Wednesday, April 17, 2024
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Chicago developers cry foul on historic tax credits roll back

Developers, urban planners and preservationists across the city voiced their opposition to the elimination of the federal Historic Tax Credit program as mandated by the Republican’s tax reform bill, asserting that it would affect more than just historic structures.

While proponents of the bill assert that the program only benefits developers at the expense of ordinary citizens, the National Trust for Historic Preservation noted that redevelopment of historic and abandoned buildings has benefited the economy.

Since the program’s enactment in 1981 by the Reagan administration, it had been used to renovate more than 40,000 structures throughout America which channelled about $117 billion in private investment into the national economy. Between 2002 and 2016, the program financed 269 projects in Illinois, generating more than 45,000 jobs.

In Chicago, the program has funded 90 projects and in effect, generated $2.4 billion worth of investment in the city in the last 10 years. “The bill would hurt the city’s ability to serve residents, provide affordable housing, and support development projects in local neighborhoods,” David Reifman, commissioner of the Department of Planning and Development, told the Chicago Tribune.

Moreover, the tax reform’s provision endangers rehabilitation of outdated structures that do not conform to newer and safer building standards, as well as that of struggling neighborhoods around Chicago.

“Absent the federal historic tax credit, all of these buildings would need to be torn down,” said Ghian Foreman, executive director of Greater Southwest Development Corporation. He was referring to his proposed transformation of the former Armour Institute of Technology Main Building into rental apartment buildings with a total of 102 one-bedroom units.

He added, “The 20 percent tax credit is such a critical tool, especially when you’re talking about neighborhoods that aren’t the central business district.”

Chicago preservationists are still hopeful that the move to cut the HTC might falter if the tax reform bill fails to gain support. They are also hoping that the Senate will author its own bill.

The HTC provides a 20 percent tax credit to companies in exchange for revitalizing historic structures. The incentive is paid out over a period of five years, and is only given once the project is complete.

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