The tax credit, which has assisted many Minnesota cities with historic structure rehabilitation, is set to expire this June.
HF 3688, a bill that would extend the sunset on Minnesota’s Historic Structure Rehabilitation Tax Credit to 2033, was discussed by the House Taxes Committee on March 2.
The bill, authored by Rep. Cheryl Youakim (DFL-Hopkins), was laid over for possible inclusion in the House omnibus tax bill.
What the bill does
The bipartisan bill would avoid the elimination of the tax credit, which is now set to expire on June 30, 2022, after last session’s one-year extension of its sunset.
The bill also modifies the distribution of the credit to provide one full payment when a building that is rehabilitated using the credit goes into service.
Benefits of the tax credit
Since its inception, the tax credit has helped leverage more than $1.9 billion in developer investment. It has also given cities the financial ability to rehabilitate and reuse historic buildings.
Since 2010, the tax credit has helped complete over 170 rehabilitation projects in Minnesota cities across the state and has created over $5 billion in economic activity.
Support for bill
Testifiers in support of the bill included Seward Redesign, Rethos, Minnesota Pipe Trades Association, and the Commercial Real Estate Development Association. All testifiers spoke about the benefits of the tax credit in leveraging non-state resources to spur economic development, create thousands of jobs across the state, and bridge the gap for developers to take a risk on redeveloping and re-using historic buildings.
The League provided written testimony in support of the bill, citing the tax credit’s importance to communities seeking to bolster local economies and revitalize city main streets.