A bipartisan bill introduced on Dec. 19 in Washington, D.C., aims to streamline processes, reduce cost-burdens for rural homeowners and small developers, and provide affordable housing incentives in America’s rural communities.
Specifically, the Rural Historic Tax Credit Improvement Act, S. 5607, sponsored by U.S. Sen. Shelley Moore Capito (R-WV) and cosponsored by U.S. Sen. Mark Warner (D-VA), would amend the Internal Revenue Code of 1986 to enhance the rehabilitation credit for buildings in rural areas.
“Being a rural state shouldn’t mean losing out on private investment incentives like tax credits to help us preserve our communities’ history and revitalize local economies,” Capito said. “The Rural Historic Tax Credit Improvement Act will help level the playing field for communities in West Virginia by attracting investment for economic expansion and additional housing supply.”
If enacted, S. 5607 would make historic tax credit projects in rural areas eligible for an increased credit from the current 20 percent to 30 percent, and the bill includes an additional increase in the credit to 40 percent for affordable housing creation, according to a bill summary provided by the senators.
The measure also would permit the credit to be used in addition to the Low-Income Housing Tax Credit (LIHTC); allow small rural projects to claim the credit in the first year of use; allow transferability of the credit to a third-party; and eliminate basis adjustment to simplify credit transactions, the summary says.
“By expanding access to historic tax credits, we can preserve our nation’s rich heritage while also incentivizing the construction of more affordable housing,” said Warner. “I’m proud to join Sen. Capito in introducing this legislation to bring new life to abandoned buildings and grow the housing stock in rural communities.”
Carol Quillen, president and CEO of the National Trust for Historic Preservation, pointed out that historic tax credits are a time-tested economic development tool that spurs community revitalization and job creation.
“Expanding their reach as this bill does will create new opportunities for economic growth by driving private investment toward the reuse and rehabilitation of existing and often distinctive buildings in small and rural communities across our country,” said Quillen. “We’re grateful for the leadership of Sen. Capito and Sen. Warner in addressing this needed reform.”
The bill is also supported by the Preservation Alliance of West Virginia, The Historic Tax Credit Coalition, and Main Street America.