Ala. Admin. Code r. 460-X-23-.02

Current through Register Vol. 42, No. 10, July 31, 2024

Section 460-X-23-.02 - Definitions

(a) Act. Act 2013-241 of the Alabama legislature and its amendments and successor legislation.

(b) Aggregate Tax Credit Allocation Amount. The cumulative limit on tax credit allocations as set forth in the Act per calendar year. As of October 1, 2013, the aggregate amount shall be twenty million dollars ($20,000,000) per year.

(c) Applicant. For the purpose of this Program, the Applicant shall be the Owner of the Qualified Structure for which tax credits are being applied.

(d) Application. The Application shall consist of three parts: Part A: Evaluation of Significance, to be used by the Commission for making a determination whether a building is a Certified Historic Structure, a Certified Historic Residential Structure, or a Qualified Non-historic Structure; Part B: Description of Rehabilitation, to be used by the Commission for reviewing proposed Projects for compliance with the Secretary of the Interior's Standards (Standards); and Part C: Request for Certification of Completed Work, to be used by the Commission for reviewing completed Projects for compliance with the work approved under Part B. The Commission staff will develop the Application and may modify it as needed over time. All required forms, including Applications, Part A, B, C and amendment forms, are available from the Commission at no cost.

(e) Certified Historic Structure. A building located in Alabama that is certified by the Commission as being individually listed in the National Register, eligible for listing in the National Register, or certified by the Commission as contributing to the significance of a Registered Historic District. For the purpose of this Program, the term "structure" means a building or any edifice enclosing a space within its walls, and usually covered by a roof, the purpose of which is principally to shelter any form of human activity, such as shelter or housing, or to provide working, office, parking, display, or sales space. The term includes, among other examples, banks, office buildings, factories, warehouses, barns, railway or bus stations, and stores and may also be used to refer to a historically and functionally related unit, such as a courthouse and jail or a house and barn. Functional constructions made usually for purposes other than creating human shelter or activity, such as bridges, windmills, and towers, are not eligible to be Certified Historic Structures under this definition.

(f) Certified Historic Residential Structure. A Certified Historic Structure located in Alabama which is or will be used as a single family, owner occupied residential structure, either free standing or supported by party walls, but not to include individual units within a multi-residential structure such as a condominium or cooperative.

(g) Certified Rehabilitation. Repairs or alterations to a Certified Historic Structure or a Certified Historic Residential Structure that is certified by the Commission as meeting the Standards, and to Qualified Non-historic Structures that are certified by the Commission as meeting the Standards and the following requirements during rehabilitation: at least fifty percent (50%) of the existing external walls shall remain in place as external walls, at least seventy-five percent (75%) of the existing external walls shall remain in place as either external or internal walls, and at least seventy-five percent (75%) of the internal structural framework shall remain in place.

(h) Commencement of Rehabilitation. The date on which actual physical work contemplated by the Rehabilitation Plan submitted with the Application will begin. The Applicant shall incur no less than 20 percent of the estimated costs of rehabilitation described in the Application within eighteen (18) months of receiving a Tax Credit Allocation Reservation.

(i) Commission. The Executive Director and staff of the Alabama Historical Commission, a state agency, and or any successor to the Alabama Historical Commission. For the purpose of notifications or filing of any Applications or other correspondence, delivery shall be made to: Alabama Historic Rehabilitation Tax Credit Program, Alabama Historical Commission, 468 South Perry Street, Montgomery, Alabama 36130-0900 (U.S. Mail) or 36104 (courier delivery).

(j) Complete Application. Submission of completely filled out Parts A and B of the Application that are signed and dated by the Applicant and accompanied by photographs and site plan(s), floor plan(s), and elevation drawings and any other supporting exhibits necessary to accurately convey to the Commission the scope of all work that is proposed to the building. The Commission shall also make a determination that the building is a Certified Historic Structure, a Certified Historic Residential Structure, or a Qualified Non-historic Structure before the Application is considered to be complete.

(k) Condition of Information. A qualifier for the approval of proposed work based on the Commission staff's review of an Application where the staff determines that additional information is needed on certain aspects of the rehabilitation Project before a determination can be made to approve or deny the Application.

(l) Condition of Work. A qualifier for the approval of proposed work based on the Commission staff's review of an Application where the staff determines that certain aspects of the proposed rehabilitation Project shall be modified or deleted before a determination can be made to approve the Application.

(m) Department. The Alabama Department of Revenue.

(n) National Register. The National Register of Historic Places, which is the official list of the nation's historic places worthy of preservation authorized by the National Historic Preservation Act of 1966 and administered by the National Park Service, a bureau of the U.S. Department of the Interior.

(o) Owner. A taxpayer filing a State of Alabama tax return or any entity that is exempt from federal income taxation pursuant to Section 501(c) of the Internal Revenue Code, as amended, that owns title to a Qualified Structure or owns a leasehold interest in a Qualified Structure for a term of not less than 39 years.

(p) Project. A Project includes all work to a Property for which rehabilitation tax credits are sought, the scope of which is fully described in an Application Part B and a Rehabilitation Plan. For the purpose of these Regulations, all work completed on a building in addition to all work to a Property for which rehabilitation tax credits are sought is subject to review for compliance with the Standards during the period beginning six (6) months before the Application is submitted and continuing through the end of the recapture period for any tax credits used.

(q) Program. The Alabama Historic Rehabilitation Tax Credit Program as authorized by the Act and described in these regulations.

(r) Property. A Qualified Structure located in Alabama and its site and landscape features.

(s) Qualified Rehabilitation Expenditures. Any expenditure as defined under Section 47(c)(2)(A) of the Internal Revenue Code, as amended, and the related regulations thereunder, and other reasonable expenses and costs expended in the rehabilitation of a Qualified Structure. For Certified Historic Residential Structures, this term shall mean expenses incurred by the taxpayer in the Certified Rehabilitation of a Certified Historic Residential Structure, including: preservation and rehabilitation work done to the exterior of a Certified Historic Residential Structure; repair and stabilization of historic structural systems; restoration of historic plaster; energy efficiency measures except insulation in frame walls; repairs or rehabilitation of heating, air conditioning, or ventilation systems; repairs or rehabilitation of electrical or plumbing systems exclusive of new electrical appliances and electrical or plumbing fixtures; and architectural, engineering, and land surveying fees. Qualified rehabilitation expenditures do not include the cost of acquisition of the Qualified Structure, the personal labor by the Applicant, enlargement of the Qualified Structure, or any cost associated with the rehabilitation of an outbuilding of the Qualified Structure, unless the outbuilding is certified by the Commission to contribute to the historical significance of the Qualified Structure.

(t) Qualified Non-historic Structure. A non-historic building located in Alabama built before 1936 that is certified by the Commission as not meeting the eligibility requirements as a Certified Historic Structure or a Certified Historic Residential Structure and that is certified by the Commission as meeting the requirements contained in Section 47(c)(1)(a) and (b) of the Internal Revenue Code, as amended. For the purposes of these regulations, non-historic structures built before 1936 shall not include residential buildings.

(u) Qualified Structure. Certified Historic Structures; Certified Historic Residential Structures; and Qualified Non-historic Structures.

(v) Rehabilitation. Rehabilitation means the process of returning a building or buildings to a state of enhanced utility, through repair or alteration, which makes possible an efficient use while preserving those portions and features of the building and its site and environment which are significant as defined by Part A of the Application approved by the Commission.

(w) Rehabilitation Plan. Descriptions, construction plans, and specifications for the proposed rehabilitation of a Qualified Structure in sufficient detail to enable the Commission to evaluate compliance with the Standards.

(x) Registered Historic District. Any district listed in the National Register or any district which is: a) designated under Alabama or local law certified by the U.S. Secretary of the Interior as containing criteria which substantially achieves the purpose of preserving and rehabilitating buildings of historic significance to the district; or b) certified by the U.S. Secretary of the Interior as meeting substantially all of the requirements for the listing of districts in the National Register of Historic Places.

(y) Request for a Tax Credit Allocation Reservation. The submittal of Parts A and B of the Application for a Qualified Structure.

(z) Reservation Priority List. A list prepared and maintained by the Commission of the order in which completed Applications are received for review and reviewed.

(aa) Standards. The Secretary of the Interior's Standards for Rehabilitation as defined by Title 36 Code of Federal Regulations (CFR) Part 67.7.

(bb) Substantial Rehabilitation. Rehabilitation of a Qualified Structure for which the qualified rehabilitation expenditures exceed 50 percent of the Owner's original purchase price of the Qualified Structure or twenty-five thousand dollars ($25,000), whichever is greater. For the purpose of these regulations, the Owner's original purchase price of the Qualified Structure shall mean the original purchase price of the Property minus the value of the underlying land and any buildings other than the Qualified Structure for which rehabilitation tax credits are being applied.

(cc) Tax Credit Allocation. The dollar amount of tax credits apportioned for the substantial rehabilitation of a Qualified Structure based on a Rehabilitation Plan approved by the Commission.

(dd) Tax Credit Allocation Reservation. The reservation of a tax credit allocation issued by the Commission via a written form or letter for a Project for which a complete Part A and B of the Application has been submitted, which entitles the owner to a tax credit provided that the owner complies with all of the requirements of the Act for the issuance of a Tax Credit Certificate. For the purpose of the definition, Part A of the Application shall also have been reviewed and a determination made by the Commission that the building is a Certified Historic Structure, a Certified Historic Residential Structure, or a Qualified Non-historic Structure.

(ee) Tax Credit Certificate. A certificate issued by the Commission via a written form or letter to the Applicant providing information about the Project and the amount of its Tax Credit Allocation to be filed with the Applicant's Alabama state tax return. If there are multiple owners of a property, or if the owner is a partnership or limited liability company, the Tax Credit Certificate will contain a section to be completed by the Owner that provides the percentage or amount of credit that will be allocated to each partner, member or owner, and such completed Certificate may be provided to the department to transfer all or any portion of the tax credits passed through to the partner, member, or owner in accordance with 460-X-23-.03(6). A copy of the completed Certificate shall be filed with the partner's, member's, or owner's respective Alabama tax return. The aggregate credits claimed by the partners, members, or owners may not exceed the total amount of the credit set forth in the Applicant's Tax Credit Certificate.

Ala. Admin. Code r. 460-X-23-.02

New Rule: Filed December 13, 2013; effective December 20, 2013.

Amended by Alabama Administrative Monthly Volume XXXII, Issue No. 12, September 30, 2014, eff. 10/8/2014.

Authors: Chloe Mercer, David Schneider, Jennifer Bailey

Statutory Authority: Act 2013-241; Act 2014-452.