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Monday, March 19, 2012

Allentown Continues to Stonewall on EIT Tax Grab

David Woglom administers tax collection committees
Under legislation first drafted by State Senator Pat Browne in 2009, Allentown will divert the earned income taxes collected for other Lehigh Valley municipalities to help cover the costs of a hockey arena and other projects in its 130-acre Neighborhood Improvement Zone (NIZ). Most townships were completely unaware of this tax grab, but all that changed when Morning Call reporters Matt Assad and Scott Kraus told us all about the NIZ biz.

"I'm not sure why anyone is confused. The law is very clear," Browne dismissively told Assad and Kraus.

Since that time, local officials have been trying to determine exactly how this EIT tax grab will affect their own bottom lines.

During a February meeting of the combined Tax Collection Committees of both Lehigh and Northampton County, Allentown Finance Director Garret Strathearn had no answers. "To be honest with you, a lot of this stuff is still being worked out," he explained. He promised to return the next month with answers, asking only that all questions be reduced to writing.

David Woglom, who administers these combined Tax Collection Committees, sent Strathearn a 16-question letter the following week. But when they met again on March 15, there still were no answers. And Strathearn, who had promised to return, was MIA.

Allentown's delegate, Debi Bowman, did promise she'd be sending some information the very next day.

Guess what?

In a March 16 memo, Allentown now notices "some discrepancies" with its own data. Now, instead of receiving information from Strathearn or someone else in Allentown the information "will be sent out to you by Senator Browne's office."

Can you say stonewall?

Hanover Township has already voted to sue over this diversion. Other municipalities like Lehigh Township and the Northampton County TCC may join in the party.

Allentown's memo is below.

38 comments:

Anonymous said...

It is a state tax program. Since Sen. Browne is getting the heat he should release the data (but soon).

A lot of the complaints are directed at the city, but EIT is collected at a countywide level. They are not the party with full control of the info.

The proposed suit is aimed at a state constituional issue.I think most of the comments are based on the wrong assumption that the city can change the tax code.

Bernie O'Hare said...

I think you are assuming that the suit will be predicated on the consttution. That might be part of it, but I suspect there will be more.

Anonymous said...

Why can't everybody just get on board and buy lots of tickets to the spectacular $ 160.0 million dollar PALACE OF SPORT already?

Jeez!!!

The Chairman and all his well-connected friends are working so hard for YOUR BENEFIT, you know.

Where is the sense of community cooperation and compromise towards working together, blah, blah, blah?

FUTURE DOWNTOWN ARENA ATTENDEE

zoid said...

Keep up the good work Bernie, this stinks so bad I would rather sleep with a skunk. Fact is they do not know the impacts to any of us and why will the response come from Browne. Further, where is Berkheimer in all this they were not even mentioned. Until both TCC's selected Keystone, many of us had Berkheimer as our tax collection firm. So Keystone will not and does not have historical data on all of us. Bottom line if they ever get info back to us, that is a big IF(as Bernie stated stonewalling is a good characterization) it will be nothing but propaganda and bullshit. I think there will be many more folks joining Hanover. Kudos to them for getting out of the gate first. This is long from over!!!!!!!

Anonymous said...

Keep up the good work, Bernie...with more stories like this, we can KILL THE ARENA!!!

Then, we can get our downtown back to normal - pawn shops and massage parlors...the businesses and jobs will flood in, as they have over the last 30 years.

Anonymous said...

Yawn. Wake me up when I can go to a Phantoms game.

Anonymous said...

Good work. Do you think there could be issues with the uniformity clause in the PA Constitution?

Bernie O'Hare said...

I don't know the legal theory for the challenge.

Bernie O'Hare said...

"Yawn. Wake me up when I can go to a Phantoms game"

This is endemic of why Allentown has a problem. Democracy died there many years ago.

Anonymous said...

Retired ASD teacher here.

Bernie, you wrote:

"Since that time, local officials have been trying to determine exactly how this EIT tax grab will affect their own bottom lines."

That says it all for me. Any construction in Allentown (or elsewhere) should NOT affect anyone else's bottom line! Particularly not when unilaterally decided. This enters dangerous territory.

Allentown citizens elected officials to make purchase decisions on THEIR behalf. If they don't like those decisions, they can remove their representatives at the ballot box. Citizens of OTHER municipalities are not, and SHOULD not, be any part of this exercise. . . . unless their OWN citizens approve.

This legislation obviously passed through as a rider to something much more. It might have been approved on a Friday afternoon when everyone was preoccupied with their own agenda, or on their hasty way out of town. Either way, you simply just don't "live with it." You put it on hold pending further analysis.

Although I do not believe the arena will ever pay for itself, will never be heavily used, etc., I don't want to "kill" Allentown's project. I just want the wisdom of that investment to be on Allentown citizens alone.

I have to believe, if this concept ever receives full light on a statewide basis, it will NOT be well received.

According to Browne, and others, use of surrounding E.I.T. payments is "peanuts" compared to the entire funding stream. Actually, not needed in the end.

Well . . .

Anonymous said...

"Wake me up when I can go to a Phantoms game"

Perhaps you should already be awake, then.

The good people in Glens Falls, New York, would be happy to take your money anytime you are ready to give it to them!

Meanwhile, the Phantoms are playing this Friday night against the Scranton/Wilkes-Barre Penquins in northeastern Pennsylvania.

The SWB Penquins average 5,779 per game through 31 American Hockey League games this season. The MOHIGAN SUN ARENA AT CASEY PLAZA officially lists 8,050 as the capacity for ice hockey ...

... so ticket availability should not be a problem.

SHAIBU!

Anonymous said...

Allentown: City Without Integrity

Anonymous said...

Bernie,

Elected Officials should begin to read before they vote.
But more importantly is this really an issue. Most of the people employed in the NIZ Zone would otherwise not be working.

Anonymous said...

"Most of the people employed in the NIZ would otherwise not be working"

What, not be employed without the Tax Grab?

Yeah ... okay ... whatever you say.

Anonymous said...

Retired ASD teacher here.

There are NUMEROUS questions here.

First of all, why was this legislation (if good) written so that it could ONLY apply to Allentown? Why not provide every other municipality the same opportunity to benefit?

Where in the law does it authorize Allentown to designate 130 acres (or any other amount) as NIZ affected property?

Why is the NIZ not limited to just the 25 acres in the immediate area of focus (arena project)?

Is there any prohibition to Allentown deciding that 130 acres is not enough to achieve its vision? Why not 300 acres, the entire city? Whose call is this?

How do other communities statewide feel about their state-intended tax payments going specifically to an arena in Allentown, and not to typical state-provided initiatives.

Does the state agree to NOT increase taxes on everyone else to make up the deficit created by this re-direction?

Do the developers, in effect, receive immediate, state taxpayer-provided equity in buildings they will later sell at a profit?

Do surrounding municipalities receive interest on their "loans" to the Allentown (or other city) investment?

Is there a penalty if the "loans" are not paid back by a specific date?

Again, this scheme is NOT something surrounding communities should simply "live with."

This scheme is NOT ready for implementation.

Anonymous said...

To Anon 602p.m.

Hey Einstein,
The Taxes collected are going to pay the Bond issue that financed the Arena area.
Without the arena area there would be no jobs!!!
Thats why the NIZ was created.

Anonymous said...

To 651 p.m.

There's a fine line between between Larry and Einstein. You're close to Larry!!!

Anonymous said...

At least Mr Pawlowski is trying to help the city and he is such a nice man, once during a parade in town he gave me a bottle of water. Did you ever give anyone a bottle of water in a parade? I didn't think.

Nice Allentown voter

Anonymous said...

Retired ASD teacher here.

Anonymous 6:39 -

But why?

Why use taxes destined for some OTHER community to create a minimal amount of minimun wage jobs in Allentown?

Makes no sense to the taxpayers in those OTHER communities.

Do you not see the concern here?

Anonymous said...

Keep in mind the jobs wouldn't be there, if it wasn't for the stadium.

The NIZ needs to be financed and the way to do this is to keep the Tax money in the city to pay the Bond.
The construction jobs created and the other jobs after construction won't be minimum wage.

Anonymous said...

Retired ASD teacher here.

Anonymous 9:00pm-

The construction jobs are a ONE year deal. The $200 million dollar debt runs throughout your lifetime.

Do the math.

Anonymous said...

These jobs that you are talking about - the permanent ones, how much do you want to bet that 3/4 of those jobs are from companies that move in from the suburbs? How is that creating any jobs?

Anonymous said...

I fully support Allentowns memo as listed at the end of Bernie's article. So much substance and it gives me such a better understanding of where the taxes will come from

Anonymous said...

Real Democracy is Bernie deleting comments about how John Stoffa has an email proving he approved of diverted county paid work to O'Hare. It's bad in Allentown but protected in Northampton County.
the moral of the story!

Bernie O'Hare said...

No, it's off topic and has been tossed out of court several times now. That's why I delete it. You and your fellow Gracedale Goons are just batshit cRaZy.

Anonymous said...

Can someone explain why a STATE SENATOR is going to release EIT date on a municipality in his district. This smells!

Anonymous said...

Anon 6:39,

Your statement makes it seems as if no one in the NIZ would be working without the Tax Grab.

I am not talking about just arena construction, Dickhead.

Anyway, those contruction jobs are permanent, Genius.

So go F--- Yourself.

Anonymous said...

Not permanent.

You can still go play with yourself.

No bullshit hockey for me, Genius.

Anonymous said...

Go sell your crap to someone else, Genius.

You pro-Arena Dickheads really get under my skin.

Pawlowski's Poop House will never see a penny from me.

ironpigpen said...

Trash talk does not tickets sell.

The Chairman's Cheerleaders would do well to keep this in mind.

The hard feelings over this damn ice hockey rink WILL last a long, long time.

Bernie O'Hare said...

"Can someone explain why a STATE SENATOR is going to release EIT date on a municipality in his district. This smells!"

Agreed. I think this really pissed off Bethlehem Township.

Anonymous said...

That is why Northampton county voters are pissed off. No freebies for private citizens.

Anonymous said...

5:04 - Yes. Scranton doesn't fill their arena. They also don't fill their baseball stadium like our local team, the Lehigh Valley IronPigs. In fact, the IronPigs had the highest attendance of ANY AAA franchise last season. Perhaps you might attend a game? You see, the Lehigh Valley (and I use that colloquialism purposefully) has a much higher population and thus fan base than any local population center other than the Philadelphia area. The IronPigs took the name "Lehigh Valley" because the team belongs to all of us regardless of our municipality. It is unfortunate that the term "Lehigh Valley" only applies when it is convenient.

Anonymous said...

Why not provide every other municipality the same opportunity to benefit?

What a naive statement.

Allentown is not like Hanover Township or Bethlehem Township. It is the third largest city in the state.

I was born and raised in Allentown and currently live in one of the above townships. There is no reason for Harrisburg to do everything within their power to help "save" Bethlehem or Hanover Township. Their IS a reason to using taxing authority to save the heart of the Valley and the region.

Anonymous said...

Jobs. On the IronPigs staff directory, I see about 36 good, real jobs. That doesn't count the dozens of concessions and parking jobs. Those are all new jobs created out of thin air. That is all new revenue coming into the city.

The city will also make money collecting revenue from player salaries and possibly visiting team player salaries - I don't know the particular law in Allentown.

Add revenue pouring in when the arena is full for concerts.

This could be a bust but it could really be something positive - like that other park in town.

Anonymous said...

Sorry, above I was referring to Phantoms jobs when speaking of jobs in Allentown created out of thin air.

Anonymous said...

ta know, since they're getting sued, it's hard to say they're still stonewalling.

Bernie O'Hare said...

Why? All they need to do is refuse to give information out until the binds are floated, and then say it was obvious.