Lehigh Valley

ANIZDA approves intervening in Atiyeh lawsuit long after it intervened

ANIZDA Meeting

ALLENTOWN, Pa. - The recently-organized authority in charge of developing Allentown's hockey arena and surrounding properties seems to have put the cart before the horse.

The Allentown Neighborhood Improvement Zone Development Authority formally voted to intervene in a lawsuit early Thursday evening, about a month after it actually did intervene in that suit.

The case involves developer Abe Atiyeh's suit against the state that challenges the constitutionality of recently amended laws that created the city's Neighborhood Improvement Zone.

Authority chairman Seymour Traub said the decision to intervene was based on an e-mail poll of ANIZDA's board "because of the speed in which it was necessary to do that at the time."

He said the board had never ratified ANIZDA's intervention. When the board briefly reconvened in public after a closed-door executive session during Thursday's meeting, Traub said: "We feel a motion should be made to ratify the action that was taken." That motion was made, seconded and unanimously approved without any public discussion by other board members.

Seven board members attended the meeting. The nine-member authority has one vacancy, caused by the resignation of Don Snyder. Another member, Alan Jennings, was absent.

The new state signed by Gov. Corbett on July 2 included language changing NIZ financing and is expected to resolve major legal obstacles to the delayed arena project. Suburban municipalities that sued the state over the funding mechanism, which kept some of their tax money in the city, have indicated they are dropping their suit, clearing the way for work to continue. However, Atiyeh reportedly intends to continue with his lawsuit against the state.

In April, Allentown filed a counter-suit against Atiyeh, seeking $50 million in damages.

After the meeting, Frances Fruhwirth, ANIZDA's interim solicitor, explained why the authority intervened in the Atiyeh suit before taking action to do so in public: "The way the speed of events was taking place, we had to act within the guidelines of the court."

When asked if the authority should have formally voted before intervening, Atty. Marc Feller, ANIZDA's special counsel, deferred to Fruhwirth, saying she is in charge of all Sunshine Act/Right to Know issues.

The authority, which was organized in April, last met May 3.

During Thursday's meeting, Traub publicly thanked the Brooks Group, owners of the Phantoms, the minor league hockey team that will play in the center-city arena, "for hanging in there and for making it clear Allentown and the Lehigh Valley are their choices for this hockey arena, which hopefully we now are going to be cleared to move forward with, with all dispatch."

The chairman also commended the local media for fair and accurate reporting about the NIZ controversy. "It's not a process ANIZDA or the city wanted to go through, nor did the municipalities I'm sure," said Traub. "But through the reporting by the media, it's very clear that anybody who reads the newspapers or listens to television should now understand the issues.

"Hopefully, we can put all of this behind us and get moving on the development of the arena and the development surrounding the arena."

Reviewing key changes made to the state's NIZ legislation by the governor's July 2 signature, Feller said Allentown no longer is entitled to get earned income tax that should go to neighboring jurisdictions. That issue spurred local municipalities to challenge the NIZ law by suing the state. "You don't see the words flying off the page that earned income tax of local municipalities is no longer included but that is the clear effect of this change," said Feller.

Feller said no earned income tax was collected in 2011 from suburban residents who work in the designated Neighborhood Improvement Zones in the city. But it was collected this year. The amended NIZ law requires it "promptly" be returned to municipalities where those people live.

State Rep. Jennifer Mann, who serves on the ANIZDA board, said members of both political parties and members of the Lehigh Valley's legislative delegation "from suburban, rural and urban communities" worked together to resolve issues with the NIZ law that spurred the lawsuit and stalled the project. "Every member of the Lehigh Valley delegation voted in favor of this correction," she said. "They understood the importance of the arena and the ancillary development that is part of that and how important it is, not only to the City of Allentown but to the entire Lehigh Valley."

Traub added: "We all owe a debt of gratitude to representatives throughout the state so we don't have a hole in the middle of Allentown – collecting water."

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