Since the middle of the 19th century, the John A. Roebling’s Sons Co. factory stood as one of the centerpieces of Chambersburg. At its peak, it employed 15,000 workers in a sprawling complex, famed for the Roebling wire rope — metal cables and wires used in the George Washington and Golden Gate bridges, as well as electrification, airplanes, elevators and ships.
The factory complex shuttered in 1974, 20 years after the Roebling family sold the site to the Colorado Fuel and Iron Co.
Since then, two structures, the Roebling Machine Shop and John A. Roebling’s Sons Company Trenton N.J., Block 3, were named to the National Register of Historic Places, a list maintained by the federal government of properties, buildings and other structures deemed worthy of historic preservation.
In 2009, the plant’s main gate was opened as the Roebling Museum. Structures that had not been knocked down were retrofitted to house a minimall, the iconic Trenton Punk Rock Flea Market and social services agencies.
David Henderson, principal at HHG Development Associates LLC, said his redevelopment firm is moving ahead with plans to remake a half-million-square-foot section into the luxury Roebling Lofts.
“We’re renovating and repurposing those into residential lots, Class A office space, retail amenities and large restaurants to create a hip live-work-play scene,” said Henderson, whose firm has been in the business of redeveloping and restoring historic properties since the mid-1990s. “All the buildings are around a central courtyard or piazza.”
Emboldened by the ambitious economic master plan unveiled by Gov. Phil Murphy on Oct. 1, developers like Henderson see an enormous opportunity. Among Murphy’s proposals, all aimed at overhauling how the state attracts and keeps jobs and businesses in the state, is the Historic Preservation Tax Credit.
The credit is part of New Jersey Communities, one of the four main tenants of Murphy’s plan, which is aimed at redeveloping New Jersey’s urban centers.
“As we continue to accelerate New Jersey’s innovation economy, repurposing old buildings to house our new ideas will be key to preserving our rich history and responsibly redeveloping our historic assets, particularly in cities and downtown corridors,” reads the plan.
To qualify for the tax credits, a property would have to be listed in either the National Register of Historic Places or the New Jersey Register of Historic Places.
Any property the Pinelands Commission lists as a “historic resource of significance” to the Pinelands region would also be eligible for the tax credits.
Properties deemed to be a “significant historic resource” to a municipality would be deemed eligible, so long as it gets the blessing from both the host town or city, and the State Historic Preservation Office.
The credits would require action of the Legislature, which moved forward last month with such a measure, Senate Bill 2031, which would establish the Historic Property Reinvestment Act.
S2031 calls for the state to provide tax credits for up to 25 percent of the costs of qualified projects to rehabilitate historic properties such as homes and businesses.
The Senate State Government, Wagering, Tourism & Historic Preservation Committee approved S2031 in a 4-0 vote, after which it was referred to the Senate Budget & Appropriations Committee where it awaits a vote.
The Assembly version, Assembly Bill 1311, was referred to the Assembly Agriculture and Natural Resources Committee on Jan. 9, but has not yet received a vote.
For residents rehabilitating a historic home, the credit would count against their gross income tax, capped at $25,000 over a 10-year period.
Homeowners seeking the tax credit cannot spend more than 60 percent of the rehabilitation costs on the interior of the property. Also, the homeowner must use that property as their main residence for at least a year following completion of the project.
For developers and other businesses, the credit would count against their corporate business tax and insurance premium tax liabilities.
The state would not cap the value of the tax credits for businesses, but in order to qualify they would have to spend at least $5,000 on the cost of rehabilitation.
S2031 calls for the State Historic Preservation Office and the Director of the Division of Taxation to devise a system for awarding the tax credits.
The state would cap the number of credits it awards at $15 million in the first fiscal year of the program’s existence, $25 million in the second year, $40 million in the third and $50 million in the fourth year and beyond.
At least 25 percent of the tax credits would have to go to homeowners and at least 65 percent to businesses and developers.
During an Oct. 18 committee meeting, historic preservation groups praised the bill as a means to preserve New Jersey’s history and heritage.
Developers who came out in favor of the bill saw it as a means to generate profits and lower the costs of doing business in the state.
Cate Litvak, president of Advocates for New Jersey History, said at the meeting the tax credit and resulting industry could provide employment for “professional architects, carpenters, electricians, plumbers, masons and painters.”
And Michael Calafati, principal of the Cape May-based Michael Calafati Architect LLC, which specializes in rehabilitating historic properties and testified in favor of the bill, told NJBIZ he thinks New Jersey could reap enormous opportunities from the credit.
“A really high percentage of New Jersey’s existing building stock are historic buildings, and what people don’t seem to realize is there are large swaths in downtown Newark, downtown Trenton, Paterson, Perth Amboy, Camden … you can just name the long list of historic cities that have vacant buildings,” he said. “There are buildings across the state that are just languishing away for want of better use.”
Calafati said New Jersey is currently missing an opportunity to match credits offered developers through the federal government’s own historic tax credit program that allows participants to claim credits up to 20 percent against their federal tax liability.
“[The historic tax credit is] more employed when there’s a state program to piggyback on top of it,” Calafati said.
Henderson said the opportunity for historic tax credits could become a critical factor in whether developers would want to expand in New Jersey’s urban centers.
“If New Jersey is going to grow its economy in this kind of new market, it’s going to happen in its cities, and a lot of it will be the rehab of existing structures and a lot of them are historic,” Henderson said. “To have a focus credit like this to support rehabilitating historic structures in town centers and city centers, it’s huge.”
Sean Jackson, senior vice president of business consulting firm Rosemont Associates in Lambertville, a business consulting firm, noted the rehabilitation of historic properties is complicated and expensive. And New Jersey’s lack of a historic tax credit, he said, “makes it harder to do these projects.”
“You can’t bring that additional equity to the project,” Jackson said. “You have states out in the Midwest that are barely a hundred years old that have state historic tax credits and here’s New Jersey, one of the original 13, that does not.”