New Jersey’s past is its future — and preserving historic sites from our past is the best way to build a future for generations to come.
The state of New Jersey could embrace an excellent public policy tool for building its future by adopting a state historic tax credit (HTC) to incentivize renovation and rehabilitation of historic sites. Thus far, the state government has lacked the will to do so. For decades, governors and legislators have been weighing the concept of an historic tax credit. In 2012, there was hope when a bipartisan bill passed the Legislature, only to be vetoed by the governor. In the 2018-2019 legislative session, legislators again flirted with adoption and Gov. Phil Murphy publicly supported an HTC, but the proposed bill never made it to a floor vote. The initiative seems to have become ensnared in the larger debate about development incentives.
On Jan. 14, Sens. Shirley Turner (D-Mercer), Joseph Cryan (D-Union), and Teresa Ruiz (D-Essex) reintroduced the Historic Property Reinvestment Act (S-412), which provides credits against state taxes for the costs of rehabilitating historic properties. If we are lucky, history won’t repeat itself for this bill.
Preservation New Jersey (PNJ) urges our government officials during the new legislative session to evaluate historic sites’ development through a different lens. New Jersey needs a statewide law that would give developers and homeowners an economic reason to take the risk and invest in the revitalization of older communities and historic structures.
An HTC drives economic development:
- It creates jobs during both the rehabilitation phase and the building’s operation.
- It increases revenue in the form of income taxes, sales taxes and property taxes.
- It incentivizes developers and banks to invest locally, especially in economically distressed areas they might not otherwise consider.
- It revitalizes run-down areas while making use of existing infrastructure.
- It results in “spillover” effects that extend beyond the rehabilitated building, improving the local economy and attracting businesses to the surrounding area.
For those who fear loss of state revenue if an HTC is implemented, they should note the following: Similar tax credit programs in other states have generated strong net tax revenue to the state. In Maryland, for example, the historic tax credits return over $3 for every dollar invested. Between 1978 and 2015, the National Park Service’s federal historic tax credit for income-producing buildings led to $28.1 billion in federal tax receipts, a significant net gain over the $23.1 billion in allocated credits.
Thirty-seven states have a historic tax credit and are reaping the benefits of restoration and rehabilitation of their historic resources. They also are doing a much better job than New Jersey at leveraging federal historic tax credit dollars. Without a state HTC, New Jersey is missing out on a proven strategy for economic growth and revitalization.
The dream of PNJ is to advocate so successfully for saving New Jersey’s historic sites that New Jersey’s endangered historic sites would become history.
Unfortunately, we are a long way from realizing that fantasy. Twenty-five years ago, PNJ created its first list of the 10 Most Endangered Historic Sites in New Jersey. And every year since, we have produced this list to highlight fading historic, architectural, cultural and archaeological sites with the hope of raising awareness about the benefits of preservation. Out of the 250 properties on the 10 Most list, about 15% have been restored and are again in use, while another 15% succumbed to development or nature and are lost forever. The rest remain in some state of limbo, awaiting the necessary interest and/or funds to restore them. After a certain period of time without restoration, these endangered sites will also be lost forever.
A benefit to the community
Preservation of historic properties is more than a feel-good activity of nostalgia. Preserving old buildings is beneficial not only for a community’s culture, but also for the local economy and for the longterm sustainability of our society. Earlier this year, PlaceEconomics published a report citing the Twenty-Four Reasons Historic Preservation is Good for Your Community. Here are just a few of the reasons it’s good for New Jersey:
- Jobs: Historic preservation requires labor-intensive work, employing carpenters, electricians, plumbers and other tradespeople. In Delaware, for example, rehabilitation of historic structures created 14.6 jobs for every $1 million spent, while new construction created 11.2 jobs per million.
- Downtown revitalization: Think of all the “best downtown” articles you may have read over the years. What separates the best from the rest? Compared to strip malls and other modern retail developments, historic buildings are what make downtowns distinctive. This historic character, along with the walkability typically associated with historic development patterns, is what is driving the downtown resurgence. Not only that, the unique spaces in historic buildings are attractive to small business, as well as startups and young businesses.
- Tourism: In 2018, heritage tourism in New Jersey generated $3.52 billion in revenue, $385 million in state and local taxes, and 39,000 jobs. The average heritage tourist spends just over $1,300 compared to an $800 average spend for general tourism, largely because heritage tourists spend more money on dining and shopping and are more likely to stay at a hotel or inn.
- Property values: Many believe that more restrictions make a property harder to sell, and thus reduces value. Study after study, however, has proven that values tend to be higher in historic districts and that they are less vulnerable to foreclosure during market downturns. That’s good both for the property owner and the property tax base.
- Millennial housing of choice: Trying to attract the largest age cohort? A recent survey by the National Trust for Historic Preservation found that 44% of millennials surveyed wanted to live in historic, “character-rich” neighborhoods. Housing trends back this up. While millennials only represent 34% of all homebuyers nationwide, they represent 59% of all buyers of houses built before 1912 and 43% of buyers of houses built between 1912 and 1960.
- Structures tell stories: Historic buildings are a community’s tangible connection to our past. From Native American heritage to the crossroads of the American Revolution to women’s suffrage, the civil rights movement, the struggle for LGTBQ parity and many more moments important to our culture and heritage, historic sites help to tell the stories of our diverse past.
- No going back: The preservation of historic buildings is a one-way street — once a piece of history is destroyed, it is lost forever.
This last point is the theme of a new documentary PNJ is unveiling on March 4 at a gala celebration. The documentary, “Saved or Lost Forever,” delves into the history of three endangered properties that have moving stories to tell — Camden High School, Lower New York Bay’s Romer Shoal Light (a lighthouse) and the Van Wagenen (Apple Tree) House of Jersey City. These properties are unable to talk, so PNJ is telling their stories in hopes that they will inspire state and local officials, developers and corporate leaders, as well as individual citizens, as to the pressing need for preservation.
The 10 Most documentary will premiere a celebration gala at Newark Symphony Hall, included on the first 10 Most list 25 years ago. If passed, historic tax credits could play a major role in the long overdue restoration of the historic venue, providing a strong anchor for Newark’s Lincoln Park Coast Cultural District. We will continue our work to advocate for the passage of an HTC bill in the new legislative session and continue our advocacy on behalf of New Jersey’s endangered sites. We need individual citizens to recognize the peril of not doing so and rally around the PNJ mission in order to deliver a future rooted in our past.
More information about the gala and documentary premiere on March 4 at: www.preservationnj.org/10-most-gala/