By Jason Yots
If you’re like me, then you’ve been anxiously awaiting the issuance of “Federal Tax Incentives for Rehabilitating Historic Buildings”, the National Park Service’s annual report about the performance of its historic tax credit (HTC) program. Well, wait no longer because the 2013 version hit inboxes this month (Note #2), and this year’s issue was illuminating to watchers of the historic rehabilitation industry.
Preservation By Numbers
Like all good annual reports, the HTC report is packed with statistics. On the macro level, the historic tax credit program generated over $6.7 billion in new investment in 2013, an increase of 21% from 2012. At the micro level, the average cost of an HTC project was $5,820,000, while forty percent of all HTC projects cost less than $500,000 to build. An interesting tidbit for small cities like Buffalo, NY: projects both large and small can work with HTCs.
Jobs, Jobs, Jobs
In historic preservation, we never tire of that broken record: “Preservation Means Jobs!” Because it’s true. Since 1978, the HTC program has created over 2.4 million new jobs. In 2013 alone, the program created nearly 63,000 net new jobs, up from 58,000 in 2012. And before you can ask, “Where, in China?”, we read that an average of 78 new LOCAL jobs are created with each HTC project. Factor in the $40,000 average annual pay-days on HTC jobs, and suddenly it’s a no-brainer that small market cities like Buffalo should be encouraging HTC development.
Lofts, Lofts, . . . Affordable Housing?
The HTC program is a strong housing generator. In 2013, the program rehabilitated 247,625 units and helped to spur the creation of another 236,886 new units. Of those 484,511 total units, 131,438 – or a full 27% - were low-to-moderate housing. So, while the perception at times may be that HTCs only result in fancy urban lofts, the reality is that the impact of HTCs on the housing industry is in fact diversified.
Most Importantly, How Did WE Perform?
In the end, it’s all about us, so let’s close with some statistics specific to our state. 2012 was an active HTC year for New York, and 2013 built on that momentum. In overall “Part 2” approvals (the government’s OK to start work on your HTC project), New York placed 5th with 63, behind Virginia (128) Louisiana (119), Ohio (78) and Massachusetts (72). To give that number some context, however, consider that New York led the nation in total HTC project costs with an eye-popping $1.165 billion in estimated HTC investment (that is, about 17% of all HTC investment in the nation in 2013). Ohio placed a distant 2nd in that category with $612,610,000. New York’s total investment undoubtedly skewed a bit higher due to New York City’s propensity for mega-projects, but it’s clear that New Yorkers in general are aware of what only a handful of other states have figured out: commitment to the HTC program means new investment, new jobs and new lives for old buildings.
Jason Yots is President and CEO of Preservation Studios LLC www.preservationstudios.com.
1. For background on the federal and NY HTC programs, please see http://buffalorising.com/2012/10/survival-of-nys-historic-tax-credit-program-may-depend-on-bifurcation/
2. Annual report: http://www.nps.gov/tps/tax-incentives/taxdocs/tax-incentives-2013annual.pdf . Accompanying statistical report: http://www.nps.gov/tps/tax-incentives/taxdocs/tax-incentives-2013statistical.pdf