Friday, April 20, 2012

J.B. Reilly Courting Cigars Internatonal For NIZ?


Although I've been unable to get confirmation from Craig Reynolds at Cigars International, very reliable sources tell me that Neighborhood Improvement Zone (NIZ) developer J.B. Reilly is courting this company to move into the NIZ.

Its state tax revenue makes it a very attractive tenant.

Cigars International is currently operating at a 115,000 square feet facility within Lehigh Valley Industrial Park VII, which is part of Bethlehem's 1600-acre brownfield.

Can you justify poaching a business that pays taxes from a brownfield in Bethlehem to a subsidized site in Allentown, where it will pay none?

21 comments:

Lighthouse said...

I'll assume this doesn't impact their retail sites in downtown Bethlehem, and in Bethlehem Township--just their main facility??

However, per your linked article "just their main facility" is 225 employees...taxes that would now go to A-town...let alone property taxes lost from the Bethlehem facility for the city and school district.

This can't even be some twisted "urban" joy of stealing back from the "'burbs" (though partly re income taxes), but a "raiding party" from a neighboring "urban" municipality who even agreed to share its casino money with Lehigh County (hence Allentown)in the spirit of regionalism. Class.

So thats Allentown's version of "regionalism"?? Chalk up another one for Sen. Browne, et al.

Lighthouse said...

Bernie, are they planning to actually move the entire facility operations from the LVIP VII site to a NIZ site? IF so, are there any consequences for having received LERTA to build the Bethlehem facility, and then leaving it?

Also, to preempt a potential argument someone might make, CI did receive a tax break from Bethlehem, but it is different than the NIZ incentive because a.) the city was only denying themselves tax monies as an incentive, not other municipalities, and b.) Cigar Int.'s stated reason for the relocation was to increase size not because of tax incentive over their East Allen facility--in other words, they probably would have moved eventually anyway to continue their growth.

One problem with this whole NIZ that your post highlights is that the government is now the agent that creates unfair advantage/favoritism within the commonwealth itself. Different type of tax, but it is the same principle why the US Constitution included in Art I Sec 8 the provision that taxes be "uniform". They wanted to prohibit govt tax policy (we did not have income taxes then) to benefit one region economically at the expense of another. That is basically what this NIZ does within the Lehigh Valley.

Anonymous said...

There is no sales tax for cigars, silly.

Anonymous said...

Why would anyone want to buy cigars in a brownfield? it only makes sense that they would want to relocate into a more commercial area.

Allentown Democrat Voter

Bernie O'Hare said...

"are they planning to actually move the entire facility operations from the LVIP VII site to a NIZ site?"

I have posted everything I know, which is very little. ... Or even less than that.

Bernie O'Hare said...

"There is no sales tax for cigars, silly."

Pa. is the only state in the union that imposes no excise tax on cigars. How long will that last?

In 2010, CI's owner made these points. "My company pays well in excess of $1 million per year in state corporate taxes, payroll taxes, sales taxes, mercantile taxes, income taxes, property taxes and more. This tax revenue would vanish if we move."

Anonymous said...

Maybe he'll open CI in the Lehigh Valley Hospital Sports Center. Can't blame s guy for wanting perpetual clients.

THE Observer said...

Geez us bern
you have stooped to a new low. you admit you know very little, yet you incite the burbs and bedlam city against atown. does the word FEAR MONGER mean anything to you

Bernie O'Hare said...

I am inciting no one and do not subscribe to the class warfare theory being foisted on us by Pawlowski. In fact, the NIZ hurts other urban centers, including A-town itself.

But yes, I do know very little. Most of us know very little bc most of the information is being hidden. That's alright with you, but not with me.

Anonymous said...

I think the Class Warfare schtick extends well beyond Chairman Pawlowski and goes pretty much all the way straight up to the top with our beloved, most dear, can't do anything without President Barack Hussein Obama ...

... BTW, how is that Republican War on Women been working out as of late?

Yeah, the electorate is THAT dumb and, who knows, ice hockey might become an acquired taste amongst the indigenous population here in the Democrat stronghold that is the City With No (Spending) Limits.

HUGO CHAVEZ

Anonymous said...

Not fear mongering, I have heard several comments from reliable sources that Allentown is in fact trying to poach business from the surrounding municipalities.

I would hope council takes this up quickly!

Seamus

zoid said...

And so the cannibalization starts. There are real estate brokers out there knocking on doors approaching township managers and even cutting each other's throats trying to make deals to get local businesses to relocate into the NIZ and grab their commission.

This ain't over until it's over!!!

It gets uglier everyday!

Anonymous said...

An other idea would be to make cigars illegal. Stop smoking.

Anonymous said...

Where will all of JB's clients go when the NIZ goes down quicker than a lit cigar.

It's coming.

How is Corbett with the $14M in diverted state tax revenue. Less of a budget hole to fill if he puts the brakes on it.

Anonymous said...

I wouldn't be so quick to tell everyone to stop smoking ...

Do you know how much money in taxes from tobacco goes to fund this program and that program?

:)

Ha ha

Be careful what you ask for --- you just might get less money for something you support.

Anonymous said...

The NIZ movie is really like an episode from 24. That show always set up the first bad guy but you didn't find out who the *real* bad guy was until the second act and see how they maneuvered all the chess piece, manipulated the game, etc to set up the entire season of the show.

In the NIZ case, everyone thinks Pawlowski is the villain here. In reality, it's Reilly. He's pulling the strings, calling the shots, wrote the legislation and is its primary profiteer from it. He saw a perfect opportunity.

Let's not ignore that is really is a big conspiracy to do all this.

I applaud Reilly on one point: It was brilliant and aggressive. Taking state revenue and turning it into private revenue under the guise of a public works project, and not only a one time shot, but a consistent fountain of public money and finding two ready henchmen in Browne and Pawlowski was quite a chess move.

The timing was really spot on.

The public doesn't care about legislation. Legislators only care about their own. State agencies were busy transitioning from one administration to the other...questions if asked, we're probably general.

Allentown was desperate for something to happen. Pawlowski needs something big.

Grants are for amateurs.

I know in a boardroom somewhere, Pawlowski, Browne, Reilly and the folks have had that "we really didn't see this coming" moment, surprised that anyone noticed, but moreso, anyone caught on to the "plan".

Anonymous said...

If the NIZ is dead, what happens next? Lot's of suits I suspect.

If the law is found legal(50/50) and the townships delayed it, won't the Phantoms and Comcast have losses to recoup? Also the developer and the city? Build more court rooms.

Lighthouse said...

Separate from the other issues revolving around the Allentown project, from what I gather in the Express article (Sunday) this is nothing more than a proposed expansion of CI for a cigar/restaurant not any relocation of their main facility.

Bernie O'Hare said...

The guy never returned my call, and I was told what I was told. I think the ET explanation might be an attempt at damage control. Or it could be true. But I find it interesting he would not speak to the person who broke the story and who attempted to get his side first.

Anonymous said...

Bernie and Lighthouse,

If you look carefully at the ET story about Cigars International, you will see no quotes from Cigars International. Rather, it was a media generated response by City Center Corporation, i.e., Reilly and his team, most likely in direct response to what you reported. Odd that a company that proclaims to have no interest in the project would break a story about interest in the arena. Or maybe it is just coincidence that the story broke the day after you wrote something Bernie.

Anonymous said...

Ain't smoking in a public building banned, if in fact the building is public? The law is not the law in palumpas palace o sport nor in the town the king runs were federal monies is taken from the poor.