Minnesota Government Considers Tax Credit for Abandoned Structures
Innovative Tax Credit Proposal Seeks to Revitalize Abandoned Buildings in Minnesota
The Conversion of Underutilized Buildings Tax Credit, or CUB, is a novel concept that is currently under discussion within the government of Minnesota. This concept seeks to assist historic structures that have been abandoned due to the pandemic. Proposer Senator Matt Klein is the one behind this. He intends to reward building owners who make repairs to these abandoned structures with tax benefits. If an owner of a building agrees to perform repairs after it has been largely abandoned for five years or longer, they may be eligible for a tax credit equal to thirty percent of the repairs’ total cost.
The proposal has some strict rules. For example, at least three-quarters of the original structure must stay the same, and the outside walls can’t be taken down. Also, if a project costs less than $5 million to fix up, the owner might get a grant instead of a tax credit. Although there’s some uncertainty about how much it might cost the government, supporters say it’s vital to make use of these old buildings now, as building new ones is getting more expensive.
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Tax Credit Proposal for Building Transformation Deliberates in Senate Panel. (PHOTO: The Business Journal)
Advocates See Promise in Tax Credit Proposal for Abandoned Buildings
Some believe this concept might revolutionize cities and breathe new life into abandoned spaces, including Minneapolis Mayor Jacob Frey and others. They claim that more people visiting downtown districts may result in more establishments and safer streets. Legislators are concerned about potential effects on property taxes and the value of surrounding properties, though. However, there are still many who believe that this tax credit holds the key to revitalizing abandoned structures and communities.
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