There are a number of city and state incentives for residential historic rehabilitation. These are the ones with which I have personal experience. Our house was built in 1907, and extensively altered by the second owner in 1922. By the time we bought it (from the fourth owner, who had intended to scrape it), most of the original interior detail had been replaced, and it was being used as a rooming house.
State Historic Tax Credits
Being big fans of historical preservation, some quick research told us it would probably qualify for designation, so we started the landmarking process before we finalized the sale. We were able to have it designated fairly quickly after we passed papers, and set to work rehabilitating the interior. We expected that years of “deferred maintenance” would mean that we would have to do significant work to update utilities so we could maintain it as a viable residence. We brought the electrical and plumbing systems up to code, added air conditioning, and replaced the inefficient baseboards with cast-iron radiators consistent with the age of the house. We also had to completely upgrade the kitchen and bathroom facilities. However, the most costly single problem was structural. Because some of the 1922 renovation work was done with less-than-optimal engineering, we had to re-support the entire second floor with a multitude of steel posts and MicroLam beams.
Because of the designation, all of our exterior, and some of the interior work had to be reviewed and approved by the city Historic Preservation department. In order to qualify for financial incentives, all work followed the Secretary of the Interior’s Standards for rehabilitation, which really was never an issue with us. At the completion of our initial phase of rehabilitation, we received a state tax credit equal to 20% of the cost of the qualifying aspects of the project. On qualifying residential projects, a homeowner can recoup up to $50,000 in state income tax credits, redeemable over a 10 year period. Costs must exceed $5000 for each project, and you can apply more than once for different projects.
With the financial assistance available through the preservation tax credit program, we were able to accomplish significantly more than we would have otherwise been able to, and continue the process after we moved in. Since then, we’ve restored exterior rafter tails, replaced the missing gable screens, and remodeled the interior in a period-sympathetic manner.
Get a 360 degree view of the interior remodel here: https://kuula.co/post/7khnh
Design Assistance program
Our existing attached garage had not been designed for modern vehicles, in fact it started out in 1918 as a detached Model T garage. It had been expanded and reoriented in 1948, but was still insufficient for two automobiles. We looked to the city Design Assistance program for advice on how to make a new structure fit in. The city will fund exterior design assistance (up to $2000), payable directly to a city-approved architect or designer. This is our result.
Zero Interest Loans
Another useful incentive is the “zero interest loan program”. The city will underwrite a loan of up to $7500 for qualified projects. You pay zero interest for the life of the loan, which only becomes due when you sell your home. The program incentivizes additional qualifying rehabilitation costs concurrent with the specific projects, and so we embarked on new wooden storm windows for the South face of our home, complimented by restoring the front porch steps. A previous owner had torn out the original steps in 1980, and replaced them with brick steps- too few steps, and all the wrong height. Thanks to the ZIL program, we were able to demolish the brick steps and replace them with a close approximation of the originals.
More State Historic Tax Credits
As part of our qualifying project cost we also decided to rehabilitate the old attached garage into a comfortable heated workspace. This involved gutting the garage, furring out the studs to 2×6, adding insulation, putting up new walls, leveling the floor, and installing a split heat pump for heating and air conditioning. As for the exterior, we simply removed the single garage door and inserted reclaimed windows and a double-wide egress door within the framed garage door opening. Since we had not previously hit the upper limits of the state historic tax credit program, and since all of the work qualified for both programs, we filed for additional credits, which assisted in affording this particular project. In this particular case, since Fort Collins is in a designated disaster area (due to the 2014 floods), we qualified for a credit equal to 25% of the cost of the project.
Of what value is Historic Preservation?
We’ve invested quite a bit of time, effort, and money in our home. We are lucky to have been able to afford it in the first place, but thanks to historic preservation incentives, we have accomplished between 20 to 25% more than we would have been able to do without these programs. Historic Preservation in Colorado is awesome.