Bethlehem Area School Board to approve extension of Southside tax-incentive program

Written by on September 20, 2022

Bethlehem Area School Board to approve extension of Southside tax-incentive program

By Sarah Mueller
September 20, 2022

Bethlehem Area School Board is poised to approve extension of a Local Economic Revitalization Tax Assistance zone in Southside Bethlehem.(Photo| Wikimedia Commons)

BETHLEHEM, Pa. – Bethlehem Area School Board is poised to approve extension of a Local Economic Revitalization Tax Assistance zone in Southside Bethlehem.

The current LERTA, established in 1991, is set to expire at the end of the year. The program is targeted at redeveloping deteriorated properties and making them contributing parts of the local economic tax base.

It offers developers a tax abatement, eliminating any taxes in the first year, and after that levying 10% of taxes each year until, after 10 years, it becomes 100% taxable.

City officials gave a presentation to the school board at a committee meeting Monday. City council last month approved the Southside LERTA extension to December 2027.

The proposed LERTA extension would reduce by 85% the acreage covered by the zone, and focus on the development of remaining former Bethlehem Steel properties.

It includes a provision that mixed-use projects with 10 or more residential units must devote 10% of those to be affordable housing or contribute $52,320 per unit.

That’s double the contribution amount suggested earlier this year. The original one-time fee amount raised concerns among some city council members as too low.

Affordable housing is defined as tenants paying just 30% of their income on housing.

Laura Collins, Bethlehem’s director of community and economic development, said if the developer decides to write a check instead of adding affordable housing, the money goes to the city.

“There is benefit to receiving the payment in lieu of as opposed to the affordable in the buildings themselves because it goes into a housing fund that is administered by the city,” she said.

“Which means that we can take those funds and add them to our larger affordable housing initiatives.”

A city interoffice memo from June said the LERTA extension also would aim at a possible expansion of existing businesses within the industrial areas and target properties in central business and limited commercial zoning districts.

But the school district removed an amendment in which environmentally friendly designed projects were incentivized under the proposal by adding another abatement.

School board Chairman Michael Faccinetto expressed concern about that amendment to the project.

“I don’t believe, however, it is our duty or our lane to be in to dictate what developers in the community do,” Faccinetto said. “I think that’s the role of the city. It’s very appropriate the city council put this in there.

“But from my perspective, I would encourage us to omit the LEED part of this and just approve it with the other two amendments.”

The other amendment increases the responsibility of the LERTA property owner to make payments on time.

If the school district approves the LERTA extension at its Sept. 26 voting meeting, the proposal would head to Northampton County Council for a vote.

In another matter, the school district also will vote at that time to increase the pay for school crossing guards to $15 an hour. The school district and city of Bethlehem split the wage cost.


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