A long-established federal program is increasingly helping restore Buffalois historic buildings. Federal Historic Preservation Tax Incentives were created in 1976 and is one of the federal governmentis most successful and cost-effective community revitalization programs. Private investment in rehabilitating historic properties such as offices, schools, rental housing, warehouses, hotels, and retail stores is rewarded and assists making costly restoration projects feasible.
The Federal Historic Preservation Tax Incentives are available for buildings that are National Historic Landmarks, that are listed in the National Register, and that contribute to National Register Historic Districts and certain local historic districts. Properties must be income-producing and must be rehabilitated according to standards set by the Secretary of the Interior.
Under the Internal Revenue Code, rehabs into housing have to be income-producing properties such as rental properties. Conversions into condominiums are permitted under the program but only if they are rented out, not sold. Developers usually sell the tax credits to financial partners. By selling their credits, developers get immediate cash that they can use for rehabilitation work, as opposed to getting a reduction on their taxes once the project is completed. The Seneca Paper Building conversion project on Ellicott Street just qualified for the credits and the developers intend to immediately turn those into cash by selling them for 95 percent of their value.
The Historic Preservation Tax Incentives fosters private sector rehabilitation of historic buildings and promotes economic revitalization. They have proven to be an invaluable tool in revitalizing Buffalo and preserving the historic places that give the city its special character.
Photo: CitySky photography by Nate Farnsworth