Tax Abatements for Restorations

When Jeff and Katie Bullard bought their Hyde Park house at 4210 Avenue G, they already knew all the positive and negative aspects of owning an old house.  They were veterans of two historic landmarks, the most recent in Judge’s Hill.  But this old house on Avenue G had an advantage that didn’t exist for the previous two: a city ordinance that offered tax abatements for the restoration of contributing and potentially contributing properties in local historic districts.

Adopted by the City of Austin in 2012, this program helps owners restore contributing structures or bring potentially contributing structures back to contributing status by providing a property tax abatement to owners whose restoration costs are at least 25% of the pre-restoration value of the property.  Its purpose, according to the City of Austin, is “to encourage preservation and maintenance of the architectural character of local historic districts.”  The program abates 100% of the city property taxes assessed on the value added to a property as a result of the restoration project.  The abatement lasts for seven years.  Commercial properties are also eligible for the program, but their restoration requires an expenditure of 40% of pre-restoration value and their tax abatement lasts for 10 years.

Before picture

Jeff and Katie’s house on Avenue G, while in good condition, had not been touched since the 1970s.  The tax abatement program enabled them to add a second floor while retaining three-fourths of the original structure.  As the owner of Avenue B Development, Jeff was accomplished at historic restorations.  When he learned about the tax abatement program through a Preservation Austin seminar, the stage was set for his Hyde Park venture.

To participate in the program, an owner must apply to the Historic Landmark Commission before beginning the restoration.  All work must comply with the Local Historic District Preservation Plan and Design Standards.  After the Historic Landmark Commission approves the application, the owner has two years to complete the project.  The City of Austin Historic Preservation Officer performs a final inspection to approve the work before initiating the tax abatement.

AvenueG

Eligible expenses include the demolition of non-historic exterior additions and the repair, restoration, or replacement of the historic façade and landscape features, including the reconstruction of missing features.  In keeping with modern environmental concerns, it also includes sustainability features such as solar panels.

The Bullards were the first owners to take advantage of the tax abatement program in the Hyde Park Local Historic District.  While they celebrate their “new” home, Hyde Park can appreciate another tool that favors restored single family homes over demolitions and new construction.