Tonight, Northampton County Council is poised to act on a massive tax break, known as a TIF, to kickstart the conversion of Wilson Borough's vacant Dixie Cup factory into 405 luxury apartments. Though this proposal was defeated in November in a close, 5-4 vote, a new County Council with 4 new members might see things differently. The latest scuttlebutt, however, is that developer Skyline Investments wants to pull its application and go it alone with Wilson Borough and Wilson Area School District.
Aside from Allentown's NIZ or an outright grant, a TIF is the most generous tax break a taxing body can give to a developer. As Good Jobs First explains it, Tax Increment Financing is a geographically targeted economic development tool. It captures the increase in property taxes, and sometimes other taxes, resulting from new development, and diverts that revenue to subsidize that development. That diversion means local public services do not get the new revenue they would normally get from new re/development.
In the case of the Dixie Cup site, a TIF will enable developer Skyline to use $26.5 million or more in anticipated real estate taxes increases to finance the cost of the project and pay it back over 20 years. During this time, participating taxing bodies will be denied the opportunity to collect any increase in real estate taxes to pay for its own operations.
This TIF, by the way, is in addition to outright grants for this venture. Skyline has already been awarded $1,000,000 from an RACP application in 2024 and this year. It has received $163,257 from a DCED Multimodal Transportation Funding Grant and a $175,000 Greenways, Trails and Recreational Program grant. It is seeking even more grant money from PennDOT, DCED Mixed Use Housing Development, another DCED Greenways grant, another DCED multimodal transportation grant, and Pa Historic tax credits. It also wants $28.5 million in federal tax equity credits.
According to the proposed ordinance Exhibit I, the TIF bond will reward Skyline $4 million as a "developer's fee," and his architect will collect $5 million. Another $3.235 million in soft costs is just listed as "fees" with no additional explanation. I have no idea where that money is going.
Nearly two years ago, I pointed out a number of red flags about the bona fides of Skyline, a private equity firm. Not only has this firm never developed anything, but it falsely claimed to have built the "Louix," a nonexistent project.
I have noted on multiple occasions, and as recently as three weeks or so ago, that 405 luxury apartments will actually exacerbate the workforce housing crisis.
But the main reason why a TIF should be denied is because the developer, by his own admission, has said he doesn't need the county's help. In February, he was specifically asked by Council member Jason Boulette whether he needed the county's help. "It really means a lot to us to have the county support and buy-in as well." answered Bartee. But when pressed he acknowledged that "[t]here are other ways to have the project move forward."
If he does not need the TIF, granting it would technically be illegal. Under the Tax Increment Financing Act, a TIF can only be granted when development of the project is economically or physically unfeasible "but for" the tax break. This is a prerequisite for TIF approval. When a developer stands up before a taxing body and asserts that no TIF is needed, as Bartee has done, it really should not be granted.
35 comments:
Very much agree, no TIF or any other use of my County tax dollars should go to the developer of this Dixie project.
Sounds like the developer already received plenty of MY tax dollars as taken from all those other grant programs. Remember, unless a grant comes from an individual private citizen, the monies doled out for schemes like this one originated from the pockets of average, everyday working people. The money did not magically appear without you and I first providing it.
Any County Council person voting for this needs to be criticized and voted out as soon as possible.
County Council better vote against the TIF. They are going to look very bad if they don't and raise taxpayer taxes.
Very interesting BO. So the TIF granted by the Boro and School District is illegal . Those two bodies need to withdraw their approval of this money grab !
Looking forward to that property continuing to be a blighted eye sore until your boyfriend Nat can swoop in and save the day. Too bad the council ruined getting the 2 mil for affordable housing. What did these DSA morons think? That if they ruined Bartees deal that someone would buy it and put affordable housing there?!? I'd like to live in their lala land too!
It’s going to fail. And as much as Sultana and her friends will attempt to take credit, the votes WERE NEVER THERE TO PASS
Northampton County Government has only one source of revenue to fund their programs and projects. That source is "REAL ESTATE TAXES". Why would these elected officials give away this revenue source when it is obvious that Northampton County will be facing huge tax increases in the very near future. They need money to fund Gracedale (the County Nursing Home), they need money to fund wage increases for their underpaid and understaffed workforce. They need money to pay their financial obligations for their employees increased medical coverage (not to mention their multi- million dollar obligations for their retirees obligations). They have to be nuts to fund a TIF.
A greedy for profit group from nyc looking for handouts just to earn more money. And this is going to pass with flying colors, good job Tara and council don’t forget these when it’s time to vote
A TIF doesn’t take existing tax dollars away from taxpayers. Y'all been misinformed! As usual 😑
It works by using the increase in property tax revenue created after improvements are made and the property is reassessed. That additional tax revenue — which wouldn’t exist without the development — is then used to help pay for the project and related improvements. If the property were never developed or improved, that added tax base wouldn’t exist in the first place.
A judicial challenge would likely fail. A determination that the project needs the TIF is not subject to judicial review unless there is bad faith, fraud or the decision is arbitrary.
As Hyman pointed out in his letter to council, that ship has sailed. The property has been sold and Skyline owns it. Prior to Skyline's purchase, I believe there were actually numerous offers to buy. No one actually ever looked hard at the question whether the property could never be developed but for the TIF.
Council members will show their true colors with this vote
I honestly have no idea how Council would vote on this measure. I do know that there are three definite YES votes from the Kraft Keegan Warren troika. Zrinski spoke in favor of it even though she gets a lot of support from DSA. Holland, Boulette and Fadem and even Qayyum are all still unknowns. Vargo Heffner and Giovanni are NOs. I could see this going either way.
"That additional tax revenue — which wouldn’t exist without the development — is then used to help pay for the project and related improvements." - In other words, it takes tax dollars away, and for 20 years. I've explained the TIF accurately, and on several occasions. It is a massive property tax break, the most generous that most municipal governments can give aside from outright grants.
Nice job CC! You lost 2,000,000 for affordable housing!
Hey Bernie how about some comment on Easton getting 2.7 million of state money to help with the Bushkill Drive project
"Nice job CC! You lost 2,000,000 for affordable housing!" - And gained $6.5 million in tax revenue that can be used to support affordable housing while refusing to be part of a scheme that will increase rents in Wilson Borough.
"It takes money to make me money."
Ed Pawlowski, probably
Hold on, what? Voting for a TIF does not equate to a raise in taxes. LOL and you people think for yourselves? Lol
These people are not to be trusted.
9:12 - Try doing that with your own property. When anyone else improves their property, they pay the additional tax assessed for those improvements.
But now we’re supposed to make an exception for a developer who has already admitted that he doesn’t need the TIF? That makes no sense.
Everyone should operate under the same rules.
"I don't know if I support TIF for this project or not. It depends what my puppet-masters who write me checks tell me to think; the same handlers, oddly enough, who will also will dictate my policy stances and tell me how to vote, if elected."
Bob Brooks, Probably
Just sell this thing to Nat, let him do what he always does and develop nice looking affordable apartments with no government money. Problem solved.
I agree, they should vote no on the TIF. Unnecessary giveaway of taxpayer funds to a shady private developer.
What would be your problem if Hyman did swoop and save the day ? And DSA knows he would build affordable apartments and we would get to keep our tax dollars.
A typical bonehead move! For 2 years I have watched as various ENTITIES give money away to this guy. A developer with ZERO experience.. fools all of you! Hyman wanted to take on this project and well, no sense crying over spilt milk.
Don't come crying to this tax payer when the schools et al give away these funds to a nobody developer.....
Easton can do as it wishes. Wilson apparently can't. Double Standard.
I think you misunderstood the post. The person is prediction that the county will have to raise taxes. It's a pretty safe bet given how McClure left the county. So voting for the TIF and then raising taxes is a bad look. That's what I think the poster was trying to say. I agree!
Have you seen all the Lerta approvals from the county just for the City of Easton alone?
Thank you for being logical
Thanks for the info Bernie . How did this get this far ? If this guy has never built anything, is putting none of his own money into it and is taking most of the TIF for his own fees, what kind of idiot would vote for this ?
There are no TIFs in Easton. Most of the LERTAs in EASTON and Bethlehem are for residential owners who might want to put in a new roof or make needed improvements to their home. They will still pay the increased assessment, but it is phased in over 5 years. This is community development designed to help people, and I support it. I oppose LERTA for commercial developers.
Mayor Pawlowski is languishing in a dark and dank jail cell. His only crime was wanting to take the tremendous improvements he made in Allentown to the U.S. Senate.
For information on how to right this wrong see Alan Jennings FB page.
•FREE MAYOR ED•
I hope they've voted 'no'. Tough to come back for a tax increase later when you've given public funds away to someone who said they didn't need it. Plus, the developer has been drinking at the public trough rather heavily already.
So you oppose the LERTA for upper mt bethel then? I mean that is a commercial developer, and he already stiffed the county on taxes and possibly leveraged the LERTA into a loan and nothing is being built
In the spirit of Ed Pawlowski, I will go to Jennings' FB page if - and only if - you pay me.
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