You are here
Home

Voice Your Support - Federal Incentives for the Rehabilitation of Canada's Historic Places

 

Voice Your Support

Federal Incentives for the Rehabilitation of Canada’s Historic Places

On December 1, 2016, a Private Member's Bill to create tax credits for historic places was tabled in the House of Commons.  Bill C-323 – An Act to Amend the Income Tax Act (Rehabilitation of Historic Property) – is based on a great US success story with a 40- year track record.  This Bill presents an historic opportunity to tell elected officials from every political party that Canada’s historic places matter, and that federal actions can help save and renew them. 

 

We urge heritage advocates, heritage property owners, the construction industry, property developers and anyone with a stake in Canada’s historic places to get involved.   Learn more below!

What you can do

Here is a sample letter to get you started. When crafting your letter(s), you will find helpful background information on our website. Point to historic places in your area that need this kind of financial measure – especially those at risk!

About Bill C-323

 

Bill C-323 includes the creation of:

  • a 20% tax credit on eligible costs for rehabilitation work done to designated historic places (commercial & owner-occupied residential); and
  • an accelerated Capital Cost Allowance (25%/50%/25%) for eligible capitalized costs incurred under the same conditions of the tax credit (commercial only).

 

These two tax measures would transform the economic fundamentals for renewing historic places. In the process would create more skilled jobs and generate less carbon than new construction. What an historic gift to all Canada communities to mark the 150th anniversary of Confederation!

 

Arguments to Support Financial Measures for Historic Places

Job Creation – Rehabilitation generates upwards of 21% more jobs, including skilled jobs, than the same investment in new construction. [i]

Economic Stimulus that is Effective, Targeted – The tax credits in Bill C-323 are inspired the success of the US Federal Historic Tax Credit Program in place for 40 years. Since its creation in 1976, $23.1 billion in federal credits have generated more than $28.1 billion in additional federal tax revenue and leveraged over $120.8 billion in private investment (a 5 to 1 ratio of private investment to tax credits).  In the process, it has created 2.4 million jobs and preserved 41,254 historic properties. This program has created over 525,000 housing units 27% of which were affordable for low/moderate income families. Leverage and multiplier effects data has shown, again and again, that the US program is a strategic investment that works.

Economic Impact Stays in Canada – Heritage rehabilitation also incurs less “leakage” out of the Canadian economy for foreign goods.[ii]

Fights Climate Change – Building renewal and re-use capitalizes on materials and energy already invested, reduces construction and demolition waste,[iii] and avoids environmental impact associated with new development.  A recent study shows that it takes from 10 to 80 years for a new “green” building to make up for the negative climate change impacts of its construction.[iv]

Canada 150 – Tax credits would bring heritage support home to buildings of every size and type – from landmark commercial buildings to modest homes.

Historic Rehabilitation Tax Credits Work – The Commercial Heritage Properties Incentive Fund (CHPIF) –a Canada-wide pilot program (2003 - 2008) – was designed to ‘test’ the benefit of a heritage tax credit. The results were impressive: a total of $21.5 million in federal contributions spread across 49 projects leveraged over 8 times more in private sector investment ($177.2 million).   Developers confirmed the need in a 2014 study.[v]

Tools are in Place – Pre-Conditions for other tools include the Canadian Register of Historic Places which continues to be populated with designated heritage properties eligible for tax credits. Heritage conservation standards have been published and adopted nationally.


[i] For example, the 2010 US study, Delaware Historic Preservation Tax Credit Program: Good for the Economy, Good for the Environment, Good for Delaware’s Future, found that $1 million spent on rehabilitation of historic properties created 14.6 jobs while $1 million spent on new construction created 11.2 jobs  - a difference of 30%. The 2011 US study, Good News in Tough Times: Historic Preservation and the Georgia Economy, found that $1 million of economic activity created 18.1 historic rehabilitation jobs compared with 14.9 jobs for new construction - a difference of 21%.

 

[ii] Empirical studies in Germany and the US show that rehab is much more labour intensive than new construction. Their building industries typically reckon project costs of 50% labour and 50% material for new construction, while heritage rehab sees between 60% and 80% for labour (Dr. Jörg Haspel, Built Heritage as a Positive Location Factor – Economic Potentials of Listed Properties, ICOMOS, 2011; Donovan Rypkema, Heritage Conservation and the Local Economy, Global Urban Development Magazine, 2008.) Indeed, the Ontario Heritage Trust’s review of its rehab projects over the last 20 years saw up to 90% of project costs allocated to labour (OHT, Cultural Heritage - Proposals for Ontario Cultural Strategy, Dec.2015).

 

[iii] A 2005 Statistics Canada study found that 12% of all residential and non-residential waste (amounting to 3,371,880 tonnes) comes from construction, renovation and demolition. Only 16%, or 555,352 tonnes, is diverted.

 

[iv] The Greenest Building: Quantifying the Environmental Value of Building Reuse. National Trust for Historic Preservation, 2011.