“That means we had a lot of beautiful buildings in the
downtown — old loft buildings — and lovely residential
buildings in neighborhoods. But the high cost of renovation didn’t work, particularly for the large buildings and
it didn’t work particularly well for the smaller buildings
or homes, either, so there was a big gap. Rehabilitation of
owner-occupied housing is directly linked to economic
development, especially in distressed areas.”
He credits St. Louis attorney Jerry Schlichter for championing the cause and developing the legislation. Missouri
REALTORS® then became part of the coalition that
helped to pass the tax credit program for Missouri. Initially, the initiative did not include homeowners, but
Schlichter added them when residents of Benton Park
— which dates to the 1860s — approached him at a
neighborhood meeting and asked to be part of the law.
“If you are trying to rebuild neighborhoods and downtowns, you want to have homeowners there and not
just renters,” said Friedman, who said some homes in distressed areas were sold for $1 by the city. “This helps do
that and it makes all the sense in the world. A Brookings
Rehabilitation of owner-occupied
housing is directly linked to
economic development.
Institution report said we need to support these urban
areas because they are the economic engines of our country.
“Besides, a lot of people from millennials to boomers want
to live in or near revitalized downtowns in walkable, bik-able neighborhoods. Our historic income tax credit law
has helped make that happen. Over the years, I think hundreds of middle-income families have benefited.”
Once the program got going, he said it took off rapidly
and has resulted in more than 43,000 jobs and literally
billions of dollars in redevelopment, especially along
Washington Avenue and in many of the city’s beautiful,
historic neighborhoods. Washington Avenue, he noted,
has been described as one of the country’s “Great Streets”
by the American Planning Association.
A key aspect of the state tax credit, Friedman said, is the
ability of homeowners (and commercial developers of
larger properties) to sell the credits. That means if someone spends $100,000 to renovate a historic home, he or
she would only have to borrow roughly $75,000 because
of the 25 percent state credit they can sell to banks or
some other entity.
Friedman said the ability to sell the tax credit was essential to the program’s success. Without that transferability,
the tax credit would not have been so effective an incentive for development. He said the credits usually sell from
Photo by Paul Sableman
