Preservationists could soon be reimbursed for their efforts in restoring historic homes and buildings.
State Rep. Mike Halpin, D-Rock Island, has introduced legislation providing an income tax credit on expenditures spent rehabilitating historic structures. The credit will be equal to 25 percent of eligible expenses to taxpayers living in 34 counties bordering the Mississippi River, including Rock Island County. The credit will be available for tax years beginning January 1, 2019, through 2029.
The Bicentennial Mississippi River Region Redevelopment Historic Tax Credit Act, introduced Feb. 16, is co-sponsored by state Rep. Tony McCombie, R-Savanna, and state Rep. Katie Stuart, D-Edwardsville. The bill states eligible taxpayers must apply with the Department of Commerce and Economic Opportunity within six months after the effective date. The tax credit is retroactive going back three years.
During a news conference Wednesday at the Rock Island County Office Building, Halpin said without the financial incentive, some projects may not occur. The federal government has had historic tax credits since 1976 with more than $84 billion in rehabilitation projects completed, he said. Iowa has offered incentives since 2000.
"This is not a tax expenditure at the end of the day," Halpin said. "This is an investment that carries incredible returns. Between 2009 and 2014 in Iowa, there were projects totaling at least $621 million. The average annual tax credit was $27 million. You can do the math on what your return can be.
"This is a strong tool and for me, a no-brainer. There's no reason why our river communities in the state of Illinois shouldn't benefit from this program. It creates jobs, enhances property values, and preserves our history."
Halpin was joined by Rock Island Mayor Mike Thoms, Moline council member Sonia Berg, Rock Island council member Dylan Parker, county board members Richard Brunk and Scott Terry, Quad-Cities Chamber of Commerce vice president Jason Gordon, Moline Preservation Society member Diann Moore, and Rock Island preservationist Diane Oestreich.
Gordon said the chamber has been advocating for a similar tax credit for the past three legislative sessions. Citing a study done by the University of Illinois four years ago, he said the tax credit averages a four-to-one return on investment.
"The state gets more retail, there will be more residents living in your downtown and historic areas, and office space," Gordon said. "How much more (activity) would we see in Moline, Rock Island and East Moline if we had this credit? I'm excited for our municipalities to have this opportunity and to bring more people to live and work in the Illinois Quad Cities."
Thoms said the benefits of the tax credit can be seen locally in Davenport, which has invested about $450 million in historic rehabilitation projects.
"We want to be on a fair and equal playing field as the other states," Thoms said. "In some cases, it doesn't cost the state anything. These buildings are sitting empty and unproductive. They're not producing any sales taxes."
Moore said the tax credit could help save decrepit historic buildings from being demolished.
Despite the legislation's effective date of Jan. 1, 2019, Brunk said it could help save the county courthouse by attracting potential buyers interested in rehabbing the historic building. The challenge would be securing financing for a renovation project until the tax credit came through.
"Even if we were able to pass some kind of lease buy-back (deal) on a renovated courthouse, we would still have to come up with the funding mechanism to make the payments on it," Mr. Brunk said. "The (buyer) would refurbish the building with the idea of the county buying it back. But the problem is you're still talking about a significant monthly payment the county wouldn't be able to make. Ideally, this legislation could save the courthouse, but it still comes back to the county paying for it. Hopefully this helps us save some other buildings in the future."
Counties eligible for the pending tax credit are Adams, Alexander, Bond, Brown, Calhoun, Carroll, Clinton, Greene, Hancock, Henderson, Henry, Jackson, Jersey, Jo Daviess, Johnson, Knox, Macoupin, Madison, McDonough, Mercer, Monroe, Perry, Pike, Pulaski, Randolph, Rock Island, Schuyler, St. Clair, Stephenson, Union, Warren, Washington, Whiteside, and Williamson.