Economic development officials worry that GOP tax plan could eliminate preservation credits
File photo by Tom Rivers: Developers eyeing the old Holley High School want to use tax credits to help make the project work financially.
ALBION – The Orleans Economic Development Agency is worried about tax plans that call for either eliminating or reducing federal tax credits for renovating historic buildings.
“It will have an impact on many adaptive reuse projects,” Kevin Zanner, an attorney for the Orleans EDA, said during Friday’s EDA board meeting. “Any time you take money out, the developer has to find it somewhere else.”
Republicans in the House of Representatives approved a plan that would eliminate the 20 percent federal investment tax credit for historic preservation projects. The Senate plan would reduce the credit to 10 percent.
The developers of the old Holley High School want to use the tax credit as a piece of a $17 million plan to renovate the old school, turning the site into 41 apartments and the village offices.
“It makes everybody nervous,” said Jim Whipple, CEO of the Orleans EDA.
The agency the Holley project and another in the pipeline could potentially be adversely impacted by the Republican tax plans in Congress.
The historic downtown business districts are all ripe for the preservation tax credit to help make projects more economically manageable. Zanner said the tax credits have been a key to many recent redevelopment projects in Buffalo.
“The beautiful buildings in downtown Albion are all elgible for it,” Zanner said about the tax credit.
If Congress ultimately cuts the tax credit or reduces it, Zanner said it could approve a transitional system preserving the credit for projects like Holley’s old school where developers have already applied for the credit.
“It won’t just be gone,” Zanner said, “But it creates uncertainty.”
The tax credit has been used for 491 properties in New York State from 2002 through 2016. Those credits added up to $680 million for the projects, which have generated more than $4 billion in new state taxes and 52,000 new jobs, according to Ryan Silva, executive director of the NYS Economic Development Council.
He sent a letter last week to the Orleans EDA and other members of the NYS Economic Development Council. Silva, in his letter, said reducing or eliminating the historic tax credit “is not the right approach.”
