Lebanon County Commissioners approved a resolution Thursday to provide tax abatement for the rehabilitation of commercial properties in Myerstown Borough via the state’s Local Economic Revitalization Tax Assistance Act (LERTA) program. The resolution passed by a vote of 2-1.
Although the borough and Eastern Lebanon County School District had approved both residential and commercial properties within borough limits to have access to LERTA, the county commissioners approved tax relief only for commercial properties.
In stating her opposition to the resolution, commissioner Jo Ellen Litz cited the low threshold of only $10,000 for a business to participate, which she said would create a “bookkeeping nightmare” for county officials and was unfair to other businesses who have already made capital expenditures to improve their properties.
“First of all, I see it as a domino effect on other boroughs and even the city, and that means they could all come in to us and request that every commercial property within their district becomes a part of the LERTA for $10,000,” Litz said. “That’s not a big improvement. That could be just a roof.”
If that were to happen, it would have a ripple effect on the county, Litz said. “That, then, in turn, will transfer the tax burden to all of the residents in all of the townships in this county.”
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Litz also noted the massive workload that would be created as a result of so many businesses seeking tax relief as part of rehabilitating their commercial entities.
“There is a nightmare of bureaucracy and record keeping for our assessment office in this proposal,” Litz said. “I don’t know that they’re getting reimbursed for all of that extra work, and I don’t think it is fair to them.”
She said she hasn’t heard from business owners for their input on prior work that they’ve already done on their properties.
“I did not hear from the businesses that they have changed their minds, the ones who have invested downtown, the ones who are successful downtown and the ones who have already spent tons of money, to allow others to get a tax break when they didn’t,” Litz said. “It’s just overwhelming and I’m not ready to support this.”
Commissioner Bill Ames stated he had some confusion with the proposal early on because he was led to believe that it included the entire borough, meaning residential properties could get tax relief, and that he is opposed to including personal residences in the county’s LERTA agreement.
Michael McKenna, Myerstown Borough Manager, said Ames was correct in his understanding that the borough and school district had passed, in 2017, an ordinance and resolution, respectively, to include all properties within the borough regardless of their zoning designation.
“If the county were to pass a resolution, for example, if you specify that only commercial properties would be involved in the county resolution, then that’s how it would go forward,” McKenna said. “If a residential property wanted to do development, they’d get the abatement from the borough and from the school district but not from the county.”
To help clear confusion, Chief Clerk/County Administrator Jamie Wolgemuth read the proposal, which states: “Authorizing the granting of tax exemptions on the assessed value of certain improvements and new construction to industrial, commercial and other business properties in an area of the Borough of Myerstown.”
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Although LERTAs exist for tax abatement on existing properties that are to be revitalized, the resolution, as read by Wolgemuth, does not address whether a business could add new construction to existing structures and receive a LERTA or if the county’s participation is strictly contingent upon rehabbing current buildings.
The agreement by the county to participate with the borough and school district brings to a close an initiative that began in 2012, according to McKenna.
Although he’s only been with the borough for five years, he noted that the borough developed in 2012 a comprehensive plan to make redevelopment and revitalization a priority within Myerstown. McKenna noted the plan was developed and paid, in part, via available funding through the 2007 county comprehensive plan update.
“That was the catalyst to engage Myerstown residents and taxpayers to come to a consensus on a future vision for Myerstown Borough that was really developed around what the community wanted,” McKenna said, “and the community really wants revitalization and redevelopment. One of the common themes that was heard was that the borough has seen a decrease in investment over the past few decades.”
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“The community made it clear that they wanted to see an increase in the level of investment and an increase in the level of business presence,” McKenna added. “Historically, there has been a high business presence in the downtown of Myerstown and the area throughout the borough, really.”
An economic development study was commissioned in 2013 to look for economic development opportunities and to explain why there had been a lack of development and investment in the borough, McKenna added.
According to McKenna, the study concluded that the primary reasons for the lack of investment were the financial hurdles of redeveloping land and older buildings — and the fact that there aren’t many incentives for development.
“One of the recommendations that came out of that study was for the borough to put into place a LERTA district to help incentivize development and redevelopment of the older buildings and the underutilized properties,” McKenna said.
Release of the study was followed by public meetings to disseminate information and gather input from the community to see if there was community support and to determine the district’s boundaries and who would be eligible to participate.
The community agreed that the LERTA should include projects over $10,000 on all properties within the borough boundaries and result in an increase in the assessed value of the properties.
McKenna added that an individual LERTA period would last seven years, with 100 percent abatement in the first year, 90 percent in the second year and 15 percent more each subsequent year up to year seven.
In other county business Lebanon County Christian Ministries executive director Bryan Smith requested approval of an agreement with the county so the agency can receive surplus food via The Emergency Food Assistance Program (TEFAP) as administered by the federal government.
After the commissioners unanimously approved the agreement, Smith provided a program update, adding that the agency has had to pivot its response to the community need due to the COVID-19 pandemic.
“We have been given a waiver from the Pennsylvania Department of Agriculture from our congregate setting, where individuals were required to receive the food, partake of the food and not take food off the premises,” Smith said. “With everything going on, we’ve been doing that in a grab-and-go format.”
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Bryan added the need for food assistance from county residents has increased by about three-fold from its pre-COVID total until August 5th.
“We’ve seen a pretty significant increase in the numbers that have been attending the noon meals,” Smith said. “We had been averaging about 100 guests a day, but we’re now at 230 to 240. Yesterday, we were at 270 guests.”
Smith noted the agency has been blessed with an increase through COVID CARES funding, which is only for food, totaling $143,803, of which $11,500 is earmarked for administrative expenses. The agency was allowed to backdate that to March 2020, which covered some costs for the previous fiscal year. The funding must be spent by the end of the year.
“I can tell you that what we are observing right now, particularly with the amount of food going out through the noon meal, that we will certainly spend that as we work with our partners in the community to see that their needs are met as well,” Smith added.
He said that, for now, distributions through the food pantry are down and believes that is because unemployed families are currently receiving assistance through the Supplemental Nutrition Assistance Program (SNAP) as part of their unemployment benefits. He said he believes the pantry will see an increase as people’s unemployment benefits expire.
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