Tax day approaching? Think about historic preservation

[April 12, 2012]  SPRINGFIELD -- It sounds like a political campaign promise -- a pledge to reduce taxes and revitalize the economy. But that’s what the owners of historic properties can do when they take advantage of a tax incentive program, jointly administered by the Illinois Historic Preservation Agency and the National Park Service, which has had a $2.3 billion economic impact in the state during the past 12 years. This translates into more than 37,000 jobs, based upon a national economic impact study.

The Historic Preservation Tax Credit program for income-producing properties offers lucrative tax incentives for rehabilitating historic structures. The program rewards property owners for their historic preservation efforts, while the property owners produce construction jobs, purchase local materials, preserve history and foster community pride as a result of their rehabilitation work.

Illinois led the nation in 2011 with $365 million in completed tax incentive historic rehabilitation projects. Since 2000 the state has seen a total of $2.3 billion in private investment in these projects, which translates to $460 million in tax incentives for Illinois property owners.

The Federal Tax Reform Act of 1986 allows an income tax credit equal to 20 percent of the rehabilitation expenditures for certified historic commercial, agricultural, industrial or rental residential buildings. The credit may be subtracted directly from federal income taxes owed by the owner. Eligible properties have to be listed on the National Register of Historic Places.

In addition to the federal tax credit program, Illinois offers a state income tax credit through the Department of Commerce and Economic Opportunity of 25 percent through December 2016 to owners of certified historic structures located within designated River Edge Redevelopment Zones in Aurora, East St. Louis, Elgin and Rockford.

The federal and state tax credit programs have benefits for communities as well. These programs encourage the protection of landmarks, increase the value of the rehabilitated property, return underused structures to the tax rolls, upgrade downtowns and neighborhoods, and often increase the amount of available housing within the community.

Historic rehabilitation projects also have "green" benefits. When historic buildings are renovated rather than replaced, huge amounts of waste are not created and the impacts of making new construction materials are avoided. Historic structures are also proving to be just as energy-efficient as new green buildings.

"Historic preservation, encouraged by incentives, is proving to be a winning strategy in meeting the environmental, economic and equity goals of sustainable design," said Mike Jackson, FAIA, manager of the Preservation Services Division of the Illinois Historic Preservation Agency.

Specific standards must be met to be eligible for the federal and state historic preservation tax incentives. For more information, visit http://www.illinoishistory.gov/PS/financial.htm.

Some recent historic preservation tax incentive projects, including the total project cost, are listed below.

• Alton: Lincoln Lofts, 206-212 State St., project cost $1.9 million

• Bloomington: C.U. Williams Building, 207-209 E. Washington St., $760,000

• Cairo: 2606 Washington, $45,000

• Danville: Holland Apartments, 324-326 N. Vermilion, $4.2 million

• Decatur: Roosevelt Junior High, 701 W. Grand Ave., $6.3 million

• Evanston: The Homestead, 1265 Hinman Ave., $2.6 million

• Galena: H.W. Miller Residence, 11672 W. Norris Lane, $350,000

• Geneva: Riverbank Labs, 1512 Batavia Road, $1.5 million

• Joliet: Old YMCA, 215 N. Ottawa, $18.3 million

• McLeansboro: Cloud State Bank, 108 S. Washington, $1.2 million

• Moline: Old High School, 1001 Sixteenth St., $8.1 million

• Peoria: Old YMCA, 301 NE Jefferson, $8 million

• Quincy: Schott Building, 611-619 Hampshire, $250,000

• Riverdale: Whistlers Crossing (Pacesetter), 13604-13736 S. Lowe Ave., $12.5 million

• Rockford: Richardson Building, 201 W. State St., $1 million; and Garrison School, 1105 N. Court, $6.8 million

• Skokie: Dempster Street Station, 5001 W. Dempster, $1.2 million

• Springfield: Buck Building, 3 N. Old State Capitol Plaza, $110,000

• Urbana: Lincoln Square Mall, 300 S. Broadway, $10 million

• Washington: Denhart Bank, 101 Washington Square, $1.25 million

• Waukegan: Karcher Hotel, 405 Washington, $11 million

• Woodstock: Old Post Office, 123 Johnson St., $2.6 million

Chicago projects:

• Blackstone Hotel, 636 S. Michigan Ave., $94 million

• Carbide and Carbon Building (Hard Rock Hotel), 230 N. Michigan Ave., $106 million

• Carson Pirie Scott Building (Sullivan Center), State and Madison, $220 million

• Chicago Board of Trade, 141 W. Jackson St., $39.3 million

• Continental and Commercial Bank Building, 208 LaSalle St., $200 million

• Hyde Park Apartments, 5330 S. Harper, $1.6 million

• IBM Building, 330 N. Wabash Ave., $110 million

• Inland Steel Building, 30 W. Monroe, $40 million

• Krause Music Store, 4611 N. Lincoln Ave., $500,000

• A.J. Lindemann & Hoverson Co., 2620 W. Washington Blvd., $7.3 million

• Mather Tower (Club Quarters Hotel), 75 E. Wacker Drive, $20.7 million

• Parkway Garden Homes, 6330-6546 South Martin Luther King Drive, $50 million

• Pullman-Packard Auto Plant, 901 E. 104th St., $13 million

• Raymond M. Hilliard Center, 30-54 W. 22nd St., $70 million

• Reid Murdoch Building, 320 N. Clark St., $65 million

• Sears, Roebuck & Co. Power House (Charles Shaw School), 931 S. Homan Ave., $31 million

• Steuben Club Building (Randolph Tower), 188 W. Randolph St., $140 million

• Tree Studios Building and Annex, 603-621 N. State St., $11.3 million

• Vassar Swiss Underwear Co. Building, 2545 W. Diversey Ave., $32 million

[Text from file received from the Illinois Historic Preservation Agency]