West Virginia has made its historic tax rehabilitation credit program permanent, a move real estate developers are hailing for its economic influence in downtowns.
Gov. Jim Justice recently signed the bipartisan bill, which provides a 25-percent tax credit for those who rehabilitate historic income-producing properties, according to Danielle Parker, executive director of the Preservation Alliance of West Virginia.
"The 25-percent credit, which became law in 2018, was set to expire at the end of 2022," Parker said. "However, in those five years, the program attracted renewed interest in West Virginia’s historic commercial districts and spurred private reinvestment in more than 80 vacant and dilapidated buildings throughout the state.
In just two of those years, more than $34 million were invested in nine projects.
Renee Kuhlman, Senior Director at the National Trust for Historic Preservation, said the move to a permanent 25-percent credit provides needed certainty to property owners and developers.
The 25-percent credit often fills a financing gap in a project, she said, but the uncertainty around its future made it difficult for developers to successfully apply for construction loans or plan long-term projects.
“The removal of the sunset date increases the attractiveness of the credit to investors,” Kuhlman said.
“Already, I’ve received a call from a New Orleans developer wanting information about West Virginia properties because the program was made permanent.”
Without this tax credit, many historic redevelopment projects would not happen, Parker said. The credit is often the reason a project becomes feasible.
"There are more than 1,000 properties—including 168 historic districts—that can be revitalized using the credit, and I am excited to see how these places can be brought back to life using this financial incentive,” she said.
The state historic tax credit is capped at $30 million of income tax credits per year and also offers a 20-percent residential rehabilitation credit for historic homes, which is also permanent.
The State Historic Tax Credit is administered by the W.Va. Historic Preservation Office, and the National Park Service.
For more information on applying for the credit, or to find out if your property is an eligible tax-credit project, please call 304-558-0240. You can also Visit the WV Historic Preservation Office's website for additional information.