DCA announces $45 million available in State Historic Preservation Tax Credits

DCA and SHPO outline changes made during past legislative session


For Immediate Release: July 1, 2013
Contact: Jeff Morgan, 515-281-3858


DES MOINES –The Department of Cultural Affairs announced that the State Historic Preservation Office will accept applications for the state historic preservation tax credit program this year beginning July 1 through July 31, 2013, and is reminding applicants of changes made to the program during the past legislative session.

Applications for the State Historic Preservation Tax and Cultural and Entertainment Tax Credits program may be submitted to the State Historic Preservation Office beginning at 9 a.m. on July 1 through 4:30 p.m. on Wednesday, July 31, 2013. This is not a postmark deadline. SHPO is located in the State Historical Building, 600 E. Locust Street, Des Moines, Iowa 50319. Visit www.iowahistory.org or call 515-281-5111.

The program provides a state income tax credit of 25 percent of qualified rehabilitation costs for historic buildings. Owners of historic properties and developers use the tax credit to leverage private investment in adaptive-reuse and preservation of Iowa’s historic buildings.

To date, the program has leveraged more than $1 billion in estimated and finished rehabilitation costs by private investors in Iowa communities toward improvements in Iowa’s historic resources. The program has attracted private investment to historic cores of cities and Main Street towns across Iowa, generated jobs, enhanced property values, created affordable housing and augmented revenues for federal, state and local governments.

During the most recent legislation session, the Iowa Legislature made changes in the State Historic Tax Credit program. Senate File 436 includes new language that changes four major components of the program:

• Definition of commercial property – Previously, the Iowa Code divided property into categories based on whether the property was a residence, a barn or commercial. That meant non-profit organizations were included with commercial properties. Now the distinction is commercial or “other than commercial property.” The special category for barns and houses has been eliminated so that nonprofits, barns, houses and any other properties that do not earn income are in the “other than commercial property” category.

• Decreased dollar amount required for a project to qualify – Another important change is the decrease in the financial cost required for a project to qualify for the program. Previously, homes and barns would qualify if the work cost 25 percent of the assessed value of the property (excluding land) or $25,000, whichever was less. But the size of the project was much higher for commercial properties at 50 percent of the assessed value of the property (excluding land). With the legislative changes, the commercial property amount has been decreased to 50 percent of the value of the property (excluding land) or $50,000, whichever is less, and property other than commercial qualifies for the 25 percent or $25,000. This means that small businesses can undertake projects for $50,000 or less and still qualify for tax credits if the assessed value of their property is less than $100,000. It also means non-profits such as churches can qualify for projects under $25,000. This new definition will allow more small projects to qualify and take advantage of tax credits.

• Increased cap on the small project fund – The new law also increases the cap on projects that qualify for the Small Project Fund. The former cap was $500,000, but projects with expenses as high as $750,000 can now qualify for the fund. Small projects can be submitted and funded at any time during the year while large projects must be submitted during the filing window, which has been extended this year to July 31, 2013.

• Increased length of time given to complete a project – Finally, there has been a change to the length of time available to complete a tax credit project. The previous rule was the building had to be “placed in service” within 60 months of receiving the tax credit reservation. Now there is a possibility for an extension of another 12 months. The project will qualify for that extension if 50 percent of the qualifying rehabilitation expenses have been expended within the first 60 months.

State Historic Preservation Tax Credit applications and instructions are available on-line at www.iowahistory.org. SHPO hours are 9 a.m.-4:30 p.m. Monday-Friday; closed Thursday, July 4, 2013, in observance of Independence Day.

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The Iowa Department of Cultural Affairs is responsible for developing the state’s interest in the areas of the arts, history and other cultural matters with the advice and assistance from its two divisions: the State Historical Society of Iowa and the Iowa Arts Council. DCA preserves, researches, interprets and promotes an awareness and understanding of local, state and regional history and stimulates and encourages the study and presentation of the performing and fine arts and public interest and participation in them. It implements tourism-related art and history projects as directed by the General Assembly and designs a comprehensive, statewide, long-range plan with the assistance of the Iowa Arts Council to develop the arts in Iowa. More information about DCA is available at www.culturalaffairs.org.

 

 

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Mary Cownie, Director

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