Capitol Places II Owner, LLC, Historic Preservation Fund 2014 LLC, A Partner Other Than The Tax Matters Partner, 164 T. C.1, filed 1/2/25, loses its $23.9 million historic façade easement write-off, as Interior and Treasury didn’t agree that the Capitolists’ “three-story classical revival masonry building designed by James Urquhart, an architect prominent in early 20th-century Columbia,” 164 T. C. 1, at p. 3, was “certified by the Secretary of the Interior to the Secretary [Treasury] as being of historic significance to the district. I.R.C. §170(h)(4)(C).” 1645 T. C. 1, at p. 5. (Footnote omitted).

That’s Columbia, SC, a town familiar to all us Fort Jackson alumni.

The Capitolists claim that if the district is in the National Register of Historic Places, that’s enough, but Judge Patrick J. (“Scholar Pat”) Urda, says no, read the statute. Your property has to be historically significant in the district.

And just having some paperwork that mentions the property somewhere  in the file at the Registry doesn’t get it, either. The Capitolists’ claim that “the phrase ‘listed in the National Register’ should be read to include anything and everything within the boundaries of a National Register listing, based on a hodgepodge of documents from two Keepers of the National Register, the South Carolina State Historic Preservation Office, and the Federal Energy Regulatory Commission.” 164 T. C. 1, at p. 9, gets them a Taishoff “Oh, Please,” and a shootdown from Judge Scholar Pat.

But the Capitolists’ trusty attorneys go down fighting, in the tradition of the Great Chieftain of the Jersey Boys, who’s in the thick of the fray. They claim that being in the “land area” of the historic district is good enough.

“Although [Capitolists]’s argument asks us to interpret ‘listed’ to include ‘resources within the boundaries of a listed properties,’ the broader statutory context blocks this reading. Section 170(h)(4)(C)(i) provides that a ‘certified historic structure’ includes ‘any building, structure, or land area which is listed in the National Register,’ while, under clause (ii), the term includes ‘any building which is located in a registered historic district (as defined in section 47(c)(3)(B)) and is certified by the Secretary of the Interior to the Secretary as being of historic significance to the district.’ If a building is necessarily ‘listed in the National Register’ simply by being within the boundaries of a property listed in the National Register, such as a registered historic district, then section 170(h)(4)(C)(ii) has been rendered superfluous.” 164 T. C. 1, at p. 10. (Citation omitted). In statutory construction, no word left behind.

Anyway, the façade easement protects only the façade, not the building itself or the land under the building, so the land area isn’t protected.