Pennsylvania Gov. Tom Corbett awarded two City Revitalization and Improvement Zone (CRIZ) program designations to Bethlehem and Lancaster on Monday.
Corbett signed the CRIZ program into law in conjunction with the 2013-14 state budget to spur new growth in cities that have struggled to attract development, help revive downtown areas and create jobs for the residents in the regions.
“Our local communities are the foundation of Pennsylvania’s economy. We developed the CRIZ program to spark local economic growth, create jobs, and improve the lives of city residents and visitors,” Corbett said.
Local officials in Bethlehem and Lancaster were recently informed of their CRIZ designations. These cities will work closely with the Department of Community and Economic Development and the Department of Revenue to identify priority projects within their applications.
Bethlehem Mayor John Callahan said, "It means $350-400 million, I mean that's a huge number at this time of our economy, $350-400 million of new investment on 11 different projects here in the city, 3,000 construction jobs, 4,000 new permanent jobs in the community."
Bethlehem Mayor-Elect Bob Donchez, who takes office next week, said, "It's a game changer for the city of Bethlehem. It'll provide jobs, economic development, a tax base."
He said he commends the Callahan administration for its work with the CRIZ.
"I think the projects that are in the there look very solid and I just want to continue the momentum of economic development in our city," said Donchez.
Reading was among the other Pennsylvania cities hoping to win the CRIZ designation.
Through the CRIZ program, vacant, desolate or abandoned space can be developed for commercial use, thereby creating jobs, increasing personal incomes, growing state and local tax revenues and reviving local economies.
Cities eligible to apply for CRIZ designation based on local economic indicators included Altoona, Bethlehem, Erie, Lancaster, Reading, Wilkes-Barre and York.
Delaware County, a home rule county, was also eligible to apply for a CRIZ designation for the City of Chester.
Applications were reviewed by the Department of Community and Economic Development, the Department of Revenue and the Office of the Budget, which awarded CRIZ designations based on eligibility requirements identified in program guidelines.
Eligible applicants that did not receive designations have been encouraged to reapply in the next round of applications.
“Eventually, all eligible Pennsylvania cities that develop quality proposals could have successful economic development projects," said Corbett. "I have directed DCED to work with cities that did not receive designations to help them improve their applications. "We want to inspire our cities to start thinking creatively about spurring new growth through economic development strategies and the CRIZ program has certainly helped in that effort.”
State Sen. Lisa Boscola praised the state’s decision to designate Bethlehem for the new economic development program that will enable it to reinvest future state and local tax dollars into a targeted economic revitalization zone within the city.
CRIZ allows for the use of future tax revenues to pay for infrastructure and development costs of local projects.
“This designation will enable Bethlehem to both enhance and accelerate its efforts to bring more jobs and businesses into the city,” said Boscola in a news release. “I am proud of the role I played in helping the city capture one of only two available eligibility slots; and I commend the work of all those involved in the process, from the mayor’s office and City Council, to the city’s CRIZ authority, to our local developers for all of their hard work during the application process.
“I believe Bethlehem’s overall economic prospects and focused efforts to generate private investment were the keys to winning this designation. I also want to thank the Corbett administration for granting this valuable economic development tool and recognizing the great potential this designation will have not only to the city of Bethlehem, but the entire Lehigh Valley,” she added.
Legislation creating the CRIZ program was enacted earlier this year. Boscola was successful in having the enabling legislation expanded to include larger cities such as Bethlehem in the eligibility pool.
Boscola said that all of the city’s development projects are in line with its comprehensive plan, previous revitalization efforts and commitment to smart growth.
The plan would generate 4,120 permanent jobs, stoke $300 million in new development and plow $83.8 million in new revenue into the economic development effort.
The Bethlehem CRIZ Authority, the applicant for the state designation, is now tasked with securing development funding and driving that funding out to approved projects.
Possible projects include a proposed convention center at the former Bethlehem Steel Corp. site, a $12 million office and retail complex at New and Third Streets; and the redevelopment of Martin Towers.
Under the CRIZ program, new state and city revenue generated from the program can be used to help fund the economic development initiatives.
Qualifying taxes include sales, income, earned income, business privilege and corporate net income. Those additional tax revenues generated by the CRIZ development would revert back to their respective state or local government source when the bonding obligations are satisfied.
Business owners on the Southside of Bethlehem are hopeful.
"It's kind of exciting, there's a lot of potential, a lot of great things that could happen," said Brian Tallarico of Tallarico's Chocolates on East Third Street. "Over the last five years the economy's really put a hurt on just about everybody and anything that's going to be potential development is going to be a great boost."
John Saraceno owns Saraceno Design and his wife owns Cleo's Silversmith Studio and Gallery, both also on East Third Street.
"Can't be a bad thing," said Saraceno. "It'll be a shot in the arm. It'll provide some energy to get over the hump and start moving forward again."
He added, "This may push this side of town in a better direction."