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…by Warren KirshenbaumState’s construction industry gets a little lift from 14 projects
Minnesota’s Historic Rehabilitation Tax Credit appears to be producing construction jobs.
14 projects had preliminary approval to take advantage of the tax credit, according to a report released Monday. Developers expect the projects to create 1,808 construction jobs — and a total of 2,948 jobs when indirect and induced jobs are counted.
That’s in line with the 1,500 to 3,000 construction jobs a year that the Minnesota Historical Society and the Preservation Alliance of Minnesota predicted would be created when former Gov. Tim Pawlenty signed the tax credit into law in 2010.
The tax credit is creating construction jobs at the same time that the industry appears to be improving after years of decline. Last month, Minnesota posted its first 12-month gain in construction jobs since April 2006.
The credit covers up to 20% of qualifying rehabilitation expenses; that’s on top of a federal tax credit that can cover another 20%. Supporters say job creation is reason enough for the state Legislature to keep the state tax credit going.
Minnesota’s construction industry remains in a state of “depression,” with more than 50,000 jobs lost between 2006 and 2011, so every bit helps.
Developers plan to spend an estimated $343 million on the 14 projects, with $250 million going toward rehabilitation expenses that qualify for the tax credit. Total economic impact is expected to be $451 million — about $9.20 for every dollar of the $49.1 million of tax credits going toward the 14 projects.
Besides the 14 projects mentioned, there are an additional 14 that have since applied and another handful of developments are considering it, the Minnesota Historical Society. Contrast that with 2009, when only two Minnesota developments were seeking the federal tax credit.
Steve Elliott, the Historical Society’s director and chief executive officer, described the state historic rehabilitation tax credit program as a “resounding success” during a Monday morning news conference.
Original article Finance & Commerce