9 AN ACT
relating to historic preservation; concerning tax credits;
amend-
10 ing K.S.A. 75-2716 and
repealing the existing section.
11
12 Be it enacted by the Legislature of the
State of Kansas:
13 New Section
1. (a) For all taxable years commencing after Decem-
14 ber 31, 1999, there shall be allowed a 25%
tax credit against the income
15 tax liability imposed upon a taxpayer
pursuant to the Kansas income tax
16 act for the restoration and preservation of
historic property by a taxpayer
17 who is:
18 (1) The owner of
the property and who incurs qualified costs in an
19 amount equaling or exceeding $5,000; or
20 (2) allowed a
credit for costs incurred in the rehabilitation of Kansas
21 property pursuant to section 38 of the
federal internal revenue code of
22 1986.
23 (b) If the amount
of such tax credit exceeds the total state income
24 tax liability for the year in which the
costs and expenses were incurred
25 for the rehabilitation of property which is
a registered state or federal
26 historic structure or federal historic
district, such excess amount may be
27 carried over for deduction from the
taxpayer's state income tax liability
28 in the next succeeding taxable year or
years until the total amount of the
29 tax credit has been deducted from tax
liability, except that no such tax
30 credit shall be carried over for deduction
after the 10th taxable year suc-
31 ceeding the taxable year in which the
expenditures were made.
32 (c) To qualify
for the state income tax credit, a structure shall:
33 (1) Have historic
value;
34 (2) have historic
architectural value; or
35 (3) be designated
as:
36 (A) Contributing
features to national register districts; or
37 (B) a landmark;
and
38 (4) listed or
eligible for listing individually on the national register of
39 historic places or the state register of
historic places.
40 New Sec.
2. (a) Except as otherwise provided in subsection (c), in
41 order for any taxpayer to prequalify for
the credit provided in this section
42 the taxpayer on forms developed by the
agency shall:
43 (1) Submit to the
cultural resources division of the state historic pres-
2
1 ervation office, a fee determined by
the agency, but not exceeding $100;
2 (2) submit
documentation verifying that the structure is or is eligible
3 to be on the state register of
historic places;
4 (3) submit
plans and specifications for such proposed restoration, re-
5 habilitation or preservation; and
6 (4) submit
a signed agreement, if required, as specified in subsection
7 (b).
8 (b) When
more than one taxpayer qualifies for the tax credit provided
9 for in section 1, the amount of the
tax credit allowed shall be divided pro
10 rata according to the number of such
taxpayers, unless a binding agree-
11 ment signed by all of the eligible
taxpayers has been filed with the division
12 which specifies the manner in which the
amount of the tax credit allowed
13 is to be divided among such taxpayers.
14 (c) Nothing shall
preclude the state income tax credit in subsection
15 (b) from being allocated among the
taxpayers in a manner different than
16 the allocation of any credit claimed under
section 38 of the federal inter-
17 nal revenue code.
18 New Sec.
3. (a) When the division approves the application a notice
19 of preliminary approval shall be sent to
the applicant along with a state-
20 ment that the approved preservation must be
completed within 24
21 months from the date of preliminary
approval.
22 (b) If more than
one taxpayer is involved in the project as in subsec-
23 tions (b) and (c) of section 2, and
amendments thereto, the division shall
24 issue the notice in subsection (a) to each
taxpayer.
25 (c) The division
upon request of the applicant and upon good cause
26 shown may issue a one time extension of the
project's completion dead-
27 line. The extension shall be for a period
of time not to exceed 24 months.
28 New Sec.
4. (a) Upon submission to the division of an accounting of
29 the total qualified costs incurred in the
project, the names of the owners
30 who incurred such costs, the payment of a
fee in an amount determined
31 under subsection (c) of section 9, and
amendments thereto, and a deter-
32 mination by the division that the completed
project: (1) Conforms to the
33 plans and specifications approved under
section 2; (2) was completed
34 within the approved time frame; and (3)
conforms to the United States
35 secretary of the interior's standards for
rehabilitation; the division shall
36 issue a certificate of eligibility
specifying the amount of the tax credit the
37 taxpayer is permitted to claim. When
claiming the state tax credit, the
38 taxpayer shall attach the certificate to
the taxpayer's state income tax
39 return.
40 (b) The
provisions of subsection (a) shall not apply to any taxpayer
41 who has already met the criteria for
rehabilitation under section 38 of the
42 federal internal revenue code.
43 New Sec.
5. (a) Qualified rehabilitation expenses which the
eligible
3
1 taxpayer may include, but is not
limited to, should include: Structural
2 repair; sheet rock, plaster, fire
sprinkler systems; repair, refinishing or
3 replacement of architectural features
on the interior and exterior includ-
4 ing fixtures, doors, windows,
ceilings and carpentry; heating and air con-
5 ditioning repair or replacement;
electrical repair or replacement; tuck-
6 pointing, cleaning, roofing and
flashing; architectural and engineering
7 fees and costs incurred to meet
building and safety codes.
8
(b) Enlargement costs and site work that take place outside
the foot-
9 print of the building do not qualify
for the credit.
10 (c) Acquisition
costs, interior furnishings, excavation grading, paving,
11 landscaping, routine or periodic
maintenance, repairs to outbuildings
12 which are associated with the property but
are less than 50 years old are
13 not included.
14 (d) All work on
the project must meet the United States secretary of
15 the interior's standards for
rehabilitation.
16 (e) While the
project is worked on the division may, at any time,
17 designate a reviewing entity to review the
project and to ensure that it
18 meets the United States secretary of the
interior's standards for
19 rehabilitation.
20 New Sec.
6. (a) Any taxpayer who has repaid money under subsec-
21 tion (b) shall no longer be eligible to
carry forward any amount of the
22 credit which has not been used as of the
date the repayment is made.
23
(b) Notwithstanding any law to the contrary, if an eligible
taxpayer
24 who has claimed the tax credit sells the
qualified property within five
25 years after the completion of the project,
such taxpayer shall repay to the
26 state a portion of the amount of credit
which has been used to offset the
27 taxpayer's income tax in the following
amounts:
28 (1) Within the
first year, 100% of the amount of the credit allowed;
29 (2) within the
second year, 80% of the amount of the credit allowed;
30 (3) within the
third year, 60% of the amount of the credit allowed;
31 (4) within the
fourth year, 40% of the amount of the credit allowed;
32 and
33 (5) within the
fifth year, 20% of the amount of the credit allowed.
34 New Sec.
7. The secretary of state shall adopt rules and
regulations
35 to implement the criteria, duties and
procedures necessary to implement
36 this act.
37 New Sec.
8. The state historical preservation officer, designated
un-
38 der K.S.A. 75-2717, and amendments thereto,
shall certify any local gov-
39 ernment which meets the provisions of 16
U.S.C. 470a(c) and criteria
40 established by rules and regulations under
this act.
41 New Sec.
9. (a) Prior to January 1, 2001, and annually thereafter,
42 each certified local government shall adopt
a resolution stating whether
43 that local government will act as a
reviewing entity for the purposes of
4
1 sections 4 through 12, and amendments
thereto, during the following 12
2 months. A copy of the resolution
shall be sent to the state historic pres-
3 ervation office prior to January of
each year.
4 (b) Any
certified local government which resolves to act as a review-
5 ing entity for any given year shall
be required to perform all duties and
6 responsibilities required by the
state historical preservation office con-
7 cerning rehabilitation projects which
received the notice of preliminary
8 approval under section 3, and
amendments thereto.
9 (c) Upon
submission of the required materials under sections 4 and
10 5, and amendments thereto, to obtain the
certificate stating the amount
11 of tax credit the taxpayer may claim, the
taxpayer shall pay an amount
12 equal to the appropriate amount determined
by the following schedule
13 minus the fee amount paid under section 2,
and amendments thereto:
14
Amount of qualified costs
incurred
Amount of fee
15
$5,000 up to and including
$15,000
$250
16
$15,001 up to and including $50,000
$500
17
$50,001 up to and including $100,000
$750
18
Over $100,000
$1,000
19 (d) A portion of
the fees collected under this section shall be trans-
20 ferred by the state treasurer to the
reviewing entity's preservation fund
21 as payment for such entity's services.
22 New Sec.
10. (a) Any certified local government which is designated
23 to act as a reviewing entity for the
purposes of this act shall create a
24 preservation fund. The moneys in such fund
shall be used for expendi-
25 tures of such certified government incurred
in the performance of its
26 duties.
27 (b) All fees
collected under sections 2 and 5, and amendments
28 thereto, by the cultural division of the
state historic preservation office
29 shall be transmitted at least monthly to
the state treasurer.
30 New Sec.
11. There is hereby established in the state treasury a
pres-
31 ervation fee fund which shall be
administered by the state treasurer. Upon
32 receipt of any such remittance the state
treasurer shall deposit the entire
33 amount thereof in the state treasury and
the same shall be credited to
34 the preservation fee fund. All expenditures
from such fund shall be made
35 in accordance with appropriation acts and
upon warrants of the director
36 of accounts and reports issued pursuant to
vouchers approved by the
37 division of cultural resources or a person
designated by the state historic
38 preservation office. All moneys deposited
in the preservation fee fund
39 shall be used for the purpose of
expenditures incurred by the division,
40 agency and reviewing entity in the
administration of this act.
41 Sec.
12. K.S.A. 75-2716 is hereby amended to read as follows:
75-
42 2716. As used in this act, unless the
context otherwise requires:
43 (a) "Agency"
means the state historic preservation agency.
5
1
(b) "Division" means the cultural resources division of the
state his-
2 torical preservation
office.
3
(c) "Certified local government" means any local government
certified
4 by the state historical
preservation office pursuant to 16 U.S.C. 470a(1).
5
(d) "Contributing property" means property which by location,
de-
6 sign, setting, materials,
workmanship, feeling and association adds to the
7 sense of time, place and
historical development of a historic district.
8
(e) "Division" means the cultural resources division of the
state his-
9 torical preservation
office.
10
(a)(f) "Historic preservation" means
the study, identification, protec-
11 tion, restoration and rehabilitation of
buildings, structures, objects, dis-
12 tricts, areas and sites significant in the
history, architecture, archeology
13 or culture of the state of Kansas, its
communities or the nation.
14
(b)(g) "Historic property" means any
building, structure, object, dis-
15 trict, area or site that is significant in
the history, architecture, archeology
16 or culture of the state of Kansas, its
communities or the nation.
17
(e)(h) "Person" means any individual,
firm, association, organization,
18 partnership, business, trust,
corporation or company.
19
(c)(i) "Project" includes: (1)
Activities directly undertaken by the
20 state or any political subdivision of the
state, or any instrumentality
21 thereof;
22 (2) activities
undertaken by a person which are supported in whole
23 or in part through grants, subsidies, loans
or other forms of financial
24 assistance from the state
or, any political subdivision of the state,
or any
25 instrumentality thereofof the state or any person; and
26 (3) activities
involving the issuance of a lease, permit, license, certif-
27 icate or other entitlement for use, to any
person by the state or any po-
28 litical subdivision of the state, or any
instrumentality thereof.
29 (j) "Property"
means a building or structure or a unit of a multi-unit
30 building where such units are
individually owned.
31 (k) "Qualified
property" means property located in Kansas which is:
32 (1)(A) At
least 50 years old; and
33 (B) listed
individually or as contributing property in a district
listed
34 on the national register of historic
places or state register of historic places;
35 or
36 (C) deemed
eligible to be listed on the national register of historic
37 places or state register of historic
places;
38 (2) designated
as a landmark by a certified local government; or
39 (3) listed as
a contributing property within a designated historic dis-
40 trict of a certified local
government.
41 (l) "Qualified
rehabilitation" means any exterior improvements,
42 structural improvements, mechanical
improvements, plumbing improve-
43 ments, or electrical improvements
undertaken to restore, rehabilitate or
6
1 preserve the historic character of
a qualified property which meets the
2 standards of rehabilitation of the
United States secretary of the interior
3 as adopted by the state historic
preservation officer and certified local
4 governments pursuant to federal
law but shall not include any improve-
5 ments undertaken due to normal
wear and tear.
6
(m) "Reviewing entity" means:
7 (1) A
certified local government; or
8 (2) the
state historic preservation officer when the qualified
property
9 is not located within the
jurisdiction of any certified local government.
10
(d)(n) "State or any political
subdivision of the state" means the state
11 of Kansas, any office, department, agency,
authority, bureau, commission,
12 board, institution, hospital, college or
university of the state, or any
13 county, township, city, school district,
special district, regional agency,
14 redevelopment agency or any other political
subdivision of the state.
15
(e) "Person" means any individual, firm, association,
organization,
16 partnership, business, trust,
corporation or company.
17 (o) "State
historic preservation officer" means the person designated
18 and appointed pursuant to 16 U.S.C.
470a(b)(1)(A) and K.S.A. 75-2717,
19 and amendments thereto.
20 Sec. 13. K.S.A. 75-2716 is
hereby repealed.
21 Sec. 14. This act shall
take effect and be in force from and after its
22 publication in the statute book.