Lebanon County Commissioners on Thursday approved a 10-year LERTA tax abatement for a planned 92-unit luxury apartment building in Palmyra.
The abatement means Philadelphia-based Ventura Real Estate Holdings will not have to pay any property taxes for seven years. In the eighth year they will pay 25 percent of their taxes, 50 percent in the ninth year, and 25 percent in year 10.
LERTA, or Local Economic Revitalization Tax Assistance, is a state program that allows local tax authorities to create tax exemptions for the redevelopment of blighted buildings. The property that was granted the abatement by the commissioners is in the 100 block of North Harrison Street at an abandoned factory that’s been deteriorating for years.
Ventura owner Jack DeCicco said he has the full support of Palmyra Borough Council but is still seeking approval of the Palmyra school board – which decided not to make any decision at a mid-August meeting of its finance committee.
“The first thing I’d like to say there is an ongoing dialogue with the school board – with a key member of the school board, so that’s positive,” said DeCicco.
DeCicco noted “nice things” like luxury apartments costs money and added that inflation has driven up the projected cost of the project, which makes full LERTA support from all three local taxing agencies a necessity if the project is going to proceed.
“Building a luxury product at the site is more of a really-nice-to-have than a necessity, and just like anything else in your life that’s a really-nice-to-have comes with a price tag,” added DeCicco. “It just so happens that in today’s environment, that price tag is 30 percent higher because of where we are with inflation and costs. When you run the numbers, no matter how you slice it, if you want to bring a true luxury product to Lebanon County in Palmyra, you really can’t do it without all three of the taxing authorities supporting what’s in front of you today.”
DeCicco said a similar project built in proximity to his was granted a LERTA.
“Your competitor paid 30 percent less to make the same building and they are still operating under a minimum six-year, 100-percent LERTA, which means they don’t have the tax expense that I would have in the absence of this LERTA,” said DeCicco. “The LERTA really levels the playing field and without it, a luxury product can not be competitive.”
DeCicco explained that in a competitive real estate environment the firm with a LERTA could charge less because their costs are lower than the company without one.
Commissioner Jo Ellen Litz said she did not agree with a lot of what DeCicco had to say. She did note that she would be more prone to support the LERTA if he opted for one that was good for five years instead of 10.
“I think asking our taxpayers to foot the bill for 10 years is not fair to our taxpayers,” said Litz. “The school district and the municipality are fortunate enough to at least get an earned income tax, the county does not get that.”
Litz cited recent increased costs to provide mental health, drug and alcohol, and 911 services, among others, as having placed a financial burden on county coffers.
“The taxpayers who live throughout the county, really, and especially Palmyra would be picking up the tab for all those services for 10 years – seven at 100 percent,” said Litz. “And it just doesn’t feel right, Jack. If you were willing to go five years with a declining percentage, I would be interested but not under the terms that were presented.”
Commissioner Mike Kuhn said while he appreciates Litz’s concerns, he views the LERTA as benefiting the county over the long term.
“Yes, we would forgo some of the very important tax revenue to the county, but I see the long-term benefits of the increased value of that property and the increased value to that part of the community to outweigh those in my mind, so I am going to support it,” said Kuhn.
Commissioner Chairman Robert Phillips cited several reasons he supports the LERTA proposal, including enhanced public safety in the neighborhood.
“I think the other thing that hasn’t been mentioned, at least today, is the public safety benefit, you know, saving that neighborhood from the blight that’s there and also the toxic issues that you’ve eliminated,” said Phillips. And the endorsement of the borough – they’re the closest government to it. And they’ve fully endorsed this. In fact, they went to the school board meeting on your behalf, unsolicited.”
Phillips added that while the county is receiving $500 in taxes annually from that property now, it would increase to about $20,000 seven years down the road.
Litz corrected Phillips, saying the county would receive $922.50 per year if the LERTA is approved, to which DeCicco replied that Litz is correct. DeCicco said the tax doubling to that figure is fully attributable to the increase in the property’s land value.
“I guess if you never showed up on our doorstep, we’d (still) be getting $500,” replied Phillips to DeCicco, prior to calling for a vote.
When Phillips called for a motion to approve the project, Kuhn approved the motion but Litz refused to second it. Phillips seconded the motion and the vote was then 2-1 to approve the LERTA for 10 years.
In other county business, the commissioners voted unanimously to:
- Award a contract for the new 911 center communications tower in the amount of $74,487 to Daley Tower Service of Louisiana. The other bid was from Sabre Industries of Texas in the amount of $119,101.
- Approve a funding request from the Lebanon Coalition on Homelessness to conduct a homeless study throughout the county in the amount of $45,000, which is 75 percent of the overall project cost. Lebanon city is slated to pay the remaining 25 percent of the cost, or $15,000. The project was awarded to Ohio-based Bowen National Research with a projected completion date eight months from the time the contract is signed.
- Renew the Medical Director Service Agreement with UPMC Primary Care, Fredericksburg, for the Renova Center in the amount of $1,090 a month for Dr. Shelby Morgan. The renewal is retroactive to July 1.
- Give permission to add Mayor Sherry Capello, Amanda Hitz and Susan Wright to the administering board of Lebanon County Community Action Partnership. Each position is for a three-year term, expiring at the end of December 2025.
- Provide a proclamation recognizing Chris Smith for 30 years of service with various local community service organizations that work to empower children.
- Authorize a one-time payment of $4,000 to county correctional officer Jonathan Bell for 40 years of service, effective Sept. 8. Phillips said he believes this is a county record for longevity.
- Sign an agreement with Chocolate Workers 464, who represent the telecommunicators in the Department of Emergency Services, to memorialize their collective understanding to temporarily adjust the training model and compensation under Article 5 of the collective bargaining agreement. The agreement will remain in effect until 24 of the 28 full-time positions are at least two board certified and there are enough available communications training officers to continue to train new employees and existing staff.
- Grant real estate tax exemptions for two fully disabled veterans.
- Approve the minutes of its Aug 18 meeting, the treasurer’s report as presented and various personnel transactions.
Following his presentation of the cell tower bids, Lebanon County Department of Emergency Services director Bob Dowd highlighted the drought watch that was issued Wednesday for 36 of Pennsylvania’s 67 counties, including Lebanon County.
The Department of Environmental Protection notice asks residents to conserve water given the lack of rainfall in much of the eastern part of the state. Dowd said he wants to raise public awareness about the need to conserve water during this extended dry period.
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