Should my state tax refund last year be taxed on this years federal return when it resulted solely from historic state tax credits i received last year?

[Opus 17]

If you itemized your deductions on schedule A last year and deducted your state income tax, then the refund is taxable this year.

The state refund means you deducted too much state tax on your federal return, you deducted more than you ended up owing.  It doesn't matter why you owed less tax.  Rather than amending your 2017 federal return to adjust the itemized deduction, you report it as taxable income in the year the refund is received.  It is a taxable recovery, a refund of a previous deduction.