TRENTON – The Senate Wagering, Tourism and Historic Preservation Committee approved legislation today sponsored by Senator Barbara Buono that would encourage the rehabilitation of historic properties in the State by offering tax credits for a portion of the cost of the rehabilitation.
“New Jersey’s historic buildings are irreplaceable treasures that we need to do more to protect,” said Senator Buono, D-Middlesex and Chair of the Committee. “We need to make it an attractive option to rehabilitate these sites rather than just erecting new buildings and abandoning our past.”
Senator Buono’s bill, S-2030, would establish State tax credits for the cost of rehabilitating historic properties in the State. The bill would authorize for individual homeowners a tax credit of 25% of the taxpayer’s outlay for rehabilitating a historic property, capped at $25,000. In addition, businesses would receive a 25% tax credit that would not be capped. The tax credit would be against the individual’s gross income tax liability; the businesses’ corporate business tax and insurance premiums tax liabilities.
If the taxpayer’s liability is insufficient to take full advantage of the credit, the bill provides that the taxpayer may sell the credit by means of a tax credit transfer certificate program.
Senator Buono noted that this measure also helps to combat sprawl and preserve open space.
“As we work to maintain our green spaces and curb sprawl, we need to ensure that our long-standing neighborhoods remain vibrant. Restored historic buildings can serve as a beacon in this endeavor,” explained Senator Buono.
To qualify for the tax credit provided for in the bill, the property to be rehabilitated must be individually listed or located in a district listed on the National or New Jersey Register of Historic Places, and if located in a district, certified as contributing to the district’s historic significance and identified for protection as a significant resource in accordance with criteria established by the appropriate municipality and approved by the State Historic Preservation Officer.
“New Jersey has a long and rich history, and our historic buildings tell that story in a unique way that will be lost if we don’t constantly act to keep them well-maintained. These tax credits will help history buffs and community groups to keep these sites in good condition,” added Senator Buono.
In addition, the homeowner seeking the tax credit must agree to spend no more than 60% of the cost of rehabilitation on the interior and own and occupy the property as their principal residence for twelve consecutive months following the completion of the rehabilitation.
The bill would limit the cumulative amount of the tax credits to $15 million in fiscal year 2008, $25 million in fiscal year 2009, $40 million in fiscal year 2010, and $50 million in fiscal year 2011 and thereafter. In addition, the bill would require that in any given year, 33 percent of the total approved credits would be to homeowners.