Lehigh County Commissioners slam door on tax break for apartment redevelopment project

Author: , WFMZ.com Reporter
Published: Aug 29 2013 07:28:30 AM EDT
Lehigh County commissioners
ALLENTOWN, Pa. -

Lehigh County commissioners slammed the door on any compromise that would have allowed a developer to get a tax break to turn an old Allentown textile mill into apartments.

Post Road Management was unsuccessful Wednesday night in persuading the commissioners to delay their decision on including the former Adelaide silk mills property at 333 Court St. in a Keystone Opportunity Zone, which would exempt the project from most state and local taxes for up to a decade.

The developer wanted time to change the mind of the Allentown School Board, which, by a 5-4 vote last week, rejected KOZ status for the $25 million project that would create 150 apartments and commercial space. City officials told the commissioners they will help make the case for reconsideration to the school board before the commissioners Sept. 25 meeting.

But only three of the nine commissioners -- Daniel McCarthy, David S. Jones Sr. and Percy Dougherty -- were willing to wait. When the commissioners voted on granting the KOZ designation, it, too, was defeated by the same 3-6 margin, despite pleas from Post Road Management partner Borko Milosev and Sara Hailstone, head of Allentown's Department of Community and Economic Development. Hailstone said the project "very vital to" and "still critical for" the city.

Milosev estimated it would cost taxpayers $4 million to have his property included in a KOZ, which would need the approval of Allentown City Council as well as the school board and the county commissioners.

The commissioners who voted against the KOZ designation offered a variety of reasons. Michael Schware said, "There's little to no job creation here," and added that the project would create a parking problem. Vic Mazziotti said, "The last thing we need is more rental properties," noting that professional planners say rental properties should make up no more than 25 percent of city housing, "and Allentown's exceeds 50 percent." Brad Osborne said, "I don't think there's a strong enough business component."

Milosev said he would like to use the eight-acre property for a commercial development, "but given what's happened in the [nearby Neighborhood Improvement Zone] has made it impossible." Because of the low rents being offered in the NIZ, "I would have to give away space" to compete, Milosev said.

One argument that several KOZ opponents made was that the project would bring in children that would put an added strain on the school district's resources.

However, Milosev said few families with children would be likely to rent his loft-style apartments.

After the vote, commissioner Dougherty told his colleagues they "pulled the carpet out from under the school board. … The school district should have its say on this."