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Wednesday, February 29, 2012

Hanover Township Considers Lawsuit Over Allentown's EIT Tax Grab

Glenn Walbert
Hanover Township Supervisors, at their February 28 meeting, unanimously authorized Solicitor Jim Broughal to research the feasibility of challenging the diversion of earned income taxes from Township residents who work in Allentown. This decision was reached after Manager Jay Finnigan reported on a recent meeting that he and other municipal managers had with State Senator Pat Browne.

A recently-formed Allentown Neighborhood Improvement Zone Authority (ANIZDA) can use those funds, along with the EIT from other Allentown workers, regardless of residence, to pay the projected $10.9 million annual debt service for a $158 million downtown hockey arena.

Finnigan told Supervisors that Browne has assured him it's unlikely that any EIT will be needed. "If that's what they hope, then the legislation should have been enacted without that in there," said Finnigan, adding that he is astonished that a lending institution would hand out $35 million "on a hope" that a "hole in the ground" would be profitable.

During his meeting with Senator Browne, Finnigan was also told there would be projects within the NIZ for the Allentown Brew Works and Cosmopolitan Restaurant.

The Fegley family, which owns and operates the Brew Works, contributed $2,100 to Allentown Mayor Ed Pawlowski's campaign last year.

Bill Grube, co-owner of the Cosmopolitan and board member of ANIZDA, donated another $3,500.  On his December 13, 2011 application for appointment to ANIZDA, Grube denied he would have any conflict of interest. Before his appointment on February 1, Grube told Allentown City Council, "I have no dog in this hunt other than to rebuild the City."

Finnigan finally told Supervisors that Senator Browne asked municipal managers to support and endorse the Allentown project.

Hanover's Supervisors instead condemned it.

John Diacogiannis, who chairs the board, stated he has no problem with helping support the revitalization of another community, but does have a problem with "benefiting individual entrepreneurs." Referring to the EIT tax grab as a "scheme," he took exception to the way Allentown "ran roughshod" over outlying communities. "I just think it was plain wrong," he complained.

"If the state wanted to commit their money to it, fine. But why'd they have to commit ours?" asked Supervisor Glenn Walbert, who wants to know how the annual $10.9 million in debt service will be realized. Noting that the annual EIT from outlying communities and Allentown would total around $1 million, Walbert stated that the 3% state income tax would only be about $3 million. "Where does the other 6 million come from?" he asked, noting that revenue from sales tax would be insufficient.

Finnigan replied that Allentown DCED Director Sara Hailstone told him the money would come from add-ons to hockey tickets and cover charges.

Worried that bonds will be sold before anyone has time to react, Walbert suggested that the tax collection committees might consider a NIZ challenge, but Finnigan answered that there are no resources. "Something has to be done soon in fairness to future bondholders," stated Walbert. "We owe it to ourselves to have Mr. Broughal look into it."

Agreeing with Walbert, Supervisor Steve Salvesen argued the EIT tax grab violates the state constitution. "I don't see how they can appropriate another municipality's money for a purpose outside that municipality," he reasoned. If they can do that, they can do real estate tax or anything else with impunity."

"Do we fight this?" Salvesen asked.

Walbert then made a motion, seconded by Salvesen, authorizing Solicitor Jim Broughal to research the Township's options, including litigation, and to hire outside counsel, if necessary. It passed unanimously.

Supervisors will meet again on Tuesday, March 13, 7 PM, at the Municipal Building located at 3630 Jacksonville Road.

Despite Threatened Protests, Local Gov't Seminar at NCC Still On

Frickin' amazing! Who the Hell organizes a protest for a seminar about local government? Last I heard, doctors are prescribing them for people with insomnia. But some people are just plain batshit cRaZy. Especially religious kooks like Fake Rev. Mario Martinez, who insists Angle is Satan and I am his little helper.

Yesterday, I told you that Fake Professors Ron Angle, Sal Panto and Jose Rosado and I have been invited to participate, as panelists in the "local government" segment of a 3-day Citizens' Academy being hosted by Northampton Community College. We're scheduled to make our presentations on Thursday at 6 PM. I was invited to participate, not because of my opinions, but because I do attend a lot of local government meetings.

And I do.

Over six years of active blogging, I've managed to step on a lot of toes. Most of my victims, especially elected officials, are pretty good about the criticism and even better at giving it back to me. But there are a few people out there who confuse me with what I'm saying. They think that attacking me personally somehow negates an otherwise valid argument. So when I make a point, they'll respond with all kinds of hate, from idiotic comments about the size of my penis to my 1985 (yes, that's 1985) suspension as an attorney. They engage in email campaigns to warn any person I discuss here, and have even started a knock-off blog in the vain hope that they can dilute my message.

They've failed.

The latest stunt pulled by these trolls was to publish a blog claiming, falsely, that the Citizens' Academy had been canceled. Fake Rev. Mario Martinez did that because he thought someone from the Gracedale crowd, preferably him, should have been chosen as a panelist. "We The People [he refers to himself like that] could speak with experience relating to 'fostering civic awareness and government engagement' much better then the two misfits [that would be Angle and me] can...because we are aware, and we did engage - and we WON."

When I saw this, I called Northampton Community College. I learned the program was still going to be held, despite (or perhaps because of) the numerous complaints being made about Angle and me. I was also told that the Gracedale people were made aware that the show was going on. Basically, the Fake Rev., the dude who claims God is on his side, lied to you. Because he was afraid of what Evil Ron Angle or I might say, he deliberately deceived his readers.

Fellow blogger Untouched Takeaway, unwilling to accept what anyone says at face value, decided to check it out herself. She called NCC, and learned that the Fake Rev (Mario Martinez of Forks Township) was indeed being untruthful. When she challenged this phony, he deleted her comments and now is accusing me of impersonating her.

She tells you about it here.

Since I love her writing style and humor, I don't mind being accused of being her. It's a big step up from being accused of posting as Brenda. Tricia Mezzacappa, aka The Wicked Witch of West Easton, used to post here using that name. I've also been accused of being Monkey Momma, the Banker and Retired ASD Teacher.

They're all much smarter than me, so I don't mind.

But Untouched Takeaway, a fashionista who can distinguish between Balenciaga and balaclava, is a bit miffed at being called a bottom-feeding blogger like me.

Can't say I blame her. I wouldn't want to be called me, either.

Now they are claiming that Angle must have purchased the minimum number of registrations himself. This is also untrue. They want County Council to deny funding to NCC. They are even threatening a demonstration outside the hall.

Ron would love that.

The Fake Rev, through his lies, has created a lot more interest in this seminar than it otherwise would have received.

Updated 9:05 PM: The Fake Rev. claims that my quotation from him comes from an email he sent to NCC.  How did I get it, he asks, and then claims that staffers there must have sent it to me. Actually, the quotation in question comes from his own blog, dated 2/28, the one in which he falsely claims that the seminar has been canceled. Now he is falsely accusing NCC officials of leaking emails when the language in question appears on his own blog.


Tuesday, February 28, 2012

Call Me Professor

In addition to being a Fake Reverend, I'm also a Fake Professor.

This Thursday, I'll be one of four panelists discussing local government during Northampton Community College's 3-day Citizens Academy. I'll be joined by Fake Professors Ron Angle, Sal Panto and Jose Rosado. Class starts at 6 PM, and I have a pop quiz ready.

My appearance, as one of four panelists in a two-hour discussion of local government, has some people very upset. "It's outrageous, and sad, that you'd host Bernie O'Hare at Northampton.edu on March 1," claims one person in an email to NCC bigwigs.

Today, these truth manipulators actually lie to you with a Gracedale blog post claiming that the event has been canceled.

NCC Cancels Workshop

Citizens Academy - An Inside Look At How Government Works...CANCELED!!!

Yes ladies and gentlemen of NorCo, the planned course scheduled for March 1st, 2012 has officially been canceled, and while a lack of interest has been deemed the reason for the cancelation, the full truth may be that NCC received much negative feedback regarding two presenters 1) the ousted - Ron Angle, and 2) the disbarred Bernard Ohare.
The three week course was designed to assist We The Peopleunderstand better our local, state and federal government, as if we don't understand government well enough already. 

It's sad to see outright lies being posted on another blog, even a hate blog, in an attempt to deceive you. But it's no surprise.

They lied about Gracedale, too.

I'm looking forward to Thursday. The class will take place as scheduled.

Does Easton or Any Municipality Need Its Own Ethics Commission?

This is what Easton Mayor Sal Panto says at Neighbors of Easton: "Yes, I did say 'I was recommending to the council that we get rid of it.' I stated this because we have a state ethics board and that board has no local ties that would be seen as a conflict. Fortunately in Easton we have elected officials of honesty, character and integrity. I can’t tell you the last time there was an ethics probe. In four years of asking members of council if they have any residents that would like to serve and advertising vacancies on all of our Authorities Boards and Commissions one council member just gave me three names."

Pennsylvania does have a state ethics commission whose jurisdiction includes local officials. Allentown's ethics commission, which has handled a few complaints against the Mayor, is dogged by complaints of bias.

Unpersuaded, blogger Noel Jones asks, "How would the state even know to look into the ethics of a local government?"

The answer is simple. File a complaint. That's what blogger Chris Casey did in Upper Macungie, and the entire Board of Supervisors skedaddled.

Monday, February 27, 2012

Senator Browne to Modify NIZ??

APRIL 1, 2012



Senator Pat Browne (RINO-Lehigh County) has introduced legislation in the Pennsylvania Senate to modify one of the most controversial provisions of the NIZ legislation - the sequestering of employees' Earned Income Taxes.

"While the original legislation was a forthright, virtuous attempt to transform the City of Allentown into a vibrant hub of commercial and artistic grandeur, it is clear that some might have been hurt by the sequestering of the EIT. I have listened to my constituents and have offered this legislation in response to their concerns," said Senator Browne.

Under Senator Browne's new legislation, the benefits of the original NIZ will be extended to additional municipalities. The NIZ will now be available to the areas of any municipality in which real estate is owned by Lehigh Gas Company, Joe Topper, J.B. Reilly, Alvin H. Butz Company, or American Traditions, and any other person who has contributed $1,000 or more to Browne or Allentown Mayor Edwin Pawlowski. NIZ benefits will also become available to municipalities where these companies buy real estate in the future.

"I've listened to local municipalities and worked with my most trusted advisers to craft what I believe is an appropriate compromise," said Senator Browne. "The public needs to know that this new legislation still retains all the features that inspired me to offer the original legislation in 2009."

Separately, Senator Browne announced that his wife, Heather, has resigned as a lobbyist for Pugliese Associates, which coincidentally represents NIZ developers Topper and Reilly. "Neither Heather nor I ever saw her work as a lobbyist as a conflict of interest," Senator Browne noted, "but she has decided to pursue a different line of work. She's been studying for her real estate salesperson's exam at night, for months, and passed the exam last week," Senator Browne beamed. "I am sure there is a solid commercial real estate firm out there who will welcome her to the team!"

Browne went on to point our that NIZ does not, as commonly thought, stand for "Neighborhood Improvement District."

"I thought this was obvious, but anyone looking at the Urban Dictionary can plainly see that a NIZ is a really cool guy who gets all the Babes, like J.B. Reilly and Joe Tops. Heather calls me Niz all the time."

Bethlehem School District to Target Undervalued Properties

A cavernous but largely empty auditorium at East Hills Middle School was the venue for February 27's Bethlehem School Board meeting. Those few hardy souls who did appear were greeted by a 33-page agenda as school officials and board members peered over Mac Notebooks. But when the meeting started, directors raced through the agenda, finishing business in less than an hour. School Board President Michael Faccinetto explained to onlookers that the new agenda, which organizes school district business by committee, should streamline meetings.

He was correct. Every agenda item passed unanimously, with little or no discussion. In fact, the lengthiest portions of the meeting were the occasional rounds of applause for honored students and administrators. Teachers union president Jolene Vitalos tried for a round of applause herself, announcing "pom pom" awards for teachers who go "beyond the call of duty."

Only one item of actual school district business - a contract that will allow the school district to go after properties it believes are under-assessed - was discussed after Bethlehem resident Randy Toman questioned several provisions. An agreement with Keystone Realty Advisors, a New Jersey firm, will give that firm a finder's fee if it discovers properties whose assessments are too low, and the district is ultimately successful in increasing the valuation in what is called a "reverse appeal."

Faccinetto corrected Toman's assertion that Keystone Realty would be paid upfront, noting that payment (30% of the increased taxes for three years) would only be made as taxes are collected. Superintendent Joseph Roy added, "All the risk is on that firm. ... It comes back to the Board to decide which ones we want to pursue."

Without comment, board members also unanimously approved a three-year energy savings agreement with Tangent Energy Solutions. In exchange for reducing electrical consumption up to ten times between June and September, the school district will earn $387,200, including a $69,789 advance payment.

The next regular Board meeting is scheduled for March 19, 7 PM, at the East Hills Middle School auditorium.

What to Do With Your New Lehigh County Assessment

I know what you'd like to do, but reader Bill has the best suggestion. His taxes are going up $400 next year, and he wishes his home was worth as much as assessment officials claim. Here's his advice:

Take your letter and on it will be the county web site at


Enter your ID number and you can see exactly what will happen with your taxes and you can also request a review, but you need to do it before March 16th.

Updated 8:15 AM: The web address that Bill provides is off. The correct link is here. Enter your "control ID" and you will see your taxes. Michael Molovinsky provides some analysis.

How Did Senator Browne Explain EIT Tax Grab?

The Morning Call has summarized what Senator Pat Browne told local municipal officials during a Friday meeting. Below is the account of David Woglom, who administers the tax collection committees in both Lehigh and Northampton County.

What this memorandum reveals is that the financial projections made here are pretty much on the money. Allentown is depending on future businesses, most of them poached from other Lehigh Valley communities, to be able to pay the bill.

Good luck with that!

February 27, 2012

Dear Lehigh and Northampton TCC Delegates--

Last Friday afternoon, Jay Finnigan of Hanover Township, Jon Hammer of South Whitehall, Stacy Gober of the Bethlehem Area School District, and I met with State Senator Pat Browne and several others concerning the EIT financing of the Allentown NIZ.

To begin the meeting, the Senator gave a presentation on the project, followed by presentations on the NIZ from Allentown Economic Development Director Sara Hailstone and Project Financing Consultant Scott Shearer of Public Financial Management (PFM). Bond Counsel Marc Feller of Dilworth Paxson was also present to answer various questions. From the presentations, we learned:

1. The expected cost of the entertainment arena is $80-100 million; the expected total cost including acquisition, soft costs, parking lots, and other expenses is $158 million;

2. The major portion of the project is the entertainment rink. There is currently also interest from several private parties for other development;

3. The total NIZ is 130 acres; 90 acres along the river and 40 acres in the downtown area;

4. The bond sale of approximately $158 million is expected to be in April 2012;

5. The expected annual debt service on the bonds is expected to be $10.9 million;

6. The total amount of revenue to be generated annually from all taxes is estimated to be:

a. $10.9 million from the taxes generated from the current businesses in the NIZ
b. $10.9 million from the taxes generated from the future businesses in the NIZ

7. Based on the fact that the total estimated revenue to be generated annually is $19.8 million ($10.9 + $10.9), while the estimated debt service is $10.9 million, it is expected that there will be an excess revenue at least in year one. Once the actual total revenues and debt service are known, it is estimated that refunds for the first year (2012) will be sent to the PSDs by May 2013. However, when asked, Senator Browne indicated that the Authority could decide in the future in to incur additional debt by adding on the project. If this occurred, the Authority could use more of the EIT revenue to cover the additional debt.

8. The channeling of EIT funds into the NIZ fund will not begin until January 2012, meaning that PSDs can expect that the amount of money they receive on EIT will not change until the 2012 first quarter receipts are sent to PSDs in April/May.

After the presentation was concluded, the focus of the discussion was on the estimated "loss" that PSDs will experience in 2012. Allentown officials as of yet do not know this. They told us that they are waiting for Keystone to provide them with the information. We reiterated that our main question was to get a listing by PSD of the historical EIT revenue generated in the zone. By the end of the meeting, it was agreed that 
Allentown would work to answer this question through two means:

1. They will work to get a list of the actual EIT generated in the zone by individual PSDs from Keystone (the Allentown tax officer in 2011) for the third quarter of 2011 so that each PSD can multiply by 4 and have some idea of the annual, estimated loss. We all hope to have this information by our meeting on March 15.

2. They will work to secure a list of the actual EIT generated in the zone by individual PSDs from Berkheimer (the Allentown and Lehigh TCD tax officer in Allentown in 2012) for the first quarter of 2012 so that each PSD can see the most recent update. We will not have this information until June/July 2012.

We also asked Gary Strathearn of the City and Pat Browne to respond to the questions in our letter from last week. They indicated that they would but some of the answers would indicate that Allentown does not have sufficient information yet to respond.

I will keep all of you apprised of any developments between now and March 15.

David Woglom
Administrative Director, NTCC
Executive Director, LTCC

Jackson Eaton and Rick Daugherty Schedule Some Debates

Democrats Jackson Eaton and Rick Daugherty are duking it out over which one of them has the privilege of running into Charlie Dent buzzsaw this Fall. They're considering up to four debates before this Spring's 15th Congressional District primary.

One of the debates will take place at 7 PM, March 13, at the Macungie Institute in the Borough of Macungie. It will be moderated by the League of Women Voters. They've both also accepted an invitation from the Kutztown Democratic Club at some yet unscheduled date in early April.

"Given the current spectacle of the Republican debates on national television, I believe you and I can demonstrate to our Democratic voters that our Party can have a civil debate about meaningful and constructive ideas, not petty mudslinging and wild, often disgraceful charges against our President,” Eaton said in a ltter to Daugherty. “Instead, we can show the voters that we have ideas for the future and the means to get Congress working again for the 15th District rather than the vested interests that presently control Congressman Dent and the Republican tea party majority.”

Blogger Who Threatened Judge, Online, Avoids Prosecution

An Allentown resident who threatened a Northampton County judge has dodged a bullet. That's the decision of District Attorney John Morganelli, announced during a February 27 news conference.

Allentown resident George Charles has threatened Northampton County Judge Michael Koury three times in online comments at The Morning Call webpage, posing as Montikea.

On February 9, Charles stated in part, "... Professional conduct? Meet me anytime behind the courthouse and I'll give Koury justice, and it won't be professionally done." The following day, Charles posted another critical comment, stating that "Koury needs to 'get clipped' one night after court's done."

Concerned about his personal safety, Judge Koury asked the DA to investigate. The first-term jurist also confronted defense attorney Dennis Charles, George's cousin, in open court about the incident. Stunned, Attorney Charles denied any knowledge of the matter. Judge Koury later apologized to the lawyer and recused himself from a matter in which the attorney was involved.

As a result of his investigation, Morganelli told reporters that a prima facia case of terroristic threats, a first degree misdemeanor carrying a punishment of five years imprisonment and $5,000, had been established. But the prosecutor had decided against a prosecution because George Charles has expressed remorse, has apologized to the judge and his family, and Judge Koury is satisfied with that result.

Morganelli stated the outcome could be vastly different with a different DA or judge. Another jurist might not be so forgiving. And Morganelli acknowledged he is something of a purist who in the past has dismissed prosecutions against people exercising their First Amendment rights by distributing leaflets outside a post office or flying a flag upside down.

Another prosecutor might have a less tolerant view, Morganelli warned.

"Citizens should feel free to comment freely and to criticize freely any of us," the prosecutor stated. "However, we would only ask that all citizens be mindful of the terror that could be brought to those who are in the system and who are vulnerable to retribution by individuals who are adversely affected by decisions that are made in our courts."

Morganelli stated his office reviews several threats against judge every year, but they usually come from prisoners.

Blogger's Note: You can read Morganelli's Statement here.

Wanna' Have Lunch With Niz Man J.B. Reilly?

Brother, can you spare $200? I'd love to go myself, but it's out of my price range. I promise I wouldn't even eat.

Taxes Up in Second-Hand Smoke at Allentown's NIZ

Morning Call journalists Matt Assad and Scott Kraus, in their latest revelation about the NIZ biz, reveal a tax grab that goes way beyond mere EIT from outlying municipalities. Developers Joe Topper and J.B. Reilly, partners in Lehigh Gas Corp. and each of them $10,000 contributors to Allentown Mayor Edwin Pawlowski, now plan to divert tobacco tax, too!

According to the news account, Topper and Reilly made an offer to East Side Allentown cigarette wholesaler Dorward Wholesale, and are moving operations from there to the NIZ so they can take advantage of the $1.60 per pack tobacco tax, estimated to bring in a cool $7.2 million each year. That tax money will be diverted for their $50 million office complex.

Instead of the tobacco tax revenue going to fund state programs, it will be converted into building equity for J. B. Reilly and Joe Topper in City Center. Is this economic development or economic alchemy? This is an economic development shell game at best, and tax larceny at worst.

Senator Pat Browne, who now looks like the little Dutch boy trying to put his finger in the dike to stop the flooding, keeps telling us not to worry. The spokesman for Lehigh Gas, says this is a good thing for all of us and par for the course.

I feel better already.

We get no new businesses moving into the NIZ, just another one from another part of Allentown - its forgotten East Side. Worse than that, these guys have figured out a way to "game the NIZ." In fact it's the closest thing to the elusive concept of alchemy I have ever seen.

If Tom Corbett sits silently for this one, if the rest of the Lehigh Valley doesn't see what is really happening here, then we are all fools and deserve to have these thieves laugh all the way to the bank - literally and figuratively - since that is what 702 Hamilton was and is.

Irony has a funny way if being ... ironic.

The barbarians are at the gates and they will use this NIZ to get their buildings built for free. We haven't seen the end of it, since the waterfront development is still to happen. If you don't think that Mark Jaindl and his partners won't try to leverage the NIZ benefits to their advantage, then you haven't been out to the townships that his brother has devoured courtesy of public subsidy - new highways, new sewer lines and new water lines - and even more importantly, some of the most favorable rezoning this side of New Jersey.

Hey, here's an idea for old Topper and Reilly. Talk to tax collector Berkheimer about "relocating." They collect the per capita tax for a lot of school districts and EITs for a lot of municipalities (Bethlehem included).

The per cap tax for BASD alone probably is somewhere around $1 million.

I'm sure, with Berkheimer's massive staff, they'd need gobs of office space (maybe a couple thousand sq ft max). I think Reilly would have an attractive lease for them.

Let's not forget about the fact that you have Lehigh Gas' state gasoline taxes that are being used to build the new building, too. Assad and Kraus did a good job of projecting what this little wholesale tobacco and candy company would generate in state taxes, I am sure they could do the same for Lehigh Gas' taxes on gasoline sold.

This is truly an example of the "law of unintended consequences." I cannot believe that this scenario was envisioned when the legislation was discussed - even though it was with a very small group of decision makers - and that something like this would be condoned. I guarantee you that every wholesale tobacco outlet in the State - the low-hanging Lehigh Valley fruit will be picked first - is fair game for these two.

This is just incredible. Now, if they could just move the PLCB's "cage" in Harrisburg to the NIZ, they'd have a billion+ more in liquor taxes to play with.

"Sir, have you no shame?"

While Topper and Reilly have made sure they took care of themselves, let's see how Allentown has taken care of you. For that, you'lll need to read the post below.

Each Phantoms' Ticket Sold Will Cost Taxpayers $20-40

Let's crunch a few numbers, shall we?

State Senator Pat Browne, author of the NIZ legislation, has told local municipal officials that the steady state arena debt service will be about $10.5 million. I assume these are revenue bonds with a sinking fund feature so that the money has been sequestered to retire the principal at maturity in 30 years. That works out to a debt service of approximately $11.2 million (7%)  per year, assuming that the total arena cost is $160 million.

If the EIT collected is about $550,000 a year, that will cover about $8 million of the debt service. Total. Over the course of 30 years.

But what about cost overruns?

My guess is the EIT will be used for the first $8 million of the inevitable cost overruns of the project. To be fair, that $160 million is a "soft" figure. You really don't know the real cost until it's finished. A recent Morning Call news account about soaring hockey arena costs, is very disconcerting. Before construction has even started, we may have spent as much as $45 million. Obviously, King Edwin would rather not ask his own taxpayers to make up the difference. He'll grab the EIT.

Won't the lease to the Phantoms pay for the $10.5 million in annual debt service? Nope. Not even close. That lease is only $500,000 a year, with a corresponding $500K a year for "capital improvements." Rent on the arena is $10 million less per year than the annual debt service. It doesn't even cover 5% of the debt service!. And the $500K a year in capital improvements sounds great, but is only one-third of one percent of the development cost.

Let's (generously) assume the land is valued at $10 million and the improvements to the land at $150 million. That means, for that $500K a year to actually cover "stuff that wears out," the average building component would have to have a useful economic life of 300 years! Even at $5 million a year, that's a 30-year average life.

Do you know of an HVAC system that lasts 30 years, much less 300 years? How about those seats in the arena? The playing surface? The roof? The interior fit (including dressing rooms, office space and so forth)? The "pig-in-the-poke" here, for me, is the enormous subsidies given directly to the tenant of the arena in a desperate attempt to get a minor league hockey franchise to locate in Center City.

The taxpayers will be on the hook for a lot more than $10.5 million a year - closer to $20 million by my estimates - for just the arena. 

If the arena attracts 500,000 attendees a year, taxpayers will be subsidizing the ticket price for each and every one of those attendees to the tune of $40 per ticket! Even at 1 million attendees a year (that, folks is four events a week - every week - averaging 5,000 attendees per event), that's a subsidy of $20 per ticket. Imagine how much cheaper the Phantoms' owners will be able to lease those "luxury boxes" to King Edwin's wealthy political contributors (and still make a tidy profit) with such a massive subsidy from "the little people." And, they'll get to "write off" even that heavily-subsidized cost as a business expense.

Once again, this is government pork built in a simple way: figure out what your wealthy contributors are willing to "pay-to-play," then have "the little people" make up the difference.

It ain't complicated!

Sunday, February 26, 2012

Marc Holliday: How to Develop Urban Offices Without a NIZ

Marc Holliday, CEO of SL Green Realty Corp., is not just any landlord. With over 28 million square feet in Midtown, he is the largest office landlord in New York City. He's paid almost as much as a professional athlete, with a $10.32 million, 6-year package.

For good reason, too. In a challenging real estate market, its FFO (funds from operations) rose 17% over the last quarter of 2011, to $90.3 million.

A Lehigh grad, Holliday will return to his alma mater on Wednesday, February 29, to explain how office development is done in a real city. Without an NIZ.

If you'd like to go, call 610-758-4768 or email sds210@lehigh.edu, and see if you can wrangle an invitation.

Friday, February 24, 2012

Nursing Homes Out, Managed Care In

That's according to a report in The New York Times, which notes most people would rather live out their lives in their own homes.

This is just one of the reasons why Northampton County Executive John Stoffa, himself a former Human Services Director in two counties, advocated the sale of Gracedale.

Unfortunately, his attempt to inform the public in numerous town halls was drowned out by fear-mongering from a group more worried about their jobs than the elders they are supposed to serve.

Updated Sunday, 8 AM: The Archdiocese of New York plans to open seven PACE (Program of All-inclusive Care for the Elderly) centers in the South Bronx. It is selling St. Teresa's, a 98-bed facility that would cost the Diocese $25 million to renovate. A PACE center costs $6 million, and can help 250 seniors stay out of nursing homes.

Gee Whiz! Allentown's NIZ Hits Fox News

You can read the story here. Lehigh University's Steve Thode, a real estate expert, disputes an unnamed City spokesperson who claims that the NIZ and arena are "transformational."

"There is no tangible evidence that there's going to be any net job growth because of this," claims Dr. Thode. Sure, Allentown will get new jobs, but they'll be poached from other portions of the Lehigh Valley.

Updated Sunday, 12:15 AM: This story also appears in The Blaze, along with 55 comments! I liked this question: “How can a city/state spend money on a sports statium when there are people living on the streets and eating out of garbage cans?”

Local Ballot Challenges in State House Races

Although they have yet to make their appearance on the DOS webpage, Capitol Ideas reports that two local state house candidates are facing ballot challenges: Wanda Mercado-Arroyo (running for Doug Reichley's seat); and Leslie Altieri (running against Marcia Hahn).

Hearing in March For Scranton Men Accused in Streetlight Scam

A Northampton County Grand Jury has charged two Scranton-area men - Robert J. Kearns and Patrick J. "PJ" McLaine - with defrauding Bethlehem Township of $832,460 in a street light purchase scam. According to The Scranton Times, an electrician is now suing for $5,000 in unpaid invoices. This is on top of $320,222 bill to another subcontractor.

A preliminary hearing on the Northampton County charges is scheduled March 16, before District Judge Barner in Bethlehem Township.

Atiyeh's Proposed Rehab Spawns Website

Eleven North Bethlehem residents opposed to Abe Atieyeh's proposed rehab, adjacent to Bethlehem Catholic High School, have been at nearly every one of the seven (and counting) hearings before the Zoning Hearing Board. They got the Mayor and City Council involved. They hired a lawyer. And now, they've started a webpage, North Bethlehem Action Committee.

This group, which includes former Judge William Moran, former Northampton County Council member Greg Zebrowski and retired educator Bill Nelson among its members, is a direct response to Abe Atiyeh development proposals. In addition to opposing the proposed voluntary substance abuse residential treatment on Dewberry Avenue, they're also against Atiyeh's plans to build either luxury apartments or a psychiatric hospital on a five-acre tract, directly across the street. They're also concerned about Atiyeh's recent purchase of a nearby residential property, located at 2110 Center Street. "This property may be a part of a grand plan for this area—either multiple drug and alcohol treatment facilities or large, high density apartments."

Using the Internet, they've circulated a petition opposing Atiyeh's proposed rehab, and have collected 240 signatures.

All Atiyeh has on his side is a former Phillies ace.

And the law.

Thursday, February 23, 2012

New Barber Shop Coming to Bethlehem's South Side

Master barber Robert Cruz, with proud wife Ileana
Bethlehem will have a new barber shop on the South Side, thanks to a unanimous decision by its new, five-member board on February 22.  Robert L. Cruz was given permission to convert a vacant Mini-Mart, located at 1326 1/2 E. 4th Street, into "Rob's Barber Shop."

According to Cruz, it will be the first barber shop for drivers coming into Bethlehem from Route 78, and he noted that he has "ample parking" in the back, room for three cars But he expects most of his clientele to be local, walking there from two or three blocks away.

"I'm very nervous," Cruz told zoners. But as time went by, he relaxed enough to tell them he was recently awarded a master barber's license and would like to spend the rest of his career working "and paying taxes" in Bethlehem.

As the decision was announced, Solicitor Mickey Thompson gave Cruz a thumbs up and said, "Come back and see us."

"Come back and see me," smiled Cruz, whose shop will be open from Tuesday through Saturday.

In a separate matter, zoners also agreed to permit Wendy Thomson, a nationally certified grief counselor, to operate out of her home at 408 N. New Street, near City Hall. Under questioning by her attorney,Robert V. Littner, Thomson explained that a home setting is a more conducive environment to healing. She added that it is also greener, having less impact on the environment. She called it a good work-life balance.

Thomson told zoners she would see a maximum of 10-12 patient over the course of a week, and no more than 6 people during any given day.

Under cross-examination by Bethlehem Attorney Karl Longenbach, Thomson acknowledged a home occupation is also cheaper than paying rent at Main Street Commons, where her office is located. Longenbach represented nearby antiques dealer Sam Guttman, who claimed that a home occupation "sets a terrible" precedent in Bethlehem's historic district. He also suggested that Thompson is already seeing customers from her home, noting he sees cars parked there.

Before conducting hearings, the newly-constituted five-member board reorganized at the suggestion of Solicitor Mickey Thompson. Chairman Gus Loupos, Vice Chair Bill Fitzpatrick and Secretary Linda Shay Garder were all elected unanimously.

How Will Lehigh County Reassessment Affect You?

Information supplied by Lehigh County Director of Administration Tom Muller

Zoners Hear Final Arguments For and Against Atiyeh's Rehab Proposal

Allentown Diocese Attorney Jay Leeson
Over eighty people, including retired Judge William Moran and City Council members David DiGiacinto and Eric Evans, crowded into Bethlehem's Town Hall on February 22 for final arguments on Abe Atiyeh's zoning appeal for a controversial 70-bed voluntary inpatient substance abuse center. Proposed at the vacant Calvary Baptist Church on Dewberry Avenue, it's located right next to Bethlehem Catholic High School. Those expecting a quick decision left disappointed. After 21 hours of testimony spread out over six long nights, zoners Gus Loupos, Bill Fitzpatrick and Ron Lutes will wait until March 5th to make a decision. "We see light at the end of the tunnel," said Loupos, who chairs the zoning hearing board. "All we need now is a decision."

Representing Abe Atiyeh, Attorney Blake Marles told zoners that City Council and Mayor John Callahan only injected themselves into this case because of last Fall's election, drawing groans from the audience. "That's ridiculous," blurted out retired educator Greg Zebrowski, an ardent rehab foe.

Marles also argued that the Objectors in this case - the Diocese of Allentown, City Council and the North Bethlehem Action Committee - all failed in their burden of establishing that the proposed rehab actually presents a risk to anyone. Noting they had an obligation and ample opportunity to present facts, all they could come up with is "speculation" and "what if objections." In contrast, Marles subpoenaed the principal of an elementary school located next to a rehab, who testified there never has been a problem.

"They tried to make this a referendum on Abraham Atiyeh," Marles said of the Objectors. "but it is the use that must be evaluated, not the user."

A cross of ashes, marking Ash Wednesday, adorned Attorney Joseph "Jay" Leeson's forehead as he made his final argument on behalf of the Diocese of Allentown. Referring to the "town hall democracy" that sets Bethlehem apart from other communities, Leeson noted the "unusual breadth and depth of opposition," including the Mayor, City Council, a religious institution and "citizens from all walks of life."

Turning to the audience, he asked every person opposed to the proposed rehab to rise. Every person in the room, save for the press and Atiyeh's own legal team rose.

Leeson told zoners the "collective wisdom" of this group can't be wrong, and the room burst into applause.

City Council Solicitor Chris Spadoni
Representing City Council, Attorney Chris Spadoni told zoners that nobody objects to the rehab, just its location. He urged zoners to "protect our children" at Bethlehem Catholic High School Noting that Bethlehem is the "gem of the Lehigh Valley" because of its neighborhoods, he argued that a rehab so close to a high school and park is "deleterious."

Leapfrogging onto Spadoni's argument, Attorney Steve Goudsouzian also complained about the "awful location. I could not think of a worst place for this." Claiming that Atiyeh "tried to sell you a package," he noted there is a drug enhancement penalty near schools for a reason.

After attorneys were done, Zoning Chair Gus Loupos allowed six members of the audience to make final arguments as well. Stewart Early, a consultant, pointed out that the proposed rehab is located either next to or within a mile of four different schools, as well as two daycare centers. Youth case manager Holly Hornerook pleaded, "Please listen to what we're saying. These are our children. It only takes one time."

All that's needed now is a decision on March 5. Before leaving, Attorney Blake Marles told zoners, "I've seen you considerably more than my wife some weeks."

Sportswriter Cheers For Downtown Hockey Arena ... From the 'Burbs

Morning Call sportswriter Gary Blockus  thinks the NIZ and hockey arena in downtown Allentown can be a success, so long as we brush aside those nasty "perception of crime" issues with a vigilant police presence. Well, I guess if a Blockhead Blogger can write about this deal, so can Blockus. But at best, it's nothing more than a "homer" column supporting yet another sports venue at which the jocks and their favorite writers can hang out. At worst, it's an orchestrated "puff piece" of fluffy journalism to satisfy the criticism that the Morning Call is likely getting from civic boosters and Pawlowski boot lickers.

Peter Luukko, President of Comcast-Spectacor, who will operate the arena, keeps comparing the Allentown project to the John Lebatt Centre in London, Ontario as a comparable. The facilities are certainly comparable, but the cities aren't. London is a city of almost 370,000 people, about 3 times the size of Allentown. It is a major urban center in both Ontario and Canada. I'll bet the demographics of London versus Allentown are much different, too.

Gary Blockus cites the increase in restaurants and businesses around the arena site in London, after it was built, and draws the conclusion that it was the arena that did it. Perhaps, but London is a major urban center and the new nightlife and commerce could also be attributable to other factors. His "anecdotal" observations are just that, anecdotal.

He also cites Washington, DC and the Verizon Center and New York City (Bryant Park, really) as examples of how more police can clean up a city.  What is he smoking?

Finally, this sports maven compares the safety of walks across suburban parking lots in Hershey, Wilkes-Barre, and even Philadelphia as comparable to the urban core travel from parking to arena in Downtown Allentown.

Holy Brew Works, Batman, we have another FDAA style apologist! And on the sports pages, no less. It sure looks as though this "column" by a Morning Call sports staffer was intended to balance the news side's questioning of the Arena, its many shortcomings and lack of transparency. I could be a cynic and say that I hear that Jeff Vaughan - mouthpiece for the Arena and J. B. Reilly brother-in-law - and Morning Call Content Editor David Venditta are old friends, but I won't, because it's probably not relevant.

One last thing, Blockus talks about how he used to walk - in 1980 when he moved to Allentown - from his apartment on South 13th Street to work at 6th and Linden Street after 4 PM and then home again after midnight with no fear. Would he do that now?  A year from now? Not sure, but one thing I do know, it's going to be hard for him to do it anytime soon. He lives in Laury's Station in North Whitehall Township. That makes walking to work a bit difficult.

That's the bad news. The good news is, his EIT is not going to be driving back to North Whitehall Township and the Parkland School District with him.

It's staying in Allentown, thanks to the NIZ.

Wednesday, February 22, 2012

Bill White Sounds Off on Swaption

The Morning Call's Bill White has sounded off on Northampton County's swaption, which I prefer to call the Reibman Folly. For a quick $1.9 million in 2004 ($1.6 million after "consultants" were paid), we now owe the Bank of America $25.4 million, due October 1. White's advice, like mine and like Angle's well over a year ago, is to stop dithering with the second and third opinions already. Give financial advisers authority to pull the damn trigger.

"County Council can continue cluelessly gambling The Blob will shrink to a more manageable size before it eats the diner and kills everybody. Or council can freeze it and dump it in the North Pole."

Hispanic Chamber Moving to Bethlehem

From the Hispanic Chamber of Commerce: ) - Alvaro A. Diaz, Executive Director of the Hispanic Chamber of Commerce of the L.V. (HCCLV), announces partnership with the Greater Lehigh Valley Chamber of Commerce and the move of the HCCLV office from Allentown to a new location in Bethlehem, as of February 1, 2012. The office is located at the Main Street Commons Building, at the heart of the Bethlehem business district. The move was facilitated through the strategic partnership that HCCLV established this year with the Greater Lehigh Valley Chamber of Commerce (GLVCC), which allows HCCLV tapping on resources and logistical expertise from GLVCC and enhances the diversity footprint of GLVCC in the Valley. The Hispanic Chamber is in the process of launching a new website to help better serve its members. The office move “places us literally at the center of the Lehigh Valley with easy access to our current members, as well as to potential new members in the bustling Southside of Bethlehem”, Diaz commented. A press conference will be held on Monday, February 27th at the Hotel Bethlehem, 437 Main Street, Bethlehem, PA at 3:00 PM and following a ribbon cutting at the new Chamber office at located at 561 Main Street, Suite 245, Bethlehem, PA. at 3:30 pm.

HCCLV was created with the purpose of advancing the commercial, industrial and professional interests of all its members, especially its Latino members, in the Lehigh Valley. Founded in 2003 as a separate and independent chamber of commerce, HCCLV accomplishes its mission by focusing on three key principles: Advocacy, Business Development and Community Development. HCCLV, through its Fe Foundation, provides entrepreneurial training and internships to high school students in the Lehigh Valley.

Mike Schlossberg Now Unconstested in State House Race

Mike's the one on the left
Earlier this week, I told you that Aryeh Spero, a rabbi, was running against Democrat Mike Schlossberg for Jenn Mann's state house seat in Allentown.

Not anymore.

According to The Express Times, Rabbi Spero has withdrawn, possibly the result of residency concerns or problems with his nomination petition.

Barring a write-in campaign by Republicans or an independent candidacy, Schlossberg will succeed his old boss, Jennifer Mann, as a State Representative.

Sixteen Questions For Allentown's NIZ Whiz

David Woglom, who administers the Tax Collection Committees in both Lehigh and Northampton County, has asked Allentown Finance Director Garret Strathearn to answer sixteen very specific questions in advance of the next combined meeting. [W]e need to know what the financial effect will be on our budgets, particularly during these challenging times," Woglom tells Strathearn.

The combined committees will meet again on March 15, 8:30 AM, at Hanover Township Community Center on Jacksonville Road.

You can view Woglom's letter here.

Realtor Denies Lehigh Reassessment Will Favor Higher-Priced Homes

The Morning Call's latest report about Lehigh County's reassessment predicts that assessments will go up in Coplay, Heidelberg Township, Lynn Township, Alburtis, Catasauqua, Coopersburg, Emmaus and Macungie. Executive Don Cunningham had warned Commissioners that smaller communities with little industrial or commercial tax base would bear the brunt of this storm. His prediction seems to be coming true.

But pro-reassessment advocate Ray Geiger, a South Whitehall Realtor who wrote an op-ed on the topic, is taking the Morning Call (and Cunningham) to task in this email.
Your quote yesterday (and the headline was similar): “The changing landscape favors higher-priced properties over lower-priced ones”.

What is your data source for the above statement?

To the best of my knowledge, the County has only released the chart you offered which shows a geographic/municipal breakdown. Where is a chart that illustrates the trend among higher-priced properties versus lower-priced properties? Just because the smaller Boroughs illustrate increases, does NOT mean that higher-priced properties are favored overall.

The County Administration on January 25th released the following---the existing PRD (price related differential) under the existing assessments is 1.09 and following the reassessment the PRD will be 1.00. I suggest you bone up on statistics and learn that statistic CLEARLY means that lower-priced properties are favored in the reassessment---NOT the FALSEHOOD that your headline screams to agitate the pubic

From this statistical FACT, one may more accurately conjecture, the declines in lower priced properties in the City of Allentown and throughout the County far outweigh the increases in the Boroughs--suggesting that the increases in the Boroughs are due to other factors---i.e. maybe, just maybe they’ve been “underassessed” since 1991?

Do you know anyone that EVER appeals an “underassessment”—and if County officials let things slide for twenty years---why not just keep quiet about an “underassessment”?

When the County releases the entire database—we will know the whole story—but the Administration continues to inflame rather than inform—and the Morning Call is a useful puppet.
He adds tht Cunningham's veto has resulted in "a shorter window for taxpayers to make informal appeals. If not for the veto the notices were expected to go out around February 4th, now they are going out February 23rd, and the deadline on informal appeals is March 16th—reducing the window by two weeks or so---thereby potentially risking more FORMAL appeals that cost more to the County to administer, and potentially clog up the already overburdened court system."

Wouldn't that be a reason to delay reassessment for a year, as Cunningham asked?

My Spirit Animal

I'm taking a break from the usual politics on this blog. If there was any doubt in your mind about my sanity, I'm about to erase it completely with this question:  Do you have a spirit animal?

I do.

Honest! I'm by no means a spiritual or religious person, but there is an animal that really does look out for me. Is it the fierce falcon, who strikes at blinding speeds from above? The lone wolf, whose mere appearance strikes fear?


I'm a goose.

Geese and I have lots in common. We're both slobs, bird brains, talk a lot, and weigh more than we should. We also both have among the worst-looking bowel movements in the Animal Kingdom. We both wear out our welcomes pretty quickly. When we finally get going, we're pretty slow. But we both can go forever.

None of these similarities is what makes me a goose. This is where you might want to call the happy wagon. .

I first realized it many years ago, while running in a 4-mile race. I had just passed some guy, but could feel and hear him behind me, hot on my tail, with a half-mile to go. And I was beginning to fade. Suddenly, out of nowhere, a gaggle of geese flew overhead, honking away. For some reason, I dug down and was able to beat this guy, even though he was really the better runner.

Ever since that day, geese often appear when I'm out on a run, especially when I begin to fade. Last week, for example, I was nearing the end of my first 9-mile run in may years, and was really getting tired. I was thinking of stopping and just walking the final half mile, when three geese appeared out of nowhere, and for the first time during my entire run. I forgot all about being tired.

It happens to me all the time.

Naturally, I'd prefer to be an Eagle or a Falcon. Sounds more impressive, although a goose is a step up from buzzard.  From what I've read, a spirit or power animal is kinda' like a guardian angel or patron saint, and is supposed to guide you when you're in trouble. So maybe my guardian angel is a frickin' goose.

Or not. Today I run 10 miles.

If you'd like to discover your spirit animal, take this quiz.

Updated 1 PM: Just finished running 10.2 miles in a blinding speed of 2 hours. The first mile is very difficult, straight uphill. I was considering calling it quits and trying again later, and there they were - my spirit animals. Fortunately, none of them shit on me.

Cunningham Announces Lehigh County Hall of Fame

Every year or so, Morning Call columnist Bill White inducts some poor soul into his Hall of Fame, making that person an object of ridicule and scorn for the rest of his or her life. White even continues to take digs after the "winner" passes into the Great Beyond.

It's a really horrible and mean thing to do to another person.

I wish I had thought of it.

Lehigh County Exec Don Cunningham, in the course of getting ready for Lehigh County's Bicentennial on March 6, has announced an Inaugural Hall of Fame, too. But unfortunately, this is a nice list of twenty four prominent current and former residents of Lehigh County. are attached.

Honorees will be formally inducted at 6:00 p.m. on Community Celebration Day, March 10, an all-day event at the Agri-Plex building located on the grounds of the Allentown Fairgrounds.

The Bicentennial Committee still needs about a dozen volunteers to help coordinate on the day of the community celebration. Anyone interested in helping can go to www.lehighcounty.org and click on the bicentennial logo, or call (610) 782-3001.

In addition to the Hall of Fame induction, the community celebration will feature more than seventy-five community groups, businesses, historical societies and ethnic and cultural groups with interactive, educational and historical displays including a live bison visiting from the Lehigh Valley Zoo Food and drinks will be available on a cash basis. The day will end with a fireworks display and a bicentennial performance by the Allentown Symphony Orchestra at Allentown’s Symphony Hall.

J.B. Reilly will be juggling all day, while Mayor Edwin Pawlowski has volunteered for the dunk tank. Marcel Grown will collect all the trash.

Allentown is imposing a 200% sales tax on all food and beverages sold. City Council will pass a law later making it all legal.

All proceeds that do not go into the NIZ will fund the George Taylor House in Catasauqua, one of only a handful of remaining homes of one of the 56 men who signed the Declaration of Independence.

Below are the Inaugural Hall of Famers:
Lehigh County Hall of Fame Inaugural Class

Curt Simmons, baseball         Phillies Whiz Kids/World Series Champ            Whitehall
Chuck Bednarik, football      NFL Hall of Fame                                            Coopersburg
Matt Millen, football               NFL Super Bowl Champ 4x                             Whitehall
Andre Reed, football             NFL Super Bowl participant 4x                        Allentown
Dan Koppen, football            NFL Super Bowl Champ 2x                             Whitehall
Larry Seiple, football             NFL Super Bowl Champ 2x                             Allentown
Ed McCaffrey, football          NFL Super Bowl Champ 3x                             Allentown
Marty Nothstein, cycling        Olympic Gold Medalist                                    Emmaus
Michelle Marciniak, bball        NCAA National Champ/WNBA                         Macungie

Arts and Entertainment

Carson Kressley                    TV Personality                                                  Weisenberg
Amanda Seyfried                  Actress                                                            Allentown          
Christine Taylor                    Actress                                                            L. Macungie
Michaela Conlin                    TV Actress, Bones                                            S. Whitehall

Ed Donley                          Former Air Products & Chemicals CEO               U. Macungie
Raymond “Chip” Mason      Founder of Legg Mason financial firm                 Bethlehem
Lee Iacocca                        Former Chrysler Corp. CEO/Author                  Allentown

Government and Military
Brig. Gen. Anna Mae Hays           First woman general in US military             Allentown
Gen. Thomas R. Morgan              Four Star General/Asst. Marine                  Slatington 
Innovation and Philanthropy

Joel Spira                                    Founder of Lutron Electronics/                  Coopersburg
                                                  Inventor of dimmer switch             

Literature and Communications
David Zinczenko                        Editor of Men’s Health/Author                     Emmaus
John Grogan                             Author of Marley and Me/Columnist            Coopersburg
Charles Bierbauer                      Network White House correspondent          Allentown
Billy Packer                               Network basketball broadcaster                   Bethlehem
Rich Lerner                               Golf Channel broadcaster                             Allentown