Why Alabama's historic tax credit has better odds in 2017
A new study is helping the push to reestablish Alabama's historic tax credit.
A look across downtown Birmingham will show what the credit has already helped accomplish. Developers of the Pizitz Building, Empire Building and Thomas Jefferson Tower all attribue the state tax credit to making the projects feasible.
It expired last year and the push to renew it did not have success at the Alabama State House, despite having overwhelming support in the House and Senate. At the time, Senate President Pro Tem Del Marsh did not allow the legislation to move forward in the Senate, citing concerns about the way the program worked.
Marsh requested an independent study of the credit, which was conducted by The University of Tennesse and came back this week. The report gave the program a "B" and reccomended changes to make it an "A."
“Overall the Historic Tax Credit is a good program that could be a great program with a few modifications. I look forward to working with my colleagues in the regular session as we attempt re-establish the tax credit with the suggested improvements.” Marsh said.
"I think this gets several senators over the hump," said Senator Slade Blackwell (R-Mountain Brook, a co-sponsor of the bill. "They have nothing to argue about now."
One example of the credit's success is the Thomas Jefferson Tower, which was built in 1929. It was one of the nicest hotels in the southeast, hosting celebrities and presidents. Bear Bryant had his own suite.
After sitting vacant 30 years, the building is now being brought back to new life. People are moving into new apartments. The second floor restaurant, Roots and Revelry, is set to open February 3.
"I can say pretty definitively this building would not have been developed. This restaurant would not be here if it wasn't for that (historic tax credit) program," said Brian Beshara, owner of Roots and Revelry and partner in the Thomas Jefferson.
Beshara believes the credit is critical to continuing growth downtown.
"I think there's a big hole in the financing for these big tough historic projects," said Beshara. "That program really fills that hole nicely. I think you've noticed there havent been any developements or new histroic rehabs announced in the last 12-18 months."
Beshara showed us around the dining room of Roots and Revelry, where tables are made with marble from the original hotel.
"All of the molding you see is historic," said Beshara. "These medalians, really all of the decorative stuff you see is historic. We put a lot of time and effort and money into bringing it back to as close to its historical nature as we could."
Beshara describes the restaurant as American cusine in a fine dining experience at an affordable price point. The terrace will have firepits, a community table, a drink rail around the border and a bean bag game. He desribes the terrace as the "revelry" and fun of the restaurant.
Blackwell says the new study will help get it passed in the upcoming legislative session.
"The results are fantastic," Blackwell told ABC 33/40. "They came back with a solid B which means it is very impactful for the state. It's good for local economies. it improves jobs."
Blackwell says he agrees with the proposed changes in the study.
"One is having an independent board that approves the applications instead of just the historic commission doing it themselves," said Blackwell.
Another proposed change: "We need to have claw back provisions that maintain the applicant does when he says he is going to do," Blackwell continued.
Another example of the credit's success in Birmingham is the Pizitz Building. People are already moving into the residences and the highly anticipated Food Hall is set to open in February. David Silverstein with Bayer Properties tells ABC 33/40 the project was made possible with the credit.
Marsh told ABC 33/40 he sees a good chance of reestablishing the historic tax credit in the upcoming session.
One vocal opponent of renewing the credit in 2016 was Sen. Trip Pitman (R-Montrose). Pitman told ABC 33/40 with some modifications as reccomended in the report, he looks toward being able to support reestablishing the credit for another several years.
Pitman pointed out he is from Birmingham and helped pass the credit initially, looking forward the renewal of some of downtown's most iconic buildings. He wanted time to evaluate the credit's impact before voting to continue it.