A Luzerne County Council majority approved a tax break for a Hanover Township development project Tuesday, with some council members saying they were not willing to risk losing new jobs by scaling back the requested real estate tax forgiveness.
“I don’t want to gamble on our people and the opportunities this presents,” Councilwoman Jane Walsh Waitkus said of the break for Missouri-based NorthPoint Development.
“We can’t roll the dice and lose it,” added Councilman Chris Perry.
The company will receive seven years of full forgiveness on three structures totaling 1.375 million square feet the company plans to build on a 150-acre tract along Dundee Road. The tax reduction will be 90, 80 and 70 percent in the final three years.
The break applies to new construction only, and NorthPoint must pay full taxes on the land, which is currently tax-exempt.
Councilman Harry Haas unsuccessfully proposed forgiveness of 30 percent the first three years, 20 percent in the fourth and 10 percent in the final five years, saying providing more would be unfair to other property owners without breaks. He offered a lengthy argument for his position and said he was confident the site eventually would be developed without the more generous break.
“I think we are unfairly picking winners and losers when we look at these kind of extreme tax break programs,” Haas said.
Vice Chairman Eugene Kelleher questioned the likelihood the site would attract such a project without honoring NorthPoint’s request, saying the tract needs significant work.
NorthPoint representative Brent Miles told Kelleher his company must invest millions of dollars to prepare the site for development, in part because the portion being purchased from the Greater Wilkes-Barre Chamber of Commerce contains wetlands requiring mitigation, which should take approximately two years to complete.
His company also must construct an access road over a large UGI Energy Services line, he said.
Miles also revealed he is helping the county by agreeing to purchase the chamber property for $750,000 more than the chamber had been offered by another developer. This means the chamber won’t have to request county forgiveness of penalties and interest in that amount on a past county community development loan, Miles said, noting he came up with the idea after reading concerns about that forgiveness from some council members.
NorthPoint would be at a “major disadvantage” attracting tenants who also are considering sites in other areas with similar major highway access that offer incentives, he said.
Several council members praised NorthPoint’s progress landing employers at two other sites in the township and Nanticoke, including Chewy.com, Adidas and Patagonia Inc. 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 reiterated.
“Thank you very much for investing in us. We trust you,” said Councilman Robert Schnee.
Council Chairman Tim McGinley said the site is a “terrible piece of property” that sat vacant for years.
“We have to be competitive with everyone else on this I-81 corridor. If we’re not offering something that’s competitive, we’re not going to get that opportunity. It’s just that simple,” McGinley said.
In the end, Haas and council members Stephen A. Urban were the lone dissenters. Councilman Edward Brominski was absent.
Reach Jennifer Learn-Andes at 570-991-6388 or on Twitter @TLJenLearnAndes.