IMPORTANT - Historic Rehabilitation Tax Credits in Jeopardy!!!

[TheLofts@120]

The Tulsa World ran the following article today highlighting the legislature's proposal for a 2 year moratorium on historic rehabilitation tax credits that could, and likely would, halt or kill many proposed redevelopment projects in the downtown Tulsa area and across the state. 

I urge you to read the article and if you support the legislature hearing the amended proposal and voting in favor of it, please contact your state Representatives and Senators immediately.  The amended proposal must be heard and voted on by end of business tomorrow!!

Ask for support for the trailer bill and tell our legislators that the bill needs to be heard!

Please ask your colleagues, friends, neighbors, kids and pets to do the same.
To show your support for keeping the tax credits in place, please contact the following:

CHRIS BENGE (Speaker of the House) 405-557-7340
REP. KRIS STEEELE 405-557-7345
SEN. COFFEE 405-521-5636

These credits helped make the Mayo, Mayo420, Philtower, and Atlas Life projects happen (among many others).  Support the continued redevelopment of downtown and preservation of its historic architecture.

Striking a blow to history

by: MICHAEL OVERALL World Staff Writer
Thursday, May 27, 2010
5/27/2010 4:19:17 AM

Standing outside a loft project that he's designing in downtown Tulsa's historic Brady District on Wednesday, architect Mike Sikes could hear the hammering and sawing from another building under renovation around the block.

"After simmering for years," Sikes said, "the revitalization of the Brady area was about to really catch fire."

Then he somberly repeated the keyword: "was."

Not "is."

Revitalization efforts will become impossible to finance if the state Legislature doesn't change its mind about revoking a tax credit for historic properties, Sikes warned.

"Developers are going to turn away from Oklahoma," said Sikes, whose current projects include loft apartments at the old Robinson Packer building near Main and Brady streets.

"All the progress we see right now will stop."

Developers and officials statewide agree with him, predicting that investors will pull out of revitalization projects across Tulsa, Oklahoma City, Muskogee and elsewhere.

With the legislative session ending Friday, preservationists are lobbying hard to persuade lawmakers to act in time.

"There's a lot of work going on behind the scenes to avoid disaster," said Melvena Heisch, deputy state historic preservation officer. "But time is running out."

The Legislature voted last week to impose a two-year moratorium on 30 separate tax credits worth a combined $25.7 million in state revenue next year and $50 million in 2012.

Preservationists didn't expect the moratorium to include the State Rehabilitation Tax Credit, which gives a 20 percent credit for projects that meet certain standards in renovating historic properties.

But the "rehab credit" did, in fact, wind up on the final list approved as part of Senate Bill 1267, which has not been signed by the governor.

"We were shocked to hear it," said Michael Abernathie of Tulsa's Sikes-Abernathie Architects, specializing in the renovation of historic buildings across the Midwest.

This particular tax credit actually makes money for the state, considering how much investment it lures to Oklahoma, Abernathie said.

"Other states have credits like this, and they're competing for these investment dollars. Oklahoma is handing them a huge advantage."

Critics often suggest that the tax credits simply increase profits for rich investors, Abernathie said, adding that "that's not the case."

In the complex financing schemes that make large-scale renovations possible, profit margins become so tight that a tax credit is needed to make a project financially viable, he said.

"It's the difference between a project happening or not happening," he said. "Think of all the jobs at stake."

Even if Oklahoma reinstates the tax credit after a two-year moratorium, investors will hesitate to put money into projects here, said Sikes, Abernathie's business partner.

"Who would ever trust that the rug won't be pulled out from under them again? Would you?"

Indeed, out-of-state investors have already promised to pull out of Oklahoma if the tax credits disappear.

In Muskogee, for example, Garrison Development of Kansas City, Mo., renovated the 10-story Surety Apartments in 2006. The successful project encouraged the company to buy another 10-story building in downtown Muskogee.

"That deal is dead if SB 1267 is signed into law," the company promised in a written statement this week.

"Garrison Development has another $50 million in projects under consideration in Tulsa and Oklahoma City that will surely die too."

The Tulsa Preservation Commission counts at least 10 "active projects" in the metropolitan area that are counting on the tax credits, plus more than 20 other projects across the state.

Several other projects remain in various stages of planning but likely won't happen at all without the tax credits, said Amanda DeCort, the commission's preservation planner.

All week at the state Capitol, preservationists and developers have been frantically meeting with legislators to urge them to reconsider the issue before the session ends Friday, DeCort said.

"It's not over yet," she said. "But if this goes through, it's going to be a very big blow for downtown Tulsa."

--------------------------------------------------------------------------------


Tulsa, state projects
Recent or ongoing Tulsa projects made possible by state tax credits:

Mayo Hotel

Mayo Building

Philtower Lofts

Atlas Life Courtyard by Marriot

Tribune Lofts

Ambassador Hotel

Planned renovations that might not happen without the tax credits:

Gates Warehouse

Tulsa Paper Co.

Robinson Packer (Regal Hotel)

Detroit Street Lofts

Cities Service Station No. 8

Other projects statewide:

Chickasha Hotel, Chickasha Manhattan Building, Muskogee

Wells Building, Sapulpa

Jewel Theater, Oklahoma City

Buick Building, Oklahoma City

Chieftain Pontiac Building, Oklahoma City

Hadden Hall Hotel, Oklahoma City

Seiber Hotel, Oklahoma City

Seavers Block, Muskogee

Source: Tulsa Preservation Commission

[Townsend]

Man...it really is how we do things around here isn't it?

Seriously, it seems as soon as our foot heals up we shoot the other one.

[SXSW]

Several of our upcoming development would seriously be impacted by this legislation.  Please let the legislators know how you feel. 

[TURobY]

I just finished my civic duty. 

[Conan71]

When I Googled SB-1267, Oklahoma, I got the text of a bill which takes away the 50% electric car credit which was being exploited for Rodney Dangerfield style golf carts. 

Was this some sort of catch-all bill for multiple tax credits?  Cutting the credits for development does seem to be cutting off the proverbial nose.

[TheLofts@120]

The Tulsa Foundation for Architecture has some information on this as well as a link to post a comment to Gov. Brad Henry.  They also provide email language should you choose to copy and paste in lieu of your own. 

Please send this to all your friends and ask their support in keeping the tax credits in place.

Thanks

Will Wilkins

http://tulsafoundationforarchitecture.blogspot.com/

There you will find a highlighted link to the Gov. Brad Henry web page where you can post a comment and send.

[TheLofts@120]

And yes Conan, the bill targets over 30 different tax credits for moratorium.  What I dont understand is the legislature seems to think that this is taking money out of a budget.  The fact is, if the credits were not available, most acvtivities that are benefitted by the credits wouldnt likely take place anyway, so no loss of tax revenues.

On the historic rehabilitation credit, many developers utilize these to redevelop previously obsolescent properties that were not sales tax revenue generating to begin with, but transform them into revenue generating projects that also bring increased job opportunities that further increase the sae tax revenues and at the same time, increase ad valorem taxes through increased property values. 

In terms of the electric 'car' credit, I can understand a somewhat different view, however, the legislature could decrease the state level tax credit while still promoting the utilization of 'greener' transporation within the state.  Getting some tax revenue is better than getting none in wiping out the entire credit I would think.

The logic here escapes me.

[Conan71]

The logic here escapes me.

I'm equally miffed.

[Townsend]

http://tulsafoundationforarchitecture.blogspot.com/

There you will find a highlighted link to the Gov. Brad Henry web page where you can post a comment and send.

Done.

[Gaspar]

Likewise. . . and I was a bit verbose.

[dsjeffries]

I wrote Senator Adelson in a hurry this morning, and made some calls for action on facebook. Probably need to email the authors of the bill, as well. The word is spreading among my group of friends. Here's what I posted on facebook... Feel free to take it, post it as a note and tag all of your friends--we can't let this happen.


Friends,

Please add your voice to the crowd on this matter. The State Senate will vote soon on a bill that would eliminate over 30 tax credit programs including energy efficiency improvement credits (like Energy Star), and the State Rehabilitation Tax Credit, which provides incentives for developers to preserve and restore historic buildings, all in an effort to plug their $6 million hole (a hole they created, by the way). They're looking at cutting these programs and education first. Neither can be allowed to happen.

These programs generate value for a state that seems intent on doing the opposite.

The SRTC in particular actually MAKES MONEY for the state, bringing in millions of dollars of new development and thousands of jobs while creating new tax revenues and restoring historic buildings. More than $50 million from just ONE developer will be absent from the state if this happens. That's ONE company that WOULD be investing $50 million in Oklahoma. They've said they will not move forward with their projects if this is revoked, and many developers have already echoed their statements.

These programs are absolutely vital to Oklahoma's future. If we're looking to be competitive with our jobs, energy independence, tax dollars, development, and actually attract residents, we need these programs to remain intact.

Take a moment to visit http://www.capitolconnect.com/oklahoma/ , enter your address and write an email to your legislator. I sent the following, hurried letter to Senator Adelson (below), earlier this morning, and I urge you to write a quick note, as well.

Here are some links detailing some of the effects of SB 1267:
http://www.tulsaworld.com/news/article.aspx?subjectid=11&articleid=20100527_11_A1_Archit794530
http://e-lobbyist.com/gaits/OK/SB1267
http://www.moderntulsa.net/2010/05/26/historic-tax-credits-sb-1267/
http://www.newsok.com/measure-to-pause-30-credits-advances/article/3462227?custom_click=pod_lead_politics


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Mr. Adelson,

I write to you today distraught over the potential passage of Senate Bill 1267 and ask you to vote no on it. As you know, SB 1267 would eliminate over 30 tax credit programs, including the State Rehabilitation Tax Credit, energy efficiency tax credit programs (like Energy Star) and many others. These tax credits are important to the preservation of our most treasured buildings and homes, and provide incentives for developers. These programs make money for the State of Oklahoma by attracting developers and investors to our historic structures. One company from Kansas City alone has more than $50 million in development that will not go forward if the SRTC is cut. These developments not only preserve our buildings, but they create jobs and generate much-needed revenue for the State. There will be serious repercussions if this bill is passed. Developers will pack up, leave and not look back. Jobs will be lost. Revenue will be lost. The growing momentum of preserving our historic downtowns and main streets will be lost.

These tax credit programs are vital to the future of our state. Our buildings, our energy independence, our jobs, families, companies and communities all benefit from these programs. If we allow ourselves to move backward as a state, how can we expect an outsider's view to be positive?

Please vote no.

Thank you for your consideration, and thank you for your service to the people of Tulsa and eastern Oklahoma.

Daniel Jeffries

[OurTulsa]

Called Chris Benge's office to voice my concern.  The aide indicated he'd been receiving quite a few calls concerned with this issue.

[Conan71]

Done- I went to the top.

Dear Governor Henry,

The sweeping cuts on tax credits contained in SB-1267 will have the unfortunate impact of losing millions and millions of investment dollars in the preservation and re-development of historic properties in the central business districts of every significant Oklahoma community.

For the relatively minimal amount of revenue anticipated to be recaptured by ending these credits, it will cost far more in the loss of future sales and use tax, property taxes, and payroll taxes. This is incredibly short-sighted lumping all these credits together.  There have got to be better ways to raise revenue and cut expenditures.

Please do not sign this bill.  This will be a disaster for jobs, historic preservation, and revitalizing downtown districts throughout Oklahoma. 

Sincerely
Conan70
Tulsa, Ok.

[Weatherdemon]

Done.

Done, along with 5 emails or web contact forms filled out to other senators and reps.

[PonderInc]

Here's the latest from the Preservation folks in the know...(although I couldn't find anything on SB 723 below...so not sure if that's the right number for the trailer bill)

The last news I've heard is that the trailer bill is stuck in committee and has not yet made it to the floor.  

I am told that anyone with a finance or banking background should call Rep Ken Miller, Chairman of the House Appropriations Committee, ASAP and speak in support of the trailer bill.  405-557-7360.  No emails, just phone calls, is the word on the street.

Trailer bill supposedly will be SB 723.  I believe it will change the restrictions from a two-year moratorium to a one-year deferrment of the tax credits.  

Keep your fingers crossed.  And get your bankers friends on the phone!