The Historic Tax Credit Growth and Opportunity Act (HTC-Go) ((H.R. 2941/S. 1459), recently introduced by Reps. Darin LaHood (R‑IL), Tom Suozzi (D‑NY), Sen. Bill Cassidy (R‑LA), and Sen. Mark Warner (D‑VA), proposes several changes to the federal Historic Tax Credit that would make it more effective and easier to use for the rehabilitation of historic buildings in Main Street districts. As Congress is quickly moving to craft tax legislation, now is the time to contact your representatives to request their support. 

The Historic Tax Credit is a vital tool for Main Street districts

The Historic Tax Credit (HTC) is a 20% credit on the qualified rehabilitation costs of a structure either listed individually on the National Register of Historic Places or listed as a contributing structure to a historic district. The HTC has spurred the rehabilitation of over 49,000 historic buildings, has created nearly 3 million jobs, and has produced over 199,000 low and moderate-income affordable housing units, according to the National Park Service HTC Annual Report (2023). Each year, almost half of all completed HTC projects are less than $1 million in project size. Historically, almost 10% of HTC projects have been located within the boundaries of Main Street districts.

The HTC helps communities embrace their historic structures and leverages those existing assets into new, tax-generating uses. According to HYPERLINK ​“https://mainstreet.org/the-latest/news/building-opportunities-on-main-street-through-the-booms-tracker“data from the BOOMS Tracker, a quarter of the buildings in Main Street districts are either eligible to use the HTC or may be eligible. Of those historically and culturally significant buildings, over 30 percent are sitting vacant. With the support of HTC, these buildings can breathe new life and economic potential into communities.

Main Street developers and leaders face challenges with the HTC

Any rehabilitation project for a small building is complex. Main Street leaders report absentee landlords, lack of skilled labor and local capacity, and lack of financial resources as key barriers. The HTC can and does help make rehabilitation a reality, but developers using the credit face challenges. 

Using the HTC for small projects can be difficult due to the need to ​“syndicate” the credit, which creates transactional costs that pose a significant burden, particularly on small and rural projects. This stands in contrast to ​“transferability,” where the recipient of a tax credit can transfer the value of the credit to another taxpayer without complicated partnerships. In 25 states, the state historic tax credit program allows for transferability. Main Street leaders report that this provision makes use of the tax credit more effective for commercial district buildings.

Additionally, in 2017, the HTC was threatened with removal from the tax code. While advocates – including many Main Street leaders – rallied for its survival, changes in the credit lessened its real value to projects. 
 

HTC-Go proposes improvements that can help transform Main Street communities

The provisions in HTC-Go include:

• Incentives for small and rural projects: 
  • Projects under $3.75 million receive a 30% credit. 
  • Rural projects under $5 million also receive a 30% credit. 
  • Small and rural projects gain the ability to transfer credits directly without needing complicated investment partnerships.
• Restoring the one-year credit delivery, increasing upfront value for developers. 
• Reducing the rehabilitation requirement from 100% to 50% of building basis, opening the door to more modest projects.
• Eliminating basis adjustment, making it easier to pair with other programs like the Low-Income Housing Tax Credit (LIHTC).
• Improving use by nonprofits.

This is an urgent moment for Main Street advocacy. Our collective goal is to see HTC-Go included in pending tax legislation. House Ways and Means Committee members are currently drafting legislation as part of a Republican-led reconciliation bill. The Senate Finance Committee will soon follow. While Democratic members will have little input in this process, outreach to all members is important to raise the needs of Main Street. 

Reach out to your Members of Congress to voice your support 

Call your U.S. Representative and Senators to express support for HTC-GO (H.R. 2941/S. 1459). Ask to speak with the tax policy staffer. Find your Members of Congress here. We suggest you include this information in your message: 

1. Introduce yourself and the work of your Main Street program. 
2. Share a project in your community that has benefited — or could benefit — from the HTC. 
3. Make the ask: ​“As a supporter of Main Street revitalization, I urge you to cosponsor and support the Historic Tax Credit Growth and Opportunity Act (H.R. 2941/S. 1459). This bill will restore lost value to the HTC, make it easier to use, and increase investment in small towns and rural communities.” 

Tell us about your call! Email the MSA Government Relations team at advocacy@​mainstreet.​org so we can document who you spoke with and track advocacy efforts. 

Want to share this easily with others? Send this memo to city leaders, local property owners and developers, and other advocates interested in supporting Main Street!