Harrisburg scrambles for revenue.

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PA could have a 1.3 billion increase in spending to fund a $31.5 billion election-year budget. That’s the latest number. Now they wrangle over how to raise revenue. That’s the topic of debate right now in Harrisburg.

It seems like the rumored list of possibilities is becoming clearer. New taxes could include:

  • Gambling expansion – I call this one a gimmick. It could include Licensing fees on internet based gaming and also expanding gaming machines in bars and taverns. Personally I’ve always had mixed feelings on any kind of gambling expansion. I think one thing most can agree on is it’s never delivered the amount of relief promised. In the case of internet gambling we can look to New Jersey where revenues have underwhelmed and some say led to further poaching of dollars from traditional casinos. Peter meet Paul.
  • Energy taxes – A broad based consumer tax. This is a preference of the Gov. It would mean extending existing gross receipts tax to natural gas customers. This could amount to around $55 a year for the average residential customer.
  • Taxes on banks – Institutional tax. A tax on savings. Don’t quite understand this. Not much information out there about this.
  • Uber and ride-sharing taxes – Wetting governments beak on a new and very successful disruptive tech. Uber is now pretty much legal everywhere in PA except Philly. Although that may have recently changed.
  • Digital download tax – I look at this as closing a loophole. Potentially on purchases ranging from music to movies. It’s a consumer tax.
  • I keep reading another piece is “Tax amnesty legislation” – I’m not sure what this means, but tax amnesty is generally related to forgiveness on delinquent bills. I can’t find information on what this entails. Will we offer more flexibility in hopes of getting more late or delinquent accounts paid up? Maybe this is a good reform? I need to learn more.
  • Accounting magic – Also read last couple days the use of an accounting trick essentially to borrow from the workers compensation fund. To be fair, this sort of accounting trick is used quite frequently in most levels of government.

I hope these capsules and links help folks navigate what’s proposed. As is usually the case most strategies are paired with optimistic (unrealistic) revenue projections. And we have unresolved concerns of how this relates to the states constitutional mandate for a balanced budget.

What we know is, the 1.X billion more in spending is driving the need to raise revenue. The conversation now is what combination of taxes make the most sense to do that.

We can argue what mechanisms are more or less “fair”. We should instead be debating how we re-prioritize, enact structural reform and reduce overall spending. Then the convo would not be about which taxes are “better” or somehow less burdensome and talk about what taxes we actually roll back first. Spending is going in the wrong direction and leaders are again punting on reform.

I’m a realist. I never had a burn it down type attitude. I understand the state funds many critical or otherwise important programs. Taxes on some level are reality. Also compromise is a reality of our Democratic system. But we’re failing again to address a number of areas where inherent waste exists where allegedly we have agreement across the aisle. I believe the money needed to address our priorities exists today. We have more than enough. We just need to 1.) In some cases shift the burden. For example school funding away from homeowners. #SB76 and  2.) Understand that more overall revenue because of increased overall spending is almost never the answer to anything. #nonewtaxes

Movie tavern thoughts part 2

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Movie Tavern has generated a lot of positive discussion over the last couple days. But before we get to that let’s back up a second.

I was elected on a smart growth platform. From the beginning I was clear that meant better growth management. Not stopping growth. You can’t stop growth. And to promise that would have been insincere. I was clear Lower Mac’s strategy needed to be smart growth + land preservation. And that’s exactly what we’ve been implementing.

Here are just a few examples:

Preservation of 55 acres on Mountain Rd.
Lower Macungie commits funds to preserve 55-acre Heim farm
Adoption of official map – a critical preservation tool
With official map Lower Macungie could take more proactive stance on land use issues
Utilization of County municipal match to leverage twp. funds for preservation dollars
Turning $200,000 into $800,000 for farmland preservation Two Lehigh County townships in pilot program to save farms
Update of our comprehensive plans
www.planswl.org 

I also believe we need to hold development in appropriate locations to higher standards. Not be afraid to vote against projects that would have negative impact. I’ve done this having voted against and pushed back on bad projects.  I’ve said here on this blog many times Lower Mac is open for business in appropriate growth areas but developers should be prepared to bring your ‘A’ game. In other areas where dumb growth strains our infrastructure and resources we must be prepared to put our skin in and game enter the market and get farmland and open space preserved. And we have done that. And will continue to do that.

So that brings us to the Movie Tavern and if the township should support a variance for increased building height to accommodate a 15 ft higher than the roofline marquee that some have categorized as a tower. 

The township currently regulates building height to 50ft. This is by my best guess a fairly old regulation. The question becomes, is this a standard we should dig our heels in on and risk losing what is otherwise a pretty good fit for our boulevard? Or should we work with the tavern like we’ve done for 6+ months now.
First, it’s important to understand what the purpose of the 50ft regulation is. Regulations must have a purpose. I spent some time trying to figure that out last two days. Since the ordinance was written before our current zoning officer and planner were here I can make an educated guess it has something to do with fire safety. When the ordinance was written the LMTFD may not have had the capability to fight fires in buildings over 50ft. Fact is today we can. I confirmed that yesterday with the LMTFD Chief. And of course this was reviewed as part of the land development process months ago as all developments are. Brent Mcnabb our fire inspector sits on our planning commission. Every single land development is reviewed by Brent.

Bottom line is we absolutely should hold developers to higher standards. And we have been last 2 years. To that end the project has seen numerous revisions over 6 months. Largely because the township requested certain improvements. In fact Movie Tavern officials have said to me “Lower Mac is the hardest review process we’ve ever had to go through”. But they also agree and have said that the strenuous review will result in a much better overall project. That’s the sort of buy in we seek.

Some of our requests included a complete redesign of the back of the building to eliminate glare, an additional large plaza area if front of the tavern and also allowing the township to hand pick the facade and building prototype that best represented the townships design standards. Movie Tavern volunteered to do all of this. And the review isn’t yet finished. The height issue relates directly to the Movie Tavern component. But the rest of the project is subject to a conditional use hearing that is yet to be held. Even today I have issues with other aspects of the property and of course will attempt to address them.

What I don’t want to do is regulate good projects to death. That’s not my purpose. As a whole this is a decent project. Not great. But within the scope of the overall project a Movie Theater is one of the best aspects. This is mostly based on measurable impact.

Fact is, the tavern IS the best use for this location. Understand, this commercial center is allowed under zoning. Since it’s grandfathered that cannot be changed. Something is going to be built at this location as an anchor for this commercial center. If it’s not a Movie Tavern it would likely be some else. Probably box retail. And box retail would almost certainly have more impact both on the community at large and also neighbors. Purely traffic conversation. The theater is an anchor that will generate mostly evening and weekend trips. Anything else would likely be AM/PM peak day trips. That is exactly what we want to avoid.

I will also say having attended the hearing it was clearly demonstrated with site line drawings that the tower would not impact neighbors. I think this could have been addressed even further with enhanced buffer plantings along the back of the building.

So the issue is, yes I believe strongly (and have demonstrated many times) the township needs to have a commitment to high design standards. On this project we’ve done that. But at the same time those standards need to have an actual purpose. It’s not just obstructionism or throwing up monkeywrenches. With the Movie Tavern we have an excellent use on a decent project in an area identified by long term comprehensive plans (regional and local) for targeted growth.

Residents came with very valid concerns (we need more of this) and I think those concerns were addressed. There will be more opportunities to address concerns during conditional use.

Because I’ve fought bad projects in the past I think some expect me to fight every development project. There are some who just want the township to cease all development. Personally I’m sympathetic.  I wish we could. Would be nice to just put a moratorium on development. But unfortunately, that’s impossible based on state laws. So I’m going to continue to do what I’ve done last 2.5 years. Aggressively advocate for farmland and open space preservation. Continue to hold developers to very high and meaningful standards. And for projects that represent good fits in identified growth areas? Get the heck out the way and help foster higher value growth in the right places. 

I’m sorry that some disagree with me on this. But I made a promise when I ran to always let residents know exactly where I stand on issues. And this is another attempt at letting folks know where my head is at. Disagree? Let’s talk. Contact me at ronbeitler@gmail.com

Movie Tavern thoughts

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Last night the zoning hearing board rejected a dimensional variance that would have added 15 ft onto a tower in front of the proposed movie tavern. Movie tavern officials claimed this is a deal breaker. It remains to be seen if that is the case. It’s important to note that the Zoning Hearing Board is a quasi judicial board entity, seperate from the Board of Commissioners. Though I attended the hearing I did not get a vote.

My thoughts are this. Generally, I think our zoning hearing board gives away major variances to large scale developers much too easily. They did this in the case of Hamilton Crossings. And in the past I’ve spoken out opposing such variances both in person and in the form of letters.

However, this is not one I would have personally dug my heels in on. This is after having visited a similar Movie Tavern in Exton PA. I wrote this post a few months ago and included some photographs and video I took. Also after having seen the site line diagrams presented last night that demonstrated clearly that residents over 500 ft away from the tower in Shepherd Hills would not even see it from their backyards.

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So at this point I’m nervous that if this kills the theater we will get another anchor that could very well be much more impactful. Remember, this plan is grandfathered originally submitted almost a decade ago. So the allowed uses are vested. Meaning the theater could be replaced with a big box retailer. That would mean more traffic, more truck deliveries and more parking issues. And likely a much less attractive building design. (The movie tavern really did work with us last few months agreeing to build a large plaza in front of the building with enhanced landscaping and buffers.)

The theater is a good use for this site. I’m not sure what could replace it would be.  I certainly do not want to see anymore strip malls, big box retailers or warehouses. That leaves entertainment uses which is something our recent PCTI study said we are deficient in here in Lower Mac. Entertainment uses typically have much lower impacts. So a win/win for the township.

Now we wait and see. Was this a bluff? Will the tavern walk away? If so, then we need to be concerned with what replaces it.

Bottom line for me is yes, I think our zoners often give away variances much to easily on large projects. And I’m happy to see them actually challenge a request. But this is not one I would have taken a gamble on. The risk/reward didn’t make sense in this case. The reason is because the Movie Tavern is an excellent low impact fit. Now, if we lose it we could end up with something much worse. And will not have any power to stop it.  We often have to play hands we are dealt and put on strategic hats. This was the case here. The Movie Tavern already addressed a number of township concerns including completely changing the color of the back of the building as to reduce glare for neighbors. They went above and beyond. Another user might not be willing to voluntarily do all the things Movie Tavern agreed to do. So at this time the tower wasn’t a fight I would have picked over 15 additional feet. Residents of Shepherd Hills will still end up having to look at the back of a very large building. But the next user might not be so community conscientious as the Movie Tavern was.

Sen. Casey addresses Wal-mart impacts on local communities

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Sen. Casey – Wal Marts and other box stores strain local resources. 

When you develop a property you are not entitled to unlimited or unreasonable usage (waste) of public municipal resources paid for by tax dollars.

Our Lower Mac Wal-Mart, has for years been a considerable strain on police resources. This is well documented locally. (2013 Morning Call) Wal-Mart seems to rely on police to provide basic security at considerable cost to taxpayers. While every resident and business is entitled to call police for help or to report a crime it’s obvious Wal-Mart exploits this. 

Not only do we face financial impact, but safety as well. When police are spending excessive time at one business they are taken away from other duties.

Similar issue, in 2013 we instituted a nuisance ordinance for excessive fire alarms. We did this after our Fire Dept. reported ] 30% of emergency calls from commercial users were false alarms. Same principle. While every business is entitled to fire protection, there came a point where excessive calls constituted a public nuisance. After enacting the ordinance along with corresponding fines we immediately saw a drop in false alarms. I believe if Wal-Mart had to pay for excessive call volume for totally preventable retail crimes we would see the retail giant suddenly become much more proactive with prevention.

Here is what Sen. Casey had to say in a letter penned to Wal-Mart President Doug Mcmillon. 

“I write to request that Wal-Mart conduct a review of its internal security protocol to ensure adequate security staffing and procedures at stores in Pennsylvania and around the country,” Casey wrote. “Of course, police protect and serve every member of our communities, but the significant volume of calls from Wal-Mart stores raises serious questions about whether the company’s current security infrastructure effectively deters crime without overburdening local police departments, many of which already operate on stretched budgets.”


According to the article, a Wal-Mart representative said the retailer plans to meet with Lehigh Valley elected officials and police in coming weeks to discuss security measures. I have asked to be kept informed and to be a part of this meeting if possible. I made a phone call to Sen. Casey’s office this AM. 

 

 

 

What are those new cameras on Hamilton Boulevard traffic signals?

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So, what are those new cameras on Hamilton Boulevard traffic signals?

The cameras being installed along a sequence of signals on the Boulevard are part of the hardware package for the townships new traffic adaptive “smart” system. It’s not yet activated but will be later this summer.

They will be used by the automated adaptive system to “sync” green light and turning lane phases corridor wide. Each signal will communicate in real time via a wi-fi system to coordinate traffic flow.

Here is a very nice overview of a similar system.

Farmland preservation through TDR

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Transfer of Development Rights (TDR) is a voluntary, incentive based program enabled by the MPC that allows landowners to sell development rights from their land to a developer or other interested party who then can use these rights to increase the density at another more appropriate location.

Lower Mac is working through creation of a TDR program as a mechanism for preservation coupled with smarter growth. In our case we are dealing with one owner of two tracts. This strategy makes sense for number of reasons. First some background. In 2012 a prior board created a new zoning ordinance introducing residential uses into commercial zones. This mixing of uses could be considered smart growth. However, in my opinion the ordinance was weak in that regard. The zoning change also granted additional density for nothing. The decision increased the net density of the township. In contrast, with a TDR like the one proposed today we can accomplish desired mixed use development (of a higher quality) but without increasing the net density of the township and also preserving farmland at the same time.

To put it another way, under a zoning code a community has a net maximum amount of units that can built out. In 2012 the BOC at the time made a decision to increase that number. A poor decision in my opinion.

With the proposed TDR we have on the table today, while there would be increased density at one location as part of the TDR, (a location identified as more appropriate based on comprehensive planning) overall we will decrease the townships net density. In fact, our goal is to reduce significantly the total number of residential units that could otherwise be built over two tracts. Therefore, reducing the net density of the township. We are trying to erase more residential density in one location than we are replacing in another. The balance could be made up with farmland easements or neighborhood commercial uses that do not generate or drive traffic.

Goals are simple: Reduce the overall net density of the township through land preservation. Guide walkable mixed use growth to more appropriate locations closer to existing infrastructure. 

Coverage: Lower Macungie pursues farmland preservation, mixed-use village.

Comparison of local tax rates

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What are municipal taxes like in Lower Mac compared to other areas?

With the recently enacted homestead reduction residential properties assessed under 150,000 in Lower Mac have the lowest municipal property tax bills out of all East Penn communities + Upper Mac. Residents with homes assessed at 111,300 or less are the only remaining homeowners in the entire county who have a local property tax bill of ZERO. (about 1000 households)

Across the board, Lower Mac is tied for the 5th lowest municipal millage rate in all of Lehigh County out of 25 municipalities. Lower Mac’s millage is 50% lower than average for all townships.  FYI neighboring Macungie Borough has the lowest municipal taxes out of not just the East Penn Boroughs but all 8 Lehigh County Boroughs.

The chart below shows municipal millage rates and the tax bills in dollars for various assessments in East Penn municipalities:

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To compare what you pay in municipal taxes vs. what you pay in school property taxes see chart below. 

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For a home appraised at around 220,000 your Lower Macungie bill represents about 1% of your total property taxes. (See what that looks like below) With the homestead reduction over the last two years 50% of homeowners got a tax break 2 years in a row. 90% got a tax break in at least 1 of the last 2 years.

In Lower Mac we are continuing to fulfill our goal of 1st class services, facilities, parks, amenities and a very aggressive farmland and open space preservation program while keeping municipal taxes very low. Our low millage rate is unparalleled for a township our size with the amount of services and facilities we provide and public works we maintain.

 

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Lower Mac taxes visually. The green slice (if you can find it) is your Lower Mac tax bill. Yellow is Lehigh County. Red is school district.

Approaching 10 year anniversary of 1st class township

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Last week we celebrated Arbor day with the planting of a tree at a high visibility location on the municipal campus. In addition to the Arbor day tree we also planted a very nice Tri-Color Beech that was generously donated by Citizens for Change. Recently the group made the decision to disband after having been dormant for several years.

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Citizens for Change (CFC) is best known for a successful campaign to change the classification and operation of the twp. from 2nd class to the more appropriate 1st class designation. The right move for a very large and (still) rapidly growing suburban community. With ten years hindsight it’s even more clear. I was honored to help commemorate the group who spearheaded this effort.

CFC began the effort in 2007 with the daunting task of gathering the required number of signatures (10% of registered voters) to place the question on the ballot. They had to do this since Supervisors at the time were resistant to a change. After having succeeded with the petition they then went on to launch a successful campaign resulting in 61% (4,487) voting in favor of conversion in the November 6, 2007 election. A huge victory. This was the first conversion in 40 years in Pennsylvania.

The biggest difference with first class designation is the introduction of more checks and balances on township finances. Structurally, the biggest problem with the second class arrangement is that supervisors also can work as township employees. The 2nd class form of government was designed for relatively small and often rural townships with minimal resources. The lack of oversight, checks and balances and inherent conflicts of interest almost certainly played a role in the embezzlements that took place between 1999 and 2006. A supervisor who was also employed by the township was charged but passed away before prosecution. The time was right for the residents to hit the “reset button”.

In contrast larger, first-class townships elect five commissioners for four-year terms, and they are prohibited from taking paid employee positions. 4 year terms as opposed to 6 increases accountability to residents. In the 1st class arrangement Commissioners develop policies, set direction and conduct oversight while a professional staff undertakes the day-to-day operations under the direction of our township manager.

This was a big step forward. A clean sweep after a major scandal. Next year, an appropriate commemorative plaque will be placed in the future at the tree location to celebrate the tenth anniversary of the township’s conversion to first class and CFC’s role. This was an important moment in township history. Even though CFC is now disbanding they played a big role in creating the culture of resident oversight that exists today.

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Following in the footsteps of Lower Mac, last year Pocono Township made the conversion to 1st class.

BOC Agenda Preview 4/7

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HERE IS A LINK TO THE AGENDA WITH DETAIL
FYI: All township BOC meetings are available on video online the next day at www.lowermac.com
You can also always watch them live on Channel 66 on RCN cable.

There will be an executive session prior to the mtg tonight to talk about litigation and real estate. I will provide an update on the real estate issue after tonight’s meeting. As much information as I can give I want to do so.

Announcements & Presentations:
The developers of Hamilton Crossings will be present tonight to provide an update on the major development project.

Last year I voted against the corporate welfare public funding of the project, but generally supported the land development. Although, I believe we could have required more stringent design guidelines. The TIF funding passed despite my objections 3-2. Even without the TIF developers rec’d 10 million dollars in state grants. Only $6.6 million of the total capital cost of $139 million is the subject of the TIF debate. About 5% of the total. This project would almost certainly still have proceeded without the township giveaway.

We will also get an update from the library board. This is regularly scheduled.

COMMUNICATION:
We have a letter from Upper Milford Twp. inviting us to a joint meeting of the UM supervisors and open space committee. Both as a Twp. Commissioner and a member of the Lehigh County Farmland Preservation board, I plan on attending this and thank UM for the invitation. The preservation of open space is a regional concern.

We have two letters from residents urging us to continue to preserve and protect open space. Although multiple elections have given us clear mandates and direction it’s nice to hear we are on the right track.

We have a letter from resident and chair of the walkways subcommittee to recall a number of walkway deferrals in multiple locations throughout the township. What this means is that either during a land development, or a subdivision a requirement to complete a sidewalk was deferred. This is not a waiver. A deferral means the twp. can call in the waiver at an appropriate time. It’s an obligation that could have been required immediately but was postponed by the township. Mr. Palmquist believes that time is now. I tend to agree. This will be an interesting conversation. Our policy is to no longer give deferrals in most cases.

We have a letter from a developer of a proposed shopping center on the Eastern Industries site. This would be the 3rd major shopping center of the past few years. The center can be built by right but has some serious access constraints. The developer is requesting the township endorse an application to study the problem with PennDot. At yesterdays Planning and Zoning Committee I expressed a number of concerns.

We have recommendations to appoint 3 residents to various boards and commissions. I want to thank these 3 volunteers. Interested in serving? Fill out the volunteer application form!

Engineering
We are continuing to restrict dangerous truck turning movements on Schoeneck, Quarry and Creamery. Unfortunately, the process takes a frustratingly long time because we have to work through PennDOT. Tonight we will advertise Rt. 100 and Schoeneck restrictions. I continue to be disappointed by how this is taking.

Rt. 100 corridor study. See my thoughts here. This is a warning not a roadmap.

Authorization to draft and advertise official map. This was a goal of mine. We are one step closer. More information here.

Award of proposal for Act. 209 study. This is the process to update the townships traffic impact fee plan. I’m going to try to write a post about this in the coming days.

 

 

Stop crowing about warehouse projects

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Read today another real estate group and other economic development professionals crowing about another warehouse project along I78. They talk glowingly about the “hundreds of jobs” the project is forecasted to bring. (these forecasts usually end up being low, do not break down full time vs. part time and sometimes are inflated with temporary construction jobs.)

That being said giving the promoters of the project the benefit of the doubt and assuming this project will create 600 full time permanent jobs. . .  Let’s #Dothemath and stop looking at job counts alone in a vacuum.  We also must account for revenues, expenses, assets (land) and long term taxpayer liabilities. To do this we look at community return on investment. 

Returns on investments – New Hamburg Commerce Park
Acres of land consumed: 200 acres mostly lost farmland.
Total Jobs: 600
Jobs/acre of land lost: 3 jobs per acre
Municipal revenue per acre: Unknown but based on Lower Mac comps very low.
Municipal liabilities per acre: High impact.

Warehouses generate very low jobs and revenue per acre. What a community does get... freight traffic which is a very expensive public liability.

Warehouses generate very low jobs and revenue per acre. What a community does get… freight traffic which is a very expensive public liability.

To compare let’s take a Lower Macungie manufacturing facility. I usually use Mack Trucks to demonstrate but this time let’s use our newest facility Smooth-on.

Returns on investments – Smooth On 
Acres of land: 12 acres. A reuse of an unused existing facility in a mixed use walkable neighborhood. This transition required no new infrastructure and no municipal taxpayer dollars. (I excluded the parking lot which is a separate parcel and will be redeveloped into employee housing reducing employee trips to and from the facility as an added bonus)
Total Jobs: 150
Jobs/Acre of land: 12 jobs per acre of land (all excellent paying jobs)
Municipal revenue per acre: $242/acre. In Lower Mac this is 2x the ROI of a warehouse.
Municipal liabilities per acre: Low impact.

Smooth on employs 150 people at excellent wages. Large majority full tim positions. Photo from the Morning Call

Smooth on employs 150 people at excellent wages at it’s East Texas facility. Large majority full time positions. Many employees choose to live within walking distance of the facility. Many more will in the future as the company re-develops a vacant parking lot with employee housing. This facility provides fantastic return on investment for Lower Macungie Twp. 
Photo from the Morning Call

Another warehouse project. Another terrible low return and high impact project. *Missing information here is what taxpayer subsidies are being utilized on the Hamberg project. It’s likely there is some kind of assistance. Usually a RCAP grant or something similar. This is almost always the case. If so this makes the equation even more lopsided. I’ll dig a little deeper..

This particular project is outside the Lehigh Valley but it’s the same story. Moving forward our economic development and planning forces (local and regional) must start considering land as the increasingly finite resource it is. That means demanding higher return on investments. Especially when a commodity lost in the exchange is farmland, which is in itself a form of irreplaceable industrial infrastructure. The manufacturing facility example above generates 4-5x the return on investment in even the most conservative ballpark estimate. We’ve got to seek higher value development.

*Disclaimer – As always, logistics operations were always in the cards for our region. This is because of geography and highway access. My problem is I worry we have already lost balance and will go far beyond a certain critical mass our infrastructure can reasonably support. It boils down to a financial and impact equation. Financial solvency is a prerequisite for long term prosperity. We have not been and still are not doing the math. If we don’t expect to repeat this 20 years from now.