Corporate Welfare

Last night at the township BOC meeting one colleague fellow Commissioner Ryan Conrad asserted that participating in the TIF is not “corporate welfare”.

It’s important residents understand where Commissioners stand on issues. This issue in particular outlines stark philosophical differences and approaches to land development, development subsidies and who should shoulder the costs of impacts both immediate and projected. Therefore it’s crucial residents understand very clearly without semantic interference where each Commissioner stands. Every four years we receive a job review in the form of an election. Therefore, I would be remiss if I didn’t clearly state that I fundamentally disagree with Mr. Conrads assertion in the strongest of terms. 

“Corporate welfare” in this instance has been used as a rallying cry for residents who by and large support the project but without the 20 year tax forfeiture. Some institutional supporters have tried to use semantics and word games to insist this doesn’t qualify as corporate welfare or that the townships decision on participating in the TIF could somehow derail the project. This is a disingenuous game and unfair to residents.

The facts remain:

1. If Lower Macungie participates in the TIF 50% of the developers incremental taxes will be siphoned away from the township.

2. The money instead is siphoned back to the developer and other private interests through LCIDA where it would be used to pay back construction bonds for basic improvements that are required of all developers seeking to do business in the township.

3. With this TIF, tax money is forfeited and instead used to pay for what otherwise would be the responsibility of the developer. In other words the normal costs of doing business. Infrastructure costs every other developer has to pay for themselves. In this case it is the bare minimum infrastructure improvements required by Penndot to build a shopping center of this magnitude.

4. The bottom line is that this mechanism pads the developers bottom line. TIF will increase profits of private business interests and decrease the return received by taxpayers. It is preferential treatment for one chosen business. It is a subsidy of both of the sellers flawed piece of land and of the buyer. It is a distortion of the market that will hurt other local businesses.

5. While you can argue that creating the TIF district could pull the plug on the entire TIF, (including the school district) the townships participation (remember they are 2 separate ordinances and two separate votes) is purely symbolic and will have absolutely zero impact on the developer building the project. In other words, with or without the township participating in the TIF this shopping center is coming. This is a certainty. I can’t be anymore clear about that. There have been attempts to blur this line. 

Lower Macungie’s participation in the TIF is giving one developer receiving special treatment for purely symbolic reasons. We are a relatively affluent township with a healthy and robust economic climate, therefore TIF is unnecessary and borderline egregious to even consider.

A vote for the TIF is a vote to take money out of the pocket of Lower Macungie residents and funnel it to private interests over a 20 year period. This is compounded by the fact some Commissioners seated on this board just recently voted to raise taxes.

If any Commissioner believes this is the right thing to do, then they should stand by that decision and not try to rationalize it by making statements like “The developer still pays 100% of it’s taxes” while ignoring the fact that half those taxes are siphoned away from the township back to the developer by padding their bottom line through the Lehigh County Industrial Authority. The other misleading notion I’ve heard is no “corporation is receiving a direct subsidy. Last time I checked TCH development and The Goldenberg group are in this to make money. They are indeed both private businesses who will benefit from TIF subsidy in terms of increased profits. No, the “nameplates” Costco and Target aren’t the direct beneficiaries but they are indirect beneficiaries. No matter how to slice it private interests are the gov’t sponsored winners in this shell game and taxpayers and other local businesses are the losers.

 

Guest blog – Jim Palmquist: Walk this way: Lower Macungie becoming pedestrian friendly

The following was submitted by Jim Palmquist the chair of the LMT walkways group. You can view the website here. It also appeared as an op-ed in The Morning call.

Surprise, surprise. Lower Macungie Township, the place where almost everyone drives wherever they go, has a major section that is almost completely walkable. About a quarter of Lower Macungie residents live in a walkable community! Who knew?

Lower Macungie is a place where thousands of people can walk or ride bikes on walkways to a drug store, grocery store, state liquor store, medical and dental offices, banks, churches, convenience stores, restaurants and other merchants and services.

walk way

 
But wait, there’s more!. Continue reading

Got a phone call from owner of a business today….

Got a phone call from a business owner today. He owns a business in the Giant shopping center. I will let them name their business should they choose to if they publicly address the Lower Macungie BOC which I encouraged them to do. If you have been following this issue for awhile they attended a county meeting and spoke out.

They honestly believe their small business will absolutely be hurt by Hamilton Crossings. When you own a small eatery in a shopping center you count on foot traffic to drive customers into your place of business. The “Giant shopping center” is located just blocks away from Hamilton Crossings and is clearly struggling.

Now please understand one thing. And this is my opinion but I think the business owner shares it. Competition is one thing. Business owners accept this. As a township Commissioner I encourage it. It’s survival of the fittest thing. The problem is when the playing field is skewed. Plain and simply TIF’s when abused and utilized in a community that isn’t distressed disrupts the free market. Utilizing this TIF in this area where an existing inventory of businesses have not benefitted from the same treatment will hurt other business owners. Many small businesses in the “Giant” shopping center will now have to compete with potential new business in a government chosen shopping center on an uneven playing field. At least one owner is certain this will hurt him and his employees.

Does anyone out there believe that this is fair? If so I’d love to hear why.

Competition is a fact of life for small business. It leads to more options and better pricing/service. When this happens the consumer wins. My problem is it’s fundamentally unfair to choose the winners with this kind of government intervention in a community that isn’t distressed. Hardworking people will be hurt by this TIF. Does anyone out there believe Lower Macungie is a distressed economy?

Above is a picture of 5 empty storefronts in the Giant shopping center. This is just one corner. In total there is over a dozen vacancies.

Above is a picture of 5 empty storefronts in the Giant shopping center. This is just one corner. In total there is over a dozen vacancies.

*Additional note: Some have said “well this shopping center is run down” “That’s why no one wants to shop there”. I don’t disagree. The “Giant/Redners” shopping center is one of the worse “Strip Malls” in the whole Lehigh Valley. It’s dated. Ugly. Terrible. Traffic flows poorly. Some locations the parking lots are downright dangerous.

To that point, note that the same company owns the “Kohls” side. And they did acknowledge this. At least in terms of spending some major money on recent renovations of. This included new landscaping and a facade renovation (Kohls). From what I understand more improvements are coming and they are slowly making there way to the “other” side where giant is.

the point is, this is the natural order. Your shopping center is crummy and because of that you can’t attract good tenants? Then invest money and fix it. Or fail in the open and free market. What isn’t natural is when a gov’t chooses a winner. Then that new shopping center which “needed” the special treatment succeeds because it’s allowed to divert 50% of it’s taxes to repay bonds for 20 years. 

Development watch: Hamilton Crossings

Two items on tonight’s agenda dealing with Hamilton Crossings. First, it’s been determined that the County will not be participating in TIF. Moving forward the township must now decide if we are. Tonight, the timeline for moving forward to a vote on this issue will be outlined. The specific decision will be whether or not to hold a public hearing. This consists of authorizing staff to advertise so we can conduct a hearing sometime in May. (I will post  relevant dates when set) If approved at the May hearing we would consider two items:

1. The creation of the TIF district.
2. If Lower Macungie is to participate in the TIF district. |

Both items would be considered as proposed ordinances. These ordinances if supported would then be advertised for adoption sometime in June. At the same time the project will continue to move through land development process.

My thoughts: I am heading into the next 2 months with the mindset that the developer and those who support the TIF must make a case for it. The prior BOC which I did not sit on publicly supported TIF. They did this via a resolution asking Lehigh County to participate. (At the time the public narrative was all 3 district, county and township were needed for TIF to move forward. Apparently that is not the current interpretation.) If I were on the board last year I would have voted against the resolution of support.
Continue reading

Smooth On a great fit for Community

Commissioners unanimously voiced support for Smooth On at our last BOC meeting ahead of tonight’s 7pm Zoning Hearing Board meeting. (What is a Zoning Hearing Board)

Smooth on Logo

Smooth on Logo

Here is why I support Smooth On based on smart growth principles: 

First, by encouraging a company to move into an existing empty building we help to preserve precious open space and farmland. Infill and true mixed use is the alternative to greenfield development. Churning up our open space is costly both in terms of providing new infrastructure but also by hurting our quality of life.

Smooth on projects to have 1/7th the impact (parking, traffic, deliveries) of Daytimers when they were operating at their peak. As an example, the projections are for 20 trucks total daily limited to Mon-friday. These deliveries will also be limited to certain times and will not occur on weekends. Contrast that to distribution warehouses which generate 20-40 trucks an HOUR 24/7 and 365 days a year. Sounds like a pretty neighborhood friendly deal to me compared to other alternatives. Remember, part of Daytimers facility is a huge warehouse. There was a real fear a distribution outfit would have tried to purchase the property. This would have generated up to 10x the truck traffic.

Secondly, Smooth On will bring over 150 good paying jobs. They’ve already stated they would like to hire former Daytimers employees who lost their jobs when the company relocated. This is contrary to distribution warehouses which typically hire alot of seasonal and part time employees at much lower wages.

Lastly, Smooth On has expressed an interest in being a partner in future smart growth visioning projects including taking a look at East Texas. This is wonderful, because without an anchor who buys into community vision it’s hard to move forward with ambitious planning projects. Smooth On encourages a culture where employees live, work and play in the surrounding neighborhood. The folks who work there likely will live here, spend money here and send there kids to school here. This was similar to Daytimers where a large percentage of folks who worked at the facility lived here in Lower Mac.

Yes, with any large manufacturing facility there are concerns. This is no different. But as someone who always looks at new development with a critical eye, personally after 2 meetings with company officials I feel confident issues will be addressed. I have seen residents asking the right questions. That’s important! And great to them engaged. I hope to see many at tonight’s meeting. I am confident our staff, fire and emergency professionals and of course smooth on will be able to address any concerns residents have.

I grew up next to daytimers and today I live in a home in the same neighborhood 2 houses down. So not only do I look at this from the standpoint of a Commissioner, but also as a direct neighbor. Daytimers even at it’s peak was always a fantastic neighbor. It’s important we get another good neighbor in this building. Smooth on will have the same restrictions and 1/7th the impact in most measurable ways. To be honest it kept me up at night worrying the “wrong fit” may have expressed interest in the building. There are still questions to be answered tonight, but overall it’s fantastic that we have what looks to be the right fit.

 

TIFS & Jobs

Organic, Incremental land development is always more desirable then the “magic bullet” project. The same can be said about job creation.

I’ve written alot about the Hamilton Crossings TIF. I’ve tried to keep the land use issues separate from TIF funding issues. At first from a land use perspective I felt it was a good project based on assurances of quality, context, function and form. Then the project slowly started to devolve. Today, it is a very large strip mall. Albeit, one with bells and whistles. Unfortunately, a smattering of bells and whistles doesn’t make a strip mall a town center lifestyle complex. Definitely not one in the mold of the promenade. Which is what we were promised in exchange for the township supporting a more intense/dense project.

We’re not getting what we were sold and that remains a problem. Assurances of quality were what made the TIF pill easier to swallow. If I were a County Commissioner looking at the topic my vote would be ‘no’ as the project stands today. First the infrastructure improvements need to include a limited access interchange. That’s the logic for the TIF. That the infrastructure improvements are a benefit to the whole region. We’ve got to get rid of the lights on the by-pass. Penndot at one time recommended a “skinny diamond” interchange. What happened to that recommendation? The Bypass needs to be a road moving cars quickly from point A to B while old Hamilton needs to be allowed to flourish into a Main Street. Streets are value capture mechanisms, roads move cars. We can’t afford to build side by side STROADS. Secondly, the project needs to represent what we were sold. There is a tax abatement in play and the public deserves to get what we were promised when the developer was trying to rally support.

Today, I want to talk TIF a little more. Specifically TIF’s and job creation. On patch this afternoon someone made a comment about the jobs. Fair enough. I hear that often. It’s an interesting conversation. I have some problems with the general argument and I’ll lay them out here.

There have been some good studies done on TIF’s and job creation.  Yes, TIF creates jobs. The problem is no one ever looks at the “but for” factor. What that means is if job creation, and economic development would not happen BUT FOR the existence of a TIF district then yes, proponents of TIF’s have a very good case. Where proponents logic is flawed however is that as soon as you look at the “but for” factor you quickly see that the studies that do take it into account very clearly show that most communities still get the economic development without the TIF. Especially ones with the strengths and desirability of LMT.

So while we might not get the big strip “Costco” mega project at THAT particular location without TIF, we definitely will still get continued job creation and economic development here in Lower Macungie. Why? Because we’re an attractive community for employers at a strategic location. We have developers literally filing litigation to get zoning changes to be able to build here. That’s how desirable our community is to employers. We have 1.5 million square ft of warehouses coming. 100′s of 1000′s of square ft of commercial development coming. Nearly 1000 more homes in the pipeline. Trust me, if Hamilton Crossings doesn’t build someone else will. Even with the mine wash issues. Someone will build. No one in their right mind can say we don’t have a very healthy amount of economic development here in Lower Macungie.  If you take into account the “but if” factor when considering a TIF for LMT the results are very clear. Yes, TIF’s produce jobs. But we’re producing jobs here in LMT without TIF’s. So how isn’t this picking winners and losers?

Exhibit A - I want to wait until this set in stone cause it’s so exciting. But presentations have already been made at public meetings. It’s safe to say there is a large company about to buy the Daytimers building. They want to bring nearly 200 great paying manufacturing jobs. Guess what? NO TIF NEEDED. Job creation will happen because we’re an attractive area. Not because of gov’t tax abatements. 

 

Nice letter about Willow Lane Elementary

Below is a letter written by a resident about WLES. There was another couple weeks ago complimenting the crossing guards. Last BOC meeting was justifiably dominated by tax issues so I wanted to post the letter. It reflects alot of the rationale for building neighborhood schools as opposed to “sprawl campuses” that are disconnected from the neighborhoods they serve.

Yes, rollout was at times complicated to say the least. But when dealing with ensuring safe routes most of the parent safety concerns were warranted. After initial hiccups and the inevitable politicking that came during election season, from my observations the program has been a success. From my standpoint as a smart growth advocate, I agree with many of Scott’s comments below about fostering a connected community with a sense of place.

A community benefits when we build neighborhood schools. I was supportive of WLES’s location for this reason during the planning process. I think it’s a suburban walkable model located appropriately in the middle of 100′s of homes. Hindsight, I  wish the walking routes were discussed during land development so that walking was rolled out when the school first came online. I still to this day have no clue why they weren’t. I know it was late in the game that walking was postponed.

So let’s keep working through the kinks.  I have heard about speeding issues on the interior driveways leading to the school. I also still believe we need to texture the crosswalks and install “stalker boards” (radar boards that tell drivers their speed) on the corridor. Aside from that, I think the township improvements have worked out. I do think the crossing guards have done a fine job.

Anything else on the township end that we should be aware of? What do you think of the letter below? Let me know in the comments. 

Devolving Hamilton Crossings a concern…

Last night did nothing to alleviate concerns I have with the Hamilton Crossings project slowly but surely transforming into a typical run of the mil box project.

Here WFMZ’s Randy Kraft does an excellent job summarizing: Lower Mac planning commissioner not happy with how Hamilton Crossings is evolving

I hope any County Commissioners on the fence take the time to examine concerns planning Commission has regarding this project. There is real concern about quality. County Commissioners need to take this into account when re-considering TIF. I want this project to move forward. It makes sense from a planning perspective. This represents “smarter growth” even only in terms of getting more return on investment building where significant infrastructure improvements have already been made. This is the appropriate location for retail. Yes, I prefer more neighborhood centric. More “Main Street” in character, but fundamentally this makes sense here as opposed to building a shopping center in some cornfield out on the fringe ala the typical “Jaindly” blueprint. But I want the project we were sold. I did have issues with TIF financing, but  moving past that if it is to move forward it absolutely must be what we were promised. County Commissioners have a duty to do their due diligence we’re getting what we were promised if they choose to move forward funding. I trust they are.

Pictures say a thousand words:

Tone we were promised: This represents a “Promenade esque” walkable town center. Looking down the streetscape you see shops and attractive facades. You see a place where people can mingle, shop and relax. We were sold on the new “Gateway to the township” that we could all be proud of as a community. This is what we were promised when the developers were “selling” the project for TIF financing.

This is the rendering used to win the “hearts and minds” of residents when the developer was making a pitch for public financing.

Here is the current Costco rendering….. It’s a box. One that has been described as “cheap looking”, bland, boxy, generic.

Proposed Costco rendering for Lower Macungie Township

There are MUCH MUCH nicer Costcos as I’ve outlined in previous posts. For some reason we’re getting a “cheapo” one. We shouldn’t accept that based on what we were promised when the developer was seeking funding.

Police services study preliminary report

Below is the preliminary memo for the police services study. The full forum unveiling the results of the study will be presented in a public forum Nov. 12th at 7pm in the Community Center.

My detailed thoughts on this issue will be outlined in an upcoming Morning Call point counterpoint.

Pennsylvania State Police in Lower Macungie Townships primary provider for police protection.

Here is the memo:

TO: Lower Macungie Township
FROM: Gary Cordner, Consultant DATE: October 31, 2013
RE: Police Services Study

This memo is intended to serve as a preview of the police services report that will be completed by December 31, 2013. The consultant is still collecting data for the report and will participate in a public forum on November 12. Public comment at and following the forum will be incorporated into the final report.

The following “facts” and findings seem unlikely to change between now and the final report:

 

1. Lower Macungie Township (LMT) is unusual in not having its own police department. The township’s 2013 estimated population is 31,000, a 60% increase since 2000. LMT is the 22nd largest township (by population) in Pennsylvania. It is the 2nd largest township in the commonwealth that relies solely upon the state police for its police service.

 

2. LMT has a low crime rate. The 2012 estimated Part 1 crime rate of 1083.8 per 100,000 residents is about 1/3 the rate for Lehigh County and is 7th lowest among Pennsylvania’s 35 largest townships.

 

3. Over 80% of the Part 1 crimes in LMT in 2012 were thefts. Thefts increased 15% from 2010 to 2012.

 

4. The state police clearance rate in Lehigh County in 2012 (the percent of Part 1 crimes that were solved) was 32.9%. This exceeds the national clearance rate by a substantial margin.

 

5. State police activity in LMT increased from 2010 to 2012. DUI arrests more than doubled and traffic citations increased by almost 50%.

 

6. The state police do not routinely respond to a variety of types of incidents, such as parking complaints, animal complaints, lockouts, ambulance calls, and township ordinance violations.

 

7. LMT saves $4-5 million per year (about $150 per resident) by not having its own police department.

 

The “bottom line” is largely unchanged from previous police services studies. Lower Macungie Township has a low crime rate and a relatively low demand for police service, in spite of significant population growth and proximity to Pennsylvania’s third largest city. The police services currently provided are highly professional, albeit at a relatively low level.

A drawback of the current arrangement is that the residents and elected leaders of the township have little or no influence over the police services that are provided, since it is a state agency that provides those services. The benefit is that the township is not burdened with the cost of policing or the substantial administrative responsibility that accompanies a separate local police department. The final report will discuss additional options, such as a part-time police department, contracting for police services from another municipality, participation in a regional police department, and other hybrid models. All of these other options would entail some financial cost, of course. The report will not offer any recommendations, only options with associated costs and benefits. Fundamentally, the situation is one in which the township needs to decide (as it has in the past) what level of police service it wants in conjunction with how much it wishes to spend for that service. page1image20840

Want to keep taxes low? Preserve Open Space.

Featured

Large contiguous tract of farmland in Lower Macungie Township

(Submitted as LTE to LMT Patch and an abbreviated version to EPP)

By preserving open space via a well thought out smart growth plan we reduce costs for infrastructure and services, thereby reducing the need for tax increases. Farmland and open space generate no traffic, create no crime, needs little fire protection and places no new students into our school system.

Continue reading