Rethos and advocacy partners Sherman Associates, Hempel, and Hylden Advocacy and Law have been meeting with development and commercial industry stakeholders since October 2023 to craft a legislative proposal to provide an income tax credit for the reuse of vacant and underutilized buildings. Driving this proposal, which has come to be known as the Conversion of Underutilized Buildings – or CUB – credit, is the stark realities of vacant office and commercial spaces in core cities and suburbs alike, as well as lingering vacancies in the upper stories of rural downtown commercial buildings and vacant historic school buildings across the state. Office buildings from the 1980s, ‘90s and early 2000s are under threat of demolition – and the scale of that destruction could have significant environmental, economic, and social impacts.
Testifiers in support of SF5194 at the Senate Taxes hearing on April 4, 2024 included:
Heidi Swank, Executive Director, Rethos
Dan Collison, Senior Director of Business Development and Public Affairs, Sherman Associates
Jacob Frey, Mayor of Minneapolis
Nicolle Goodman, Director of Planning and Economic Development, City of St. Paul
Joe Spencer, President, St. Paul Downtown Alliance
Adam Duininck, President and CEO, Minneapolis Downtown Council
Commercial real estate developers, civic leadership organizations, and downtown boosters submitted numerous letters of support. Read what they had to say by following the links in the Taxes committee agenda, found here.
While the CUB credit is unlikely to pass in 2024, we will continue to advocate for this incentive to become one of the Legislature’s top priorities in 2025. We aim to work with our lead author, Senate Taxes Vice-Chair Matt Klein (DFL, Mendota Heights) to refine the bill language and continue to build support for this important initiative. Support Rethos with a donation to help us continue this work!
Update May 8, 2024
Yesterday, Mayor Frey gave the State of the City address in the under-construction Norstar Center conversion project. He was introduced by Erin Fitzgerald, a commercial real estate broker who has been active in the Minneapolis Renaissance Coalition. Both the Mayor and Erin addressed the need to do something about vacant building conversions.
At the same time, MPR did a story on it and so did the local NBC affiliate, KARE-11. Vacant building reuse is garnering a great deal of interest and Rethos is working hard to keep the momentum going!