As legislators consider reauthorizing Maryland's Heritage Structure Rehabilitation Program — an exemplary program that Gov. Martin O'Malley made part of his Smart, Green and Growing legislative initiatives — one question is uppermost: Does it create jobs?

In a time of economic turmoil and mounting budget deficits, that threshold question is the starting point for most legislative debates in Annapolis this year. In this case, the question is easy to answer. Maryland's rehab tax credit program offers taxpayers one of the best dollar-for-dollar returns on investment of any state program. It's also an outstanding example of a state policy that promotes sustainable development. In short, it provides the kind of economic incentive that is critical to the revitalization of Maryland's — and America's — communities.

How does a tax incentive for rehabbing historic properties help create jobs, and how can it make a dent in the recession? Start by thinking about your own home. As many homeowners know from experience, rehabbing an older house is more labor intensive than building a new one, and it requires more skilled labor than new construction. That means wages for this kind of work are usually higher — as are income taxes paid by workers on rehabilitation projects.

What's more, materials for rehab projects tend to be purchased locally, so sales tax revenues are kept in-state. On top of this, the tax credit is not awarded until the work is completed, so the state gains revenue from the taxes paid on materials and labor before the building's occupancy, meaning that revenues flow into state coffers faster.

Nationally, there is overwhelming evidence that rehab tax credits are job-creators. Studying projects in Missouri, economist Donovan D. Rypkema found that 6.3 more jobs are created through rehabilitation than through manufacturing. Rutgers University also examined the impact of Missouri's preservation tax credits and found that between 1998 and 2001, the state garnered 6,871 jobs and $60 million in tax revenues, including $25 million in state and local taxes — an astonishing 4-to-1 return on the state's investment in the tax-credit program.

In Maryland, a recent report by the Abell Foundation showed that over the past 12 years, completed rehabilitations of commercial properties generated $1.74 billion in total economic activity and employed about 15,120 people. Construction labor alone totaled an estimated 9,248 workers. While this short-term impact is impressive, it's worth noting that the greatest return on the state's investment comes from the long-term increase in employment and property taxes on these rehabilitated buildings.

Having a state program increases the use — and the economic impact — of the federal rehabilitation tax credit program, which has given a powerful boost to this state's economy over the years. The Maryland Historical Trust estimates that $172.2 million in federal historic preservation tax credits have been leveraged through the state's program.

State tax credits not only spark jobs and spur federal investment, they do it in a way that supports sustainable, green development practices. At the National Trust for Historic Preservation we've been tracking these green tax incentives for the past 15 years. Revitalizing our historic neighborhoods, typically located in or adjacent to downtown areas, helps reduce sprawl and protects agricultural lands.

By encouraging the reuse of buildings and maximizing the community's investment in infrastructure that is already in place, preservation tax credits also help decrease our dependence on fossil fuels, reduce the carbon emissions associated with demolition and new construction, and lessen the pressure on landfills.

Marylanders should urge their legislators to support reauthorization of the historic tax credit, which has demonstrated its effectiveness in stimulating revitalization, sparking reinvestment in communities and creating jobs. We've always known that preserving our heritage is good for the soul. In times like these, it's important to remember that preservation is good for the pocketbook, too.

Richard Moe is president of the National Trust for Historic Preservation in Washington, D.C.