Executive Director of the Whitehall Township Industrial and Commercial Development Authority Howard Lieberman spoke about tax incentives available for developers to help finance difficult projects during the Catasauqua Borough Council at its April 7 meeting.

Lieberman cited the borough's brownfield property along Front Street as a potential development that could incorporate tax incentives.

In November 2013, Leiberman and his group put together a request designating the property, along with some in Coplay and Whitehall, as a tax incentivized Community Revitalization and Investment Zone (CRIZ).

Because of technical issues, the application was rejected. Two cities were granted the designations, but no boroughs or townships were included. Lieberman worked with local state representatives and asked to have CRIZ legislation revised to address the unique situations that smaller municipalities encounter.

"I can report that a new bill is moving through the legislature," he said. "The new bill has wording that will address many of the issues we discussed with state officials."

Lieberman said he expects that funding for CRIZ will be included in the state budget.

"The budget doesn't get approved until June so we will get an indication of where we are then," he said.

As part of the tax incentive discussion, Lieberman touched on Keystone Opportunity Zones (KOZ). These tax incentive zones reduce payroll taxes for ten years in exchange for new jobs.

"KOZ has not worked out as well as hoped," he said. "A lot of companies take the tax advantages for the ten-year period and then move out of state to take advantage of another state's tax incentive."

Lieberman touched on the advantages of Local Economic Revitalization Tax Abatement (LERTA). According to Lieberman, the package would work well for Catasauqua.

"LERTA is a real estate tax incentive that is good for ten years," he said. "It abates taxes on the increased value of the project. You still get the same taxes you get now, but the new taxes are reduced for the developer."

LERTA taxes, according to the legislation authorizing them, run with the land, which means that if the property is sold in the ten-year period the new owner can still benefit from the tax reduction.

Another alternative offered by Lieberman is Tax Incentive Financing (TIF). Under the program, the state designates certain TIF districts. A private lender provides funding to the developer and a large portion of the loan is repaid with proceeds from the increased real estate taxes on the improvement project and the expected new business use taxes.

Lieberman promised to keep council informed of any new developments with legislature.

Lieberman said he anticipates asking Catasauqua to join with Whitehall to seek approval for tax-incentivized opportunities.

The problem that council needs to wrestle with is a difficult one. The purchase of the brownfield property along Front Street and the promise of new municipal facilities were predicated on increases in revenues that the project would bring.