BY BRIAN LIBBY
It is officially known as Senate Bill 565, and while it's not as high-profile an issue as the recent resignation of Governor John Kitzhaber, rarely has Salem had such a big chance to impact Oregon's built environment, its architectural heritage, and small-town economies.
The Revitalize Main Street Act, as SB 565 is more commonly known, would not put Oregon amongst the most protective and supportive states for historic buildings. Rather, it would bring us out of the bottom, for 35 other states already have similar incentives in place, including some of the most notoriously ultra-conservative like Alabama, Kansas, Texas, and Louisiana. Even Arizona has legislation pending on this. I mean, at this point it's getting embarrassing. Oregon is a national leader in land-use policy. Why are we so far behind on supporting and incentivizing historic preservation?
If passed, SB 565 would create a historic rehabilitation fund, providing a 25% rebate for certified rehabilitation of historic buildings (those over $10,000), be they retail outlets, hotels, theaters, apartments, fraternal lodges, factories, and other income-producing properties that nevertheless have become local landmarks. The credit would be applied to the most important properties – those listed on the National Register of Historic Places.
When paired with the federal Historic Tax Credit, a 20% deduction, the Revitalize Main Street can help level the playing field for restoring old buildings, for which the high cost of restoration, code upgrades, and seismic reinforcement often leaves a funding gap. And there's no time like the present, for approximately 2,600 buildings in 77 towns would be eligible to use the credit, two thirds of which are outside of Portland.
The credit wouldn't just foster job creation in the building industry. According to a Rutgers University study, rehabilitation of old buildings creates more jobs dollar-for-dollar than new construction, manufacturing, the service industry, and most others. More importantly, economic activity would result from these streets becoming active again, with new residents moved into upper-floor spaces and new businesses moving in, which in turn would increase property values and, by extension, increase tax revenue. It's also the sustainable thing to do, for re-using buildings is a greener choice than even the most highly rated new construction.
And you needn't just take my word for it. An economic impact study by EcoNorthwest found a state investment of just $10.6 million would see over 1,300 jobs created, generating in come of $25.5 million. It would increase yearly property tax revenue by $2.3 million, and bring $13.3 million in new federal tax credits used in Oregon annually. And the bill would help increase the state's yearly gross domestic product (GDP) by $33.7 million. I wonder what reactionaries will invent as their argument against this open-and-shut case.
Recently I exchanged emails with Peggy Moretti, executive director of Restore Oregon (formerly the Historic Preservation League of Oregon), about the Revitalize Main Street Act and its potential impact. Restore Oregon has also summarized on their website the arguments for the bill.
Portland Architecture: Can you talk about the resource we have in some of Oregon's small-town main streets? What are some towns with great main streets that immediately come to mind?
Moretti: Oregon’s historic downtowns are an economic, cultural, and environmental resource (the triple-bottom line you know so well as a foundation of the preservation movement.) We like to refer to them as both the economic heart and cultural soul of their community. They tell the story of how the town developed and reflect its character. Some towns like McMinnville are well along in their restoration of their main street. Others like Astoria and Albany have made great strides, but have more work to do. And others like Enterprise or Klamath Falls or Coos Bay have taken meaningful steps, but aren’t far along. But they are ALL great downtowns. Oregon is FULL of great downtowns!
Well, you're using all caps so you must really mean it. Is there a particular period that a lot of the buildings in Oregon small towns were built in? Is it more often late 19th century, early 20th? Do you notice any particular styles?
You’re right, late 19th/early 20th century. Although I might suggest that a district such as Portland’s Hillsdale neighborhood has some great mid-20th century buildings that could benefit from investment in rehabilitation.
I might note that a building doesn’t have to literally be located in the downtown or on a true Main Street to qualify. (Somebody asked me that). Though the majority are, any historic commercial building can be eligible: stores, hotels, factories, warehouses, apartments…even barns. We estimate there are around 2,600 buildings in over 70 communities that would be eligible.
Why do you think Oregon, which usually prides itself on being a pioneer with a lot of legislation, is behind at least 35 other states when it comes to these rebates or incentives?
Hard to say. But the good news is that similar incentives have been tested many times, so we can have confidence that they really do create jobs and stimulate economic development. We aren’t inventing the wheel on this one, but we ARE bringing a significant bit of Oregon innovation to it. Most states structure their incentives as tax credits that have to be syndicated or transferred to turn them into up-front money for construction costs. That can be very challenging for smaller businesses and property owners to do, and those states lose some of the value of their tax credits because they get discounted in that process. By structuring our program as a simple rebate, you don’t need a team of lawyers or accountants to use the incentive.
What is the timetable for the Senate committee to vote on the bill, or when it might be reasonable to see it come to a full Senate vote?
Things are a little bit in flux, given the upheaval last week, but the Senate finance committee hearing is slated for the first week of March. Safe to say we’d hope for a committee vote in early March. I’m told by our lobbying firm that our bill is not likely to come up for a standalone vote, but will probably be part of a larger spending package coming from a joint Ways and Means Committee, and that may not get voted on until the end of session the first week of July. (I’m learning that this legislative stuff is very fluid!) Key to our success will be a sustained, clear demonstration of support from constituents backed up by our (hopefully) compelling supporting data on the effectiveness of similar incentives in other states and our solid economic impact projections for Oregon.
Our next milestone is the committee hearing. Dates may be in flux while the dust settles after Kitzhaber’s resignation, but it should be early March.
It would be wonderful to let people know that they can have an impact on the passage of the bill. While we’re encouraged by the reception its received so far, we’re in steep competition for funding. encourage people to endorse the legislation and also contact their state legislators asking them to vote YES on SB 565.