Due to miscommunication, Luzerne County Council’s agenda for Tuesday’s meeting contained incorrect proposed tax break percentages for a development project in Hanover Township, council Chairman Tim McGinley said Monday.
The agenda stated the forgiveness on new construction would be 100 percent in the first year and decrease 10 percent annually, resulting in 10 percent forgiveness in the 10th year.
Instead, the agenda should have contained the original proposal, which was for seven years of full forgiveness, followed by exemptions of 90, 80 and 70 percent in the final three years, McGinley said.
Missouri-based NorthPoint Development sought the tax break for its third proposed local development project to construct three structures totaling 1.375 million square feet on a 150-acre township tract along Dundee Road in Hanover Township.
If approved, NorthPoint would pay full taxes on the land, which is currently tax-exempt.
While the initial proposal that’s back on the agenda had been pitched by NorthPoint, a council majority has authority to alter it.
Councilman Harry Haas has proposed this version for consideration Tuesday: forgiveness of 30 percent the first three years, 20 percent in the fourth and 10 percent in the final five years.
Haas said Monday he would prefer no discount because he believes it is a form of “corporate welfare,” but he is not “anti-development.”
“This would still be a very generous compromise. The average company and developer are still going, ‘Where’s my tax abatement?’” Haas said Monday.
NorthPoint developer Brent Miles told council a tax break is warranted to compete with incentives offered in other areas and encourage development of the challenging sites, noting the latest project area includes a large UGI Energy Services line through the center.
The company has previously received tax breaks for a 172-acre Hanover Township site that attracted three tenants — Chewy.com, Adidas and Patagonia Inc. — and a second 330-acre tract in the township and Nanticoke that will house three buildings, including one that is 1.2 million to 1.4 million square feet.
Approximately 4,000 jobs would be created in all three local NorthPoint projects combined, with NorthPoint investing $280 million and tenants spending another $100 million to $150 million, Miles has said.
Both the Hanover Township Board of Commissioners and Hanover Area School Board have approved the latest tax break for their real estate taxes, officials said.
Under the scenario proposed by NorthPoint, all three taxing bodies would receive a combined $82,500 in taxes on the land at the start of the project and $1.03 million after the three buildings are constructed and fully taxable, a report shows.
McGinley said he was informed the incorrect agenda version came from a past tax break that council had awarded to IRIS USA one year ago.
That plastic manufacturing company is receiving full county real estate tax exemption on its new plant in the Humboldt Industrial Park in the first year only. The discount will be lowered to 90 percent in the second year and continue decreasing by 10 percent annually, with all taxes owed after a decade.
Council’s meeting starts at 6 p.m. in the county courthouse on River Street in Wilkes-Barre.
Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.