Thirty-seven development projects in Vermont downtowns on Monday were awarded $2.4 million in state tax credits to offset development costs.
State officials say the total value of the developments supported by the credits is nearly $78 million. The winning projects were selected from an applicant pool of 42 projects spanning 26 cities and towns.
The recipients include nonprofit organizations and private developers.
Gov. Peter Shumlin said at a press conference in downtown Burlington that the people who live and work in vibrant downtowns also benefit.
“These incentives are proven to jumpstart transformation in communities and have brought jobs, business and housing to downtowns and villages across the state,” Shumlin said.
Noelle MacKay, commissioner of the Department of Housing and Community Development, credits the incentive program with underpinning revitalization efforts in Brattleboro, St. Albans, Barre, Hardwick and Morrisville.
A representative of the Vergennes Opera House who spoke briefly at the event said the facility is the hub of the community’s downtown.
“If it shut down, we would have gone back 25 years,” she said.
The Opera House has been granted $17,412 in tax credits to support $123,272 in work to complete a recently installed sprinkler system, which will enable the nonprofit to increase capacity for large events and use the building more fully as a historic space.
A representative from the Little School in Weston, said the preschool couldn’t have afforded certain fire safety and handicap accessibility improvements on its own. The Little School received $16,885 in credits for $33,770 in upgrades.
Other recipients include the private developer Redstone, which is building the new Hilton Garden Inn in downtown Burlington, where Monday’s press conference was held.
The hotel project is unique among the announced recipients, most of which are getting downtown and village center tax credits to support the work of upgrading historic buildings in downtown areas. Eligible improvements include retrofitting for handicap accessibility, code compliance, general rehabilitation and exterior aesthetics improvements. Recent changes expanded the program to encourage technology-related installations to attract high-tech businesses to commercial centers.
Eric Hoekstra, development manager for Redstone, said the company worked with the city of Burlington to apply for a sales tax re-allocation from the Hilton Garden Inn.
The mechanism redirects taxes paid on building materials. After taxes from the first $1 million worth of materials are collected by the state, the city gets the rest, which it then ploughs back into infrastructure improvements to support the project.
In this case, the money will help pay for public infrastructure needed for construction next to the historic Woodbury Armory Building. The Armory Building previously received some historic tax credits in the past, Hoekstra said. Without the tax credits, the project would have had to pay for some, but not all, of the infrastructure costs.
Other projects aided by the tax credits announced Monday include rehabilitation of the former Wilmington Home Center and neighboring Professional Building, both now vacant; upgrades to a former auto parts retail store in Waterbury, where the Craft Beer Cellar of Waterbury will move into a space that had been flooded by Tropical Storm Irene. A complete list of recipients is available on the Department of Housing and Community Development’s website.
Almost 150 community centers are designated downtowns or villages, according to a press release. When villages and towns receive the designation, they are prioritized in consideration for state grants, increased Act 250 review triggers and access to state tax incentives.
MacKay said the program has grown from $500,000 to $2.4 million in recent years, including $500,000 in additional funding budgeted by the Legislature earlier this year.
Most of the credits are either used by developers to reduce their state tax obligations, or sold to institutions like banks and insurance companies for the same purpose.
