Tax Credit Projects Shine During Conference Week

The list is impressive and growing:  Guaranty Building, AM&As Warehouse Lofts, 100 South, Lofts at 136, Warehouse Lofts, Hotel Lafayette, Genesee Gateway, ArtSpace, Babeville, Kamman Building, Electric Tower, Allentown Lofts, Packard Apartments and others.  These are the projects that have utilized historic preservation tax credits working with the New York State Office of Parks, Recreation and Historic Preservation.  

SHPO has prepared a project portfolio with a sampling of the WNY projects assisted by the office in recent years.  The WNY Project Portfolio can be found here.  Two tax credit programs are available for income-producing restoration projects:

  • The FEDERAL PRESERVATION TAX CREDIT PROGRAM offers owners of historic income-producing properties a tax credit equal to 20 percent of the rehabilitation costs.
  • The STATE PRESERVATION TAX CREDIT PROGRAMS offer owners of properties that qualify for the federal credit a state tax credit equal to 20 percent of the rehabilitation costs.

The tax credit- assisted projects have helped save some of Buffalo’s landmark properties, leveraging tens of millions of private sector investment while creating hundreds of construction and permanent jobs, thousands of square feet of commercial space and hundreds of apartments.  The polished jewels will proudly be on display for 2,500 preservationists from across the country this week.
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About the author  ⁄ WCPerspective

Buffalo and development junkie currently exiled in California.

25 comments
PaulBuffalo
PaulBuffalo

And Paul - pavement fixations can be understandable here considering many of our streets and how much front end work costs these days.

The compassion you have shown for the front end of your vehicle is duly noted.

Maybe O's next stimulus will create a fed dept to fund those kind of repairs for us in the 99%, now that he says he's figured out that most shovel ready projects aren't shovel ready.

Let me guess: you want the US to emulate the Greek deprivation model to economic health?

whatever
whatever

It was sarcasm, pretty obvious I thought, but...

brownteeth
brownteeth

Thanks for the info, I've been debating if it is worth the effort to utilize this credit or not.

Tim
Tim

This isn't the place to get into it. But the federal government has a spending problem not a revenue problem.

I'm not sure I follow you though.

whatever
whatever

Tim, don't words such as debt and overpaid have a harsh greedy sound?

Have you tried thinking of stimulus spending as simply unfunded investments in our future to rebalance our wealth?

whatever
whatever

BRL>"Do you agree that Buffalo's old building stock has attracted people and business that would otherwise not consider the city?"

I agree that a wide variety of things can help attract some people to prefer some places, and many of those things aren't good ideas for public spending.

Examples of privately-owned things that could attract some people to a place -

very nice old buildings,

NFL or other sports teams,

gambling casinos,

very nice new buildings,

private high schools / grade schools,

church congregations,

arts & culture,

very nice medium-aged buildings,

fun nightlife, bars, & restaurants,

Wegmans (just ask Alec Baldwin's mom) / Whole Foods / Trader Joe's,

...

While any of those have attracted people to places, why not leave them to the private sector (for- & non-profit), and use public govt money for publicly owned purposes such as police, parks, public health, streets/sidewalks, public schools & libraries, social welfare, snow removal, jails/courts, ...?

BRL>"Also do you agree locating business and residential in a densly built urban environment makes sense from an economic, environmental, and long term sustainability aspect?"

If I agree, then to be consistent will I have to say the city of Buffalo makes less sense economically-environmentally-sustainably than places much more dense than here? Like NYC with metro density over 4x ours? Shouldn't we be careful to not have to criticize Buffalo that way, or discourage any mega-city people from moving to here? Slippery slope?

Tim
Tim

Another federal department with overpaid fed employees and a stimulus driving us further into debt to boot? Sounds lovely.

Greg Blakowski
Greg Blakowski

What does all of this dialog tell you? Our taxes, all of them are to dam high. Lower taxes and regulations across the board, and you will see development throughout the Niagara Frontier like you have never seen before.

Black Rock Lifer
Black Rock Lifer

Do you agree that Buffalo's old building stock has attracted people and business that would otherwise not consider the city? Also do you agree locating business and residential in a densly built urban environment makes sense from an economic, environmental, and long term sustainability aspect?

Black Rock Lifer
Black Rock Lifer

The 20% is a direct credit you can deduct from your state income tax bill, not just a reduction in your taxable income. If you are a low income earner and do not pay enough state tax the credit is a direct refund much like the earned income credit.

brownteeth
brownteeth

What does that 20% equate to as cash in my pocket? I'm still fuzzy on this and would love some insight. Is it just a reduction to my taxable income or do I get a check for the value? Can anyone briefly explain?

whatever
whatever

derby>"maybe not to increase the tax base"

That was all I was arguing about in that comment, derb.

And Paul - pavement fixations can be understandable here considering many of our streets and how much front end work costs these days. Maybe O's next stimulus will create a fed dept to fund those kind of repairs for us in the 99%, now that he says he's figured out that most shovel ready projects aren't shovel ready.

whatever
whatever

"the tax credits shift resources towards density"

We can agree to disagree about whether the tax credits are good ideas instead of just letting the private sector and voluntary fund raising make these decisions. But my first comment here wasn't rerunning that argument this time - just questioning Steel's comment about tax base growth.

For example, if the Guaranty Building wasn't there then it's very likely its tenant (one of biggest law firms here if not the biggest) would be a tenant somewhere else downtown. Maybe they'd have built a new very nice building, or maybe saved some other old building, or made a major upgrade to something.

Them being in the Guaranty is great for preservation. I can even see how if any building deserved some public spending, a better argument could be made for that one which is a landmark and has viable use, compared say to the rotting portion of the GLF elevator site for example.

Still, it isn't as though the wealthy huge law firm wouldn't be here in a very nice expensive building downtown anyway helping the city's tax base - and being in an equally high density spot.

whatever
whatever

Steel, that's a 100% wrong claim on your part of anything I've said:

Steel>"It is interesting that you only interpret development within the city as shifting resources from another place but interpret development in the suburbs as "growth".

Whether or not something is growth has nothing to do with whether it happens in burbs or the city or rural areas. If it's growth it's growth, and if it's shifting it's shifting - regardless of location. The Sole restaurant moving from burb to city wasn't growth, and neither was Brodo doing the opposite. (Yes, Brodo was open in both city & burb for a little while, but effectively they moved - once were city, now burb - needed a quick example.)

I don't think either Sole or Brodo were given special tax breaks, but I'm just pointing out their location changes were shifts not growth. That they happened to move in opposite directions doesn't affect that. If I believed as Steel claimed, I'd say the move to the city was a shift and the move to a burb was growth. But I don't.

By the way - a separate issue but in case you're combining it all - I'm equally against all tax credits and tax breaks to companies and individuals everywhere - city, burbs, and rural.

Since BR posts are usually about something in the city and I try to stay on topic, maybe that's what confuses you that I treat city and burbs differently. Wrong.

In honor of your mistake, I'll verge off topic to illustrate by saying this kind of stuff in burbs reported by the BN (probably not mentioned on BR) were very dumb decisions by IDAs:

"... Tax breaks for restaurants are becoming far too common in the Buffalo Niagara region. The Hamburg Industrial Development Agency doled them out last month for a new restaurant heading into the long-empty former Bob Evans restaurant on Camp Road. The Amherst agency gave tax breaks this spring so the Pizza Plant Italian Pub could move to a new site in an empty Transit Road building after losing its lease in a plaza just up the street. ..."

Those restaurants will shift customers from one place to another. That doesn't mean they shouldn't be allowed to locate where they want to - of course they should be allowed - but they won't grow economic activity that wouldn't have happened anyway. Also, they shouldn't have been given those special tax deals.

Clear now?

STEEL
STEEL

It is interesting that you only interpret development within the city as shifting resources from another place but interpret development in the suburbs as "growth". In fact there has been no growth at all in WNY for 50 years - just shifting wealth to a new location and spending wealth to accommodate the shift. In any event the city is a massive winner with these projects and all it took was a small reduction in taxes - something any proud right wing suburbanite should be happy to get behind.

grad94
grad94

i think harwood place is within the hamlin park local historic district, which is also being surveyed for a national register district. plus it is certainly in a qualifying census tract. i am sure it is eligible.

Black Rock Lifer
Black Rock Lifer

Armchair is correct, the tax credits shift resources towards density and help preserve high quality buildings. That makes good sense economically and environmentally. Older buildings were designed for centuries of service unlike the throwaway buildings of today. These old buildings have real value that cannot be compared to the bland and uninspiring sprawl based construction that now passes for architecture. It is hard to measure the aesthetic value of historic architecture but it is certainly a part of the equation as well.

I don't think historic tax credits can be compared to IDA's or other sprawl subsidies. Historic tax credits are used to stabilize and renew existing assets and infrastructure while IDA's move existing assets out to undeveloped areas. In a region of shrinking population it is obvious as to which strategy makes sense for the taxpayer and for our resources and environment.

Buffalo has suffered from decades of policies that benefited the region at the expense of the city. Historic tax credits can be justified as a small reparation to offset those mistakes.

Black Rock Lifer
Black Rock Lifer

A private residence qualifies if listed on the State or National Register individually or as a contributing building in a historic district. The property must also be owner occupied and located in a distressed census tract (most of Buffalo). The state tax credit for homeowners is 20% up to a credit value of $50,000 with a minimum project cost of $5,000. All interior and exterior work is eligible including plumbing and electrical. A review by SHPO is also required to ensure the historic integrity of the building is respected.

Commercial properties qualify for an additional 20% federal tax credit.

The Kettle
The Kettle

Considering development subsidies that drive lower density development do not get the same harsh treatment from you as the dreaded preservation credits, I'd say both pro vacant and pro parking lot.

As far as the tax base issue, It may not grow the tax base for the region at large. However they do help ensure that investment is directed towards older areas that would otherwise be losers to areas that benefit from sprawl subsidies.

Lots of people live/work in places like Downtown, Larkinville, and North Tonawanda who would have otherwise likely have gone to places that benefit from more numerous sprawl drivers (free roads, utilities, cheap mortgages, new build favoring tax policies etc).

derby98
derby98

maybe not to increase the tax base, but what are the renovated properties producing now? Chances are quite high that without any tax credits to assist in their renovation/preservation/reuse the properties in question would still be rotting away and waiting in line for the wreckers ball.

PaulBuffalo
PaulBuffalo

[I don't know if that will be summed up as being pro-vacant-lot or pro-parking-lot, ... guess I'll have to click Submit to find out which!]

Well, you do have a fixation about the quality of asphalt.

whatever
whatever

"increase in tax base"

There's no way to prove/disprove what size a tax base would be if any tax law didn't exist. For example, tenants would be occupying other buildings if they weren't where they are - and so demand for other buildings which also pay property taxes would be adding to the tax base instead. And possibly some of the older buildings might have been saved anyway. No way to know any of that for sure.

It's similar to IDA benefit recipients claiming jobs or tax base growth as a result of what an IDA provided to them, arguing that the IDA is indispensable.

Or like if G.E. (or JP Morgan, or Citibank, or GM, or Chrysler, or Solyndra, or...) claimed that all the federal perks its received have saved jobs or helped the national tax base.

Or when past beneficiaries of the now-deservedly-eliminated Empire Zones tax break program claimed that it grew the tax base in NY state.

Any of the above could frame numbers narrowly to argue that policies benefiting them have grown the tax base or created/saved jobs.

We don't have a parallel universe to observe what a tax base (or job count) would be without some law existing. So, there's no way to know how alternatives, side effects, and unintended consequences would all unfold.

[I don't know if that will be summed up as being pro-vacant-lot or pro-parking-lot, ... guess I'll have to click Submit to find out which!]

Buffalo_Resurrection
Buffalo_Resurrection

Does Tax Credit apply to individual/private residences?

Shine some light on the kid (Matt) who bought 16 Harwood Place as I suspect he could use some assistance.

STEEL
STEEL

It would be interesting to know what the increase in tax base is due to these projects.

Rand503
Rand503

But..but...preservationists are obstructionists, no?

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