Tax Credits and Landmark Cases

The years after NHPA saw exciting developments in the preservation world. The Tax Reform Act of 1976 encouraged preservation and rehabilitation of older and historic structures with the creation of the Historic Rehabilitation Tax Credit (HRTC) for commercial properties, and the Historic Preservation Tax Incentive, or historic preservation easements, for historic-home residents and owners. The HRTC program gives a 20% tax credit to historic commercial property owners seeking to rehabilitate their buildings provided the project passes the SHPO’s evaluation for historic appropriateness. The Historic Preservation Tax Incentive (HPTI, or preservation easement program) allows owners of properties listed in the National Register of Historic Places to claim a tax deduction for appraised loss of value resulting from the restrictions preservation easements place upon the property. In 2006, U.S. Congress passes legislation that provided new incentives and safeguards for the Federal Historic Preservation Tax Incentive Program (easements).

With NHPA as a strong legislative basis, preservation entities had precedence upon which they could build – and win – court cases against private developers looking to overturn preservation restrictions. In 1978, Penn Central Transportation Company applied to the New York City Landmarks Commission for approval of the construction of a 55-story addition to the 1913 Grand Central Terminal Building. The Landmarks Commission denied approval, and Penn Central attempted to have Grand Central’s historic designation overturned. The New York Court of Appeals upheld the Landmarks Commission ruling, and the case went to the U.S. Supreme Court. The Landmarks Commission ruling was upheld at the federal level in a six-to-three decision. The case has become an important benchmark for the cause of preservation, as it supported the legitimacy of historic preservation as a governmental goal and responsibility and showed that historic ordinances function as the methods to accomplishing the goal and the responsibility.