Arguing that the restoration of individual buildings can spur the revival of entire city blocks, Baltimore officials are considering extending a program that reduces property taxes for residents who fix up historic homes and businesses.
But the tax-credit program, which expired this month, could ultimately change as officials examine why its use is concentrated in a handful of already-thriving neighborhoods.
Since the program started in 1996, nearly 900 property owners have applied for the credit, which exempts from property tax value added from restoring a home. Residents receive the credit for 10 years, as long as the restoration follows historic guidelines set by the city.
The credit allows homeowners to undertake expensive renovations that supporters say help maintain the unique character of the city's neighborhoods. Those restorations, they say, can buoy the condition of entire blocks by encouraging others to fix up their homes, too.
"From a historic preservation standpoint, the tax incentives are by far our most powerful tool," said Tyler Gearhart, executive director of Preservation Maryland. "It has proven to be very successful."
About 90 people took part in the program last year, but the ordinance expired Jan. 3 under a sunset provision.
Now the City Council is expected to extend the tax-credit program until early 2007. The measure was unanimously approved last week by the Taxation and Finance Committee and could come up for a final vote by the City Council on Monday.
The Commission for Historical and Architectural Preservation, which oversees the program, estimates the credit has leveraged more than $184 million in economic development in the past decade - much of it focused in Fells Point, Patterson Park and Canton.
That concentration has concerned some city officials, who argued in a report this month that the credit should be used to encourage development that otherwise would not take place, not as a reward for owners settling into already booming areas.
According to the report, the administration is "concerned that the latter may be occurring in some historic areas where the most intensive development is taking place and [the credit] is not really needed to spur development."
Since 1996, 442 properties have been approved for the credit. Of those, 206 were in Mount Vernon, Fells Point, Federal Hill and Canton. The rest were spread over several dozen other historic neighborhoods in the city. In some, such as Oakenshawe and Franklin Square, no one applied for the credit in 2005.
