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Criz presentation to did merchant committee 3 19-14

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Criz presentation to did merchant committee 3 19-14

  1. 1. Lancaster City Revitalization and Improvement Zone Program
  2. 2. • Purpose of the Program – Provide a financial resource to eligible third class cities in the Commonwealth to improve and develop targeted areas of the City • Lancaster’s Approach – To focus on infill development on vacant and underutilized sites, and the redevelopment of existing challenging sites within the City which have some barrier to development.
  3. 3. • Program administration – The City has created a CRIZ Authority under the auspices of the State’s Municipal Authorities Act to administer the program – The CRIZ Authority has established the CRIZ District of just under 130 acres – The CRIZ Authority will manage the program and will be the entity that will issue bonds to provide project financing or act as a pass through of state revenue to a project to pay debt service on a loan
  4. 4. • Eligible Taxes That Generate CRIZ Revenue – Corporate Net Income tax (apportioned) – Capital Stock and Franchise Tax (apportioned) – Bank Shares Tax (apportioned) – Sales and Use Tax (related to activity in the CRIZ) – Personal Income Tax (for work performed in CRIZ) – Tax on sales of liquor, wine, malt and brewed beverages in the CRIZ (tax paid to the LCB by businesses) – Local Services Tax (for work performed in CRIZ) – Local Earned Income Tax (for work performed in CRIZ)
  5. 5. • Uses of CRIZ proceeds – Development or improvement of property within the designated CRIZ – Construction, including infrastructure and site improvements to a site or facility within the CRIZ – Improvement projects including the acquisition and installation of FF&E for a facility owned by a public authority, such as the Lancaster County Convention Center
  6. 6. • Project Financing Focus – The financing provided will primarily focus on assisting projects that will: • Create new jobs • Create new state tax revenues including sales and use taxes; personal income tax; wine, liquor and malt beverage taxes; a number of State corporate and business taxes; local earned income taxes and local services taxes – Property Taxes are not included and we would anticipate that properties receiving CRIZ Assistance would not be eligible for property tax abatement programs
  7. 7. • How does it work – The State has established our baseline year as 2013. This will determine the amount of existing state and local tax revenues generated by qualified businesses within the CRIZ. – Eligible CRIZ revenues will then be those that exceed the level of revenues generated in the baseline year by each qualified business located in the CRIZ – CRIZ revenue is made available for payment of debt service on eligible projects or for public improvements related to a private development project – Matching funds must be provided in a ratio of no less than one private dollar invested to every five CRIZ dollars
  8. 8. • Limitations – Eligible tax revenues generated by an existing Pennsylvania business that transfers into the CRIZ would not be considered new revenue, these revenues are added to the baseline – Businesses that are new businesses or relocating to the CRIZ from outside of Pennsylvania will be considered new revenue – For existing businesses in the CRIZ, only those tax revenues generated that exceed the revenue generated in the 2013 baseline year will be available to the CRIZ Authority
  9. 9. • Where we are today – Developing a list of businesses that are located within the CRIZ areas which must be submitted to the State by June 1, 2014 – Developing an outreach and education program for those businesses and properties owners located within the CRIZ area – Engaged a consultant to work with businesses on tax reporting requirements. Tax reports must be submitted by June 15, 2014 – Establishing Financing Guidelines and Fee Structure
  10. 10. • Where we are today – We have defined some of the initial projects that may be financed • Conestoga Plaza Commercial Project • Convention Center FF&E • Lancaster Square (east side) including the Bulova Building, the plaza area, the Hotel Lancaster property and the Annex buildings • Aquatic Center at Burle • RRTA Air Rights above the Garage on North Queen and East Chestnut • Kepple Building in the 300 block of North Queen
  11. 11. • Benefits to the City – Ability to reposition and redevelop properties that have sat vacant or underutilized for a significant period of time, i.e. east side of Lancaster Square, Conestoga Plaza, 800 block of North Prince Street – Equalize the economic disadvantages of developing in the City vs. the suburbs – Job growth and retention of existing jobs by providing Class A and B commercial office space for new businesses, relocating businesses or expanding businesses
  12. 12. • Benefits to the City – Opportunity to recruit new businesses to the City – Increase job opportunities within the City for City residents through recruitment of businesses that create professional job opportunities – Grow the property tax base through increased assessment of properties that are redeveloped or vacant sites where new construction occurs – Grow earned income tax revenue over the longer term
  13. 13. Contact Information: Randy S. Patterson, Director Economic Development & Neighborhood Revitalization City of Lancaster 120 North Duke Street P.O. Box 1599 Lancaster, PA 17608-1599 Tel: 717-291-4760 Mobile: 717-201-7498 Fax: 717-291-4721 Email: RPatterson@cityoflancasterpa.com Website: www.cityoflancasterpa.com

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