Earlier this month, the Pennsylvania Department of Community and Economic Development (PA DCED) announced that 22 projects across the Commonwealth were awarded a total of $5 million in Pennsylvania Historic Preservation Tax Credits (PA HPTC) through the FY 2022-2023 PA HPTC Allocation.
What are the Pennsylvania Historic Preservation Tax Credits?
The PA Historic Preservation Tax Credit program provides tax credits to qualified taxpayers who will be completing the rehabilitation of a qualified historic structure into an income-producing property. The program is administered by DCED with assistance from the PA Department of Revenue and PA SHPO,
To be eligible for the state historic preservation tax credit:
- properties must be listed in the National Register of Historic Places or contribute to a listed historic district;
- applicants must have a rehabilitation plan that is approved by PA SHPO as being consistent with The Secretary of the Interior’s Standards for the Treatment of Historic Properties; and
- applicants must be qualified taxpayers, which includes an individual, corporation, limited liability company, limited liability partnership or any other form of legal business entity.
In each application round, a maximum of $5 million in tax credits is available for distribution to qualifying projects on a first come, first serve basis, with equitable regional distribution.
Applications are accepted once a year, typically in early October. DCED’s website includes a link to the application.
Zion Baptist Church received one of the PA HPTC allocations this year. Photo by Kevin McMahon. Source: Zion Baptist Church and Educational Annex National Register Nomination.
Isn’t there another tax credit program for rehabilitating historic buildings?
Yes! The federal Historic Tax Credit, which is also known as the Rehabilitation Investment Tax Credit, allows owners of income-producing properties to take a dollar-for-dollar tax credit on federal income tax for eligible costs related to the rehabilitation of a historic property for a new use. PA SHPO administers the Historic Tax Credit program in partnership with the National Park Service and the Internal Revenue Service.
A 20% credit is available. To be eligible for this federal historic tax credit:
- the property must be individually listed in the National Register, contribute to a National Register historic district, or contribute to a Certified Local District;
- the property must be used for income-producing purposes;
- the property must be owned by the same owner and be an income-producing property for five years;
- the rehabilitation work must follow The Secretary of the Interior’s Standards for the Treatment of Historic Properties; and
- the project must meet the “substantial rehabilitation test” and be completed within 24 months.
The International Harvester Company of America, Pittsburgh Branch House before rehabilitation in 2019. The project utilizes federal and state historic tax credits. Photo by Jeff Slack: Source, National Register nomination form.
What project received allocations this year?
In this last round, 31 projects were forwarded to PA SHPO for review with a total request over $12.7 million dollars. These projects also applied for the federal historic tax credit and represent over $403 million in estimated rehabilitation expenses. PA SHPO’s role is to confirm that the building is a historic property and that the proposed work meets the Standards. Of the 31, we determined that 24 projects were eligible.
Here are the successful applicants:
| Project Name | County | Tax Credit | Project Description |
|---|---|---|---|
| 832 Western Avenue | Allegheny | $75,000 | Rehab of historic residential property |
| International Harvester Co: Pittsburgh Branch House | Allegheny | $350,000 | Rehab of 1902 IH Co Branch House into 38 market rate housing units |
| Wood Street Building | Allegheny | $450,000 | Rehab former McCreery & Co Dept Store into 253 market rate housing units and some commercial space |
| Medical Arts Building | Berks | $400,000 | Rehab of former medical building into 31 affordable housing units |
| First National Bank Building | Blair | $25,000 | Rehab of former bank building to continue use as venue and office building |
| McCrory's Building | Blair | $175,000 | Rehab of former dept store into retail space and 8 housing units |
| 321 North Front Street | Dauphin | $150,000 | Rehab of office/apt building into 6 market rate housing units |
| Ridgway Central Public School | Elk | $245,000 | Rehab of former school into mixed use offices and 17 apartments |
| Erie Trust Company Building | Erie | $500,000 | Rehab of former office building into hotel |
| St. Joseph's Hospital | Lancaster | $350,000 | Rehab of former medical complex into mixed-use with retail spaces and apartments |
| Bell Telephone Company - Wilkes-Barre Central Office | Luzerne | $250,000 | Rehab former office building into 12 apartments |
| Vernon Hall | Philadelphia | $150,000 | Rehab of vacant commercial building into retail space and 16 market rate housing units |
| 1904 Mt. Vernon Street | Philadelphia | $75,000 | Rehab of rowhouse into 5 apartment units |
| Hahnemann Medical College and Hospital Complex | Philadelphia | $155,000 | Rehab updates 3 existing medical buildings into medical education and laboratory space |
| The Battery | Philadelphia | $275,000 | Rehab of vacant industrial building into mixed-use event facility with offices and 284 market rate housing units |
| Blumenthal Brothers Chocolate Factory | Philadelphia | $200,000 | Rehab of existing multi-building industrial property into multi-tenant commercial and light industrial use |
| Beury Building | Philadelphia | $275,000 | Rehab of vacant bank and office building into a hotel |
| Belfield Lofts | Philadelphia | $200,000 | Rehab of 2 vacant mill buildings into 77 residential units, 8 of which will be affordable housing units |
| Penn Asylum for Indigent Widows and Single Women | Philadelphia | $150,000 | Rehab of charitable women’s housing complex into 45 apartments |
| Rev. Leon H. Sullivan Community Impact Center | Philadelphia | $150,000 | Rehab of vacant church and educational building into a community center with offices and outreach services |
| Conrad Bischoff Planning Mill and Furniture Factory | Schuylkill | $150,000 | Rehab of factory complex into a bed and breakfast and artist studio space |
| Edward Fox Baking Company | York | $250,000 | Rehab of converted office building into mixed-use commercial and residential space with 43 market rate housing units |
The Bell Telephone building in downtown Wilkes-Barre, Luzerne County was one of 3 state historic tax credit recipients in NE PA.
Interested in learning more?
There are three easy ways you can learn more about the historic tax credit programs available to rehabilitate historic buildings in Pennsylvania:
- search our blog using the key word “tax credit,”
- check out our website, and
- get in touch with PA SHPO’s tax credit staff.
