A few weeks ago Gov. Rauner signed the Historic Preservation Tax Credit Act in Illinois that will support economic growth in the Illinois Quad Cities. That’s exciting news for developers and city officials alike, as the new legislation will offer a 25 percent state income tax credit for qualified expenditures on historic rehabilitation and re-use projects that meet certain criteria, up to $3 million per project. The new legislation allows tax credits similar to those already in place in Iowa.
According to a report prepared by the University of Illinois – Springfield, projects likely to use the credit would generate as much as $10.24 in economic impact per $1.00 in historic tax credit award during the construction phase alone, and up to $11.47 per $1.00 in the first five years after completion.
In the Illinois Quad Cities, hundreds of structures could potentially be eligible for the credit based on data for National Register Historic District and Local Landmark properties.
One such local property is the former Spiegel building near the base of the I-74 bridge construction. Originally built as Eagle Signal Company in the 20s, it was later the home of Spiegel Moving & Storage for more than 50 years before being purchased by the City of Moline in 2016. The four-story building features exposed brick and its original oak floors, which the city envisions as potential apartments or mixed use development. Currently vacant, it already has had interest from several parties.
“These tax credits helps our area compete on a level playing field with other communities,” says Jeff Anderson, Moline City Planner. “Being able to offer this financial incentive is a win not just for potential developers but also for the city where the property is located.”
Anderson estimates that an average project would generate approximately $60,000 annually in new property taxes. With an expectation of three to five projects per year, this would generate approximately $180,000 to $300,000 in new property taxes annually for the Illinois Quad Cities. Based on past experience, an average rehabilitation project for an average building might generate $2,000,000 in new investment and property valuation.
Legislation priority of Chamber
The expansion of the tax credits statewide has been a legislative priority for the Quad Cities Chamber, which has been advocating in Springfield for their availability as an economic development tool the past three years. With 85 percent of its membership having 50 employees or less, advocacy is a critical resource offered by the Chamber to its members.
“At the Quad Cities Chamber, we are committed to advocating public policies that enhance our economic competitiveness, increase investment, and benefit our members and communities,” said Chamber President & CEO Paul Rumler. “We would like to thank our legislators in Springfield who overwhelmingly supported this program, specifically Representatives Halpin and McCombie and Senators Anderson, Weaver, and Dan Swanson. Their belief in this as a means to spur growth and create jobs in our area gives us momentum as we work to build a cool, creative, connected, and prosperous region.”
The program, which will be in effect from Jan. 1, 2019 to Dec. 31, 2023, will distribute up to $15 million in credits annually on a first-come, first served basis. The Illinois Historic Preservation Tax Credit Program will be operated by the Illinois State Historic Preservation Office at the Dept. of Natural Resources. More information is available HERE>>.