2. Funding Architectural
Conservation – Ways & Means
– There are two main ways in which governments can take action to encourage
conservation, restoration and rehabilitation.
– The first involves policies and measures to stimulate the private sector to invest in
architectural heritage (the dynamic approach).
– The second derives from the fact that, without government support, the private
sector may decide that investment is not economically justified, thus creating the
need for financial incentives and subsidies (the support approach).
3. Principal forms of financial
measures – 1. Grants-Subsidies
– There are three principal forms of financial measures:
– 1. Subsidies (or grant aid) The award of grants of money through public subsidy
policy should take account of the nature of the operation. Preference may be
given to maintenance or restoration of a monument and may depend on other
factors such as whether the monument is exclusively used for cultural purposes
or for social housing, or is capable of generating a profit.
– Grant subsidies take the form of payments by a donor government (or even a
private philanthropic body) to a recipient public body (such as a local authority),
non-profit organisation, private individual or private organisation, with the aim
of stimulating activity by the recipient. Some grants require matching financial
contributions from the grant recipient.
4. Principal forms of financial
measures – 1. Grants-Subsidies
– Two types of grant programme.
– First are “formula” grants, which are not confined to specific projects. They are
generally allocated by a central government or specific ministry to a local authority or
other body responsible for heritage, for the purpose of distributing grant aid for
specific projects.
– Secondly, “project” grants are meant to fund specific projects, usually concerning the
conservation or restoration of protected buildings (but may sometimes include other
buildings of cultural heritage interest). These grants are usually awarded through a
competitive application process for a limited period.
– Denmark – funding directed at individual buildings (owned by individual, foundations)
– 20 to 50 % of the cost of approved work
– Belgium – grants are provided for classified buildings, groups of buildings and sites by
the three regional administrations at varying percentages of the cost of works ( 25 to
95%) and are topped up for privately owned property by grants from municipal
authorities and also by provincial authorities
5. – Netherland – Restoration grant – 20 to 70 % of certified cost
– Maintenance grant - @ 50 % - non-income producing monuments
– Subsidies for country house
6. Principal forms of financial
measures - Loans
– 2. Loans Measures to cover or diminish risks should be taken in order to encourage
credit institutions to finance old buildings, particularly by combining mortgage loans
with public subsidies, establishing appropriate forms of insurance, and the provision
of a public security by a public (particularly local) authority
– Denmark - the State Preservation of Buildings Fund can provide low interest loans
(1% below normal bank rates) for preservation work to listed buildings.
– The Nationaal Restauratiefonds was set up in the Netherlands in 1985 because there
were insufficient resources available for restoration. It works as a revolving fund,
issuing loans at reduced interest rates, usually 5% below normal bank rates (recently
as low as 1%), with the loan acting like a mortgage by being spread over a long time
(a minimum of 10 years and usually up to 30 years). The loan is offered for the non-
subsidised costs of a project and is guaranteed by local authorities.
7. Principal forms of financial
measures - Loans
– USA - The United States Federal Government can guarantee up to 90% of the
principal sum offered on loans made by private lenders for works to properties
that are designated historic structures and have been placed on the National
Register.
– The Federal Government may also provide a federal tax exemption for debt
obligations issued by state or local governments, such as the financing of
preservation programmes through the issuing of bonds
– A number of revolving preservation funds have been established to provide low-
interest loans for the rehabilitation of historic property
8. Principal forms of financial
measures – Taxation
– Taxation Measures should be taken, particularly in countries where the tax
system favours investment in new rather than old buildings, to arrive at a
situation where taxation provisions encourage maintenance or restoration on
old buildings. Different forms of relief can be considered, including income or
profits tax, value added tax on the sale of goods and services (including
maintenance or restoration works), inheritance tax and land (occupation) taxes.
– Tax-based incentives involve no direct transfer of money, although foregone
taxes represent a cost to the state budget and therefore to a nation as a whole.
However, activities benefiting from the incentive will usually create tax
revenues,
9. Principal forms of financial
measures – Taxation
– Forms of tax incentives
– Income tax incentives - two forms of income-tax-based incentives
– • tax deductions (relief), where the owner may deduct specified expenditure from
income, reducing effective taxable income, subject to limits; - Belgium, Denmark,
France, Germany, Ireland, Italy, Netherlands,
– • tax credits, where the owner may deduct a fixed percentage of specified
expenditure from income tax payable. – Spain (15%); USA (20%)
– • income tax relief on sponsorship and donations given for conservation purpose -
Belgium, Denmark, France, Germany, Ireland, Italy, Netherlands, Spain, UK, USA
10. Principal forms of financial
measures – Taxation
– Property tax incentives - such as an assessment freeze, a current-use
assessment (as opposed to alternative, best economic use), assessment as a
percentage of full market value, reduced rates of property tax (for historic
buildings) or complete exemption (Denmark, Spain, Germany).
– Tax incentives in the purchase of property
– VAT or Sales Tax Incentives
– Transfers, Heritance and Capital Gain tax incentives - Belgium, France, Germany,
Ireland, Italy, Netherlands, Spain, UK, USA
11. Alternative revenue raising or
funding methods for conservation
– Charitable Trust,
– Heritage Foundation
– Limited Liability Company – The Amsterdam Restoration Company
– Revolving Funds – The Architectural Heritage Fund UK, National Restoration Fund NL
– Easement Donations, endowment funds and tax relief
– Public Authority Bonds - legislation enacted by the State of New Jersey in 1987 created the
Historic Preservation Bond Program, which authorised the sale of $100 million in state bonds
to finance – acquisition, conservation, restoration
– Lotteries – Italy, Germany, UK – the National Lottery, Netherland – BankGiro Lottery
– Concession Agreement - Macedonia, Bulgaria and other eastern European countries
– Monument Annuities – Croatia - the Dubrovnik monument - 10% surcharge on the retail price
of the product
– Transfer of Development Rights
– International Donor Organisations -
12. Financial Assistance for Architectural
Heritage in Irland
– Financial Assistance for Architectural Heritage
– Financial assistance is provided to assist with the conservation and restoration of heritage
properties through schemes which are generally administered by the local authorities.
– In the context of a particular building, especially one on the Record of Protected Structures, the best
advice for the owner may be to contact the Architectural Conservation Officer in the Local Authority. They
will be able to advise on the various types of funding available to assist with the building.
– Built Heritage Investment Scheme and Historic Structures Fund 2020 - Projects funded in 2020
– On 10 June 2020, Minister for Culture, Heritage, and the Gaeltacht, Josepha Madigan TD, announced that
449 successful applicants will benefit from in excess of €4.3m under this year’s Historic Structures
Fund (HSF) and Built Heritage Investment Scheme (BHIS).
– Projects are located in each of the 31 local authorities. A list of the successful projects is available here.
– The Built Heritage Investment Scheme 2020 (BHIS) is for the repair and conservation of structures that are
protected under the Planning and Development Acts.
– The Historic Structures Fund 2020 (HSF) - is for conservation works to heritage structures, in both private
and public ownership.
13. Financial Programs for historic
Portland – Oregon - US
A number of financial programs—primarily grants, loans and tax benefits—that support
historic preservation, renovation and rehabilitation projects and programs in Portland.
These programs are offered by various governmental agencies and nonprofit
organizations at the national, state and local levels and cover a variety of activities, such
as preservation planning, surveys and documentation, public education and “bricks and
mortar” restoration and rehabilitation work. Some are only available to non-profit
organizations and governmental agencies, while others may be taken advantage of by
private citizens, property owners and for-profit businesses. The summaries are
organized into the following sections: I. Federal Historic Tax Credits, 20% and 10%
programs (NPS) II. Oregon Historic Special Assessment (SHPO) III. Preservation
Easements (HPLO) IV. Preserving Oregon Grants (SHPO) V. Save America’s Treasures
Program (NPS) VI. National Trust for Historic Preservation Programs VII. Miscellaneous
Programs VIII. List of Oregon Charitable Foundations
14. Heritage City Development and
Augmentation Yojana (HRIDAY) Scheme
– Announced on 21st January, 2015, with a focus on holistic development of
heritage cities. 12 identified Cities namely, Ajmer, Amaravati, Amritsar, Badami,
Dwarka, Gaya, Kanchipuram, Mathura, Puri, Varanasi, Velankanni and Warangal.
– Rs. 500 crore outlay - The Scheme supports development of core heritage
infrastructure projects which shall include revitalization of urban infrastructure
for areas around heritage assets identified / approved by the Ministry of
Culture, Government of India and State Governments. These initiatives shall
include development of water supply, sanitation, drainage, waste management,
approach roads, footpaths, street lights, tourist conveniences, electricity wiring,
landscaping and such citizen services.
– 77 Projects amounting to Rs. 418.06 Crore have been approved for all the 12
cities.
15. Heritage Projects under Smart
Cities Mission – Niti Ayog Report
– Smart Cities Mission has provisioned for Heritage projects under Convergence
with other Central/State Government schemes. The focus is on comprehensive
development by integrating physical, institutional, social and economic
infrastructure.
– 39 Smart Cities have initiated 101 Heritage projects worth Rs. 1,439 crores
under the Mission. Some Smart Cities engaged conservation and heritage
experts during the formation of Smart City Proposals (SCPs). Further, the cities
are utilizing services of heritage contractors for undertaking heritage projects
and have also hired specialized (skilled in heritage works) contractors for
heritage works.
– As of 6th November 2019, 23 cities have tendered out 60 heritage projects
worth Rs. 551 crore, 20 cities have work ordered 53 heritage projects worth Rs.
495 crore, 10 cities have completed 26 heritage projects worth Rs. 130 crore,
and 23 cities have 41 heritage projects worth Rs. 888 crores under DPR stage.
16. Financing Heritage Management
in India
– Adopt Revenue Generation Model through PPP Schemes - Push for revenue
growth will require investments towards improving services, facilities and
attractions that will generate visitor interest and eventually footfall. PPP Mode
can be adopted to attract funding from various Public and Private Sector
Enterprises.
– Each ASI site to be treated as separate profit centres
– ASI revenues to be ploughed back to the site
– Professional and focused marketing effort with Information Technology
– National Culture Fund – To be made autonomous
– Processing of the pending MoUs under Adopt a Heritage to be accelerated
– Crowdfunding/ community funding/ CSR
