The University of Minnesota’s Extension Center for Community Vitality prepared “Economic Impact of Projects Leveraged by the Minnesota Historic Rehabilitation Tax Credit: Fiscal Year 2018.”
Here are the key highlights from the report:
Output Effects: In FY 2018, the total estimated economic impact of the Minnesota Historic Rehabilitation Tax Credit was $715.2 million. Directly, through rehabilitation, the state historic tax credit created $393.4 million of construction activity. This construction activity then generated $321.8 million of output in other industries in Minnesota. Sectors most impacted include wholesale trade, owner- occupied housing, and real estate.
Employment Effects: In FY 2018, the Minnesota Historic Rehabilitation Tax Credit supported an estimated 3,630 full-time equivalent (FTE) jobs in the state. This includes the 1,690 jobs at rehabilitation sites during the construction activity (direct effect). It also includes 1,940 jobs at supporting industries. Sectors most impacted include wholesale trade, real estate, and miscellaneous retail stores.
Labor Income Effects: In FY 2018, the Minnesota Historic Rehabilitation Tax Credit generated an estimated $235.2 million in labor income. Directly, the rehabilitation activities created $121.5 million in labor income. Because of spending for rehabilitation, another $113.7 million of labor income was generated across all industries in Minnesota.
Tax Credit: The projects, upon completion, will be eligible for $75.3 million of state historic tax credits. Thus, for every dollar of state historic tax credit, private developers plan to invest $6.93 of their own funds. Given a total impact of $715.2 million of activity, each dollar of the Minnesota Historic Rehabilitation Tax Credit generates $9.50 of economic activity in the state.
Total Impact 2011-2018: Since the state historic tax credit became available in 2011, 119 projects have received initial approval. These projects have generated an estimated $3.0 billion of economic activity in the state. This includes $993.5 million in labor income (dollar figures are adjusted to 2018 dollars). The state historic tax credit has supported 16,557 jobs.