Legislative Alerts

Legislative Alert: on Federal HTC

House Passes Infrastructure Bill (H.R. 2), Includes HTC-GO Enhancements and Temporary Measures to Address COVID-19 Distressed Projects

 

Take Action to support these infrastructure provisions in the Senate and share HTC projects impacted by the pandemic that would benefit from temporary HTC provisions in emerging COVID-19 relief legislation.

Yesterday, the U.S. House of Representatives passed the Moving Forward Act (HR 2), a $1.5 trillion bill that funds infrastructure projects. In addition to dedicating roughly $400 billion in infrastructure investments for roads, bridges, and transit, the bill also includes key Historic Tax Credit (HTC) improvements and temporary measures related to COVID-19 recovery that were recommended by historic preservation and community development advocates [Click here to read to the section by section break down of the bill (HTC Sections are 90301-90307)].

Federal Historic Tax Credit Provisions

The legislation includes temporary increases for all HTC projects to help overcome obstacles from the nationwide shutdown this spring and aid in the economic recovery – a 30% HTC from 2020-2024, a 26% HTC in 2025, and a 23% HTC in 2026. The legislation also includes a temporary extension to rehab period deadlines to ensure projects impacted by the pandemic do not fail to qualify for the HTC.

The bill would also make permanent most of the provisions in the Historic Tax Credit Growth and Opportunity Act (H.R. 2825/S. 2615) including:

  • 30% Historic Tax Credit for projects $2.5 million and less
  • Eliminates the HTC Basis Adjustment, bringing more value to HTCs
  • Reduces the Historic Rehab Test to 50% of a building’s basis instead of 100%
  • Makes the credit easier to use by non-profits

Additionally, beyond HTC-GO provisions, the bill includes a provision for communities to rehabilitate existing public schools using the HTC.

Senate HTC Advocacy Needed on Emerging COVID-19 Related Legislation

Historic Tax Credit projects have experienced drastic, and in some cases, devastating impacts due to the necessary COVID-19 countermeasures. Projects face bans on construction, limited work site attendance, a lack of materials, limited access to government and regulatory partners, and other challenges associated with the near shuttering of the domestic economy. At the same time, new and potential projects face profound financial viability concerns.

Limited access to capital, higher investment risk, and an uncertain tenant market is causing significant harm to the present and future pipeline of projects. Including enhanced HTC provisions in an infrastructure or economic recovery bill will aid projects facing present obstacles and act as a catalyst for new growth in community revitalization projects across the nation.

Though Senate consideration of a transportation/infrastructure bill may happen this summer, this fall, or as late as next year, there are components of the infrastructure legislation that are directly related to COVID-19 relief/recovery that may be considered in House and Senate negotiations for the next phase of COVID-19 related legislation in July.

Take Action:

Contact your Senators to share HTC projects impacted by the pandemic that would benefit from temporary HTC provisions in emerging COVID-19 relief legislation. Explain how these enhanced and temporary HTC provisions would bring relief to distressed projects.

You can also contact your Senators by visiting: 

https://www.senate.gov/senators/contact   

Click the contact section or “contact me” link. Go to the message portal and if possible, select “Tax or Taxation” as the issue area category. 

 

Additionally, you may also contact the Capitol Switchboard at 202-225-3121. Please keep in mind that most congressional staff are working remotely.

Message to Senate Offices

  • “Please include these needed HTC enhancements that were in the recent House infrastructure bill (H.R. 2) to the next moving legislative vehicle to overcome present obstacles related to onsite labor, supply chain, regulatory and financing challenges, so it may be used as a tool to enable future projects to aid in the economic recovery.”
  • Describe obstacles that local projects have faced during the pandemic, at project sites, the extra costs incurred and project financing difficulties.
  • Explain how the recommended provisions would help these projects and bring back the pipeline of HTC projects that are no longer moving forward in your community.

Jim Farrell

Executive Director

Historic Revitalization for Missouri

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