U.S. Senators Ben Cardin (D-Md.) and Todd Young (R-Ind.)have introduced legislation that would expand the Historic Tax Credit to foster economic growth and urban renewal, revitalizing housing in distressed neighborhoods nationwide. In 2021 Maryland passed state legislation that that made financial assistance available to help close appraisal gaps in historically redlined and disinvested neighborhoods.

Currently, private development lacks in some urban and rural areas because the cost of purchasing and renovating homes is greater than the value of the sale price of homes. The Neighborhood Homes Investment Act (NHIA) creates a federal tax credit that covers the cost between building or renovating a home in these areas and the price at which they can be sold. The legislation also caps the price of sales for each home to ensure that they are affordable housing options in the community. The NHIA would also help existing homeowners in these neighborhoods to renovate and stay in their homes.

“Everyone deserves a safe and affordable place to call home. Our bipartisan tax credit will drive housing investments and revitalize neighborhoods across Maryland while keeping them affordable for low- and moderate-income families,” said Maryland Senator Cardin. “This credit will allow individuals in these communities to build equity and wealth for their families. We must continue to make it more attractive to invest in the communities that need it most.”

The NHIA could lead to the revitalization of 500,000 homes and create $125 billion in development revenue over the next 10 years. About 22% of metro areas nationwide and 27% of non-metro areas qualify for NHIA investments. NHIA targets neighborhoods that have poverty rates that are at or below 130% or greater than the metro or state rate; have incomes that are at or below the area/state median income; and have home values that are below the metro or state median value.

Historic preservation and revitalization is smart growth.

The revitalization of existing communities and their historic places is the wisest form of economic redevelopment.