Governor Kaine Highlights Virginia's Second Consecutive #2 Rank in Historic Preservation

Press Release

- Federal, state tax incentives promote historic preservation -

In recognition of May as National Preservation Month, Governor Timothy M. Kaine today announced that the National Park Service has ranked Virginia #2 among the 50 states for a second consecutive year in the use of federal tax incentives to rehabilitate historic buildings. The National Park Service's annual report on fiscal year 2006 lists Virginia with 114 proposed federal tax-credit projects, second only to Missouri, and 109 completed projects, behind Ohio.

State and federal rehabilitation tax credits can be combined to leverage 45% of eligible expenses, making multi-million dollar projects possible across Virginia. In fact, the total private investment in Virginia leveraged through rehabilitation projects completed and certified by the Park Service during fiscal year 2006 was more than $172 million. That is $43 million more than the previous year, and places Virginia fifth in the nation among states for dollars leveraged.

"This report from the National Park Service reinforces the fact that Virginia has a strong, well-managed historic preservation program that attracts market-driven, private investment," Governor Kaine said. "The program has a track record of success that results in jobs and economic revitalization in urban historic cores and other communities across the Commonwealth."

The National Park Service report only reviews activities under the federal program, yet the growing success of the Commonwealth's parallel tax-incentive program, initiated in 1997, has consistently kept Virginia among the top states in the nation for rehabilitation of historic properties in recent years. The state credit also has stimulated interest in rehabilitation of historic buildings, driving increased use of the federal program.

"Reusing historic buildings is good preservation, good economic opportunity, and good urban revitalization," said Kathleen S. Kilpatrick, Director of the Department of Historic Resources, the agency that administers the state and federal tax incentive programs. "We have a model program for the nation, and the results of the state and federal tax incentives can be seen in communities across Virginia as we work to promote the recycling of historic buildings for residential and commercial adaptive reuse."

As a public investment, tax credits are largely a self-funded program since revenue generated by tax-credit projects offset the state's initial investment, Kilpatrick said. For instance, these projects boost state revenue from taxes on wages generated by new jobs and on sales of goods and services and increase local revenues by taxes on increased values on real estate. Historic rehabilitation also increases heritage tourism.

For more information on state tax incentives available for the rehabilitation of historic buildings, visit the Department of Historic Resources website www.dhr.virginia.gov.

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