A state House bill that would extend state historic-rehabilitation tax credits resurfaced after four months Tuesday as part of the mini-budget initiative by Republican legislative leadership.

House Bill 399 passed the House on a 113-5 vote June 5.

That version of the bill focused solely on historic-rehabilitation tax credits and allowed for several funding options.

The latest version of the bill was subject to a “gut and amend” strategy Tuesday.

The changes were approved by the Senate Appropriations and Finances committees.

The bill is scheduled to go to the Senate floor this morning.

The new version grafted several tax-related elements from the Republican state budget compromise that was vetoed June 28 by Democratic Gov. Roy Cooper. Since the House overrode Cooper’s veto in controversial manner Sept. 11, the Senate has yet to take up its veto override vote.

The bill now just extends two deadlines for qualified rehabilitation expenditures and expenses.

For projects initiated on or after Jan. 1, 2020, the deadline now extends to Jan. 1, 2024.

For projects started before Jan. 1, 2020, the deadline extends from Jan. 1, 2028, to Jan. 1, 2032, to have properties placed into service by that time.

HB399 now includes: an income exclusion for IRA distribution for charities for individuals ages 70½ and older; certain tax deduction for amounts received as economic incentives; a sales tax exemption for American Airlines at Charlotte-Douglas International Airport; and a sales tax exemption for certain professional motorsports teams.

“I would be surprised at this point if either the House or Senate would put forward any mini-budget that does not have widespread agreement within the Republican caucuses of both legislative chambers,” said Mitch Kokai, senior policy analyst for Libertarian think tank John Locke Foundation.

“No one wants to spend October revisiting the budget deliberations of May and June.”

Rep. Stephen Ross, R-Alamance, a primary sponsor of the original version of HB399, said in April that extending the expiration date on the historic-rehabilitation tax credits makes sense given that more than 2,400 projects have benefited since 1998 with a combined capital investment of more than $1.6 billion.

For example, the tax credits have been instrumental in several projects in downtown Winston-Salem, with a combined capital investment value of more than $700 million.

“For some time, there has been an interest in renewing this program for the sake of many downtown areas predominantly,” said Sen. Joyce Krawiec, R-Forsyth.

“With many aging structures in our downtown areas, there has been interest in incentivizing restoration.”

The Republican tax-reform code foundation approved in 2013 eliminated numerous popular tax credits — including for historic rehabilitation — and exemptions in a trade-off for increasing the standard tax deduction. Several key Senate leaders worried that making any changes to that foundation would open the door to unraveling it completely.

In 2015, then-Gov. Pat McCrory, a Republican, crisscrossed the state in support of restoring the historic-rehabilitation tax credits. The legislature approved extending the tax credits in September 2015 to Jan. 1, 2020.

The initial version of HB399 would raise the expense cap from $10 million to $15 million to receive a 15% tax-credit rate. It would raise the expense cap from $20 million to $25 million for a 10% tax-credit rate.

The bill would extend the expense amount from $20 million to $25 million for a 5% bonus for projects in Tier 1 and Tier 2 counties.

State law requires state Commerce Department officials to annually rank the economic health of all of the state’s 100 counties, with the 20 most prosperous counties as Tier 3, the next 40 counties as Tier 2, and the 40 most distressed counties as Tier 1.

Forsyth and Guilford counties are currently listed as Tier 2, which means that historic-rehabilitation projects would qualify for the 5% bonus.

The bill also extends the million to $25 million for a 5% bonus for projects if the certified historic structure is located on an eligible targeted investment site.

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