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Wednesday, December 04, 2013

NorCo Revenue Appeals Board Bends Rules For Wolf Developer

Mark Mulligan
During a bizarre assessment hearing on Monday, the NorCo Revenue Appeals Board ignored a 2010 ordinance governing the timing of appeals. That's not all. One of five members of what is supposed to be a quasi judicial body, Richard McAteer, actually voted by proxy. They were all in a hurry to give Easton's latest savior, gazillionaire Mark Mulligan, yet another tax break. They voted, 3-2, to lower the assessment at the county-owned Wolf Building, a property that Mulligan won't even own until next March. Let me tell you the story.

Northampton County is hell bent on relocating and centralizing its human services department to a building under construction in Bethlehem Township. But to make this work, it had to unload the two buildings where human services workers are located. One of these places is the Bechtel Building, which was sold last Wednesday to prominent Bethlehem Attorney Justin McCarthy. But the other property, Easton's Wolf Building, is more problematic. Developer Mark Mulligan agreed to purchase the property in June for $1.925 million, but his agreement was contingent on a KOZ tax exemption that could be disapproved by the state. Mulligan told Council he'd probably still go ahead if the designation was disapproved, but reducing the assessment would sweeten the pot for Mulligan.

Never mind that the state could very well decide to grant the KOZ.  Let's give this guy another tax break!

There's no need to sweeten his pot. Easton has fallen over itself to give Mulligan practically anything he wants. The Easton Silk Mill project, for example, has benefited from at least $7 million in RCAP grants, but the City is just giving it to this guy. That's a project that could easily be split up among three or four developers, but Mulligan is their fair-haired boy. He once sang opera, so he must have class.

Recently, a trendy "Cheeburger Cheeburger" opened up at one of Mulligan's properties. Easton waived all permit fees. Do you think they did that for Sharbel Koorie's "Daddy's Place," which opened up just a stone's throw away?

Some people get special treatment. Others get the bill.

Not content with all the money and projects they've showered on Mulligan, which includes regular payments from the Easton Redevelopment Authority as a project manager, Easton officials wanted the assessment reduced at the Wolf Building.

To be more specific, Easton Redevelopment Authority's Richard McAteer, wanted that assessment reduced. So he asked the County to start the ball rolling..

Here's the problem. If you know you could never get a nickel over $150,000 for your property, but the tax man says it's worth $300,000, you can always file an assessment appeal. But if you want it to take effect for the next tax calendar year, you must file by August 1. This way, the Assessment office has time to process and hold a hearing. This isn't some rule or guideline. It's an ordinance. It was adopted by Northampton County Council in 2010, pursuant to the state Tax Code. It's the law.

Northampton County, at the urging of Easton officials, appealed the $1.6 million assessment of the Wolf Building, which  translates to a building worth $4,224,000. Obviously, it is overvalued. But instead of filing its appeal on or before August 1, it filed on November 19.

Under state law and a Northampton County Ordinance, the Revenue Appeals Board lacked the authority to reduce the assessment for calendar year 2014. But they did it anyway.

During the hearing, the County produced a 2012 appraisal that valued the property at $1.8 million (not the $760,000 incorrectly reported yesterday). A County appraiser decided to appraise the property herself, using both comparable sales and income. She valued the property at $2.55 million, far more than the the $1.925 million that Mulligan agreed to pay.

The Revenue Appeals Board decided to ignore the County's own appraiser and reduce the value of the property to $1.925 million, the amount that Mulligan agreed to pay. But there was a problem. Appeals Board members Bob Miklas and George Andralis voted to reduce the assessment, but Board members Marci Carter and Leonard Zavacky said No.

This dilemma was solved when Miklas announced that he had a proxy from the absent fifth board member. That absentee is none other than Richard McAteer, the Easton Redevelopment Authority official who improperly suggested that the assessment be reduced in the first place.

So the bluebloods took care of each other on Monday.

And we will make up the difference.

If the state grants a KOZ and exempts the property from all property taxes for ten years, this will mean that the Revenue Appeals Board broke the law for nothing.

According to one assessment official, there has never been an occasion before Monday in which a late appeal was entertained for the next calendar year. And she's never heard of a Board member voting by proxy.

The Board is clearly playing favorites, especially among certain Easton-connected property owners. I've been told for example that Gretchen Longenbach, an Easton official tied at the hip to McAteer, has had the assessments reduced on two of her Bethlehem-owned properties. I am not sure about that, but will be checking.

After playing favorites with Easton Savior Mark Mulligan, the Revenue Appeals Board screwed Abe Atiyeh. He had appealed the assessment on a school building that he actually owns, located on Northampton Street. He had an appraisal, but failed to submit it ten days before the hearing. He was shot down for failing to follow their rules. This was from the same Board that thought nothing of breaking both County and state law for the opera singer.

Abe's blood is not blue enough.

What's disturbing about this is the involvement of Richard McAteer, who was Shadow Mayor under Phil Mitman. After screwing that up, he's latched onto Executive Elect John Brown. It is McAteer who got Brown on the RenewLV Board and who introduced him to all the Lehigh Valley Partnership aristocrats. It is McAteer who thinks he can vote by proxy on a quasi judicial board, and who urged the County to violate the law. It is McAteer who jumped the gun on getting a lower assessment without waiting for a KOZ determination that could be granted.


Anonymous said...

Easton property taxes are an outrageous and complicated issue. The taxes are so god awful high because they only collect about 50% of them. Rather than enforcing them they just keep raising and raising them on the people that actually pay. This guy shouldn't get special treatment but at the same time, I wouldn't and haven't invested in Easton City real estate due to the taxes.

Since this guy is someone that WILL actually pay the taxes, it may have been better for the city to give him the break if he otherwise wouldn't buy... But this is an inappropriate remedial measure.

Fix the real problem.

Anonymous said...

Once again in order for Stoffa's bullshit building scheme to fly we have to play games. How is this guy better than anyone else?

Can county council do anything about this? At the very least they should register their displeasure and try to ensure that all current members of the Board are not re-appointed or asked to resign.

This is a disgrace to good government. But as we learned with Gracedale and The Stoffa Palace of the people, the ends always justify the means.

Hell, we gave the building to the guy for less than half of the fair market value. Why not hire a county employee to massage his balls for the next ten years.

Now we have elected even more clueless officials. The county is fucked. Or I should say the taxpayers are royally screwed.

Anonymous said...

Another day of gubmint picking winners and losers. Bluebloods scream about Obamaphones and foodstamps, peasants fire back when deals like this get done.

Gubmint could fuck neither, nor favor either, if the power to do so had not been relinquished to it by both. There is no greater good done by gubmint that justifies the daily whoring what goes on in gubmint.

The only good gubmint is a virtually non-existent one.


Anonymous said...

I would do whatever Gretchen wanted...

Anonymous said...

"Gretchen Longenbach", isn't this the same person that was appointed to serve on the Bethlehem CRIZ or CRUD?

Anonymous said...

"Blue bloods" ?

Sal Panto is at the center of this. His old man ran a failed deli and Sal barely made it out of college. He's a blue blood?

Anonymous said...

Next step here is for the school district or someone to appeal this ruling and over turn the decision. Did the board just set a precedent?

Anonymous said...

Nothing new here, Jeff Parks got special treatment from this administration to keep Steelstax off the tax rolls. It's who you are and who you know.

Bernie O'Hare said...

"Sal Panto is at the center of this. His old man ran a failed deli and Sal barely made it out of college. He's a blue blood?"

He is not at the center of this nonsense. That would be McAteer, Mulligan and Longenbach.

Bernie O'Hare said...

8:13, You're way off on that one. It actually proves my point. parks was screwed by the revenue Appeals Board. They ruled against him and he had to appeal. You seem to have forgotten to mention that little fact. try being honest.

Bernie O'Hare said...

"Next step here is for the school district or someone to appeal this ruling and over turn the decision. Did the board just set a precedent?"

Yes, it did. By giving special treatment to Mulligan, it is hard to view their treatment of others as anything less than discriminatory.

McAteer acted improperly in this matter. he should never have cast a vote by proxy. He is so close to this matter that he needed to recuse himself.

Bernie O'Hare said...


Gretchen Longenbach is on the Bethlehem CRIZ. She's like Tony Hanna and Joe Kelly rolled into one.

She earns compensation from three sources. She is Director of Economic Development for the City of Easton, the Executive Director of the Redevelopment Authority, and Executive Director of the Greater Easton Development Partnership. Her total compensation, collectively, is, I have been told, the highest in the City. And then even with all that, she needs to "supplement" her six-figure compensation package with investment properties in Bethlehem.

She has friends and patrons like Lisa Boscola, who got her on the CRIZ Board in Bethlehem, and Dick McAteer, who is Chair of the Easton Redevelopment Authority Board and is one of her "bosses."

I question whether she is interested in Easton's economic redevelopment or her own, and predict she will eventually go to work for a developer like Mulligan.

Anonymous said...

I must say that it was only a matter of time before the shit hit the fan with these 3. Always looking to scheme. You forgot to mention that Mulligan received 2m in RACP funding from the city for Pomeroy's as well.

It's been rather interesting to watch the city fall all over a guy who thinks he is gods gift to this earth. Not to mention the express-times article from over the weekend. The guy may have invested 10 million but the city gave him 9 million dollars to leverage. 7@silk mill and 2@pomeroy's. Now this guy wants more.

Anonymous said...

John Brown is and was a terrible mayor. It will take Bangor years to recover from his "leadership".

Bernie O'Hare said...

Dick McAteer was at the heart of the ArtsQuest screwing, although people like barron served as useful idiots. As a nmber of the Revenue Appeals Board, he put the screws to ArsQuest. Behind the scenes, he'd complain about how expensive the food was at ArtsQuest and disregarded the fact that similar performance venues in Easton like the State Theatre - a blue blood favorite, or Bethlehem's Zoellner Arts Center - another blue blood favorite, are tax-exempt. ArtsQuest proved the point that they met their burden of relieving the government of responsibility in several areas and made their case sufficiently to get tax-exemption.

Peter J.Cochran said...

Sal had to be in the 51% or higher in his class at that time, and that's not "barely".

Anonymous said...

My personal favorite.

"A host of economic reasons were in favor of the group coming in and purchasing the property," said Mark Hay a junior partner at VM.

No wonder why you see Hay and Logenbach together in Lehigh valley style magazine.

Anonymous said...

"She has friends and patrons like Lisa Boscola"

Lisa did the same thing for Alicia Karner in Bethlehem. Must be nice to have friend sin high places. All sucking on the public teat.

Anonymous said...

I am confused, did Mulligan get the re assessment or the county on its own property?

Why are the assessments so out of whack the county needed an emergency lowering?

What is up with the assessment office? Sounds like there is a problem in there.

Anonymous said...

Great article Bernie. I sit at home nice and comfy, while you do all the hard work. Then I get to read about it. Keep up the good work.

Anonymous said...

Am I missing something? The building pays zero taxes to anyone due to its status as a government building right? So now it is going to pay taxes that have not been payed for 10 years plus, and we are complaining, why?

Never look a gift horse in the mouth.

Anonymous said...

11:57 I don't know if we ever will see taxes. Applications have been made for tax free status (KOZ)related to the sale and LERTA. In the case of LERTA, the lower the assessment, the better off for the developer. Such benefits are not shared with other developer tax payers in the city. Sale may be in jeopardy because of the tax free status. I sometimes think that this developer is controlling all of these big buck projects in order to corral any federal or state dollars given to the city. If he does not get the grant dollars, his sales agreement permits him to walk. Check it out.

Anonymous said...

Bernie, this article represents your finest efforts. keep up the good work.

Anonymous said...

Speaking of CRIZ, the NIZs very own Morning Call reprinting of the Reading Eagle story probably ruffled some feathers.

Anonymous said...

Express Times 6/20/13 "The main concern expressed by Northampton County Council members was an opt-out clause that would let Mulligan walk away if government incentive programs don't emerge for the project. The county has previously sold the building's parking lot for $595,000 only to have to buy it back for years later when the plans to build a parking garage and apartment complex fell through." Such a sweetheart of a deal!

Bernie O'Hare said...

A few points.

1) The property is worth nowhere near the $4 million indicated by assessment records. Those records are off bc there has been no reassessment, and the political will for that is nonexistent.

2) there is no problem in the assessment office. There is a major problem with the Revenue Appeals Board.

Anonymous said...

Rumor mill has long reported Gretchen as the stipend queen. The same mill has also reported Dick as the shadow mayor. Even under Panto.

Ovem Lupo Commitere said...

A couple comments:
1.) If 12:22's comments are largely correct, Easton should listen to the concern if they are concerned about future investment.

2.) I typically do not agree with Clem, but I commend him here for being consistent. Many "conservatives" and Tea Party folks rail against "govt handouts" to various segments of society, but are frequently/strangely silent when it comes to corporate welfare.

3.) KOZ, NIZ, CRIZ, whatever your alphabet soup creates winners and losers to encourage investment. Is this case (principal to tax break, not the ord. violation) really any different? I guess its a both a philosophical and practical value judgement to determine if the long term tax/QOL benefits of development outweigh the tax breaks? Both sides of that coin have valid points.

4.) I don't always agree with Atiyeh's tactics, etc. However, now and then in COB, BT, and as you describe here, I find myself saying he has a valid and/or legal point to complain.

Anonymous said...

I wonder how the Alpha building went down.

Anonymous said...

I think Terrance Hand and Mike Krill did a good job exposing Phil Puppeteer when they were both Mayor. Macateer completely destroyed the Easton Economic Development Corp with overspending and then led the redevelopment authority into paying a ridiculous amout of money for those mills buildings. And lets not forget that the city is also putting up the $1.5 million US department of Commerce grant. So Mulligan will be gifted another 1.5 million on top of all of that.

Anonymous said...

Sounds like Panto Administration is turning into the Mitman Administration.

Anonymous said...

Panto's biggest mistake was keeping this guy around.

I think you have bad info on Gretchen Louganbach's salary. it was reported to earn LWV has her salary at 79K. Is there more to this?

Anonymous said...

Just a few corrections. Taggart associates is being paid to be the silk mill project manager, I beleive. If this guy is getting paid to be te same well that wouldln't make much sense.

Bernie O'Hare said...

According to what I've been told, Mulligan is the paid project manager on some of his own projects. You're right about Taggart.

Anonymous said...

According to a construction friend, Mulligan is the paid contractor who is telling everyone what to do. One has to wonder why the authority is paying for all of this just to give it up to him? This doesn't seem right. Do townships pay to put new roads through developments or do developers? Isn't this why we have developers? Am I missing something?

Anonymous said...

to put it in his words....i guess the pot is extra sweet for him in easton

Anonymous said...

Just a question here but how can a public official, elected or appointed, receive salaries from three different entities, public or private? Who do they actually work for? Can a organization like GEDP really pay a city employee without that employee reporting it as a direct gift? Aren't these organizations substidized by the city and recieve money from the city in order to pay expenditures? Same with the redevelopment authories. Years ago I remember an issue with Philadelphia's housing authority and parking authority and the then Mayor Streets appointed officials.

Just a question, I'm not suggesting anything is being done wrongly.

Bernie O'Hare said...

Good question. I don't have an answer, but I will.

Anonymous said...

If city council did not act on the compensation, regardless of where is came from, then it is a violation of the third class city code, in my opinion. There is nothing wrong with it so long as council votes on it.

Anonymous said...

City budget, on the city website, shows her salary coming from the city. It would be a violation of the city charter to accept any other compensation acting as an official of the city without the consent of council. There is a reason why council must approve salaries.

(1) Acting in an official capacity on a matter(s) in which the official has a private financial interest, clearly separate from that of the general public;

Bernie O'Hare said...

I will be finding out.

Anonymous said...

I think that the above posts are wrong. There is nothing that would stop a municipal employee from collecting a salary from an authority or non profit corporation. The salary, if any, would have to be disclosed on PA ethics documents. I checked the federal tax records for Greater Easton and those records did not break out salaries. The records did show a nominal amount of time for actual work.

Anonymous said...

Annon 1:32 - Reference Section 912 of PA's Third Class City Code. I think any employee who uses city property to earn additional money can but they need councils consent. I don't see anything about ethics documents.
I don't know what the deal is hear but I don't think ethics documents are required. Let it go.

Anonymous said...

4:34 Every high level municipal employee has to file an ethics document detailing all sources of outside income. That form will answer all questions regarding income and sources. If you are using municipal property to earn income , then you violate the law. Even elected officials cannot give you permission to use city property to enrich yourself. They also would be violating the law.