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Keep credit in tax reform bill

When West Virginia legislators boosted the state’s tax credit for those who repair and rehabilitate historic buildings, they did so in the knowledge it could accomplish enormous good, when coupled with a similar program available throughout the nation.

But that good, coming in the form of economic development for cities such as Wheeling, may never occur.

State lawmakers were smart to increase West Virginia’s credit, which covers applicable costs of restoring old structures. The old rate, 10 percent, was not competitive with nearby states. The new level, 25 percent, is.

Paired with the federal 20 percent credit, that could be a big incentive for developers to take on the challenges and risks of rehabilitating historic buildings.

Wheeling officials say there are concrete reasons to believe the two credits would make some local projects, perhaps including repurposing of the old Wheeling-Pittsburgh Steel building on Market Street, attractive to developers.

But a major problem looms on the horizon. It is tax reform legislation in Congress — ironically, aimed at improving the nation’s economy.

A tax reform bill approved by the House of Representatives would end the federal credit for redeveloping historic buildings. Taking away that 20 percent incentive would make such projects much less appealing.

U.S. Rep. David McKinley, R-Wheeling, has said he expects the credit to be put back once a final tax reform bill is enacted. Members of the Senate have yet to vote on their version of the tax measure. Once they do, it and the House plan would have to be reconciled. That would provide an opportunity to keep the historic building credit intact.

That would be far more likely to happen if senators retain the provision in their version of the tax reform bill. It would provide a negotiating point in reconciliation talks.

We urge Sens. Shelley Moore Capito, R-W.Va., and Joe Manchin, D-W.Va., to fight hard to keep the credit in the Senate version of the tax reform bill — then to stick with it through the reconciliation process. A major tax change meant to spur the economy should not remove a credit that is nearly certain to do just that in areas such as West Virginia.

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