Historic tax credits report shows economic benefits of preservation
Published on March 12, 2021
Historic preservation tax incentives continue to be one of the most effective means of encouraging investments in historic preservation and revitalization of communities small and large across the country.
The National Park Service recently published its annual report highlighting successes achieved by the Federal Tax Incentives program for Rehabilitating Historic Buildings. The Federal Historic Tax Credit program provides a 20% federal tax credit to property owners who undertake a substantial rehabilitation of a historic building in a business or income-producing use, while maintaining its historic character.
Administered by the National Park Service in partnership with the State Historic Preservation Offices, the Federal Historic Preservation Tax Incentives Program is the nation’s most effective program to promote historic preservation and community revitalization through historic rehabilitation. The program has leveraged over $109.18 billion in private investment since its enactment in 1976, in the rehabilitation of historic properties.
Key takeaways from the 2020 report include:
- Program activity remained high, and nearly half (46%) of all certified rehabilitations were under $1 million in fiscal year 2020.
- Over $6.54 billion in private investment in historic preservation nationwide.
- New National Register nominations — about 17% of projects involved properties not yet listed in the National Register of Historic Places.
Federal, state tax credits combine
The federal preservation tax credit is often paired with the Texas State Historic Preservation Tax Credit, which provides a 25% credit for eligible rehabilitation costs. When combined, the federal and state preservation tax credits are the most powerful tools Texans have to preserve their heritage. Since 2015, 243 projects have been completed through the state tax credit program, resulting in investments of over $2.6 billion in historic buildings across Texas.
By partnering with the Federal Historic Tax Incentives Program, property owners who use the state tax credit are empowered to preserve and restore historic buildings — promoting economic development by creating specialized jobs and increasing local and state tax revenues across sectors including travel, education and real estate.
A Fort Worth success story
One of the most recent successful tax credit projects in Fort Worth was the rehabilitation of the Sinclair Building in downtown. Complete with 164 rooms, the hotel also offers a rooftop bar with exceptional views of the city, a restaurant and a lobby bar.
Originally home to the Sinclair Oil Co. in 1930, the building’s Art Deco past has been brought to life with thoughtful and elegant design by Merriman Anderson Architects, in partnership with Forrest Perkins, which handled interior design, and Dash Design, which handled the restaurant and bars.
The rehabilitation also incorporated several energy efficiency systems, such as PoE technology, digital electricity and an energy storage system onsite. Historic buildings such as the Sinclair are inherently some of the most energy-efficient buildings before rehabilitation, embodying the energy and resources that were originally used to construct them. By carefully integrating modern energy-efficient innovative technology into a rehabilitation project, the Sinclair Building has become one of the most energy-efficient, high-tech structures in the North Texas region.
To learn more about how to apply for federal and state preservation tax credits or whether your rehabilitation project qualifies, contact the City of Fort Worth’s preservation staff at 817-392-8000.
Photo: The Art Deco Sinclair Hotel at 512 Main St. is an architectural gem with a modern upgrade.
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