By JAMES FINK AND ADAM SICHKO
jfink@bizjournals.com | 716-541-1611

A bill sponsored by Assemblyman Sam Hoyt to expand New York's historic preservation tax credits passed the Legislature June 16 and is expected to be signed into law soon.

The changes will enable developers to sell the tax credits to banks and insurance companies - something not allowed by current law.

Banks and insurance companies, which are key investors in the rehabilitation projects, would be allowed to buy tax credits from developers and claim them on their tax returns.

The bill sailed through the state Assembly and Senate in the June 16 votes. The changes would take effect immediately, kick-starting projects statewide.

"This will dramatically increase the pool of participants, which makes it more competitive, which will then allow us to stretch the dollar for these types of rehabilitations," said Hoyt, D-Buffalo.

Buffalo developer Rocco Termini, with several projects in the economic-development pipeline waiting for the bill's passage, said the action could not come at a better time.

"I hate to sound like (automobile dealer) Billy Fuccillo, but this is huge," Termini said. "It is the biggest economic-development boost the city has seen in the past decade."

The tax credits are a crucial part of a complex financing package he crafted for the renovation of Hotel Lafayette and AM&A's flagship store in downtown Buffalo. Those projects represent more than $110 million in private-sector investment.

Termini is not alone.

Kissling Interests said the tax credits were critical for its renovation of the long-vacant, former Remington Rand warehouse in Tonawanda to a mixed-use project anchored by live/work-style lofts.

Architect Karl Frizlen also was waiting for historic tax credits to help with financing the former Horsefeathers building on Connecticut Street into a residential complex and indoor farmer's market.

"Everyone has been waiting with bated breath for this to happen," Termini said.

Hoyt, meanwhile, said there are 10 projects in Western New York - totaling more than $175 million - that can begin once the bill is signed into law. He said he also sees potential in downtown Albany.

"I walk up and down State Street and see extraordinary old buildings, too many of them sitting vacant," he said.

"I'm absolutely convinced this tax credit amendment and tax credit program will be the catalyst for many of these historic buildings in downtowns across New York state to be redeveloped."

Gov. David Paterson, earlier this year, said historic preservation efforts have been proven to create jobs, attract small business, increase property values and promote affordable housing.

"In these difficult times, it is essential to target existing resources for the greatest positive impact by leveraging private-sector investment," he said.

The proposed law also doubles to $50,000 the tax credits available to individuals who rehabilitate multiple historic residences in a single year.