The bill to raise the per-project cap on historic preservation tax credits from $5 Million to $12 Million passed both houses of the state legislature with only a single dissenting vote in the session completed last month. It is now awaiting the Governor's signature. According to Assemblywoman Crystal Peoples-Stokes, the Governor has pledged to sign the bill, but our delegation isn't taking any chances. And our local developers, not wanting to lose any more of the construction season, are saying the sooner the better.
Mark Croce congratulated the local delegation, pointing out that they recognize the State spending a little now for preservation tax credits means reaping a great return over a longer period. "Preservation equals jobs," Croce said, pointing to the rich stock of large historic buildings in the city that the raised cap will help to preserve and return to community use.
Having written about New York's historic preservation tax credit program for several years (e.g. here, here, and here), my favorite feature of a press event about the program is hearing community leaders sing the praises of historic preservation, and promote the economic development benefits. This week's event was no exception -- both elected officials and several prominent developers weighing in, following Senator Grisanti's lead.
"Rehabbing buildings creates more jobs than new construction," Grisanti said. "It increases property and sales taxes, tourism, and quality of life. By increasing the cap we'll see the floodgates open on projects that have been long thought about but have been considered too expensive." He encouraged the Governor to sign the bill, and do it quickly, "while the weather is friendly."
Assemblyman Sean Ryan thanked his colleagues for their work on the bill, the gathered developers, and the other "local businesspeople who take risks on these buildings." He pointed out that developing historic buildings can be more expensive, especially if asbestos and lead abatement are involved, so raising the tax credit cap helps to level the playing field in favor of preservation and reuse. He said he expects it to encourage more projects like the Lafayette, the Statler, and the Richardson-Olmsted complex.
Assemblywoman Crystal Peoples-Stokes also pointed to those iconic projects, especially the Statler, which she called our "crown jewel." She wants to see the whole project completed, saying that when that happens, "we'll have grown this community by leaps and bounds." She also mentioned key buildings on the east side, including the Buffalo Central Terminal, and old Public School 59 at Fillmore and Best Streets, across from Martin Luther King park (pictured above).
Rocco Termini congratulated the local delegation, saying, "when you work as one, things get done." During the rehab of the Lafayette, he said, he had 270 people working every day, and that now the building supports 160 new full-time jobs. The increased cap would make possible the undertaking of the mammoth AM&As complex across the street. As soon as the Governor signs off, he will get AM&A's underway the next day, Termini said. But he then surprised the crowd by revealing that he had already started leasing the building, so sure was he of the Governor's signature. In fact, he has it 100% pre-filled, he said. He did not give the name of the tenant or tenants.
Developer Nick Sinatra said that two years ago he moved back to Buffalo, "with out-of-town capital to invest here." To date he has rehabbed a number of older buildings (Buffalo News profile) which are "important to the fabric of the community," and that the increased cap on the preservation tax credits would allow him "to look at projects that they might not be able to otherwise."
Sinatra told me later that he has been looking at using preservation tax credits for his Fenton Village project at Main and Ferry, and at the same time is looking at including 1524 Main, the smaller Italianate storefront building that Buffalo Rising commenters have expressed concern about, in the project. Over the last two months, both the Buffalo preservation board and neighbors have been talking with Sinatra about including that building in the project rather than demolishing it -- especially as its condition isn't nearly as dire as once thought. Sinatra, greatly to his credit, has been listening to their concerns and ideas.
Laura Smith, Vice-President of the Buffalo Niagara Partnership said the increasing the cap on preservation tax credits was among their top legislative priority. For New York not to do so, she said, "would be penny-wise and pound-foolish." She said that rehabbing older buildings promotes sustainable, healthy, walkable communities and complements smart growth. The cap increase would be key to the Buffalo Building Reuse Project, a major initiative by the Partnership and the City of Buffalo.
Of all the projects mentioned, the most prominent, of course, is the Statler, which Croce purchased from the bankruptcy trustees and returned to the tax rolls. To date, he has returned three floors to use, reopening the building last year. Part of that purchase and project plan involved a commitment of $5.3 Million from the City of Buffalo. I asked Croce about the status of that funding, and got an earful.
"At the beginning, we sat down with the City and went through our plan. Now, we've done everything we said we would do: restored the first three levels, created 150 jobs," Croce said. "We rescued it from bankruptcy, and returned it to the tax rolls. Now, we need the $5.3 Million we were promised by the City." That funding is needed largely for continued masonry work and new roofing, so that the building is properly stabilized so that the buildout of the upper floors can move forward.
With the Lafayette completed, and the lower three floors of the Statler reactivated, the time would seem to be ripe for both the promised City funding for the Statler and the approval of the higher cap for New York's preservation tax credits. That will not only keep the Statler on track for full renovation, but also launch downtown's next preservation mega-project, reuse of AM&A's. As mentioned by elected officials and developers, there are other large preservation projects around Buffalo waiting for just this kind of boost -- and Trico is waiting in the wings. Beyond those, who knows what creative projects may emerge that aren't currently on anyone's radar?
Some people use "cranes in the air" as a shorthand for economic development, but in Buffalo we know that "chutes on buildings" -- signifying adaptive reuse projects underway -- are also signs of jobs and progress. And Buffalo is sending that message to the Governor loud and clear: provide the tools for the job, and watch how fast we get to work!