“More Concerned with Greed than with History”?: Further Insight on Historic Preservation Loan Programs

By Special Contributor posted 03-30-2017 16:13


By John H. Sprinkle Jr.

Soon after “‘Now that the Slums are Fashionable’: The Origins of Section 104 of the National Historic Preservation Act” appeared in the fall 2016/winter 2017 issue of the Forum Journal, a colleague at the National Park Service (NPS) showed up at my door with a manila folder in hand. “Here,” he said, “I think you might want to see this.” Inside the folder were copies of correspondence that further elucidated the Historic Preservation Loan Program that was recommended by President Richard Nixon in 1971 and authorized by President Gerald Ford with the Emergency Home Purchase Assistance Act of 1974. This administrative tale touches on the origins of the Secretary of the Interior’s Standards for Rehabilitation and perhaps helps to explain why the Department of Housing and Urban Development’s (HUD) loan program was not ultimately successful.

Cover_smallforweb.jpgAfter two years of deliberation, HUD published draft regulations to implement the historic preservation loan program in May 1976. Owners of residential properties listed or eligible for listing on the National Register could apply for up to $15,000 per dwelling with 15 years to repay. These terms were more attractive than HUD’s Title I loan program, which only allowed individuals to borrow $10,000 for 12 years. That program was quite successful, with more than 250,000 loans valued at more than $805 million issued in 1975 alone.1

The preservation community eagerly awaited the kickoff of HUD’s historic preservation loan program, which was featured in an article in the July 1976 issue of Money magazine. The NPS and the state historic preservation officers (SHPOs) forecasted an influx of public interest regarding National Register eligibility. In anticipation of the program’s launch, the Keeper of the National Register, Dr. William Murtagh, distributed guidance to the SHPOs regarding how they might treat eligibility questions and reviews of proposed rehabilitation work.The NPS offered the SHPOs further guidance for future loan projects with “Guidelines for Rehabilitating and Preserving Old Buildings, Neighborhoods, and Commercial Areas."And experts predicted that the “greatest visual impact” resulting from the loans would be within historic districts because all properties, regardless of their contribution to the area’s historic character, were eligible for the assistance.4

And then, nothing happened—until the May 24, 1977, when Delegate William Fauntroy began a series of three hearings on “An Adequate Loan Program for Historic Resources."As a result, HUD finalized the loan program regulations and prepared a descriptive program brochure in July 1977. Based on the comments received during the review process, HUD increased the total loan amount to $45,000 for a three-unit residential structure and permitted up to 20 percent of the building to have non-residential uses.6 Formally launched in the fall of 1977, HUD saw real value with the program:

The preservation of America’s cultural resources must be a continuing objective of our society. One of the most important sources of our sense of national direction is our cultural and architectural heritage—the historic sites, structures, and landmarks that link us physically with our past. We urge all lenders to make historic preservation loans available in their communities.7

However, the legislative landscape for historic preservation had changed substantially in 1976. Congress had enacted the rehabilitation tax credit program, which provided substantial incentives for income-producing properties and amended the National Historic Preservation Act (NHPA) to establish the Historic Preservation Fund, authorized at $150 million per year. But not everyone was satisfied with the movement’s accomplishments. In July 1977 Senator William Proxmire hosted a series of hearings focusing on the problems of dislocation and diversity in urban neighborhoods. Rita McCurley, a resident of Baltimore’s Union Square neighborhood was a member of the “Coalition for Human Preservation,” a neighborhood organization that considered historic preservation “the speculator’s dream and the poor person’s nightmare.” McCurley brought her own perspective on the impact of the “back to the city” movement and what real estate speculation in the guise of preservation had done to her community:

Because of the tremendous inflation of property values the current residents of our area are not able to meet the new rents or even consider the possibility of purchasing a house. We feel that the concept [of] historical preservation is more concerned with greed than with history.8

In November 1977, as information about the HUD program was disseminated throughout the banking and preservation communities, several additional complications arose in the evaluation of proposed undertakings. The NPS advised SHPOs to “exercise judgment” and not treat the recommendations in “Guidelines for Rehabilitating Old Buildings” as absolute requirements. As non-contributing buildings within historic districts were also eligible for funding, the NPS saw an opportunity to enhance historic neighborhoods by making “intrusions more compatible.” Complicating these reviews was the fact that HUD’s guidance was not the same as the recently published Secretary of the Interior's "Standards for Rehabilitation and Guidelines for Rehabilitating Historic Buildings," developed for use in implementing the Tax Reform Act of 1976. In addition, the Advisory Council on Historic Preservation was still determining how it would review individual loans as part of HUD’s compliance with Section 106 of the NHPA. Perhaps most importantly, the Housing and Community Development Act of 1977 increased loan amounts available through the regular Title I HUD loan program for a single family building, so there was no longer “any economic benefit” for loans to historic properties.9

On November 29, 1977, the acting Keeper of the National Register, Robert Rettig, announced that the “Historic Preservation Loan program is now operational.”10 But given the delay in its initiation; the potential for confused rehabilitation guidance; the lack of clear Section 106 regulatory review; and the loss of its fiscal distinctiveness among other HUD loans, it is unclear just how much impact the program could have had after its launch. Comparisons with the historic rehabilitation tax credit program—which was also initiated in 1977 and has since generated more than $84 billion in private investment to preserve more than 42,000 historic buildings—are perhaps unfair, given its focus on income-producing properties. And yet one wonders about opportunities lost, especially given the issues of speculation and displacement that urban neighborhoods faced during the late 1970s—and continue to face today. What might be the potential impact of a loan guarantee program, such as the one mandated in Section 104 of the NHPA, that focused on historic residential properties?

John H. Sprinkle Jr. is the bureau historian for the National Park Service. The views expressed in this blog post are his own and do not reflect the opinions or policies of the National Park Service or the United States Government.


1. The maximum historic preservation loan was $30,000 for a two-dwelling property. The standard Title I loan was limited to $5,000 per unit, up to $25,000 per property. “HUD Historic Preservation Loans,” August 1976.

2. William Murtagh to State Historic Preservation Officers, September 13, 1976.

3. “Process (as reflected in draft regulations) for Acquiring a Historic Preservation Loan,” August 1976. Copies of the guidelines—to be published “at some point in the future”—were available from NPS staff architect, Brown Morton.

4. “HUD Historic Preservation Loans,” August 1976.

5. Hearings before the Subcommittee on Historic Preservation and Coinage of the Committee on Banking, Finance, and Urban Affairs, House of Representatives, 95th Congress, First Session, May 24, June 29, and July 27, 1977.

HUD, “Historic Preservation Loans,” HUD-452-H, July 1977.

7. This letter, addressed to more than 9,500 lenders across the country, was sent on October 20, 1977. Assistant Secretary for Housing, Lawrence Simons to All Qualified Title I Lending Institutions. “Historic Preservation Loan Regulations” September 16, 1977.

8. “Neighborhood Diversity,” Hearing before the Senate Committee on Banking, Housing and Urban Affairs, 95th Congress, 1st Session on Problems of Dislocation and Diversity in Communities undergoing Neighborhood Revitalization Activity, July 7 and 8, 1977.

9. National Park Service Planning Branch, “Additional Information on the Operation of the Historic Preservation Loan Program,” November 1977.

10. Acting Keeper of the National Register of Historic Places Robert Rettig to the SHPOs, November 29, 1977.

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