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Harrisburg city council approves property tax breaks for home improvements and new construction
12-May-2015
HARRISBURG- Harrisburg city council members Tuesday night shocked Mayor Eric Papenfuse by approving a long-contested program to provide a 100-percent tax break for improvements to residential properties for 10 years citywide.
The program would also provide a minimum 50-percent tax break for improvements or new construction for commercial properties for a decade. Commercial developers could earn a higher tax break, up to 100 percent, depending on the number of permanent jobs created.
Papenfuse had been trying for nearly a year to gather support for the property tax breaks, which are possible under the state's Local Economic Revitalization Tax Assistance law, commonly known as LERTA. The mayor has said the program is vital to the city to encourage economic development, expand the tax base and fight blight. It also makes good on one of his campaign promises.
The plan would still need to be approved by the city's other two taxing authorities: Dauphin County and the Harrisburg School District.
Harrisburg has implemented LERTA programs before, with mixed results, Papenfuse said, but previous programs featured tax breaks that eventually got smaller each year. The full tax abatement plan approved Tuesday night represents the first in recent history, Papenfuse said.
Under the program, owners of existing residential properties would not pay additional property taxes on any improvements for 10 years,
The council approved the measure on a split vote after a lengthy, tense debate.
Councilman Brad Koplinski, who had been sitting on the legislation in his committee, agreed to bring it up for a vote if language was added to require responsible contractors to oversee the repairs and new construction.
His amendments to add that language passed 5-2, with Susan Brown-Wilson and Sandra Reid opposing.
Brown-Wilson then offered an amendment that would give residential property owners a full 100-percent tax break on improvements instead of tax breaks that eventually decreased by 10-percent each year.
Her amendment passed 4-3, with Reid surprising many in the room by voting with Brown-Wilson, Ben Allatt and Jeff Baltimore in support. Council President Wanda Williams muttered to Reid after the vote and Koplinski shook his head in disbelief.
Reid explained her support by saying she believes drastic action was required to reduce the trash and blight ruining the city. Twenty percent of the city's homes are vacant.
"I believe if you're going to throw something at it, I believe in throwing everything you got at it the first time around," she said. "I'm hoping and praying that if we approve this, that we will see some true change in this city. And if we don't, you can come back and blame me personally."
Williams chimed in: "We will."
After the amendment was approved, the legislation still faced a final vote. Koplinski tried to sway Reid by saying a provision she liked that would allow council to get rid of the program in five years if it wasn't working was a "red herring."
"The damage will be done in year one," he said.
Councilwoman Shamaine Daniels also railed against the full tax break, saying it can easily become too much of a burden for property owners later when the full tax kicks in.
When the final vote was called, Reid paused for nearly a minute and a half before casting her affirmative vote. She voted with Brown-Wilson, Allatt and Baltimore while Koplinski, Daniels and Williams voted against the plan.
Afterward, Reid remained torn.
"You're putting your faith in people you don't really have faith in," she said, referring to Papenfuse. "But is it worth risking having nothing done in these neighborhoods?"
Papenfuse said Reid's support and the successful vote "completely surprised him."
"I really thought we were going to lose," he said. "I'm thrilled the city council recognized the importance of a full LERTA. It represents exactly the right approach."
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12-May-2015
HARRISBURG- Harrisburg city council members Tuesday night shocked Mayor Eric Papenfuse by approving a long-contested program to provide a 100-percent tax break for improvements to residential properties for 10 years citywide.
The program would also provide a minimum 50-percent tax break for improvements or new construction for commercial properties for a decade. Commercial developers could earn a higher tax break, up to 100 percent, depending on the number of permanent jobs created.
Papenfuse had been trying for nearly a year to gather support for the property tax breaks, which are possible under the state's Local Economic Revitalization Tax Assistance law, commonly known as LERTA. The mayor has said the program is vital to the city to encourage economic development, expand the tax base and fight blight. It also makes good on one of his campaign promises.
The plan would still need to be approved by the city's other two taxing authorities: Dauphin County and the Harrisburg School District.
Harrisburg has implemented LERTA programs before, with mixed results, Papenfuse said, but previous programs featured tax breaks that eventually got smaller each year. The full tax abatement plan approved Tuesday night represents the first in recent history, Papenfuse said.
Under the program, owners of existing residential properties would not pay additional property taxes on any improvements for 10 years,
The council approved the measure on a split vote after a lengthy, tense debate.
Councilman Brad Koplinski, who had been sitting on the legislation in his committee, agreed to bring it up for a vote if language was added to require responsible contractors to oversee the repairs and new construction.
His amendments to add that language passed 5-2, with Susan Brown-Wilson and Sandra Reid opposing.
Brown-Wilson then offered an amendment that would give residential property owners a full 100-percent tax break on improvements instead of tax breaks that eventually decreased by 10-percent each year.
Her amendment passed 4-3, with Reid surprising many in the room by voting with Brown-Wilson, Ben Allatt and Jeff Baltimore in support. Council President Wanda Williams muttered to Reid after the vote and Koplinski shook his head in disbelief.
Reid explained her support by saying she believes drastic action was required to reduce the trash and blight ruining the city. Twenty percent of the city's homes are vacant.
"I believe if you're going to throw something at it, I believe in throwing everything you got at it the first time around," she said. "I'm hoping and praying that if we approve this, that we will see some true change in this city. And if we don't, you can come back and blame me personally."
Williams chimed in: "We will."
After the amendment was approved, the legislation still faced a final vote. Koplinski tried to sway Reid by saying a provision she liked that would allow council to get rid of the program in five years if it wasn't working was a "red herring."
"The damage will be done in year one," he said.
Councilwoman Shamaine Daniels also railed against the full tax break, saying it can easily become too much of a burden for property owners later when the full tax kicks in.
When the final vote was called, Reid paused for nearly a minute and a half before casting her affirmative vote. She voted with Brown-Wilson, Allatt and Baltimore while Koplinski, Daniels and Williams voted against the plan.
Afterward, Reid remained torn.
"You're putting your faith in people you don't really have faith in," she said, referring to Papenfuse. "But is it worth risking having nothing done in these neighborhoods?"
Papenfuse said Reid's support and the successful vote "completely surprised him."
"I really thought we were going to lose," he said. "I'm thrilled the city council recognized the importance of a full LERTA. It represents exactly the right approach."
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