News

June 27, 2008

Hazleton Area amends tax for project

Dissenters in 4-3 vote argue the change may chase away development and new jobs.

RALPH NARDONE Times Leader Correspondent

HAZLETON -- The Hazleton Area School Board voted to amend a tax break for a $10 million commercial development at Thursday night’s meeting, risking the entire project, according to dissenting voters.

The board voted 4-3 for the amendment.

The Local Economic Revitalization Tax Assistance (LERTA) agreement between the district and the Sugarloaf Industrial and Logistic Holding developers originally offered a 5-year tax exemption for a new project on Route 93.

In year six, the development would owe 20 percent of the total tax, and 20 percent would be added each following year until the 100 percent tax rate is reached.

Board Member Steve Hahn argued the break is too lenient and proposed setting the exemption for only one year, then requiring 10 percent incremental tax requirements each year until the burden is complete.

Board President Elaine Curry, one of the dissenting votes, said the district could chase away the new development and many new jobs with increased earned-income tax revenues.

The other two no-voters, members Robert Childs and Paulette Pichukis, echoed similar cases.

Pichukis said the district will continue to collect the existing $2,000 tax on the land, therefore not losing any income. She added the land is essentially useless now.

Hahn countered the amendment imposes an estimated $9,000 tax tab on a $10 million business. If the business objects it would be “disgraceful,” he said, adding the tax is a “pittance.”

District business manager Anthony Ryba said the developer is on a “take-it-or-leave-it” basis.

Hahn said similar idle threats were made by new companies. The district can’t continue “rolling over” every time new development comes around, he said.

The amendment was one of several actions the board approved to cut expenses in time for the upcoming budget vote.

A secretarial position in the transportation office was abolished and the district’s allocation to the Hazleton Area Public Library was reduced $18,000 to $617,000.

Pichukis said she regretted the library cut.

In a heated discussion, board member Jack Shema fought against the district’s use of the outside firm of National Management Associates at a cost of $15,000 to screen job applicants and write job descriptions. He said that work should be done by the board. He criticized the firm’s methods of screening employees by phone. Childs argued the firm could save the district up to $400,000 per year despite Shema’s doubts.

The board is scheduled to hold two special meetings, one at 5 p.m. today and the other at 5 p.m. Monday to finalize the budget for next year, said Ryba.

The board is under pressure to cut wherever possible since the district is “strapped,” Hahn said.

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