Capital News Service

of the Michigan State University School of Journalism

Loss of tax credits could derail historic preservation projects

By LAUREN WALKER
Capital News Service

LANSING — Eliminating the state’s historic preservation tax credits could endanger sustainable development efforts, historic preservation experts say.

Nancy Finegood, executive director at the Michigan Historic Preservation Network, predicted that if the credit gets cut, the number of historical commercial rehabilitation projects will decrease.

That’s because the credit fills the financial gap that many developers face.

The credit is equal to up to 25 percent of a project’s qualified expenditures, according to the State Historic Preservation Office.

Diane Van Buren, sustainable planning consultant at Zachary and Associates Inc., a Detroit-based economic development firm, specializes in urban revitalization and has worked on several historic commercial rehabilitation projects in the city.

She said rehabilitating historic buildings and green development go hand in hand.

“If the majority of the building is built, why would you disregard that? My whole focus in preservation and in green buildings is exactly that — putting those two together.

“Building a new building that’s green to me flies in the face of being green when you have a city and a state full of resources that are empty right now,” Van Buren said.

“To say I have a brand-new green building is an oxymoron because it’s not a green building if you had to cut down trees and take the energy to transport all of those materials and produce all of that glass and start over again when those materials exist,” she said.

On top of preserving and recycling resources, she said historic buildings are some of the most energy-efficient. Their solid structures and architectural designs reflected the fact that air conditioning didn’t exist in the early twentieth century.

Besides the inherent sustainable aspect of historic buildings, historical buildings can be made greener, said Jessica Williams, weatherization project review specialist for the State Historic Preservation Office.

“There’s this misconception that people assume that older buildings can’t be made energy-efficient and you need to build a new building green. You can make historic buildings green, you can adapt them with modern technologies, just as with new construction or a relatively newly constructed building,” she said.

One of Van Buren’s recently completed projects illustrates that.

“We just finished 71 Garfield. It has a geothermal heating and cooling system which runs at about a third of the cost of a gas furnace for a building of comparable size,” she said.

The building also features solar panels, a rooftop water collection system and a white reflective roof.

Van Buren said that the project was partly financed by both state and federal tax credits.

She said that if the state tax credit is cut, there will still be a federal tax credit. But given the unpredictability of historic buildings, that may not be enough.

She said she is working on a multimillion-dollar project that is short $100,000 because of unexpected roof damage.

“When it comes right down to that last push, the amount of money that you can borrow is pretty limited. The state tax credits help fill that gap,

“They help save our buildings, help put people in communities and help create more jobs because your local labor market is used more in a historic building,” she said.

© 2011, Capital News Service, Michigan State University School of Journalism. Not to be reproduced without permission.

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