‘Real Estate Weekly’: Preservationists worry about possible cut to historic buildings tax credits

Though Gov. Bobby Jindal’s proposed tax reform plan does not specifically call for doing away with the state’s tax credit program for historic buildings, preservationists are concerned the plan could mean the end of the credits, which help offset the high cost of refurbishing and renovating old structures. Michael Echols, president of the Louisiana Trust for Historic Preservation, says he has been contacting legislators and members of the administration to lobby in favor of keeping the credits, which refund up to 25% of qualified expenditures on historic restoration projects. But so far, the only response he has gotten is that it is too soon to know for sure what the proposed tax reform will mean to the popular tax credit program. “The answer, really, is that no one knows yet,” says Echols. “They are still in what they call the defining process of figuring it all out.” Renovating old structures costs, on average, about 25% more than new construction; so the tax credits, which can be coupled with equally lucrative federal historic tax credits, have provided a big incentive to developers to tackle historic renovations. DDD Executive Director Davis Rhorer attributes part of downtown’s ongoing revitalization to the state tax credit program, noting that Hotel Indigo, Capital House Hilton, the Kress Building, Lyceum Dean and the Tessier Building were all refurbished with tax credits. “There’s more on the way, too,” says Rhorer. “This program has been incredibly important to downtown.” —Stephanie Riegel Read the rest of the new Real Estate Weekly e-newsletter here.