advocates need your support to urge members of Congress to Cosponsor the Historic Tax Credit Growth & Opportunity Act (HTC-GO). To help, we have put together a collection of resources, outreach guides, and talking points to help you take action for the HTC-GO and help make this bill a reality.

History of the Historic Tax Credit

The federal Historic Tax Credit (HTC) is a critical community development tool used to encourage investment in the rehabilitation of historic buildings nationwide. Since the program’s establishment in 1976, the HTC has leveraged nearly $235 billion in private investment to preserve more than 49,000 historic properties and support more than 3.2 million jobs. 

Unfortunately, the value of the HTC has diminished over the past decade because of IRS rulings, administrative burdens, and other legislative changes. In an effort to expand and enhance this critical community development program, Congress introduced the Historic Tax Credit Growth & Opportunity Act (HTC-GO). It includes provisions that would encourage more building reuse and redevelopment nationwide and would be particularly impactful for small, midsize, and rural communities.

Learn About the Historic Tax Credit, Advocacy Efforts, and the HTC-GO

• Learn about the provisions within the HTC-GO: What is the Historic Tax Credit Growth & Opportunity Act?
• Connect with NTCIC and stay up to date on HTC-GO advocacy efforts: HTC-GO Advocacy Updates from NTCIC
• Meet other organizations in support of the bill: Preservation Organizations Support the HTC-GO.
• Check to see if your House or Senate representatives are already supporting the HTC-GO.
• Learn about successful Historic Tax Credit-supported projects in your area: Federal Historic Tax Credit Projects by State.

Take Action for the HTC-GO

• Search for local and political events or join a local political party’s email list to learn about events your members of Congress might be attending.
• Connect with NTCIC for assistance in obtaining the contact information of the scheduling office for your members of Congress.
• Invite your Representative to tour successful Historic Tax Credit-supported projects.
• Request cosponsorship through the National Trust for Historic Preservation’s E-Advocacy Tool.
• Utilize the suggested talking points below for your conversations with your members of Congress.

HTC-GO Talking Points & Advocacy Requests

• The number of historic preservation projects has significantly decreased over the past several years – by as much as 20%.
• In addition to skyrocketing costs of materials and labor and rising interest rates, the Historic Tax Credit – our country’s most powerful tool for preservation has lost power and value.
• Historic Tax Credits have lost value over the past ten years due to IRS revenue procedures and other recent federal policies.
• Pricing of the credits has dropped 20-25% over the last ten years.
• “Now is the time to strengthen the Historic Tax Credit to address the slowdown and challenges in rehabilitation projects across the country.”
• The HTC has not been positively modernized since 1986. In light of other federal investment tax credits being significantly enhanced recently, it is important to improve this incentive.
• “Would you please cosponsor House Bill H.R. 1785/Senate Bill S. 639 – The Historic Tax Credit Growth and Opportunity Act (HTC-GO) and work to include these provisions in year-end legislation?”
• The Historic Tax Credit Growth and Opportunity Act (HTC-GO H.R. 1785/S. 639) would bring more value to the credit, make more historic buildings eligible to use the HTC, further incentivize smaller projects and nonprofit projects, and make the credit easier to use.

Urge your Representative and Senators to Cosponsor

March 27, 2023: Late last week, Representatives Darin LaHood (R-IL) and Earl Blumenauer (D-OR), Mike Kelly (R-PA), Terri Sewell (D-AL), Mike Turner (R-OH), and Brian Higgins (D-NY) reintroduced the House version of Historic Tax Credit Growth and Opportunity Act (HTC-GO/H.R. 1785). The bill includes similar permanent provisions as the Senate version and an additional temporary provision to address recent challenges facing historic rehabilitation projects.

In early March, Senators Cardin (D-MD), Cassidy (R-LA), Cantwell (D-WA), and Collins (R-ME) reintroduced HTC-GO (S. 639). Both the House and Senate bills include four permanent provisions that will add value to the Historic Tax Credit (HTC), improve access to the credit, make more projects eligible to use the credit, and increase investment in smaller rehabilitation projects.

How You Can Help Advocate for the HTC-GO

1. Contact your Representative and Senators:
   • To locate your House Representative, visit: www.house.gov/representatives
   • To locate your Senators, visit: www.senate.gov/senators/senators-contact
   • Send a message through their website and select “tax” or “taxation” as the issue area, OR
   • Call (during office hours) the office, introduce yourself as a constituent, and ask for the email address of tax staff members.
2. Talking Points to Encourage Your Members of Congress to Cosponsor the HTC-GO:
   • “The Historic Tax Credit Growth and Opportunity Act (HTC-GO), H.R. 1785/ S. 639, is needed now more than ever.”
   • “The Historic Tax Credit is a vital community revitalization tool in both small towns and large urban areas but has lost value due to federal policies over the last ten years.”
   • “The HTC has not been positively modernized since 1986. HTC-GO provisions would bring more value to the credit, make more buildings eligible to use the credit, and make the HTC easier to use.”
   • “Would the Representative/Senator please cosponsor the Historic Tax Credit Growth and Opportunity Act (H.R. 1785/S. 639)?”
   • “Please look for opportunities to include these provisions in future tax legislation.”
   • “Share the National Preservation Organizations HTC-GO Reintroduction Release with offices.”

About the Provisions of the HTC-GO Legislation

The federal HTC is the largest federal investment in historic preservation and a critical economic development tool used to revitalize our communities. Unfortunately, the value of the HTC incentive has diminished over the past decade because of IRS rulings, administrative burdens, changes in the credit structure, as well as spreading the distribution of the credit over five years as modified by the Tax Cuts and Jobs Act of 2017. As a result, the HTC has lost 20 – 25% of its investment value as interest rates continue to climb and materials and labor costs soar.

National Park Service statistics indicate that HTC applications are down 20% compared to pre-pandemic levels (2019), and the number of projects continues to decline even as the economy is rebounding.

Historic buildings have simply become more difficult to rehabilitate.

HTC-GO Temporary Provisions (House Bill Only)

The HTC-GO legislation temporarily increases the rehabilitation credit (IRC § 47) to address profound challenges facing the historic rehabilitation sector.

• This provision increases the HTC percentage from 20% to 30% for 2023 through 2026.
• The credit percentage is phased down to 26% in 2027, 23% in 2028, and returns to 20% in 2029 and thereafter.

HTC-GO Permanent Provisions (House and Senate Bills)

The permanent provisions will make important changes to the HTC to encourage more building reuse and redevelopment nationwide and would be particularly impactful for small, midsize, and rural communities. These provisions would:

• Make the credit easier to use by increasing the credit from 20% to 30% for projects with less than $2.5 million in qualified rehabilitation expenses.
• Make more projects eligible to use the HTC by lowering the substantial rehabilitation threshold.
• Increase the value of HTCs and promote affordable housing development by eliminating the requirement that the value of the HTC must be deducted from a building’s basis (property’s value for tax purposes), making it easier to pair with the federal Low-Income Housing Tax Credit.
• Enable further nonprofit use of the HTC by eliminating IRS restrictions that make it challenging for nonprofits to partner with developers. This change will create more opportunities for workforce development facilities, job/small business incubators, community health centers, local arts centers, affordable housing, and homeless services to be supported by the HTC.

Resources

• HTC State Maps and Project Lists FY2002-2022
• National Preservation Organizations’ Release in Support

For further assistance with your advocacy, please contact Mike Phillips, Shaw Sprague, and Patrick Robertson

Welcome to the National Trust Community Investment Corporation’s (NTCIC) 2023 Main Street Community Survey. We are excited to hear from community stakeholders across the United States about their needs and experiences.

The Main Street Community Survey is an opportunity for us better to understand the needs of communities across the United States and to help us make informed investment decisions that align with our preservation-based community development mission. The data collected through this survey will be used to help advise our geographic and programmatic focus for our future tax credit investments.

This survey should take no more than 5 minutes to complete, and as a thank you for your participation, you will be entered to win a $100 gift card. The survey will be open from March 20, 2023, to April 30, 2023.

Please share this survey with other community stakeholders, so that we may gain a comprehensive understanding of community needs across the United States. We believe that community input is critical in shaping the future of our investment strategies, and we value your feedback.

Thank you for your time, and for your continued support of NTCIC’s mission!

Click Here to Take the Survey.

About NTCIC

As a sister organization to the National Main Street Center, NTCIC is committed to community development and economic growth of Main Street-oriented communities across the country. We accomplish this through financing adaptive reuse and preservation of historic buildings using a combination of New Markets Tax Credits (NMTC) and Historic Tax Credits (HTC) to attract private investment capital for underserved areas.

Our NMTC allocation has provided over $2 billion in capital to over 200 high-impact rehabilitation efforts supported in the U.S. These efforts have led to the creation of over 80,000 jobs and have revitalized over 12 million square feet of historic buildings.

March 2, 2023: Today, Senators Cardin (D-MD), Cassidy (R-LA), Cantwell (D-WA), and Collins (R-ME) reintroduced the Historic Tax Credit Growth and Opportunity Act (HTC-GO/ S. 639), in the Senate. The bill includes four permanent provisions that will add value to the Historic Tax Credit (HTC), improve access to the credit, make more projects eligible to use the credit, and increase investment in smaller rehabilitation projects.

Representatives Darin LaHood (R-IL) and Earl Blumenauer (D-OR) are expected to reintroduce a House companion HTC-GO bill next week. The bill will include similar permanent provisions and an additional temporary provision to address recent challenges facing historic rehabilitation projects.

How You Can Help Advocate for the HTC-GO

1. Contact your Senators:
   • Visit the senate.gov contact list to locate your Senators
   • Send a message through their website and select “tax” or “taxation” as the issue area, OR
   • Call (during office hours) the office, introduce yourself as a constituent, and ask for the email address of tax staff members.
2. Talking Points to Encourage Your Senators to Cosponsor the HTC-GO:
   • The Historic Tax Credit Growth and Opportunity Act (HTC-GO/ S. 639) is needed now more than ever.
   • The Historic Tax Credit is a vital community revitalization tool in small towns and large urban areas but has lost value due to federal policies over the last ten years.
   • The HTC has not been positively modernized since 1986. HTC-GO provisions would bring more value to the credit, make more buildings eligible to use the credit, and make the HTC easier to use.
   • Would the Senator please cosponsor the Historic Tax Credit Growth and Opportunity Act (S. 639)?
   • Please look for opportunities to include these provisions in future tax legislation.

About the Provisions of the HTC-GO Legislation

The federal HTC is the largest federal investment in historic preservation and a critical economic development tool used to revitalize our communities. Unfortunately, the value of the HTC incentive has diminished over the past decade because of IRS rulings, administrative burdens, changes in the credit structure, as well as spreading the distribution of the credit over five years as modified by the Tax Cuts and Jobs Act of 2017. As a result, the HTC has lost 20 – 25% of its investment value as interest rates continue to climb and materials and labor costs soar.

National Park Service statistics indicate that HTC applications are down 20% compared to pre-pandemic levels (2019), and the number of projects continues to decline even as the economy is rebounding.

Historic buildings have simply become more difficult to rehabilitate.

HTC-GO Permanent Provisions

The permanent provisions will make important changes to the HTC to encourage more building reuse and redevelopment nationwide and would be particularly impactful for small, midsize, and rural communities.

These provisions would:

• Make the credit easier to use by increasing the credit from 20% to 30% for projects with less than $2.5 million in qualified rehabilitation expenses.
• Make more projects eligible to use the HTC by lowering the substantial rehabilitation threshold.
• Increase the HTC’s value and promote affordable housing development by eliminating the requirement that the value of the HTC must be deducted from a building’s basis (property’s value for tax purposes), making it easier to pair with the federal Low-Income Housing Tax Credit.
• Enable further nonprofit use of the HTC by eliminating IRS restrictions that make it challenging for nonprofits to partner with developers. This change will create more opportunities for workforce development facilities, job/small business incubators, community health centers, local arts centers, affordable housing, and homeless services to be supported by the HTC.

Resources

• HTC State Maps and Project Lists FY2002-2022

For further assistance with your advocacy, please contact Mike Phillips, Shaw Sprague, and Patrick Robertson

The federal Historic Tax Credit (HTC) is a critical community development tool used to encourage investment in the rehabilitation of historic buildings nationwide. Since the program’s establishment in 1976, the HTC has leveraged nearly $120 billion in private investment to preserve more than 48,000 historic properties and support more than 3 million jobs. The credit is also often paired, or “twinned,” with other programs such as the Low-Income Housing Tax Credit and the New Markets Tax Credit, which has helped to create nearly 200,000 units of low- and moderate-income housing units and increase access to vital community goods and services.

Unfortunately, the value of the HTC has diminished over the past decade because of IRS rulings, administrative burdens, changes in the credit structure, and spreading the distribution of the credit over five years as modified by the Tax Cuts and Jobs Act of 2017. As a result, the HTC has lost 20 – 25% of its investment value as interest rates continue to climb and materials and labor costs soar. National Park Service statistics indicate that HTC applications over the last two fiscal years are down 20 percent when compared to 2019 and prior years. Historic buildings have simply become more difficult to rehabilitate.

So, What is the Historic Tax Credit Growth & Opportunity Act?

In an effort to expand and enhance this critical community development program, Congress introduced the Historic Tax Credit Growth & Opportunity Act (HTC-GO). It includes provisions that would bring five more tools to the HTC: More Credits, More Value, More Buildings, More Nonprofit Use, and More Simplicity.

Let’s take a look at what the Historic Tax Credit Growth & Opportunity Act will do to enhance and expand the power of the Historic Tax Credit.

HTC Percentage Increase

Currently, the HTC provides a 20% credit to project costs directly associated with the repair or improvement of historic structural and architectural features of a building, also known as qualified rehabilitation expenditures (QREs). This percentage is the foundation for all equations for determining the value of the HTC through the rehabilitation process.

For example, under the current law, a project with $200,000 in historic rehabilitation costs could receive up to $40,000 in HTCs ($200,000 x 20% = $40,000).

If passed, this bill will increase the HTC percentage from 20% to 30% through 2025. This is a 50% increase in value and benefit to historic preservation projects, so that same project with $200,000 in rehab costs would generate $60,000 in credits ($200,000 x 30% = $60,000). For projects generating more than $2.5 million in QREs, the increase would be in effect from 2020 through 2025 before gradually returning to 20% in 2028. Properties must complete the rehabilitation efforts after March 31, 2021, to be eligible for this provision.

The Historic Tax Credit enhancements will better support community development projects like the Academy Lofts building in Atlanta, GA, the new home to The Creatives Project, a nonprofit organization providing quality arts-based education & outreach through artist-in-residency programs.

 

Permanent Increase in the Rehabilitation Credit for Small Projects

The HTC is not just for large-scale projects and developers. In fact, over half of all completed historic projects that utilized the HTC were under $2.5 million in qualified costs.

For these smaller projects, after December 31, 2023, a taxpayer would be able to elect a “small project credit” and receive the 30% tax credit for projects with qualified costs up to $2.5 million or less. This increase for small projects would be permanent. This change would ensure rural and non-urban areas are better positioned to benefit from utilizing HTCs even after the temporary 30% credit for larger projects expires in 2025.

Redefinition of “Substantial Rehabilitation”

To be eligible for HTCs, a project must pass the “Substantial Rehabilitation” test. Generally, this means that a project must spend the greater of either $5,000 or the pre-rehabbed worth of the building itself, also known as the “adjusted basis.” Currently, a project can determine its adjusted basis by completing the equation A-B-C+D = Adjusted Basis, where:

A.     Purchase price of the property, both building and land

B.     The cost of the land at the time of purchase

C.     Depreciation taken for an income-producing property

D.     Costs of improvements made to the property since its purchase

The new provision cuts the substantial rehabilitation requirement in half so that qualified rehabilitation expenditures must exceed the greater of 50% of the adjusted basis of the building rather than 100%. This reduction effectively updates the adjusted basis equation to (A-B-C+D)/2 = Adjusted Basis.

Lowering the rehabilitation cost requirements will greatly increase the HTC eligibility for countless projects and make the cost of entry much more approachable.

For example, an individual purchased a historic building for $200,000 ($150,000 for the building and $50,000 for the land). Under current law, the building’s new owners would need to incur at least $150,000 in rehabilitation costs to qualify for the credit. The new bill provision would reduce this threshold to $75,000 in rehabilitation costs.

Elimination of Rehabilitation Credit Basis Adjustment

For a larger-scale project to generate project funding at the onset of development using the HTC, rather than claiming the credits come tax season, a building owner needs to partner with an investor that has both the ability to use the credits themselves and available funding. The investor can then provide financing to the project, typically a percentage of a dollar per credit, in exchange for the ability to claim the credits themselves – lowering the amount of taxes the investor owes at the end of the year.

Currently, the financial and legal process of a building owner and investor partnering in this way requires an investor to recognize income in the amount of credits they can claim, which often results in a lower price per credit the investor can offer to a project. Essentially, the current law lowers the dollar value of the HTC, and the amount of funding a project can receive from an investor.

With the new provision, an investor no longer needs to recognize income in the amount of the HTC to claim the credit. By eliminating this adjustment, an investor can provide more funding per credit to a project. Though complex, this change would place the HTC in line with other development credits like the Low Income Housing Tax Credit (LIHTC) and make it easier to use with such programs.

Modifications Regarding Certain Tax-Exempt Use Property

Currently, to generate HTCs, a building owner and its tenants must be taxable entities. This requirement prevents many nonprofit healthcare centers, daycare organizations, arts organizations, and community service providers from engaging in historic preservation activities, especially if they already own and use their historic property.

This provision would amend and remove certain leasing and tax-exempt use restrictions, making the HTC easier to access by nonprofits that provide critical community services and other tax-exempt entities.

Click Here to Contact Your Representative

The Historic A. Hoen & Co. Lithograph building complex in East Baltimore was one of the last and oldest lithography printing facilities in the United States. Now, it is the Center for Neighborhood Innovation, a collaborative environment that brings together a diverse mix of industries, ideas, and people dedicated to enriching the lives of Baltimoreans.

The revitalized space:

• Supports new and existing jobs 
• Promotes job training and career growth
• Attracts new residents, businesses, and future community investment

Watch how NTCIC transforms communities with the New Markets Tax Credit.

We partnered with Jubilee Baltimore to transform a historic commercial building into a community-owned asset, which brought new tenants, jobs, and educational opportunities to the Station North Arts & Entertainment District in Baltimore, MD.

Watch how NTCIC and the New Markets Tax Credit helped make it happen.