Statement from Ronald Graham’s campaign on LERTAs
Ronald Graham for the 155th: campaign statement on LERTA
In Lisa Longo’s recent legislative update, she condemns LERTAs as “corporate tax welfare.” This slogan has a certain bumper sticker appeal, but does not comport with the reality of the LOCAL ECONOMIC REVITIALIZED TAX ASSISTANCE program. To begin with, LERTAs are implemented to rejuvenate blighted, usually industrial or commercial properties, and thereby improve the productivity of the site.
With modernized use of the blighted property, the aesthetics, the tax base, and the employment capacity of the community are improved. By way of example, I call your attention to Westside Apartments and Shopping in East Pikeland Township.
The Westside site was a severely polluted, dilapidated former car dealership, which had fallen into a multi-decade decline, to eventual, terminal disrepair and mortgage foreclosure. As a result of the LERTA, approved by the Phoenixville School District and East Pikeland Township, and applied to the multi-use zoning on the Rt. 724 corridor, developer Longview worked with the Township Planning Commission and the Board of Supervisors to craft a project that cleared all of the environmental hazards. The plan provided for 20,000 square feet of commercial space and 171 apartments, none larger than two bedrooms, so as to limit the student impact on the school system. The construction is now nearing completion.
Prior to the current development, the property had an assessed valuation of $534,630 and produced a school tax of $15,589.81. Under the terms of the LERTA, the property remains at the pre-improvement assessment ($534,630) producing $15,589.81 per year until the final occupancy permits are issued by the Township. At that time, the property will be reassessed. The developer estimates the value of the project at approximately $35,000,000. That being the case, Westside’s normalized tax will be $1,020,600 per year. Due to the provisions of the LERTA, the actual tax paid will increase from the current $15,589.81 by 10% per year of the new assessed valuation level for ten years, until the full tax is being paid annually.
As a result of the East Pikeland LERTA, as estimated herein, the School District will receive $5,455,402 more in tax revenue over the next ten years, from this property than would have been received without the LERTA.
This is the kind of corporate welfare I support. Maybe Ms. Longo had a better plan for this property, and others similarly situated. If so, please share it with me.
Candidate for State Representative, Pennsylvania District 155
(Please note: publication of this article does not constitute an endorsement by the NCCDC)