Some officials fear Scranton School Board vote on KOZs will hurt city
Published: June 30, 2009
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share thisThe undeveloped site of the future Mount Pleasant Corporate Center puts $1,850 into Scranton School District coffers each year.
If fully developed, the site may generate as much as $400,000 to $500,000 a year in property taxes for the school district, the Greater Scranton Chamber of Commerce estimates.
But the school board's 7-2 vote to deny the property KOZ tax-exempt status puts those future tax dollars in question, said Austin Burke, president of the chamber, which is investing $7 million to develop the 23-acre, former brownfield at West Linden Street and North Eighth Avenue.
"There's disappointment. We had a great strategy and a great game plan," Mr. Burke said Monday.
On Saturday, the school board denied six KOZ designations or extensions that had already been approved by the city and county. All three taxing bodies must approve KOZ status.
Other abatements not approved were for Ice Box developer Bob Burke, Donald Rinaldi of the "Renaissance at 500" project on Lackawanna Avenue, Dominick and Carl Scartelli, and Village at Tripp Park property owners Roger Leonard and Brian and Kris Kizer.
Health center OK'd
The only KOZ status approved by the board was the Green Ridge Health Care Center's new assisted-living facility, which passed on an 8-1 vote, with Director Todd Hartman dissenting.
Without the business park having tax-exempt status, a prospective tenant may be more likely to go outside the city to a KOZ property, Austin Burke said.
On Monday, he received a letter from the state informing him that the Valley View Business Park's tax-exempt status has been extended through 2019, a move made possible by approval from the boroughs of Jessup and Archbald and the Valley View School District.
Companies looking to move to Scranton may instead go to the Mid Valley, where they would not have to pay state or local taxes for 10 years, Mr. Burke said.
"We may not get those jobs for the city of Scranton," he added.
Many school board members have said they do not think KOZ properties necessarily bring jobs to the area, and that the status offers little benefit to the district.
Board 'blew it'
Director Kathleen McGuigan, who with Director Bob Lesh was one of the two votes for the Mount Pleasant KOZ status, said the board "really blew it."
At Saturday's meeting, Mr. Burke offered to offset the loss of taxes with a $50,000 payment.
The district's solicitor, Harry McGrath, said that was not legal.
If the district gave up the property tax, the eventual results would be more tax dollars for the district, Mrs. McGuigan said.
"The best way we can help the individual taxpayer is to attempt to expand the actual tax base," she said.
Another developer is also uncertain of the future of his project.
Bob Burke, owner of the Ice Box Sports Complex, who plans to develop the property in front of the complex, said it will be "certainly harder" to attract tenants.
The vacant land, which had its KOZ status denied 8-1 by the board, could be used by a restaurant and other commercial tenants, he said.
"We're still going to try," he said. "What can I say? It is what it is."
Contact the writer: shofius@timesshamrock.com
19 posted comments
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