The Alabama Legislature on Friday approved a bill to restore tax credits to encourage renovation of historic buildings.
The bill, House Bill 345, now goes to the governor for her signature.
The program, which expired last year, helped fund restoration of 51 buildings across the state, most notably in Birmingham and Mobile. The revised program would grant tax credits of up to $5 million per restoration project. Tax credits issued each year would be capped at $20 million, with the money coming from sales tax revenues in the Education Trust Fund.
One big change from the previous program is that projects to be granted the tax credits would be determined by a new Historic Tax Credit Evaluating Committee, made up of state officials.
Previously the tax credits were granted on a first come, first served basis.
The new bill also would require that 40 percent of tax credits awarded each year be assigned to projects in counties with populations of 175,000 or fewer people. That means 40 percent of the money would go to projects outside the state’s seven largest counties.
Buildings 60 years old or older would be eligible for the tax credits. Previously, buildings 50 years old had qualified.
But an earlier Senate version of the bill had been amended to require that buildings be 75 years old or older to be qualify for a tax credit.
Sen. Slade Blackwell, R-Mountain Brook, objected to the 75-year requirement, saying that would rule out tax credits to preserve buildings that are historic because of their significance during the Civil Rights Movement, an important distinction in Birmingham.
In fact, Birmingham has benefited from the program more than any other city. Twenty of the 51 projects carried out across the state have been in the city, including the Florentine Building and the Lyric Theatre.
Three of the seven buildings still on a waiting list to be considered for tax credits if they are renewed also are in Birmingham – the E. Haskins Williams House; the Birmingham Memorial Company Buildings and the Ben Jacobs Furniture Company Building in Birmingham.
Mobile has the second-most projects that have been granted credits, 15, and six were in Tuscaloosa. The rest of the projects were scattered around the state.
Rep. Victor Gaston, R-Mobile, sponsor of the bill in the House of Representatives, said that if the tax credits are good for Birmingham and Mobile and put people to work, then that’s good for the state.
But he also said he understood legislators’ desire to make sure other parts of the state had a good shot at renovating buildings using the tax credits.
Despite the desire to tweak parts of the tax credit program, the bill has gotten widespread support this year.
After failing last year because of fears about the cost to the state, this year the bill had 87 co-sponsors in the 105-member House of Representatives and 29 co-sponsors in the 35-member Senate.