a brief look at the history of historic preservation funding presents a potpourri of grants, revolving funds, tax incentives, and administrative support at all levels of government, although notably uneven throughout the nation. The federal appropriation, however, is pivotal in fueling the federal/state/local partnership and supporting the national policy to preserve our historic resources.

As with many national programs, the appropriation of funds has never fulfilled the need of the program and has waxed and waned with the politics of different Administrations. Programs already in law, e.g. the guaranteed loan program, have never been implemented. Development grants available for restoration in one administration disappear from the budget of another. This unevenness of financial support has been a major area of concern for the Forum and careful thought has been given to the federal financial role in the support of our heritage.

Not surprising, serious concern about fair federal funding extends beyond the preservation community to our partners in the conservation and recreation communities. During the past year, with a boost from the recommendations of the President`s Commission on American`s Outdoors, a heritage coalition has considered two interesting proposals to assure increased annual funding for all heritage resources.

First, to understand the new initiatives, one must be familiar with the operation of the Historic Preservation Fund as set up in the 1976 law. Each year as required by law, $150 million revenues from leasing Outer Continental Shelf lands are deposited in the Historic Preservation Fund. Congress then has the authority to determine how much will be expended annually for historic preservation to the States and National Trust.

As most people well know, Congress has never appropriated the full $150 million in a single year, but what many may not know is that the difference between the amount deposited [$150 million] and the actual amount appropriated in F/Y 1988: $28 million) "remains" in the Fund. At this time, the "unappropriated balance" in the Historic Preservation Fund is over $1 billion, and it is not in an account drawing interest. Therefore, trust fund advocates seek to achieve their goal of a more stable source of funds by arranging for the balance in this account to earn interest. The annual interest would become the source for funding preservation.

The proposal currently backed by the Heritage Coalition is popularly known as the Heritage Trust Fund. Program funding is premised on the conversion of the unappropriated balances of the Historic Preservation Fund and Land and Water Conservation Fund (a total of $7 billion at this time) to a corpus that will be increased by deposits from the Outer Continental Shelf funds until the Fund reaches a level where interest alone is adequate to fully fund preservation, conservation, and recreation programs. Legislation to support this concept will be introduced by the highly respected Chairman of the House Interior Committee, Morris Udall (D-Ariz.). The Trust Fund proposal envisions yearly support for the HPF at the $200 million level during the next century.

Another very creative "global" funding proposal, introduced by the Nature Conservancy, raised more than a few eyebrows as to its potential. Although the proposal was developed only for conservation, it authorized the one-time issuance of $10 billion in conservation bonds, using the money received to create a permanent endowment for the Land and Water Conservation Fund (LWCF). A federally chartered private corporation would administer the grants; the interest would become the annual funding for the program at $l billion per year; repayment of the bonds would be from appropriations of the Outer Continental Shelf monies flowing into the LWCF at $900 million per year for approximately 13 years. Enthusiasm dimmed, however, when sources frowned at the establishment of a private corporation for this purpose and the loss of Congressional control.

The immediate funding needs cannot wait for the long shot of early enactment of a trust fund, and therefore, short-term improvement, amendment, and expansion of funding under the current law has become a consensus item for Forum action. Financial assistance is needed to encourage more local governments to participate in the federal/state/local partnership and a range of incentives is desired to recognize the different needs of communities already supporting preservation activities and those who should be involved, but are not. Strong support has been expressed to expand the partnership to include Native Americans and to see that adequate funds flow into preservation activities of tribal governance.

The HPF, when fully implemented, should operate more like a bank, with a wide variety of funding mechanisms to meet legitimate needs of both public and private preservation interests: grants for acquisition and development; grants to encourage local government survey and planning activity; grants for the acquisition of easements, grants for endangered properties, low-interest loan and loan guarantee programs, revolving funds; and incentives that are need specific for such programs as maritime, rural, and archeology.

In the short term, we must continue to lobby for increased appropriations and press for amendments to the tax law to regain the momentum of the rehabilitation tax credits by removing the projects from the passive loss rules. (See Preservation Advocate, p. 20)

The reality of achieving adequate, stable, and predictable funding for all aspects of preservation is not impossible and careful marketing of preservation needs will set us on a course of achieving both immediate and long term preservation needs. The National Historic Preservation Forum has embarked upon a course of action to that recognizes the need for the broadest leverage and return on the taxpayer`s dollar in the achievement of long-term preservation goals.

Publication Date: Spring 1988

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