Bring back the historic preservation tax credit
One of the most foolish “tax reform” efforts of Republicans in the North Carolina General Assembly was the abolition of historic preservation tax credits. The credits expired at the start of this year after years of successful use in towns and cities all across North Carolina.
Gov. Pat McCrory rightly made restoring the credits, which basically offer tax incentives to people who restore old homes and buildings with historic value and significance, a priority of his administration. Unfortunately, despite crystal clear evidence that the credits not only improve main streets across North Carolina but create jobs, the governor’s push hasn’t done much good so far.
A conservative estimate of the benefits of the tax credits is that they’ve generated 2.5 times as many jobs as an across-the-board tax cut worth the same amount would create. More than $1.5 billion in private investment has been made because of the tax credits.
And more than 2,400 projects in the last 16 years have been made possible by the credits, among them no less than the American Tobacco campus in Durham.
The governor is doing his part. Susan Kluttz, secretary of the Department of Cultural Resources, is going all over the state touting the value of the tax credits in towns and cities where they have been put to good use.
This is something that has helped communities of all sizes, whether a cotton mill in Rocky Mount becomes a brewery or an old building on a small-town main street is saved as a local business or a home destined for demolition becomes ... a home.
It is not, in other words, an urban issue or a rural issue or a Democratic issue or a Republican issue.
The historic tax credits fell, apparently, because of a GOP scorched Earth attitude toward all taxes as Republicans took over control of the legislature and commenced to “reform” the tax system, which meant in their minds cutting things to help the most wealthy citizens and big business. The historic tax credit program seems to have been a victim of reform that looked at most such breaks as unnecessary, as something that simply didn’t deliver a return on the state’s investment.
But this program has delivered, and then some, in private investment and jobs. Now the House has passed a bill that would restore credits, although in a scaled-down way. There is questionable support for it in the Senate. But the truth is, it would be better to put the program back in place as it was. And as it worked.
Unfortunately, all things connected to the governor seem to be tainted as far as the state Senate goes, where it’s been amateur hour on tax reform and where Phil Berger, president pro-tem, would prefer that the governor mind his own business and allow lawmakers to proceed with their narrow-minded agenda.
That appears to be the case no matter how strong a case McCrory makes for the credits. After one bus tour to promote the tax credit, the governor even noted that historic tax credits “were initially started by Ronald Reagan. It is the most conservative philosophy that you can promote, and that is to encourage private sector investment through lower taxes.”
The governor isn’t holding back, and he shouldn’t. But this program shouldn’t need such a push. It has worked. It will work. The proof is there.
This story was originally published March 27, 2015 at 6:09 PM with the headline "Bring back the historic preservation tax credit."