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CPBJ Extra Blog

Time to expand CRIZ?

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Spring is here. That means a rise in construction activity.

And state budget season is upon us. That means a spike in legislative proposals and a mad dash to get bills passed before summer recess.

State House Democrats are pushing legislation to further address redevelopment across the state.

Let's start with the City Revitalization Improvement Zones program.

Mercer County Rep. Mark Longietti has introduced House Bill 2123, which would expand the CRIZ program to 15 third-class and second-class-A cities through 2016.

The CRIZ helps communities to develop vacant, blighted and abandoned properties for commercial use. Eligible cities are allowed to create an authority to issue bonds for a redevelopment project, and those bonds are repaid using most state and local taxes generated within the CRIZ area during and after construction.

Developers are required to supply at least 20 percent of the development cost for the project through private funds.

The original program was based on local economic indicators and limited to eight cities. Bethlehem and Lancaster were the first two selected.

The additional designations under Longietti's proposal would be divided among population categories: four in cities of 60,000 or more, four in cities between 20,000 and 60,000, four in cities up to 20,000 and three additional cities regardless of population.

Longietti also is pushing for five pilot programs for boroughs and townships of at least 2,000 people. The financially distressed communities under the state's Act 47 program would receive priority status for participation.

Meanwhile, Northampton Rep. Bob Freeman has introduced HB 2125. That bill would establish tax incentives to promote the redevelopment and reuse of vacant factories and mill sites.

He notes three types of incentives in his bill:

• A 25 percent tax credit for the rehabilitation and reconstruction costs incurred by the owner;

• A business tax credit equal to the salaries and wages paid to full-time employees, up to a maximum of $5,000 per employee; and

• An interest income tax credit of 10 percent on the interest from loans for the expenditures within the building. The limit would be up to $10,000 per taxable year. The loan holder also would be eligible for a 100 percent tax credit, up to $20,000 per taxable year, on interest from loans for substantial rehabilitation.

What do you think of these proposals? Do we need them right now, or should we let existing programs run their course a bit?

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Jason Scott

Jason Scott

Jason Scott covers state government, real estate and construction, media and marketing, and Dauphin County. Have a tip or question for him? Email him at Follow him on Twitter, @JScottJournal. Circle Jason Scott on .

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