Thoughts on East Penn School District and Hamilton Crossings TIF

I attended the School Board meeting last night as an interested taxpayer and watched the debate about TIF. The decision was disappointing but I felt the debate was moreso. Important points were completely missed. The board by and large failed to look at the situation from a big picture standpoint. Some compartmentalized the decision and limited the thought process to a single parcel instead of evaluating the economics of the decision regionally. End of the day the board voted 5-4 to remain a part of the Hamilton Crossings TIF. Earnshaw, Bacher, Ballard, Fuller and Rhoads voted for the TIF. Vinovskis, Munson, Donches and Heid voted against it. (for the motion which was a vote against the TIF)

The bottom line is Lower Macungie isn’t just growing an industrial and commercial base our base is pretty much about to explode. At the same time single family home construction the primary driver for school age kids has ground to a halt. Certain school directors seemed oblivious to that. I found it a bit alarming. How do you make a decision about the application of an economic development tool meant for distressed communities without considering the bigger economic picture? How can you make an economic development calculation when compartmentalizing the districts forecast to one parcel seemingly oblivious to what’s going on around it? This decision shouldn’t have been made considering one parcel in isolation. It should have been made considering the whole picture.

I’ve written here before about the objective criteria I apply when considering a TIF. For me it centers around the ‘but for’ test. The name comes from the expression, “Development in a community would not occur but for the use of TIF.”

To evaluate this criteria you have to look at the big picture of Lower Mac and ask without TIF do we have economic development in the East Penn School District? The answer is absolutely. Therefore by using a TIF when it’s not necessary we skew the market. By applying TIF in a healthy growing local economy we’ve hurt the development potential of other commercial sites. This matters for the school district because these other sites would have paid 100% of there tax burden. The mistake is compounded by the fact that millions of dollars in new assessed value is coming to the districts coffers from industrial projects immediately in the next 5 years. This isn’t speculation. We’re talking approved or nearly approved projects.

Bad decision. Plain and simple. I always felt this was a bad deal for the township but at first I actually thought it was at least an understandable decision for the school board. The more I thought about it my opinion changed over the last 6 months. Why? Because I started looking at the big picture.

Where I sit today as a taxpayer of 2 school district properties (my home and my business) I’m going to resent last night’s decision to leave money on the table the day directors vote to raise my taxes. This will unfortunately happen sooner rather then later. Big picture we never address underlying issues. We just chase development and bury our heads in the sand.

GET INVOLVED: Do you live in Lower Macungie? Township Commissioners will consider TIF next. The public hearing is this Thursday. Consideration of this topic will start no later then 8pm at the township building. More information here.