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City offering tax incentives for Historic District home owners, and those who live east of US 75
By Brandi Hart
McKinneyUpdate.com editor
Created at 10:45 p.m. on Jan. 25, 2009
If you live in McKinney's Historic District, or east of US 75, south of US 380 and north Eldorado Parkway and need money to repair your home the city of McKinney has various tax incentives available for homeowners to help offset the costs associated with home rehabilitation.
The city's Historic Preservation Office offers incentives for people who live in the Historic Neighborhood Improvement Zone, which is east of US 75, mostly south of US 380, north of Eldorado Parkway, and west of Airport Drive. A map of the HNIZ can be viewed here .
The city offers three incentives for people who live in the HNIZ. The level one incentive is known as the Historical Marker Program. The homeowner will receive a 100 percent city tax exemption for 15 years as long as the home is maintained and can also purchase a city historical marker, if the homeowner qualifies for the incentive. The marker is not the same as a state historical marker.
The homeowner would have to provide a written documented history of the home, which must be at least 50 years old located in the HNIZ; provide documentation of all four elevations of the home using black and white photos with negatives, color slides, and copies of any available historic photographs; a legal description of the home; and a site plan of the home. The home owner would have to purchase the historic marker from the city.
The level two incentive is a 50 percent city tax incentive for the maintenance and rehabilitation of the home's exterior such as painting, roof, windows, foundation, and siding that cost more than $10,000.
The level three incentive gives the homeowner an exemption of 30 percent of his or her city taxes for up to 15 years as long as the home is maintained and meets city code. The incentive is for any improvements to the home's exterior, such as the roof, painting, windows, foundation, and siding or the home's interior, such as sanitary sewer lines, fire, heating, ventilation, and air conditioning, insulation, electrical, plumbing, or a combination of home's interior and the exterior. The improvements must cost more than $5,000.
McKinney Historic Preservation Officer Guy Giersch said the reason the HNIZ tax incentives were created was to give homeowners who live in the area help in maintaining and rehabilitating their homes.
"The goal is to restore pride in the neighborhoods and for people to restore their homes," Giersch said..
To qualify, all work must fall into one or more of the following categories:
- Preservation, such as the act or process of applying measures to sustain the existing form, integrity, and material of a building or structure;
- Restoration, which is the act or process of accurately recovering the form and details of a property and its setting as it appeared at a particular period of time by means of the removal of later work or by the replacement of earlier work.
- Rehabilitation, which is the act or process of returning a property to a state of utility through repair or alteration which makes possible an efficient contemporary use while preserving those portions or features of the property which are significant to its historical, architectural, and cultural values.
- Reconstruction, which is the act or process of recreating a portion of a building, in all new materials based on factual evidence such as photographs.
The owner of a historic residential home would receive four dollar tax abatement on city taxes for every one dollar spent on qualifying expenses for 10 years when qualified restoration costs equal or exceed 5 percent of the value of the building. For every dollar spent in qualifying costs the owner would receive abatement equal to four dollars, a four to one ratio, off the appraised value of the house for city tax purposes. If an individual completes another qualified project during their 10 year exemption period the second exemption would begin at the conclusion of the original 10 year period. The city has a $50,000 annual cap on the incentives that can be awarded.
If the homeowner sells the house the incentive stays with the house and not the owner. The resident needs to submit an application to Giersch at ggiersch@mckinneytexas.org . If the homeowner is approved for a city tax exemption he will also submit an application to Collin County for 100 percent of the county's taxes for the value of the house for up to 15 years as well, Giersch said.
For more information about the Historic Neighborhood Improvement Zone home improvement incentives visit http://www.mckinneytexas.org/frameset.asp?aid=144.
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