Insider Notebook: Extension sought for money-making Maine preservation tax credits

Photo / Tim Greenway Maine historic preservation tax credits, along with the federal program, have transformed property, like the Bates Mill in Lewiston, as well as communities and made money for the state.

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By Maureen Milliken

The Maine State Rehabilitation Tax Credit, which has helped boost economic development in the state to the tune of $166 million in local property taxes, has always hovered under a cloud of uncertainty.

While it has been increasing used by developers since it was reworked in 2008, it also has to be renewed very few years as its sunset approaches. One of the issues is that developers get antsy about whether the credit will still be there for them if they launch a development with the tax credit as one of the financial tools.

The recent renewal extended the sunset from 2023 to 2025, but organizations that back the tax credit — Maine Preservation, GrowSmart Maine, CEI, Maine Real Estate And Development Association, to name a few — hope that the news from the report released this week will spur a longer-term extension by the Maine Legislature.

"This tax incentive program is one of the most efficient ones out there, as far as economic and community growth," said Greg Paxton, of Maine Preservation.

The annual economic impact analysis, released Monday, found that the credits have also created 700 full-time permanent jobs, support 500 to 700 construction jobs yearly, have generated $566 million in construction investment and have rehabilitated 3.6 million square feet of commercial and residential space, including creating more than 2,000 housing units, 1,300 of them affordable homes. It's also had a ripple effect on downtown development, the organizations that sponsored the report said.

The Maine program allows 25% credit for any historic rehabilitation that also qualifies for the 20% federal historic preservation credit, with another 5% where affordable housing is included. Projects are paid for up front and must meet benchmarks throughout the development to qualify for the credits, which are applied after a project is finished. There is a $5 million a year cap per project.

Some 106 historic tax credit projects have been completed in Maine since 2009, and there are 59 now in the process, including 16 under construction.

The report of the economic impact of the program found that since 2016, the program has generated $3 million more in taxes than it has credited.

Paxton told Mainebiz Wednesday that one of the positives about the program is that it has support across the political divide.

'It was first passed [in 2008] during the Baldacci administration, with a majority Democratic House and Senate," Paxton said. "And it was extended in 2011 during the LePage administration, with a majority Republican House and Senate."

While a bill to extend it past 2025 was being looked at during this year's Legislative session, given the pandemic, it's likely that it will be put off.

While it was initially proposed before the Great Recession after individual bills had been crafted for specific projects, Paxton said the tax incentives helped keep many projects going as the economy slowed down, then recovered. Those who support the program believe it can do the same during the economic fallout from the COVID-19 pandemic.

Courtesy / Pine Tree Curling Club

Members of the Pine Tree Curling Club play the sport in Belfast last year. The club is looking for space in the Portland area to lease for its own curling arena.

Pine Tree Curling Club ready to lease

The Pine Tree Curling Club has settled on a plan to lease and retrofit existing space as a dedicated curling club in the Portland area. The club, which has been curling for five years at the William Troubh Ice Arena in Portland, is reading to make the move in time for the surge in interest in curling expected to come with the Winter Olympics in 2022, said David Florig, club president.

The club, which is dedicated to teaching and growing the ice sport of curling in Maine, originally also considered building its own space, but has now setting on leasing space, said Florig. The only other dedicated curling arena in Maine is in Belfast. The club is looking for a warehouse or industrial space "with a lessor who is enthusiastic and willing to work with the club," Florig said. In total, the club needs about 12,000 square feet of space.

The curling action itself takes up about 9,000 square feet — a 60-by-150-foot area is needed for the playing surface, which consists of one to two inches of ice. Ice is made by placing insulation over a concrete slab, laying piping over the insulation and flooding the surface as coolant circulates through the piping. It doesn't damage the concrete floor, Florig said.

In addition to the ice surface, a curling club also has a clubhouse that overlooks the ice so that spectators can watch, a bar, kitchen and locker rooms.

Curling is one of the fastest-growing sports in the country because it can be played by nearly anyone, Florig said. Curlers at the Portland club are of all genders, and range in age from their 20s to their 70s. With its own dedicated space, the club can provide curling opportunities for youth, seniors, school and college teams, and those with disabilities as well as host corporate events, parties, and team-building events for local businesses and organizations.

Ultimately, the club hopes to have regular leagues for adults, seniors, youth, beginners, breweries, first responders, and others.

Dedicated curling sheets are also a requirement for hosting a "bonspiel," and a club would ideally host four or more a year.

Bonspiels, or curling tournaments, are generally two or three days and draw people from around the region or across the country into the area.

“They eat, drink, stay at local hotels,” Florig told Mainebiz last year. “Portland is perfect for it.”

The Maine Brew Bus was on board with curling early on, hosting a "brew and curling" tour since 2017.

Curling involves two teams of four attempting to score the most points by delivering their curling stones closest to the center of a target at the opposite end of the ice. Curling is a sport of precision — it demands that a team deliver a curling stone weighing 42 pounds across more than 130 feet of ice to come to rest in a very specific location, where mere inches often make the difference between success and defeat.

The international sport dates back to the 16th century, and the United States is relatively new on the curling landscape, but curling is gaining popularity, particularly after the U.S. men’s team won a gold medal in the 2018 Winter Olympics.

Florig said that the club believes Maine is just the place to deliver a first-class curling experience. He can be reached at david.florig@hotmail.com.