House Status:
Senate Status:
Senate Status:
Minutes for SB227 - Committee on Taxation
Short Title
Providing for different credit percentages for the tax credit for expenditures for the restoration and preservation of historic structures based on city populations and the amount of the expenditures.
Minutes Content for Tue, Mar 11, 2025
Chairperson Smith opened the hearing for SB227.
Adam Siebers, Office of Revisor of Statutes, provided an overview for SB227 that amends the tax credit for qualified expenditures for restoration and preservation of historic structures by providing credit percentages based on city populations of more than 50,000 or 50,000 less and the amount of expenditures. SB227 amends the allowable credit amounts depending on the size of the city, or township where such expenditures occurs. (Attachment 2) Mr. Siebers stood for question from Committee members.
Kathleen Smith, Kansas Department of Revenue stated the Department is estimating SB227 would decrease the State General Fund revenues by $600,000 in FY 2026, $1.9 million in FY 2027and $3.1 million in FY 2028. To come up with the estimate, the Department looked at the previous historic preservation tax credits that have been issued and came up with the estimate. The Department estimated the bill would increase the total tax credit by around $3.7million a year and assuming one third would be allowed against the liability and the remaining would be carried forward. Ms. Smith stood for questions from Committee members.
In response to questions, Ms. Smith will provide a list of the historical projects that are on the books to the Committee. She also noted the tax credit can be used for government buildings and would be able to transfer the credit if unable to us.
Eric Adell, Legislative Research, provided information from the State Historical Society and projects between 2014 through 2024 accounted for 818 projects. The ownership is classified by the project type whether they are single family residence, commercial, civic or multiple family residence. He stated there is information regarding the type of credit and if it is a nonprofit credit amount.
Chairperson Smith requested if the information could be put together on a spreadsheet and sent to Committee members.
Proponents:
Jennifer Sourk, Clock Tower, LLC and Klaton Properties, LLC testified via WEBEX as a proponent for SB227. She stated Clock Tower, LLC and Klaton Properties both have made significant investments in historic buildings across the state of Kansas. The tax credits provide essential incentive for the preservation of historic buildings. Due to high standards set by the State Historical Society, the cost of preserving the buildings is often prohibitive. SB227 would provide parity for communities with populations of 50,000 or more, ensuring that historic preservation efforts in these areas receive the same incentives as the smaller communities. (Attachment 3) Ms. Sourk stood for questions from Committee members.
Blade Mages, Executive Director of Wareham Hall, testified as a proponent for SB227 stating Wareham Hall is a nonprofit organization leading the renovation of the historic Wareham Theater to create a state-of-the-art performance space in Manhattan, Kansas. Since 1880 there has been a building standing at that address to bring the community together over the arts and entertainment. Transformational projects like Wareham Hall are somewhat rare and difficult in smaller cities unlike major metro areas where there is abundant capital or private equity. Cities like Manhattan rely on tools like the Kansas historic tax credit to make projects possible. SB227 is a fiscally responsible way to encourage private investment, economic growth, and expands the tax base especially at a time when lessening risk for developers is critical. Mr. Mages stated when their project is complete it will bring in about $4.6 million into the regional economy every single year and will drive business to downtown Manhattan. Mr. Mages stood for questions from Committee members. (Attachment 4)
Terry Humphrey, Friends of Historic Preservation, testified as a proponent for SB227 that will enhance an essential economic development programs such as the historic tax credit. Since the beginning more than twenty years ago, the state's historic rehabilitation tax credit program has contributed over a billion dollars to the Kansas economy. SB227 will bring equity to the state's historic rehabilitation tax credit program on larger projects in communities of all sizes, raising the credit from 25.0 percent to 40.0 percent on large projects in communities where populations exceed 9,500. Historic tax credits help bridge gaps in financing needed to bring abandoned and derelict buildings up to code and back into use. The proposed legislation will bring equity to the state's historic rehabilitation tax credit program on larger projects in communities of all sizes, raising the credit from 25.0 percent to 40.0 percent on large projects in communities where populations exceed 9,500. (Attachment 5) (Attachment 6) Ms. Humphrey stood for questions from the Committee.
Written only proponent testimony for SB227 was submitted by the following:
Bryan Falk, Falk Architects, (Attachment 7)
Greg Schwerdt, sdg Architecture & Interiors, (Attachment 8)
Nickolaus J. Hernandez, City of Dodge City, (Attachment 9)
Matt Allen, City Manager Garden City; Nick Hernandez City Manager, Dodge City; Scarlette Disekier, City Manager, Liberal, Kansas, (Attachment 10)
Alijah Rollins and Nadia McMichael, Commerce Bank, (Attachment 11)
Stacee Olden, Orpheum Performing Arts Centre, (Attachment 12)
Casey Woods, Emporia Main Street, (Attachment 13)
Matthew McGivern, Senne Company, Inc., (Attachment 14)
Joanne Morrell and Jeff Carson, Historic Jayhawk Hotel, (Attachment 15)
Sudha Tokala, Natman Realestate, LLC, (Attachment 16)
Claire Willenberg, North Riverside Neighborhood Association, Wichita Historic Preservation Board, (Attachment 17)
There were no opponent or neutral testimonies submitted for SB227.
Chairperson Smith closed the hearing for SB227.
