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Hanover Township: We're done negotiating, no deal on NIZ

By John Craven, Reporter, JCraven@wfmz.com
Published On: May 22 2012 07:00:00 PM CDT
Updated On: May 23 2012 10:14:46 AM CDT

Hanover Township: We're done negotiating, no deal on NIZ

ALLENTOWN, Pa. -

The NIZ negotiations are nixed. Tuesday night, a second township said it's done bargaining with Allentown over the city's beleagured hockey arena project. The move virtually guarantees the issue will either wind up back with state lawmakers, or in the hands of a panel of judges. It also means the gaping hole in Center City Allentown isn't going away anytime soon.

"With all the different litigants in this now, statewide, it's just impossible to try to settle it between us and Allentown," said supervisor Glenn Walbert.

Roughly a dozen communities are suing over the Neighborhood Improvement Zone (NIZ), the special taxing district paying for the arena construction. It includes some suburban tax money.

Mayor Ed Pawlowski, D-Allentown, has been scrambling to reach a settlement and get the project back on track. He's offered to send neighboring communities their tax money back, plus a share of developer fees.

But Tuesday night, Hanover Twp. (Northampton Co.) supervisors said they are done negotiating unless the state law that created the NIZ gets rewritten. Specifically, they want state lawmakers to remove any reference to suburban tax dollars. They also want the zone's size reduced to the immediate area around the hockey arena. Right now, it also includes the Lehigh River waterfront.

"Either change the law, or have the courts adjudicate it," said Walbert.

Hanover's move follows a similar decision by Bethlehem Twp. Monday night. Both townships said, because they believe the law is unconstitutional, any legal settlement with Allentown could get struck down by the courts.

"If you enter into an agreement that's unconstitutional, you have no valid challenge in the future," said supervisor Stephen Salvesen.

In a statement, Pawlowski said he's disappointed with the move, but he remains at the bargaining table.

"From the start they have insisted that the key issue they wanted addressed is the use of Earned Income Tax (EIT) to fund the arena development," said the mayor.

"The settlement offer recently presented to them fully protects 100 percent of their existing EIT."

But supervisors said Allentown's offers simply fell flat.

"There was no guarantee that the money would be there," said Walbert.

As for the possibility that the whole Lehigh Valley ends up with a gaping hole in the ground?

"I would hope they have a Plan B that they're considering," said Walbert.

At this point though, arena backers are still focusing on Plan A. The NIZ law's author, State Sen. Pat Browne, R-Lehigh Co., said he will not consider amending the bill. Hanover Township Supervisor Jay Finnigan, however, said he has spoken with other lawmakers about doing it.

Browne said he's still hopeful the townships will come back to the table once exact figures come in about how much tax money is at stake. Tuesday night, Hanover Twp. supervisors insisted their stance will not change, regardless of any new figures.