Dixie Cup Developer Wants Tax Break

Below you will see a detailed report from Wilson Borough resident Armando Moritz-Chapelliquen concerning the redevelopment of the long vacant Dixie Cup factory into apartments. Developer Skyline Investment group wants a tax break known as a TIF in exchange for setting aside 10% of the units for affordable housing. Wilson Borough and the school district have both signed off on this tax break, and all that is left is approval from the county. This TIF must be approved by Wilson Borough, the school district and the county to get the benefit from all three taxing bodies.

I will weigh in with what I think after checking out this New York investor. 

Armando's report:

[On May 2], two representatives from Skyline Investment Group, the buyer for the Dixie Cup site, presented their most up-to-date plans to Northampton County Council's Economic Development Committee. A lot of information was shared in the supporting documents (which you can find here starting on Page 13), but among the biggest updates is that the developer is requesting the Council pass an ordinance to set up a Tax Increment Financing District, or TIF.  

 

What is a TIF?

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, the TIF would be in effect for roughly 20 years. Given this potential diversion of tax revenues, the question on everyone's mind should be "Is a TIF worth it for this project?"

 

What is Being Proposed

Some may recall an earlier image I circulated to show what were some of the major components of this project. The below image comes from the developer's TIF Plan, submitted to County Council as part of their May 2 meeting (accessible here starting on page 24).

• Dixie Cup Seating Area (Red Square): The Dixie Cup currently on top of the building will be brought down to ground level and set up with benches for people to enjoy up close. A replica cup will be created and placed on the roof. Based on the plan provided, this area would be close to where the bike path meets 25th Street.
   
• Access Lane to Bike Path (Green Oval): The bike path that runs along the western end of the site will be accessible from the southern parking lot of the redeveloped Dixie Cup building. This would provide a new outlet for cyclists who can currently only exit this stretch of the bike path at Northampton Street to the north or 25th Street to the west.
   
• Cafe and Dog Lounge (Blue Triangle): The old boiler house will be converted into a retail/commercial space, along with a dog run (note the bone-shaped outline on the western end of the triangle). This amenity, in addition to the Dixie Cup seating area, will be open to the public and provide an additional component of connective tissue between the Wilson Area High School to the east and Easton High School to the west.
   

The previously mentioned fire lane around the building, pool for building residents, and rooftop lounge are still included (the pool can be seen to the west of the 2nd northern-most "finger" of the main building). While the parking lot to the south of the building is visible even today, it's bound to be more active once the building is complete. 

Affordable Housing

Within the TIF ordinance is a section on affordable housing (pages 18-19 for those reading through the documentation). While the text requires 10% of the units to be affordable, there is also language that allows for an owner using the TIF to opt out of this requirement if they contribute $27,000 per unit, up to 10% of the total number of units, to the County's Affordable Housing Initiative Program. The redevelopment plan is for 405 units, meaning either 40 units would need to be affordable OR the developer would contribute $1,080,000 ($27,000 x 40 units) to the County fund. The developer has repeatedly stated they would prefer to contribute to the fund, so the only remaining question is whether $1,080,000 is a sufficient contribution to the fund. 

My Opinion

While the affordable housing question still needs to be answered, this proposal is an enormous validation of community voices--like yours-- that pushed back on the warehouse plan in 2022 and completed my survey in 2023. For those unfamiliar, I asked area residents to score their favorability towards various uses permitted on the Dixie Cup site. The results were very aligned with what Skyline Investment Group is proposing.

Separate from affordable housing, I still have questions regarding some of the more specific details of the site (amenity access, bike path accessibility from Washington Blvd, general questions about vehicular traffic, etc). Regardless, the possibility of a reactivated and engaging Dixie Cup site as part of our community is only because of community involvement and advocacy over the past few years. And if you have concerns about this plan, there is still time to make your voice heard.

Next Steps

County Council will be holding a public hearing on the TIF ordinance on Thursday, June 6. A vote on the ordinance is scheduled for Wednesday, July 3. I'll be attending both and am happy to meet up with others who would like to give testimony. We are so close to getting something that will benefit our community. Let's make it happen!

 

Thanks as always for your collaboration!

-Armando

 

PS: If you think someone would appreciate this information or want to receive updates on this Dixie Cup site, forward them this email!

St. Hamilton Crossings (Postponed)

Lehigh County Executive Tom Muller will hold a public meeting next week to discuss the Hamilton Crossings Shopping Center Project proposed in Lower Macungie Township. The public will have the opportunity to meet the developers,give input and ask questions. The media is also invited to attend.

WHAT:                Presentation and public input pertaining to Hamilton Crossings Retail Center

WHEN:                 6:00 PM, Monday, February 3, 2014

WHERE:               Moyer Hall, Muhlenberg College

                             2400 Chew Street, Allentown, PA

This project has been quite controversial, mostly because it has been proposed as a TIF. This is a special financing tool in which the increase in real estate taxes that would ordinarily arise from building on raw land, is deferred. That increase can be used to fund development over a period of ten 20 years. Hamilton Crossings is a 63-acre former industrial mining site in Lower Macungie. Developers failed to persuade Lehigh County Commissioners to allow them to use half of the increased property taxes to finance the project.

I have serious reservations about this project, even though it is supposed to bring a Costco and jobs.

Instead of making taxpayers take a haircut, why not the property owner who is actually selling the real estate to the Goldenberg Group? That just happens to be the Allentown Diocese of the Roman Catholic Church.

For starters, they haven't paid a dime in real estate taxes on the property since it was always intended to be used for future storage of Catholic souls. That property was at one time remote, hard to access and even harder to develop. Just perfect for a cemetery. maybe even a homeless shelter or a shelter for the wayward queers that Vic mazziotti and his pastor despise. That all changed with the Route 222 Bypass, aka The Fred Jaindl Memorial Highway.

Of course, one of the major beneficiaries of the highway - it cost over $200 million to build, I believe - was the Jaindl family. Another beneficiary was the Diocese. Now the property is no longer a parking pad for dead Catholics, but a money maker for our Holy Mother Church. When this deal started to tank, the biggest loser - beyond Goldenberg and his partners - was the Diocese.

Enter Tom Muller, good Catholic, member in good standing at St. Thomas More, and probably a frickin Knight of Columbus for all I know. Is he interested in keeping this deal alive because he wants to help the developers or the Diocese?

Has he been threatened with excommunication?

Has Vic Mazziotti discussed this with his Pastor?

Goldenberg should be able to do this deal without TIF help. All of the prospective leases - Costco, Target and Whole Foods - are very bankable. Perhaps the sale price is too high, or the developer wants too much profit. In either case, whether it is the developer or the Church, taxpayers should not have to pay for someone else's greed.


Update: 2/3/14, 12;11 pm: This event has been postponed. It has been rescheduled for the same time and location, but it will be next Monday, February 10.

(This originally was published on 1/29/14, at 12:00 am.

So What's Going On With the Chrin TIF?

A little over a year ago, a "TIF" was approved for a massive , 689-acre industrial park in Palmer Township owned by Charles Chrin. That's a special tax tool under which the owner will continue paying the same real estate taxes on the property for ten years. Municipalities lose nothing. But during this time, the owner can use the increases in the tax base, which results from construction, to finance additional improvements. In this case, Chrin is using the TIF savings to finance the costs of an Interchange at Route 33 in Tatamy.

So what's going on?

While Chrin continues work on the Interchange and excavation at the site, between 70-75% of the tract is now under agreement to several developers, I'm told.

It has been estimated that this development will bring 5,000 jobs to Northampton County. That's why Easton Mayor Sal Panto spoke in favor of the project. "[T]he first thing we need are jobs. Everywhere I go, people are asking me for work, and I feel really badly about them. A lot of people we put out of our jails are coming back in because they can't find work."

The sole Council member to vote against it was John Cusick.

Rte 33 Interchange TIF To Bring 5,000 Jobs

Chrin attorney Scott Allinson updated Northampton County Council's Economic Development Committee last night on the progress of what is known as the Chrin TIF, a sprawling, 689-acre tract of land in northern Palmer Township, touching on 7 different municipalities. He was accompanied by Dave Colver, who chairs Palmer's Board of Supervisors.

Allinson made three points. First, there's already an agreement to sell the northwest quadrant, consisting of about 286 acres, to a national developer. Second, a study by the Dietrick group had projected about 3,500 jobs at the site, but that has now been upgraded to over 5,000 jobs. Third, Chrin will pay for a Rte 33 Interchange with bond proceeds. He assumes the risk of failure.

Without Chrin's personal investment, there would be no Interchange at all. According to Allison, the exit was not included in PennDOT's 12-year plan. Then State Senator Rob Wonderling helped Allinson break the logjam.

Dave Colver outlined the zoning overlay changes planned for the area, which I discussed last week. Those will be voted on by Supervisors on Tuesday, and will permit a 1-million square-foot big box, but only one.

According to Colver, it will be a diamond-shaped Interchange. A $33.5 million bond sale is scheduled to settle on August 15. After that, construction should start by October, with a tentative completion date of Christmas 2013.

91 acres, located near Nazareth Middle School, will remain zoned agricultural and serve as a buffer between the school and the industrial development.

Like Allinson, Colver stressed that Chrin bears the risk of failure. Palmer has already created a Neighborhood Improvement District (NID), not to be confused with a NIZ, to assess Chrin if the increased valuation in real estate is insufficient to pay the bond debt. If Chrin were for some reason unable to pay, the ultimate risk of loss would be borne by bond purchasers.

The Difference Between Chrin's TIF and the NIZ

As promised, Palmer Township's Dave Colver has sent me a plan of the zoning overlays for the massive Chrin TIF in the northern section of the Township, near Tatamy.

The 13 acres in red is the retail. The red areas on all 4 corners of the interchange are zoned that way.

The green areas provide for buildings up to 400,000 sq. ft  The pink areas allow for buildings only half that size up to 200,000. And they can fit on the proposed lots. Maximum building coverage on a lot in those areas is 40%.

The purple area, which I believe is about 275 acres, does permit a 1 million square-foot building. But because of the maximum building coverage restriction, that will be possible only on one lot.

Basically, the zones drop to 400,000 as you get close to the interchange. On the south and east sides of the interchange, they are only 200,000 sq. ft.

This development, six times the size of Allentown's NIZ, is expected to create 3,500 jobs. It will do so without diverting state taxes intended to buy medical insurance for children. It will do so without grabbing tobacco or sales taxes. It will do so without misappropriating the EIT of other municipalities. It will do so without poaching businesses from other areas in the Lehigh Valley. Developer Charles Chrin is willing to contribute up to $2 million to enable the County to preserve an acre of farmland for every one used for this development. Finally, thanks to the creation of a Neighborhood Improvement District, Charles Chrin will assume the risk of failure, and not the state.

Dave Colver: Only One 1-Million Sq Ft Big Box For Chrin TIF

Yesterday, I told you that three 1-million square feet big boxes are coming to Charlie Chrin's 689-acre TIF in northern Palmer Township.I misled you. I've since corrected by Dave Colver, the Chairman of the Township's Board of Supervisors. Instead of three, 1-million square feet big boxes, there will be just one.

Colver will make a more formal presentation to Northampton County Council later this month, but he wanted to set the record straight with me.

Last October, Northampton County approved Tax Increment Financing for 689 of nearly 1,000 acres that Chrin owns near Tatamy. Under this public financing plan, Chrin can use the increase in real estate taxes within the TIF to fund the cost of additional improvements, particularly an exit ramp off Route 33 in Tatamy, leading right into his industrial park.

Immediately after the TIF was adopted, Chrin began to market the property to national developers. There is intense interest in retail and commercial in 13 acres near the proposed Rote 33 Interchange. But Colver explained there is also interest for warehousing near an existing rail line. Warehouses are limited to 200,000 square feet under current zoning..

Palmer decided to create four zoning overlay districts on different portions of the TIF, with one segment set aside for warehousing. Under this new overlay scheme, there will be room for just one, 1-million square feet warehouse. There will also be room for one 400,000 square feet and two 200,000 square feet big boxes.

These new overlay districts will be voted on by Palmer Supervisors on June 26, and have already been recommended by Palmer's own Planning Commission, as well as the Lehigh Valley Planning Commission.

Cover told me this plan for some warehousing was already contained in the Dietrich report, which predicted that the TIF will result in nearly 4,000 jobs. He noted that the warehousing will make it easier to float financing binds at a more favorable rate.

In addition to the zoning change, Palmer Township has created a neighborhood Improvement District for the TIF. This protects the Township, County and School District if Chrin fails to attract tenants, making him ultimately responsible for the debt service on any financing.

"The developer stands to benefit, so he should take all the risk," Colver explained.  "Palmer, the County and school district can't get touched."

Colver was coaching a softball team last night, but promised to send me the plan for Chrin's TIF as soon as he can. When he gets it to me, I'll post it.

"This is not a Palmer Township thing.," he insisted  "This affects 7 municipalities."

He finally told me that he is available to anyone who has questions about the TIF.

Three 1-Million Sq Ft Big Boxes Coming to Chrin TIF

Aside from Allentown's controversial Neighborhood Improvement Zone (NIZ), the biggest Lehigh Valley development project right now is Charlie Chrin's Route 33 TIF. That's been projected to bring in 3,500 jobs.

Dave Colver is Chairman of Palmer Township's Board of Supervisors. He was the most vocal and, in my opinion, effective advocate for Charlie Chrin's Route 33 TIF. Among his arguments last September, he said this.

We're controlling the zoning. No Big Boxes. We're not gonna' see the million, two million square feet under roof, with twenty or thirty people operating forklifts so that the trucks can run around the clock and get on an interchange. Not gonna' happen. We control it.

We've got a developer who is willing to work with the Township and who is not looking for residential or the Big Box development.

That is exactly what is happening.

Colver is spearheading a change to Palmer's zoning ordinance that will provide for big boxes in the northern 200 acres of the 689-acre tract. He's doing so because Chrin is in talks with a developer who plans on bringing three 1-million square feet warehouses, with twenty or thirty people operating forklifts so that trucks can run around the clock and get on an interchange. Gonna' happen. Palmer Township controls it. A vote is scheduled for June 26.

Before that happens, Colver will have to explain his sudden about face to Northampton County Council. At this point, a cooperation agreement with the County's Industrial Development Authority still has to be executed, so this TIF is reversible.

Having those big boxes will enable Chrin to sell bonds at a better interest rate, but will the jobs promised still be produced?

According to Easton Mayor Sal Panto, another TIF advocate, "[T]he first thing we need are jobs. Everywhere I go, people are asking me for work, and I feel really badly about them. A lot of people we put out of our jails are coming back in because they can't find work."

I agree with Panto, but find it disappointing that Chrin is reaching out for the low-hanging fruit on a project in which he's marketed himself. On the other hand, Colver is a straight shooter, so I'll be interested to hear his explanation for his sudden about face.

Chrin TIF Passes Northampton County Council

Northampton County Council Prez John Cusick, who lives in Williams Township where the Chrin Lanffill is located, voted No. Ann McHale, who has a business relationship with Chrn, abstained. Tom Dietrich apparently got lost on his way to the Courthouse. But the remaining six Council members last night voted to approve a TIF, which will allow for the construction of an Interchange in Tatamy, as well as a massive 689-acre industrial park in Palmer Township. And right after the meeting, Executive John Stoffa signed an agreement with Chrin, under which the County will reap $2 million for farmland preservation.

Once again, Palmer's Dale Colver spoke in support of the TIF. "We are controlling the zoning," he affirmed, noting there will be "no big boxes." He added that this is a regional project affecting 7 municipalities. Once again, former State Rep. Rich Grucela added his support. "I've never seen a better deal. than you're getting here." he argued.

A new face joined the litany of TIF supporters - Easton Mayor Sal Panto. Although he has worked for Chrin and admitted they contribute to his campaign, he told Council he was not standing before them for his sake.

"I'm here for the residents of my City. The City needs jobs. I need  jobs for my residents and you need jobs for the County as a whole. Every day I get requests for jobs.

"We need to save our lands. I applaud what the County has done. I applaud what has been done with the $2 million that is going to be contributed. I think that's all great. But the first thing we need are jobs. Everywhere I go, people are asking me for work, and I feel really badly about them. A lot of people we put out of our jails are coming back in because they can't find work."

Cusick was upset that the agreement was finished only moments before the meeting, but it had already been signed by Chrin. He was going to offer an amendment that would increase tipping fees at the landfill, but withdrew it.

Geeting Gets Vulgar Over Chrin TIF

"I've never seen anybody else jump on a developer or politician's dick with this much gusto for a dumber project." - Jonathan Geeting

When someone with an inferior mind starts losing an argument, this is inevitably what happens. Vulgarities and personal attacks. Geeting claims to be a "public policy," economics and even a linguistics expert, but resorts to the ad hominem when his arguments fail.

Lately, he's holding himself out as an expert on Charlie Chrin's proposed TIF for the Route 33 Interchange in Tatamy. This is without having attended a single meeting concerning the project. All his knowledge must come by osmosis.

Well, I'm by no means a Charlie Chrin fan. I've attended most of the meetings concerning this project. I started off opposed. Like most of us, I'm not too crazy about wealthy people who try to get richer. I was and remain concerned about all that farmland being gobbled up and the traffic impact on tiny Tatamy. But I've been swayed. I've posted a series of blogs explaining why, but let me summarize my points here.

1) It will bring 3500 jobs. This is according to a study financed by the person taking the risk of failure, not some goofy link to some vague, nonspecific study promoting inner city development.

2) I have personal knowledge, from discussions with economic develpoment people, that businesses are already in line to into the site.

3) There will be spin off jobs in the area surrounding the site.

4) There will be tough zoning control from Palmer To, which has pledged "no big boxes. Not gonna' happen."

5) This will bring tax relief to Easton schools, Palmer Tp and Northampton County, brought about by development and expansion of tax base.

6) There is no contribution of any public money for this project, not even the interchange.

7) There is no risk by any public entity. All risk will be assumed by Chrin. If he wins, we win because we get more tax revenue down the road. If he fails, we still get what we've been getting all along.

and, finally, the icing on the cake.

8) Chrin has pledged $2 million, which Stoffa will leverage for the preservation of 650 acrse of farmland.

Angle, Chrin Swing $2 Million Deal for Farmland Preservation

The best person to send in against a bastard is always another bastard. That's what Northampton County Council decided to do two weeks ago when they went into executive session. They unanimously agreed to send their own bastard, the Northampton County bulldog, to go up against another miserable bastard, landfill magnate Charles Chrin.

Palmer Township has already voted unanimously to support a TIF for a Route 33 Interchange that Chrin wants to build next to tiny Tatamy. On Easton's school board, there was only one dissenting vote. But a TIF, which allows a developer to use the increase in real estate taxes to fund more infrastructure, also requires the County's assent.

That seems likely. The vote is scheduled for two weeks from tonight. It's hard to argue against the 3,500 jobs predicted in a study performed by the Dietrick group. Some will try, but they simply don't know what they're talking about. In addition to the study, I've talked to several people in economic development who tell me that several major businesses will definitely move in once the interchange is complete.

The downside is that, in the wink of an eye, 689 acres of pristine farmland will vanish.

All this land, and much more, was once owned by Howard Seiple, certainly the wealthiest man in Northampton County. Despite his money, he was always most at home in his dungarees, sitting atop a tractor. When he passed away, about half of Seiple's vast land holdings in four different municipalities went to the Pektors, Selvaggios and Toll Brothers of this world. They erected McMansion after McMansion, which imposes a burden both on school districts and the municipality.

No homes have been built on Chrin's 689 acres. Much of the land is still being farmed. If Charlie has a weakness, it is for farms. Bigshots like Lou Pektor liked to prance around in black silk shirts and go to WaWa in his helicopter. But people who know Chrin tell me his idea of a good time is to hop onto a souped-up tractor to plant or harvest a crop.

Like Archibald Johnston, Bethlehem's first Mayor, Chrin is a farmer at heart.. 

Developing that land with an industrial park is a Godsend to the local economy. In addition to the jobs created there and the spin-off jobs in the surrounding area, the higher tax base will ease the tax burden on schools and municipalities. Best of all, a TIF creates no risk to the municipalities involved. If the business project fails, Chrin will be on the hook, along with the businesses in the park.

Still, it is 689 acres of pristine farmland. We spend money to preserve farms, and then gobble greenfields if we think we can make a buck.

Today, Ron Angle and Executive John Stoffa sat down with Chrin. He may have Palmer Township and the school board, but he does not have Northampton County. Not yet.

What could Chrin do to make this pill easier to swallow?

Angle and Stoffa wrangled a deal that never crossed the minds of elected officials in Palmer Township or the school board. Chrin has agreed in principle to set aside 1.5 per cent of the gross sales price of each lot as sold, and create a $2 million fund for farmland preservation in Northampton County. This is still subject to final written approval.

According to Stoffa, that money will be enough to preserve most of the farmland lost. "Chrin Company's contribution of $2 million, if forwarded to the Commonwealth and reimbursed as we have in the past, would end up giving us $3.2 million. $3.2 million at present day prices would enable us the preserve 650 acres of farmland. The TIF is approximately 690 acres, which in essence leaves a 40-acre loss."

Angle joked that he and Stoffa played bad cop and good cop. Council member Mike Dowd respoded, "I know Charlie Chrin well enough to say he's probably not intimidated by a bad cop or a good cop, but this is a good deal." Council member Bar Thierry thanked Angle for his work, too.

But Angle credited Chrin. "He didn't need to do this. This is over and above anything he needed to do. This isn't a requirement, ... but one of my concerns was 400 acres of farmland [Angle believes only 400 acres is quality farmland] that now will be gone. But it would have been gone either way. It could have been gone for houses, which puts kids to schools and runs school taxes up, or we put in an industrial park, which brings in jobs and adds to the tax base. It's his land."

While Angle was making an announcement that will save farmland and help taxpayers, Tom Dietrich was busily scribbling a note to Ann McHale.

I'll tell you about that in the post below.

Do We Really Need to Give Chrin a Tax Break - Part Three

Who the Hell would endorse a tax break for a rich dude? Easton School District, Palmer Township and very soon, Northampton County Council. And they are right. Let me explain why.

Before Charles Chrin, Howard Seiple was the largest landowner in Northampton County. A farmer, his tracts extended into four different townships.

After he died, much of this property was sold to developers, who built McMansion after McMansion on what was once verdant farmland. That puts tremendous pressure on school districts, who must educate the children without getting enough money in taxes. It's also a drain on municipal government, which must maintain the infrastructure and provide emergency services to what was once quiet farmland.

Charles Chrin purchased 689 acres from the Seiple Estate. Unlike other developers, he's avoided the residential development temptation. I doubt this is altruism. Chrin knows he can make more money with an industrial park.

But it's still infinitely preferable to another housing development, or a 420-unit apartment complexe. It will increase the tax base, reducing the burden of everyone else. The Chrin TIF will allow him to defer the increase in taxes so he can use that money to finance a Route 33 interchange that will draw business.

As I've told you many times, I'm no fan of corporate welfare or Chrin. But this is no handout. It benefits everyone. No risk is assumed. In the middle of a recession, it could produce thousands of jobs.

Dave Colver, Chairman of the Board of Supervisors in Palmer Township, is the person who persuaded me that this TIF is necessary. Here's what he told Northampton County Council's Finance Committee last week.

I'm Chairman of the Board of Supervisors in Palmer, but I'm here representing all five board members. This was a unanimous decision to opt in. There was no dissension. We have been in favor of this project in general, and the TIF project all along. So all five board members are completely backing this project.


We're all in the same boat - the Township, School District and the County. We need money to operate. We can only deal with tax increases so much. In Palmer, we have looked at the north end of the Township as the way to offset some of that future tax base down the road in the future.


Let's face it, this is not a quick thing. This is not gonna' fix it in three to five years. There's no money coming off of this in the first five years. Everybody gets what they've been getting for farmland. We get about $15,000 on all that land up there. That's it. We can continue to get that $15,000, you folks can continue to get your $25,000, we can all go home and forget about it and Charlie can plant corn. Game over.


Our concerns. Zoning. Our comprehensive plan for every ten years - we're doing a new one now - past twenty years has looked at the north end development and an interchange to handle the infrastructure. We cannot develop the north end of that Township without an interchange, period. There's just no way to do it with the traffic, everything, that's needed in that area. So we have ... my successors [he means predecessors] ... I've only been there 1 or 14 years ... but my successors looked at that as the way to develop the north end. This is a way to make it happen.


The need for the interchange is imminent. The Township will not let, and the developer has pledged, no residential development, period. The Township will not allow it. We're controlling the zoning. No Bog Boxes. We're not gonna' see the million, two million square feet under roof, with twenty or thirty people operating forklifts so that the trucks can run around the clock and get on an interchange. Not gonna' happen. We control it.


We've got a developer who is willing to work with the Township and who is not looking for residential or the Big Box development.


We looked at the exposure. What exposure is Palmer Township, the County and the school district have with this? If it all fails, if it falls flat, is there any tax dollars that Palmer, the school district could be resonsible [for]? As you've heard, in the whole discussion prior to me, it's all being funded - the TIF is being funded - through the increase in the buildings. The taxes? It falls back on the Neighborhood Improvement District, which at this time is the property owner and anyone who would purchase in the future. And if that fails, it's the bondholders. There is zero risk. None. Find it, tell us what the risk is? There is none.


This is a way for all three of us to work together. It's not too often the County, the school district and the local municipality cross paths on a project that comes together to do something with zero risk for the betterment that could create two to three to four thousand jobs over the next eight - ten - twelve years.


My Board voted unanimously for it. he School District, as you heard, voted 6-1 in favor of it. I hope you folks at this Committee level, and when we get to County Council, at the County level, will see the merits of this project and support it unanimously. It's a good project. It's good for the County as a whole, and it brings jobs, it brings construction, all these ancillary things.


We're talking about 689 acres. There's another couple hundred acres outside of this district right there in Tatamy, Stockertown, Lower Nazareth, Forks. Everybody gets the benefit of this interchange.

Do We Really Need To Give Chrin a Tax Break? - Part Two

As I mentioned earlier this week, I am philosophically opposed to incentivizing economic development with tax breaks. To me, the most offensive of these giveaways is the KOZ, under which the beneficiary is exempt from virtually all taxes, excepting federal income tax. But the tax break proposed for Chrin's industrial park in Palmer Township is a less offensive TIF, which uses tax money generated by the project to fund future development.

My thinking about this TIF changed during a public meeting in which Northampton County's Alicia Karner made a power point presentation, which was followed by comments from numerous individuals who support this project. Most persuasive, at least to me, was Palmer Township Supervisor Dace Colver.

Before getting into what Colver said, I want to share Karner's power point presentation, which lays out the nuts and bolts concerning this proposed TIF.
Chrin TIF Power Point

Do We Really Need To Give Chrin a Tax Break? - Part One

Charles Chrin is definitely the smelliest person in Northampton County. He's worse than me! Driving by his landfill is always a treat, especially on a hot Summer day. It's just agreed to pay a $114,000 fine to the state DEP because, basically, it stinks.

In addition to being smelly, Chrin is definitely the largest landowner in Northampton County and he's probably the richest, too. So naturally, people hate his guts. He could probably get away with stinking up the place, but none of us like people who have more money than the rest of us. You could say we're all socialists at heart, but I think we're just jealous. Chrin can donate land for Williams Township football fields and community centers bearing his name, but nobody really likes the guy.

He might be a gazillion years old, but he's still going gangbusters on getting as much money as he can before he dies. His latest venture? Ripping apart over 600 acres of greenfields in northern Palmer Township with a humongous industrial park. And because that park will result in lots of heavy truck traffic, he wants on Interchange off of Route 33, right around Tatamy.

Now Chrin originally promised to foot the bill the $25 million plus bill himself, but he now wants to finance it using tax money, with a TIF. Sounds outrageous doesn't it?  That has to be approved by the host municipality, school district and County. It passed unanimously in Palmer Township, had only one dissenting vote on the Easton School Board and looks like a winner in Northampton County.

This is exactly the kind of project I love to rip apart. Corporate welfare, I scream. Good ol' boys taking care of each other, I complain. Nobody listens.

I went to a Finance Committee meeting last week, expecting to have my usual opinion confirmed. Instead, I was persuaded that this proposal is actually a very good idea. I was impressed by the presentation made by Northampton County's Alicia Karner, as well as the comments of former State Rep. Rich Grucela (he must be getting paid by Chrin) and Palmer Township Supervisor Dave Colver.

I'll explain why, despite my natural hatred of anyone who has more money than me, this is a good idea. But before I do that, I'll note the excellent argument against this idea by Frank Castrovinci, the sole Easton School Director to say No.

My name is Frank Castrovinci.  I am a Controller at a local company, and was recently appointed as a director on the Easton Area School Board. I apologize for contacting you at your personal e-mail address, but I have an important message as a resident of Northampton County that I hope to draw attention to.

The Easton School Board was presented with the TIF proposal for the Rt. 33 Interchange at Main Street in Palmer Township on August 18.  The proposal was approved 6-1, and I was the dissenting vote.  I am writing to you because there are a number of issues that I believe many are not considering with this proposal, and I wanted to contact the county council to highlight these concerns.

1.       TIF financing should not be used for projects that would go forward without the incentive.  On this project, the developer was intending to pay for the cost of the interchange prior to the cost increasing given the need to replace a bridge.  Porsche chose to be located in the same industrial park as the land that will be within the TIF disctrict after screening greater than 50 sites, and Majestic has a large facility in this general area, all without the interchange.  I understand that at full development an interchange at Main Street would be beneficial, but given the developer’s original plans and apparent attractiveness of this location, I do not believe a TIF is warranted for the full funding of this project.  I questioned this during the presentation to the school board.  The reply was that the cost of the interchange increased, and without this financing the developer would need to front the cost of the project.  This was their plan prior to the bridge replacement requirement.  A reasonable (and logical) request would be for the cost of the bridge to be covered by the TIF plan.

 

2.       The two existing TIF districts in Northampton County are excellent examples of the use of TIF financing.  Both are at locations that would likely have not been developed without the financing.  I am not sold on the fact that this is the case for the Rt. 33 Interchange proposal.

 

3.       The presenters of the proposal draw attention to the Dietrich Group study and the potential payout to the taxing authorities if they agree to the plan.  They also state there is no financial risk to the taxing authorities.  In my view, the issue is how much the taxing authorities should be willing to give up to pay for the interchange.  If the economics of this industrial park at full build out as projected by the Dietrich Group are sufficient for the Chrin Company to finance the interchange, an incentive of the magnitude they are requesting should not be provided. The bridge is deficient and should not be the cost of the developer, and something we should consider assisting with.

 

4.       The developer has some exposure to cover cost of the interchange through the Neighborhood Improvement District that will be in place for this location.  My understanding of this concept is that there would be an additional assessment made on property owners within the TIF district if the development has not been sufficient to cover the cost of the loan.  As the developer would be one of the property owners, they would be liable to kick in some funding to cover the shortfall.  In my view, if the developer is willing to do this, they should be willing to pay some portion of the interchange cost up front, allowing the taxing authorities to receive a higher amount of the taxes to be collected from this industrial park, and alleviating some of the burden placed on our existing taxpayers.  I am not aware of any effort to negotiate a more equitable proposal.

 

5.       The Chrin Company will be pricing this land at the market, and will seek to undercut the competition by just enough to attract prospects to their industrial park.  They in effect will control how much of this incentive is passed through to companies considering property in this area.  This gives me a high degree of discomfort, and translates into a huge potential windfall for the developer rather than an incentive to attract high quality jobs to our area.

 

6.       The magnitude of this incentive is excessive given the lack of definition around the companies and jobs that will be located in this industrial park in the future.  Palmer Township’s claim is they will not allow large distribution centers to cover this land, though as we see the Lehigh Valley is popular for these types of facilities.  Though this area appears to be promising, I am concerned about offering an incentive of this magnitude for jobs that are not defined.  If the next Olympus was moving into the Lehigh Valley, I would likely be agreeable to including an amount above the cost of the bridge in the TIF financing plan, if that is what it would take to close the deal.  This is not the case for this proposal.

 

7.       I have read that some counties have ceased allowing TIF financing for greenfield sites, as this financing was intended to cover blighted areas as defined by the Urban Redevelopment Law.  Allowing TIF financing for greenfield sites has the opposite effect of what I believe the true intent is of this legislation.  The definition of blight is so broad that it appears almost anything can be considered blighted property. We must limit offering this type of financing on projects such as this, and reserve it for properties that are truly blighted, as the county has in the past.

I respectfully request that you consider these points as the TIF financing plan is presented to yourself and the rest of the Northampton County Council.

Windfall Deal Struck on Artsquest TIF

Northampton County Council last night approved a deal that will allow the Bethlehem Redevelopment Authority to float $28 million in bonds for the development of the long-awaited "21st Century Town Square," a venue on the Bethlehem Steel brownfield that will host as many as sixty free, family-oriented, concerts every year. In return, Bethlehem, Northampton County and Bethlehem Area School District will get 35 percent of the increased tax revenue generated by new development.

Under the current, 20-year TIF, which was first negotiated in 2000, these taxing bodies only got 15% of the increased tax revenue.

Under a deal brokered by Northampton County Council Prez Ron Angle in August, the Redevelopment Authority agreed to relinquish 30% if taxing bodies agreed not to sue. Bethlehem Area School District, which came late into these negotiations, held out for another 5% and more money up front.

Under this deal, which is still in draft form, Northampton County ($519,000), Bethlehem ($677,000) and the school district ($2 million) will all get a healthy injection of cash.

Lamont McClure and Ann McHale incredibly voted No to this windfall. McClure felt they should wait until the agreement is in final form, even though the Authority intends to float the bonds before the next council meeting. McHale balked at language in the agreement providing for litigation in the event the Authority issues binds without an Agreement in place.

This draft also gives Angle the right to sign off on last minute changes, and McClure objected to that as well.