Tax Credit Victory in Ohio!
Written by Joyce Barrett
The interior of the Mercantile Block in Hamilton, Ohio, after renovation. (Photo: Sandvick Architects)
Heritage Ohio is thrilled to share the news that the Ohio General Assembly and Gov. John Kasich have renewed the Ohio Historic Preservation Tax Credit with an aggregate cap of $60 million a year with no sunset.
The program was originally created in 2007 as a tax credit refund, with a caveat that a Cost Benefit Analysis of each potential project would factor into the selection process. During this extremely challenging budget cycle, the Cost Benefit Analysis concept strongly contributed to the legislative support to renew the credit.
Ohio’s strategy for renewal included working on several levels simultaneously to gather a strong base of support across the state. With the help of the Gund Foundation, PNC, and the National Trust for Historic Preservation, Heritage Ohio conducted a dozen regional Historic Tax Credit Workshops over the past 2 years. At each of these workshops, we invited elected representatives to participate, along with the Ohio Department of Development, Ohio Historic Preservation Office, and developers, attorneys, bankers and accountants.
Through our visits with elected representatives, it was clear that budget concerns were paramount. To address this, Heritage Ohio contracted with Cleveland State University to complete an Economic Impact Study on tax credit projects from the first four rounds of funding. Their findings were more positive than the economists anticipated.
For every $1 million in tax credits allocated by the state:
- $8 million in construction spending and 80 jobs in construction-related areas were created
- $32 million in total operating impact occurs and almost 300 permanent jobs are created
- 31 cents on every dollar is paid to the state in revenue before the credit is claimed
Cleveland State University wasn’t the only group studying the economic impacts of this incentive – the Ohio Department of Economic Development found that the 35 completed projects in the pilot program represented more than $400 million in total investment, creating nearly 3,000 construction jobs, and housing more than 5,000 permanent jobs and 900 housing units.
The interior of the Mercantile Block in Hamilton, Ohio, before renovation. (Photo: Sandvick Architects)
Since 2008, 108 projects have been approved for Ohio Historic Preservation Tax Credits, representing $1.4 billion in investment in 25 jurisdictions. The success stories abound. Eighty-two percent of the tax credit properties were vacant prior to rehabilitation, and 87 percent of the projects were located in cities or counties with unemployment that exceeded the state average.
To help make the case for the historic tax credits, it was important for Heritage Ohio to familiarize elected representatives with these projects and the impact on their communities. In addition to a statewide advocacy push, the tax credit renewal was successful because of champions in the Ohio General Assembly. Rep. Kirk Schuring (R-Canton) carried the day as he met with administration officials, the Office of Budget and Management, the Department of Development, and other members of the General Assembly. Rep. Ron Amstutz (R-Wooster) was chair of both the House Finance Committee and the Conference Committee. Sen. Widener (R-Springfield) was chair of the Senate Finance Committee. These key players received the necessary data to make well-informed decisions, and came to understand their constituents’ needs for historic tax credit in their districts.
Developers are invited to come to Ohio and invest in literally tens of thousands of potential projects. We’re creating cool, hip, walkable cities, both large and small, where people want to live, work, and play – come check us out!
For more information, read Estimates of the Economic Impact of the Ohio Historic Preservation Tax credit Program Final Report 2011, and Ohio Historic Preservation Tax Credit Program 2010 Annual Report.
Joyce Barrett is the Director of Heritage Ohio and has helped lead the effort to secure this valuable preservation incentive for Ohio on a permanent basis.