Preservation's Economic Impact

"Here in Kentucky a million dollars spent in the rehabilitation of a historic building adds 23 jobs to the local economy. That is 2.5 more jobs than is created by a million dollars of new construction in Kentucky and 8 more jobs than a million dollars of manufacturing output in Kentucky."
"Here in Kentucky a million dollars spent in the rehabilitation of an historic building ultimately adds $730,000 in household income to the state’s economy. That is $95,000 more in household income than is created by a million dollars of new construction in Kentucky and $233,000 more in household income than a million dollars of manufacturing output in Kentucky."

- Economist Donovan Rypkema, principal of PlaceEconomics in Washington, DC

The Kentucky Heritage Council (KHC) works to educate the public about agency programs and services and demonstrate how we are good stewards making the most of taxpayer dollars. The good news is we are up to this challenge and can prove, time and again, that historic preservation IS economic development.

One powerful example is the dramatic return on investment realized through incentives such as federal and state historic preservation tax credits administered by KHC. Kentucky has been a national leader in the use of rehabilitation tax credits, for historic commercial and residential buildings listed in or eligible for the National Register of Historic Places.

Historic tax credits have proven to be one of the nation's most successful and cost-effective community revitalization tools - creating jobs, leveraging private investment, enhancing property values, and returning underutilized properties to tax rolls. This widely recognized program has been instrumental in preserving the historic places that give our cities, towns, and communities their special character.

Since its inception in 1976, more than 47,000 projects have been completed through the Federal Historic Rehabilitation Tax Credit (HTC), which has leveraged over $116.34 billion in private investment in the rehabilitation of historic properties of every period, size, style, and type.

In 2022, Kentucky ranked 10th nationally utilizing the federal HTC, with 30 successfully completed projects generating $79.6 million of private investment. See the Federal Tax Incentives for Rehabilitating Historic Buildings Annual Report for FY 2022 for more.

This federal HTC can often be utilized in tandem with the Kentucky Historic Preservation Tax Credit, a key provision that strengthens use and effectiveness of both programs. In 2023 alone, the Kentucky Heritage Council approved 198 projects, encompassing 89 residential properties and 109 commercial properties. These projects represent an investment of nearly $600.7 million.

Since implemented in 2005, through 2023, the state tax credit has resulted in 1,258 properties rehabilitated across Kentucky and $782.8 million of private funds invested in historic buildings, leveraged through $57.5 million in credits.

Administered by the National Park Service and state historic preservation offices, the National Register is the nation's official list of historic and archaeological resources deemed worthy of preservation.

One of the most successful programs in terms of preservation and economic impact is the Kentucky Main Street Program, administered by KHC and based on a model established by the National Main Street Center, Inc. Kentucky Main Street predates Main Street America as the oldest statewide Main Street program in the nation, helping spur economic revitalization in more than 100 participating Kentucky communities since 1979.

Kentucky Main Street is preservation-based economic development that supports the preservation and adaptive reuse of architecturally and historically significant buildings by providing structure for a community-driven approach to downtown revitalization, generating economic development and encouraging and benefiting independently owned small businesses.

Participating programs cumulatively reported for 2022 $47,876,689 of investment in downtown commercial districts, representing $16,266,747 of private investment matched by $29,237,393 in public improvements. Statewide, the program also reported 587(net) new jobs in Main Street districts, 130 (net) new businesses, 201 rehabilitation projects completed, and 37,670 volunteer hours invested.

Since the pandemic, the program has invested $151.8 million in downtown commercial districts, created 972 new jobs and 354 new businesses, and completed 324 historic building rehabilitation projects. KYMS has generated more than $4.7 billion of investment throughout the commonwealth since its inception.

Over four decades, Kentucky Main Street can document more than $4.7 billion of public-private investment throughout the Commonwealth!