Background

The Historic Preservation Tax Credit (HTC) was signed into law by Governor Whitmer in December 2020. A tax credit lowers the amount of state income tax owed by the historic resource owner. The Michigan historic preservation tax credit is a state income tax credit of 25% that is available for certain historic resources. The drawback was the credits were capped at $5 Million, an amount proven to be inadequate when the application portal opened on June 15, 2022. Commercial credits were claimed within just over 5 hours and residential credits closed in 13 days. 

The expansion proposed on February 7, 2024, first and foremost aims to increase the current $5 million annual credit cap to $100 million. The expansion also looks to increase the credit from 25% to 30% for small income-producing and residential projects, expand eligibility of properties, and “level the playing field” among the actual sizes of incoming-producing projects.

Why

Historic buildings are tangible links with the past. They help give a community a sense of identity, stability and orientation. The federal and state governments encourage the preservation of historic buildings through various programs, including federal and state income tax incentives to support the rehabilitation of historic buildings. 

Preservation projects help meet Gov. Whitmer’s housing goal of building or rehabilitating 10,000 housing units. These projects are ideal for small towns and mid-size communities. With the passage of HB 5430, the credits can fill financing gaps for large projects in urban cores and help historic buildings in the smallest communities and urban areas.

CAN Commitments

The Cultural Advocacy Network of Michigan (CAN) commits to:

• Engage professional lobbyists to influence political decisions related to our legislative priority.

• Include this legislative priority as a primary focus for legislative meetings and events CAN hosts throughout the year, including Cultural Advocacy Day.

• Inform CAN’s community of advocates on relevant information and updates to our legislative priority.