The Vermont Downtown Program selected 30 projects in 17 Vermont communities to award the credits to, including projects in East Dover and Wilmington. Gov. Peter Shumlin is touting the program as a big step in the restoration and recovery efforts of communities statewide.
“The downtown tax credit program is a proven tool that stimulates much-needed local economic activity and job creation across Vermont,” said Shumlin. “By adding flood credits to target communities particularly affected by Irene to the very successful state tax credit program, we have been able to contribute to the recovery of vital downtown businesses around the state, while promoting new growth and investment.”
In East Dover village, Amiee Pritcher and John Sprung, owners of the building that has housed the post office and general store for 150 years, have been awarded $32,200 in historic tax credits and code credits through the program. Sprung says the goal of restoring the building is to bring back an old village that was ready to disappear. “There’s many new and original residents here,” said Sprung. “The general store and post office have always been a gathering place for local people and without it they would have no place.”
The home of newly opened clothing and design store Beyond Imagination is also benefiting, receiving $13,750 in code credits to help with the rehabilitation of the first floor destroyed by flooding last year. Building owner Edward Erhard said the entire first floor had to be rehabilitated down to the supports and joists. Tax credits will help offset the cost of bringing the building to its original condition, as well as updated to state building codes.
According to the Vermont Agency of Commerce & Community Development, the Downtown Program works throughout the state to use resources, training, and technical services to help designated downtown organizations preserve and revitalize historic downtowns and create strong communities.
There are over 100 Vermont downtowns and village centers that are designated, and these communities receive priority for consideration for state funding, as well as tax credits. The program focuses its funding on costly code compliance projects business owners are required to complete.
Noelle MacKay, Commissioner of the Department of Economic, Housing, and Community Development, and chair of the Downtown Board, says the board mixed flood credit with tax credits where they could to help every impacted business they could. “We decided to take some of the regular tax credit money and apply it to some of the flood impact projects” said MacKay. “We had $800,000 in requests and $500,000 in flood money, but some requests for flood projects fit into the criteria for regular tax credits, including façade improvements and code requirements. We used the $500,000 and took some of the tax credit money to try to provide some support for all those flood impact projects that apply.”
MacKay also said the projects chosen are determined by an objective point system, wherein each project is ranked by need as well as it’s direct impact on the community.
Of the $500,000 awarded in statewide flood credit money, three businesses in Wilmington have been awarded a total of $178,848. Dot’s Restaurant, ruined by flooding last year, was the top beneficiary, granted $92,087. According to owners John and Patty Reagan, the flood credit will be used to offset the budget and pay for certain elements of the project such as flood proofing, a sprinkler system, and handicap accessibility. “ It will be a huge boost to our overall financing package,” said Reagan “We are very appreciative to the state and consider it a huge vote of confidence to our project.”
The Old Red Mill on North Main Street, one of Wilmington’s top employers in the downtown Wilmington Historic District, was awarded $77,561 in flood credit to help offset work to repair severe damage from Tropical Storm Irene. The South Main Street building currently housing Apres Vous restaurant, and Twin Valley Hair Salon was allotted $9,200 to assist in cleanup costs not covered by insurance..
At the announcement of the plan in Barre last week, Gov. Shumlin cited Wilmington as a prime example of a town that can benefit directly from the flood credits. “When you see the revitalization that’s happening in Wilmington, and the fact that I’m going to be able to go back to Dot’s and have a bowl of the best chili ever made anywhere in America, and you see that happening from south to north, east to west, it’s a testament to how important these credits are to Vermont’s future.”
According to Chris Cochran, director of community planning and revitalization for the Vermont Agency of Commerce & Community Development, when a property owner files their tax return, the traditional and historic tax credits can be used to offset existing tax liability.
“Property owners can either claim the credit on their own individual tax returns, or sell them to the bank. If the bank is lending them the building, and these projects can be difficult to finance, it’s this increment of credit the bank can look at and say, ‘I probably wouldn’t fund it otherwise, but because I know that it’s backed by the full faith and credit of the state of Vermont’ they buy the credit so it reduces the cost of the building.”
Cochran says flood credits are special because victims with substantial losses can deduct those losses from their tax return thereby decreasing tax liability. “ They are refundable. Basically you file your tax return, and the tax credit certificate will say the project is complete. The tax department then issues a check for whatever the available balance is.”