Historic Preservation

Grand Avenue is the central neighborhood commercial (and residential) street in a historic preservation district that after over seven decades of decline has recovered. Since the 1980s, Grand Avenue has both supported and been supported by all of St. Paul,  especially the neighborhoods North, South, East and West of Summit Hill.  Summit Hill and the Historic Hill District remain one of the most successful historic preservation districts in the US.  We should not debase that success now for a solution that challenges the premises the community has rebuilt itself upon.

The benefits of preserving our historic fabric are many. Historic Preservation is flexible tool that can increase affordability in housing and for start-up businesses. It can also stabilize a neighborhood and add to the City’s tax base. Historic neighborhoods are walkable and offer a pleasant experience to live, shop, dine, stroll, and visit. Perhaps most importantly, the historic nature of Summit Hill is its most defining feature and its essential character. That does not mean that new things cannot be built or that it cannot change, but changes need to be supportive and complimentary to that essential character.

Our city supports and recognizes the importance of historic preservation. The St Paul 2040 Comp Plan has an entire chapter dedicated to it. “Existing structures are important components of sustainable economic development, and the cultural landscapes that are integral to the city inherently connect this chapter with each chapter of the Comprehensive Plan. Through this chapter, Saint Paul strives to be a leader in preserving historic and cultural resources; engaging all stakeholders in education and evaluation activities that are inclusive, responsive, practical and respectful; and integrating preservation and related activities into the work of all City departments.” 


Grand and Summit Avenues in particular  are attractions to tourists and residents alike, and Chapter 73 calls for the city to “Protect and enhance the City of Saint Paul’s attractiveness to residents, tourists, and visitors, and promote preservation as a support and stimulus to business and industry” as well as to “Enhance the visual and aesthetic character, diversity and interest of the City of Saint Paul.”


St Paul Comp Plan Historic Preservation Policy


Local Economy

Donovan Rypkema is the king of economics of preservation. He is recognized as an industry leader in the economics of preserving historic structures. Here are some of his general points:

  1. Historic districts maintain tax values. At the very least, they retain value when other areas fall in value. Most studies show that houses in a historic district command a premium of 22-72% higher than similar homes in non-designated areas.
  2. Historic preservation has a higher impact than other industries on local economics. In summary, it creates more jobs, pays higher wages, and generates more tax revenue:
  3. In addition, these funds stay local. Whereas general development tends to go to larger conglomerates, preservation work uses local workers and suppliers.
  4. Preservation costs less. “If no demolition is required, a major commercial rehabilitation will probably cost from 12 percent less to 9 percent more than the cost of comparable new construction with the typical building cost saving being about 4 percent


Louisiana Tax Credit

2.7 billion invested in historic buildings from 2003-2016.  Tax credit key points:

  • Each year, on average, these rehabilitation projects generated 1,725 direct jobs and an additional 1,429 indirect and induced jobs
  • The resulting paychecks from those jobs represented, on average, $102,744,000 each year in direct labor income and $62,667,000 in indirect and induced labor income
  • Every $1 that the State of Louisiana provides in commercial historic tax credits spurs $8.76 in additional economic activity 42¢ on the dollar is recouped before the tax credit is even awarded.
  • Fully half of all projects receiving the credit were smaller than $500,000 in total costs, demonstrating that the historic tax credit is fundamentally asmall business incentive
  • An estimated $1,273,000,000 in investment using the federal historic tax credit –nearly 60% of the total –would not have taken place were it not for the State Commercial Tax Credit. Had this investment not been made, each of the last ten years would, on average, have seen: 1,497 fewer jobs;  $78,518,000 less in labor income; $10,735,000 less in state tax collections

Ways that the LA credit differs from other states (35 states use the tax credit; most are a state version of the federal credit):-the Louisiana state tax credit is available to historic buildings (generally those greater than 50 years old) that are located in either a Downtown Development District or a Certified Cultural District. This creates opportunities to use the state tax credit in areas of cities and towns that don’t have National Register districts, but do have historic buildings worthy of preservation. -The state tax credit earned through the investment in historic buildings is easily transferable toanother party (so can be used by non-profits, etc.)-LA credit is 25% (federal is 20%, they can be stacked).-Low minimum investment; only 10K-Can still stack with low-income tax credit.Note also that this has been one of the most effective ways of developing new, especially low-income housing, in a state that has had a horrendous housing shortage since Katrina.

In Louisiana, 42.2% of the projects have been residential (unlike MN, which can only use the tax credit for income-producing properties, these credits can be used by anyone). In Monroe, they considered properties within 500 feet of the rehabs. Property values increased substantially, nearly doubling tax revenues.In New Orleans, Katrina-damaged buildings and departure of businesses causing high vacancy was a major concern in the CBD. In 3 years, investors using the state tax credit reduced that vacancy by over 1,000,000 square feet.While the overall population of Shreveport has grown only negligibly in the past 15 years, the residential population downtown has grown more than 90% –and nearly all within rehabilitated historic buildings.



San Antonio Study

Older buildings play an important role in housing affordability across the country. First, housing preservation is typically cheaper and faster than constructing new units and effectively combats blight. Older and historic neighborhoods offer a diverse housing stock at varying prices, sizes, and conditions, and are located in close proximity to transit and jobs. While older housing is more likely to be in poorer condition, the number of properties needing significant repairs is low—according to the 2017 American Housing Survey, only 2% of pre-1960 housing is severely inadequate and only 6% is moderately inadequate. A city cannot build itself out of a housing crisis—the retention of existing housing stock is critical.

3 premises:
  1. One cannot build new and rent or sell cheap without subsidy.
  2. Almost by definition, when a unit of older housing is razed, a unit of affordable housing is lost forever.
  3. Policies must include older housing stock (here defined pre-1960).

A key measurement of affordability is the concept of “cost-burdened.” A household is considered to be cost-burdened when it spends more than 30% of its income on rent and utilities and severely cost-burdened when it spends more than 50%. While an increase in value benefits homeowners by increasing their equity, it may burden those homeowners with higher tax bills.  Further, increasing property values puts renters at risk as landlords may pass increased tax bills onto the tenants through increasing rents A recent study of new construction costs for Low Income Housing Tax Credit (LIHTC) projects across the U.S. found costs were approximately $40,000 to $71,000 (25 to 45 percent) higher per unit than those of acquisition-rehab projects.


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