Sec. 10-416a. Tax credits for rehabilitation of certified historic structures.
Sec. 10-416a. Tax credits for rehabilitation of certified historic structures. (a)
As used in this section, the following terms shall have the following meanings unless
the context clearly indicates another meaning:
(1) "Commission" means the Connecticut Commission on Culture and Tourism
established pursuant to section 10-392;
(2) "Certified historic structure" means an historic commercial or industrial property that: (A) Is listed individually on the National or State Register of Historic Places,
or (B) is located in a district listed on the National or State Register of Historic Places,
and has been certified by the commission as contributing to the historic character of
such district;
(3) "Certified rehabilitation" means any rehabilitation of a certified historic structure for residential use consistent with the historic character of such property or the
district in which the property is located as determined by regulations adopted by the
commission;
(4) "Owner" means any person, firm, limited liability company, nonprofit or for-profit corporation or other business entity which possesses title to an historic structure
and undertakes the rehabilitation of such structure;
(5) "Placed in service" means that substantial rehabilitation work has been completed which would allow for issuance of a certificate of occupancy for the entire building
or, in projects completed in phases, for individual residential units that are an identifiable
portion of the building;
(6) "Qualified rehabilitation expenditures" means any costs incurred for the physical construction involved in the rehabilitation of a certified historic structure for residential use, excluding: (A) The owner's personal labor, (B) the cost of a new addition,
except as required to comply with any provision of the State Building Code or the State
Fire Safety Code, and (C) any nonconstruction cost such as architectural fees, legal fees
and financing fees;
(7) "Rehabilitation plan" means any construction plans and specifications for the
proposed rehabilitation of a certified historic structure in sufficient detail for evaluation
by compliance with the standards developed under the provisions of subsections (b) to
(d), inclusive, of this section; and
(8) "Substantial rehabilitation" or "substantially rehabilitate" means the qualified
rehabilitation expenditures of a certified historic structure that exceed twenty-five per
cent of the assessed value of such structure.
(b) (1) The commission shall administer a system of tax credit vouchers within the
resources, requirements and purposes of this section for owners rehabilitating certified
historic structures.
(2) The credit authorized by this section shall be available in the tax year in which
the substantially rehabilitated certified historic structure is placed in service. In the case
of projects completed in phases, the tax credit shall be prorated to the substantially
rehabilitated identifiable portion of the building placed in service. If the tax credit is
more than the amount owed by the taxpayer for the year in which the substantially
rehabilitated certified historic structure is placed in service, the amount that is more
than the taxpayer's tax liability may be carried forward and credited against the taxes
imposed for the succeeding five years or until the full credit is used, whichever occurs first.
(3) Any credits allowed under this section that are provided to multiple owners of
certified historic structures shall be passed through to persons designated as partners,
members or owners, pro rata or pursuant to an agreement among such persons designated
as partners, members or owners documenting an alternative distribution method without
regard to other tax or economic attributes of such entity. Any owner entitled to a credit
under this section may assign, transfer or convey the credits, in whole or in part, by sale
or otherwise to any individual or entity and such transferee shall be entitled to offset
the tax imposed under chapter 207, 208, 209, 210, 211 or 212 as if such transferee had
incurred the qualified rehabilitation expenditure.
(c) The commission shall develop standards for the approval of rehabilitation of
certified historic structures for which a tax credit voucher is sought. Such standards
shall take into account whether the rehabilitation of a certified historic structure will
preserve the historic character of the building.
(d) The commission shall adopt regulations, in accordance with chapter 54, to carry
out the purposes of this section. Such regulations shall include provisions for filing of
applications, rating criteria and for timely approval by the commission.
(e) Prior to beginning any rehabilitation work on a certified historic structure, the
owner shall submit (1) a rehabilitation plan to the commission for a determination of
whether or not such rehabilitation work meets the standards developed under the provisions of subsections (b) to (d), inclusive, of this section, and (2) an estimate of the
qualified rehabilitation expenditures. The provisions of this subsection shall not disqualify applications for tax credits for certified historic structures for which rehabilitation
commenced but were not placed in service before July 1, 2006.
(f) If the commission certifies that the rehabilitation plan conforms to the standards
developed under the provisions of subsections (b) to (d), inclusive, of this section, the
commission shall reserve for the benefit of the owner an allocation for a tax credit
equivalent to twenty-five per cent of the projected qualified rehabilitation expenditures,
not exceeding two million seven hundred thousand dollars.
(g) Following the completion of rehabilitation of a certified historic structure, the
owner shall notify the commission that such rehabilitation has been completed. The
owner shall provide the commission with documentation of work performed on the
certified historic structure and shall submit certification of the costs incurred in rehabilitating the certified historic structure. The commission shall review such rehabilitation
and verify its compliance with the rehabilitation plan. Following such verification, the
commission shall issue a tax credit voucher to the owner rehabilitating the certified
historic structure or to the taxpayer named by the owner as contributing to the rehabilitation. The tax credit voucher shall be in an amount equivalent to the lesser of the tax
credit reserved upon certification of the rehabilitation plan under the provisions of subsection (f) of this section or twenty-five per cent of the actual qualified rehabilitation
expenditures not exceeding two million seven hundred thousand dollars. In order to
obtain a credit against any state tax due that is specified in subsections (h) to (j), inclusive,
of this section, the holder of the tax credit voucher shall file the voucher with the holder's
state tax return.
(h) The Commissioner of Revenue Services shall grant a tax credit to a taxpayer
holding the tax credit voucher issued under subsections (e) to (i), inclusive, of this section
against any tax due under chapter 207, 208, 209, 210, 211 or 212 in the amount specified
in the tax credit voucher. Such taxpayer shall submit the voucher and the corresponding
tax return to the Department of Revenue Services.
(i) The aggregate amount of all tax credits which may be reserved by the commission
upon certification of rehabilitation plans under subsections (b) to (d), inclusive, of this
section shall not exceed fifteen million dollars in any one fiscal year.
(j) The commission may charge an application fee in an amount not to exceed ten
thousand dollars to cover the cost of administering the program established pursuant to
this section.
(P.A. 06-186, S. 82; P.A. 07-217, S. 48.)
History: P.A. 06-186 effective July 1, 2006, and applicable to income years commencing on or after January 1, 2006;
P.A. 07-217 made a technical change in Subsec. (g), effective July 12, 2007.