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A door of opportunity opened up for some West Virginia communities earlier this month, when state legislators approved a change in tax law. Let us hope Congress and President Donald Trump are not about to close it.
State lawmakers approved a change in the state tax credit for redevelopment of historic buildings. Formerly 10 percent, the credit now will be 25 percent. That makes it competitive with adjoining states.
Officials in towns and cities with lots of historic structures have sought the change for some time. It could be enough to persuade developers to take on some major historic building renovation projects here, they believe.
But hopes just raised by the increased state tax credit may be dashed.
Federal law allows a tax credit for rehabilitating historic structures, too. It is 20 percent.
Between the two credits, one on state taxes and the other on federal returns, developers have an incentive to take the risk of repairing and improving old, sometimes dilapidated, buildings. As we have seen in Wheeling, when business people are willing to take that risk, it can pay off for them and our community.
But members of Congress, working with the White House, are crafting a tax reform bill. It is aimed at helping the middle class and encouraging business expansion. As part of the process to simplify tax preparation, some income tax credits may be eliminated.
Among them is the Federal Historic Tax Credit.
U.S. Rep. David McKinley, R-W.Va., and nearly three dozen other lawmakers, have signed a letter to congressional leaders urging that the FHTC be retained.
"Without the tax credit, this (type of) investment would dry up," McKinley warned.
He added that far from costing the government revenue, the FHTC is a moneymaker. For every dollar in credits, it results in $1.18 in new tax revenue, McKinley noted.
One of the goals of tax reformers is to eliminate some credit programs, replacing the incentives they provide with more general tax relief. But the FHTC, targeted as it is to communities such as ours which count beautiful, architecturally significant old buildings as among our greatest business assets, should not be killed.
The two credits, one state and one federal, are a major opportunity here in West Virginia. Congress should not pull the rug out from under it.