CLEVELAND (AP) Money for a state program to give tax credits to developers restoring historic buildings has dried up, leaving many who applied frustrated and uncertain about their plans for the buildings.

The Ohio Department of Development went through the $120 million budget after approving 37 projects. The two-year pilot program promised to assist as many as 200 properties, but a tight state budget kept the number of awards down. The state faces a possible $733 million shortfall in the next budget year.

The program could resume, but it may not be in time to save many of the projects that lost out in the first round.

Preservationists say restoring the credits could bring new jobs, businesses and new life to struggling cities and towns. Meanwhile, developers are looking for money elsewhere, delaying completion of projects or walking away altogether.

“We’ve been waiting to get these credits approved since last July,” said Lewis Wallner, owner of the old East Ohio Gas Co. building in downtown Cleveland.

Construction was planned months ago to turn the empty six-story office building into a hotel. The project was the 59th applicant for the state credits and didn’t make the cut. Wallner is looking for other ways to pay for the hotel project.

Architect Jonathan Sandvick, whose firm is active in preservation efforts, believes that restoring the buildings would alter Ohio’s economy.

“To the best of my knowledge, every single downtown, large and small, across the state…every one of them has vacant and underutilized historic buildings in their downtown,” Sandvick said. “This is a way to recast the fortunes of our state.”

Sandvick’s firm was among the first in line July 2, when the program began awarding credits on a first-come, first-served basis. Projects he has worked on, from a former department store in Cleveland to a large engine plant in Canton, won some of the largest awards.

The program offers the credits to offset 25 percent of qualified rehabilitation costs of restoring a historic building. That means a developer spending $20 million could receive a $5 million discount on a corporate franchise tax, personal income tax or special taxes applied to companies that lend money or deal in debt.

When former Gov. Bob Taft signed the legislation creating the program during the last days of his administration in 2006, it appeared the state would award credits to as many as 100 projects between July 2007 and 2008, followed by 100 more between July 2008 and 2009.

But the state always had a spending limit in mind, said Melissa Vince, a spokeswoman for the Ohio Department of Development.

The state met its target after 37 awards. About 80 projects were left out and the reaction was vocal enough that on March 27, just weeks after the last round of awards, Lt. Gov. Lee Fisher met with program advocates and created a small task force to consider the future of the program and options for developers who did not receive credits.

“I guess I can understand why the state had to do this, given the economic climate,” said Michael Bier, who hoped to win state credits to help renovate an apartment building.

Bier, a senior project manager with the Famicos Foundation, said he was stunned to hear about the cap but realizes the state has budget problems.

“I guess it’s understandable,” he said. “But it would have been good to know that in advance.”

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