I have written numerous times about a special tax break known as a TIF for the redevelopment of the long vacant Dixie Cup factory, located in Wilson Borough, into 405 luxury apartments. At a time when many families are facing increased housing costs here in the Lehigh Valley, it seems like a sick joke. Northampton County rejected this boondoggle in November in a narrow, 5-4 vote. But three of those no votes are no longer on Council, so like the Terminator, pitchman Brian Bartee was back again before a new County Council on Thursday night to sweeten the deal with a little more sugar to make the medicine (or should I say poison?) go down. Instead of a scant $1.2 million in county coffers, he's now willing to offer $2 million up front if the county would agree to a tax break that allows him to float bonds for $26.4 million in construction costs for the nesting perches of our well-too-do betters. We'll get the money back in 20 years. What could possibly go wrong?
While running for office and after taking the helm as county exec, Tara Zrinski has stated she'd be no Lamont McClure 2.0. That may be true, but she certainly seems like at least a Lamont McClure 1.5. Instead of proposing to tax the rich, the owners and renters of luxury apartments, she wants to give them a tax break
She started off by warning everyone, "I'm going to say some pretty unpopular things." But it was sweet music to the ears of private equity and developers whose bottom line is and always has been, "What's in it for me?" It was honey on the lips of trade unions who want the temporary construction jobs. And those trade unions, by the way, have bankrolled Zrinski's political ambition.
She acknowledged that she went on a tour of the site, and as she was perched on the roof or perhaps even the Dixie Cup with the raptors and vultures, she could see the state of disrepair of Wilson Borough homes. Some are in need of new roofs. Others need siding. That alone should have told her all she needed to know. This project will do nothing but create more disparity between the haves and the have nots.
She argued that the developer is willing to make public improvements to the property that will spare the county the expense of doing so. That's a flat-out canard. She knows that the county has nothing to do with roads, power lines or sewer. Moreover, the developer has proposed these changes for his own benefit, to make the luxury apartments more attractive. In reality, his apartment is going to create an even bigger traffic nightmare along 25th Street.
Her biggest and most illogical argument is that building 405 luxury apartments will ease the Lehigh Valley's housing shortage of 9,000 units. It will in fact exacerbate the problem.
Let me give you her argument, as she states it herself. "The Lehigh Valley Planning Commission says that we need 9000 units. That's not all affordable housing. There's a downward pressure that exists that is pushing people who can afford higher level into lower level. So while it doesn't intuitively make sense that if we put this higher priced apartment in, it makes sense if somebody who is occupying a $2,000 or $1,800 apartment or a $1,600 apartment, who could move into a $2,400 apartment, would be able to move because there's a place to go. Thus freeing up the other spaces. That is the logic here."
And that logic, as she puts it, is completely illogical. It assumes, and you know what happens when you assume, that the population remains constant. And that is belied by the very same Lehigh Valley Planning Commission, who notes we are adding 4,300 people every year, most from other states. So these luxury apartments will not be attracting affluent Lehigh Valley residents who will ditch a $1.600 a month apartment for one that rents at much higher rates for that cathedral ceiling. It will instead attract NY and NJ residents fleeing a higher cost of living there. It will make housing less affordable.
Take a look at nearby Easton, beautiful river town that is beginning to rival Frenchtown, Lambertville and New Hope. There are now several luxury apartments in what was once called Fishtown. Has that eased affordable housing there? The opposite has happened. It has attracted NY and NJ tenants who can commute or work from home. This in turn has made rentals there ridiculous. That problem is just made worse by giving a tax break for more luxury apartments even when a developer is willing to give you a pittance to ease your conscience at what you must know is wrong.
And what about nearby landlords like the Wilson Borough landlord who gobbles up properties at tax and sheriff's sales and then rents them out? They are delighted and one of them actually appeared at the TIF hearing in November. They can now demand even higher rents.
The only real way to ease the housing crisis is by encouraging more smart development that includes tiny homes, a reduction in minimum lot sizes and setbacks, an ease in tariffs on construction materials, accessory dwellings and more mixed-use development. County government has no say in any of these things.
As government screw-ups go, this would be the biggest one since the swaption debacle. And to make things worse, I have serious doubts that this great developer that Zrinski touted, will ever complete the project. More about that tomorrow,
No comments:
Post a Comment