Retention of federal historic tax credits good news for renovation of old school in Holley
HOLLEY – Village of Holley officials and leaders of the Orleans Economic Development Agency are breathing a little easier after federal historic tax credits were kept in the Tax Reform Bill.
Those credits have helped make the financial numbers work for rehabilitation projects of historic buildings, especially in the Buffalo area.
Home Leasing of Rochester is currently working to secure funding and tax incentives/credits in an effort to restore and repurpose the old Holley High School in the village into mixed-income apartments for seniors, new village office space, and restoration of the auditorium for public events.
“These types of historic rehabilitation projects require a variety of funding sources, tax credits, etc., and a wide array of cooperation from the community and at all levels of government to become a reality,” said Brian Sorochty, mayor of Holley. “For the Holley project, we are fortunate to have a great developer involved, widespread public and private support, and now with this funding source being preserved, we continue to feel we have a strong application and will be looking forward to the results in the spring of 2018.”
The historic tax credit (HTC) was threatened with elimination in the House version of the Tax Reform Bill, but the final version retained the Senate’s modification of the HTC.
The modifications mean that benefits of the tax break to restore and rehabilitate historic properties will now be spread over five years – instead of the first year the building is placed in service. That diminishes the value of the tax credit, the Landmark Society of Western New York said, but, “it is still a big win for preservation.”
The historic tax credit has been cited as the most effective tool to attract private capital into historic buildings.
According to published reports, the state’s historic credit matches the federal one, so it will also be spread over five years, beginning next year. Published reports also state the tax bill includes a grandfather clause which will allow properties purchased by the end of this year to be rehabilitated by 2019 under the old tax rules.
The old Holley High School sits in a prominent location at the intersection of Routes 237 and 31 in the village. The school was built in 1931 and closed in 1975. It was then used by a private manufacturing company, but has been vacant for about two decades.
Developers are seeking $7-8 million in tax incentives and $3 million in low interest loans for the $17 million renovation project.
The Orleans EDA said another project under consideration in the county also would benefit from the tax credits. The historic downtown districts also would likely be eligible for the credits if a developer pursued a project in the future.