Ask The Experts
SBA 504 Q&A: Historical Properties
Q: What must be done if a property involved in a Small Business Administration (SBA) 504 loan project is on, or qualifies to be on, the National Register of Historic Places?
A: Section 106 of the National Historic Preservation Act mandates Federal agencies undergo a review process for all federally funded projects that potentially impact sites listed, or eligible to be listed, on the National Register of Historic Places (NRHP).
The meaning of “historic property” for the purposes of a Section 106 review is a property that is individually listed on the NRHP, a property that is a contributing structure to a historic district listed on the NRHP, a property that has a pending nomination for inclusion on the NRHP or a property that is eligible for inclusion on the NRHP. These are very specific properties, so please keep in mind that just because a location considers itself “historic” for one reason or another it may not actually qualify, though in our experience it’s better to be safe than sorry.
If you are sure that the property, for any of the reasons listed above, would qualify as a “historic property” Florida First Capital (the Certified Development Company) or Florida First Capital’s counsel will need to reach out to SBA District Counsel and provide them with sufficient information regarding the property and the intended renovations.
The documentation may include photographs of the building and specific elements of the building that could or will be impacted by the project; a building description including a description of the subject property, year of construction and any previous alternations or additions; and a project description including a detailed description of the proposed project showing which activities will be carried out in conjunction with the project. The project description should indicate whether the project will include rehabilitation, demolition and/or new construction, defined as follows:
• Rehabilitation Description – provide a detailed description of the rehabilitation project including interior and exterior modification, i.e. if windows will be replaced, new siding, etc.
• Demolition Description – provide a specific statement of justification for the demolition and description of the condition of the property along with photographs. Also, please provide the date of the proposed demolition.
• New Construction – Information on the new construction, including any drawings.
Finally, describe what effects the renovations/demolition/construction will have on the historic property and what, if any, agency must approve these changes.
If you are unsure if the property qualifies as “historic,” it is advisable to reach out to the Florida Department of State, Florida Division of Historical Resources to discuss the property. If they can confirm it is NOT historic, request written verification to document your file and move forward as usual. If they confirm it is historic, you will need to follow the instructions above and provide SBA District Counsel the needed documentation for their review. Of course, Florida First Capital is happy to handle this once it is involved in the project.
Once SBA District Counsel has all of the documentation they need, or have requested, they will issue a formal decision regarding moving forward with the project.
If you have a question you’d like our SBA 504 loan experts to answer, email us at info@FloridaFirst.com or call 850.681.3601 or toll-free at 800.504.LOAN.