Towanda School Board approves payment-in-lieu-of-taxes for Trehab
TOWANDA - All of the taxing authorities have now approved an agreement with Trehab Center Inc., under which it will make payments-in-lieu-of-taxes on its planned $11 million development in the 400 block of Main Street, Towanda.
The Towanda School Board on Monday gave the final approval needed for the PILOT agreement, which had been proposed by Trehab.
The PILOT will be equivalent to 50 percent of the property taxes that would be owed on the property, if the property were fully taxable, Towanda Borough Manager Tom Fairchild Jr. has said. The PILOT will be made annually for 15 years.
The PILOT will be paid on a $6 million, four-story building that is planned for the site, which would have commercial space on its ground floor and housing for the elderly on its upper floors.
No property taxes will be due on the planned $5 million parking garage that would be constructed behind the building, since it would either be owned by the borough or a parking authority.
Based on the 2012 millage rates, the building, if fully taxable, would generate $87,272 in property taxes annually, so the PILOT would be approximately $43,600 annually.
The Towanda School District's share of the $43,600 PILOT would be $26,110; the county's share would be $7,291, and the borough's share would be $10,250.
The Towanda Borough Council and the Bradford County Commissioners have already approved the PILOT agreement.
Keith Lamphere was the only school board member to vote against the PILOT agreement.
He noted that the Towanda Borough Council had wanted Trehab to pay full property taxes on Trehab's proposed affordable housing development at the Mulberry Street School site in Towanda, and would not support a reduced PILOT for that project.
By only approving a PILOT agreement for the Main Street project, it seemed as if the borough council was giving preference to the downtown project, which, if it goes forward, will allow the borough to get rid of property it owns, Lamphere said.
But in an interview on Monday, Towanda Borough Council President Mark Christini said the Mulberry Street project and the Main Street project were considered by the council independently of each other, and that the council's actions in both cases were made "for the good of the public."
He said that the council's decision to have the Mulberry Street project be fully taxable was also supported by the Towanda Borough Planning Commission.
"The Towanda Borough Council and the Borough Planning Commission approved the 400 Block Main Street and Mulberry Street School projects independently while carefully considering the overall benefits of each for the residents of the Borough," Christini said. "While full taxes are ultimately desirable for both projects, the consensus of both the Council and the Planning Commission was that full taxes were feasible for the Mulberry Street parcel (which has since been sold to a private individual) while the Main Street parcel would only be re-developed if a PILOT incentive plan was offered."
The Towanda Borough Council had wanted the 400 Main Street to be fully taxable, but Trehab said it would not be able to develop the property without the PILOT agreement in place, Christini explained.
Christini said the council faces an important deadline for the Main Street project, which is another reason why the Trehab project is going forward on Main Street. Christini explained that the borough has been awarded a $5 million state Redevelopment Assistance Capital Program grant for the Main Street project, and, under the terms of the grant, only has three more years to get the project designed and built.
In order to be able to use the $5 million state grant before it expires, "the Council took advantage of the best available option," which was Trehab's proposed development for the 400 block, Christini said.
After the 15-year PILOT agreement expires, Trehab will pay full taxes on the development to the borough, county and school district, Christini said.
If Trehab wished to extend the PILOT agreement after 15 years, it would need to apply in the future for that extension, Secor said.
In other business, representatives of EFP Rotenberg of Corning, N.Y., gave a report at the Towanda School Board meeting on the 2011-12 single audit they performed.
Melissa Lewis of EFP Rotenberg said her firm had no findings on the way the Towanda School District used federal dollars.
"In our unqualified opinion, we have the highest level of assurance that we can give that the (school district's) financial statements are materially correct" and are in accordance with what the audit requires, she said.
James Loewenstein can be reached at (570) 265-1633; or email: email@example.com.