Historic Preservation Incentives
New Bedford has been a national leader in historic preservation for decades and is well versed in utilizing the tools in place that help adapt historic structures for new uses that drive development and growth.
Federal Historic Preservation Tax Incentive Program
The Federal Historic Preservation Tax Incentives program encourages private sector investment in the rehabilitation and re-use of historic buildings. The National Park Service and the Internal Revenue Service administer the program in partnership with State Historic Preservation Offices.
A 20% income tax credit is available for the rehabilitation of historic, income-producing buildings that are determined by the Secretary of the Interior, through the National Park Service, to be “certified historic structures.” The State Historic Preservation Offices and the National Park Service review the rehabilitation work to ensure that it complies with the Secretary’s Standards for Rehabilitation. The Internal Revenue Service defines qualified rehabilitation expenses on which the credit may be taken.
Tax credits awarded result in a dollar-for-dollar reduction in federal tax liabilities. Projects must be for a building that is not a personal residence and must be depreciable. Such buildings include; apartments, hotels, office buildings, warehouses, distribution facilities, back-office, sport facilities, or combination of these uses.
For more information visit the National Park Service website.
The Massachusetts Historic Rehabilitation Tax Credit
The Massachusetts Historic Rehabilitation Tax Credit allows for a certified rehabilitation project on an income-producing property to be eligible to receive up to 20% of the cost of qualified rehabilitation expenditures in state tax credits. This is a highly competitive program and there is an annual cap (unlike the Federal program), so there is selection criteria that ensure the funds are distributed to the projects that provide the most public benefit. The Massachusetts Historical Commission (MHC )certifies the projects and allocates available credits.
As with the Federal program, projects must meet the Secretary of the Interior’s Standard for Rehabilitation (demolition of contributing buildings does not meet these standards). The three-part submission is parallel, but separate to the process for the Federal program.
For more information visit the MHC website.
Community Preservation Act
The Community Preservation Act (CPA) is a Massachusetts state law (MGL Ch. 44B) designed to help Massachusetts towns and cities plan for sustainable growth and provide funds to achieve their community preservation goals. CPA allows participating cities and towns to adopt a real estate tax surcharge of up to 3% to raise funds, creating a local, dedicated fund. CPA helps communities preserve open space and historic resources; create community housing; and develop outdoor recreational facilities.
New Bedford voters approved CPA in November 2014 and adopted a 1.5% surcharge. These funds are matched annually by the state’s Community Preservation Trust Fund. The Community Preservation Committee (CPC) oversees the implementation of the CPA in New Bedford. It is responsible for assessing the community preservation needs of the city; developing and maintaining the community preservation plan which establishes the city’s preservation priorities; preparing an annual budget for City Council; and making project recommendations to City Council after an extensive application process.
