The Office of Historic Preservation (OHP) offers owners of historic properties a Local Tax Exemption for Substantial Rehabilitation. The tax exemption is available for designated landmarks and properties located within a historic district that undergo a substantial rehabilitation. Improvements that extend the life of the building, such as roof replacement, foundation repair, structural work, electrical, mechanical, plumbing and various exterior repairs qualify for the program. Other improvements such as interior work will be considered upon commitment to complete structural work.
The application process has two parts: Certification and Verification. Certification must be applied for before any work begins. After work is completed, the project is verified and the exemption goes into effect during the next taxable year. There are two types of exemptions a property can receive: a 10-year tax freeze on City property taxes only (does not include school or other taxes) at the pre-rehabilitation value of the building only, does not include land value; and a 5 Zero/5 Fifty tax freeze, which allows no City property taxes for five years and 50% of the post-rehabilitation value for the next five years. Commercial properties are only eligible for the second exemption.
The tax exemption for substantial rehabilitation remains with the property regardless of ownership or sale during the granted time period. Therefore, it can be used as a marketing tool if the property is available for purchase.
A good example of a project that took advantage of this incentive is located at 524 E. Guenther. The property owner leveled the foundation, repaired and painted the exterior, installed new plumbing and central AC, rewired the house, insulated the attic, refurbished the interior wood floors, replaced all tile floors, repaired all wood windows and screens, remodeled the kitchen and bathrooms, repaired and painted the garage, and installed a new foundation slab for the garage.
For more information, contact OHP staff at 215-9274 or visit www.santonio.gov/historic.
- Adriana Ziga
COSA Office of Historic Preservation