Exaggerating the Arena

I spent yesterday in Wyomissing, PA at a restaurant client of mine. Wyomissing is just outside of Reading and I happened to ask my client’s banker about Reading’s arena and if that’s doing anything for Reading’s downtown.
The banker said the arena has done very little, if anything, for Reading’s downtown. He noted that there was a recent article in the Reading Eagle which put the annual attendance at the Sovereign Center at only about 500,000, with about half coming from the hockey team.
I thought that was significant since it is well below Mayor Pawlowski’s projections of 1.5 million for the Allentown arena. The Allentown arena will hold 8,500 for hockey and 10,000 for concerts, so it is slightly larger than the Sovereign Center (7,200 hockey/8,900 concerts). Still, it does make Pawlowski’s estimates seem highly inflated. Also, the relatively small figure for non-hockey events was startling, since these types of events would have to cover the lion’s share of Pawlowski’s estimate (I figure there are only about 40 home hockey games in a season).
The banker also mentioned several bank clients who opened restaurants near the Reading arena (hoping for spinoff business from the arena crowd). These were successful restaurateurs who were enticed to open a downtown location by Reading’s City Hall (sound familiar?). The spinoff has not happened, and those restaurants are struggling.
Mike Schware
Allentown

UPDATE:Pennsylvania Senate Passes Eminent Domain Reform

 The Pennsylvania Senate on December 7 passed eminent domain reform legislation significantly curtailing the ability of state and local government to condemn private property for non-public uses. The bill, S.B. 881, the Property Rights Protection Act, responds to the U.S. Supreme Court's June 2005 decision in Kelo v. City of New London and the widespread abuse of eminent domain throughout the state. Limits 'Blight' Designations S.B. 881, introduced by state Sen. Jeffrey Piccola (R-Dauphin/Northern York) and approved by the Senate in a unanimous vote, prohibits the use of eminent domain for commercial development and considerably tightens the definition of blight. Tightening that definition was particularly important because defining a property as blighted is a prerequisite for condemning it and transferring it to another private party. Exceptions were inserted to exclude from the bill's reach property in Pittsburgh, Philadelphia, and Delaware County that has already been designated as blighted. The exceptions, however, will expire after seven years. Explaining the need for his bill, Piccola said the Kelo ruling "made people sit up and take notice and start to realize that in the face of activist courts and local government, private property rights might very well be threatened," according to the November 14, 2005 Greenwire. Limited to Public Uses "For too long, some local governments have threatened property owners in Pennsylvania with eminent domain for private profit," Piccola said in a December 7 news release. "My legislation will help end these abuses but not touch local governments' ability to acquire property to build everything traditionally considered a public use, such as roads, bridges, schools, and courthouses. "The idea that a citizen's property can be taken by the government and turned over to another citizen for non-governmental use is simply an outrageous proposition and something that was never intended by our founding fathers. The Property Rights Protection Act makes certain that home and small business owners in Pennsylvania know that they can keep what they have worked so hard to own," Piccola added. Far-Reaching Effects "Pennsylvania law was in dire need of reform," said Dana Berliner, a senior attorney at the Washington, DC-based Institute for Justice. "It allowed government condemnation of property merely for being 'economically or socially undesirable.' This definition put literally all property at risk. "This bill places unprecedented limits on eminent domain abuse," Berliner added. "The one glaring shortcoming is the temporary exceptions for Pittsburgh and Philadelphia, but even that does not dampen the near total victory this bill provides." "The Pennsylvania senate bill is the most comprehensive legislation in the country," said Steven Anderson, coordinator of the grassroots Castle Coalition. "It slams the door on runaway eminent domain abuse and completely redefines the overly permissive definition of 'blight' that has been repeatedly used as an excuse to take property from one private citizen and give it to another private citizen." Bipartisanship Noted "The bipartisan nature of this legislation is especially encouraging," Anderson added. "All around the country, Democrats and Republicans are uniting to put an end to eminent domain abuses. Of course, with poll after poll showing that upwards of 90 percent of the American public disagrees with the Kelo decision and feels that government should not take away a person's property merely to give it to another person for economic development, it shouldn't be a surprise that legislators from both parties are responding to the overwhelming will of the voters." "Take away the exceptions for Philadelphia and Pittsburgh and S.B. 881 stands as a model for other states looking to prohibit eminent domain for the benefit of private businesses and developers," added Institute for Justice staff attorney Bert Gall in a December 7 news release. "Both cities have abused eminent domain in the past and certainly need no exception now, particularly since citizens that live in the excepted areas receive much less protection than everyone else. Fortunately, the exceptions will expire in seven years and all cities will then play by the same rules." Broad Coalition for Reform The bill received support from a broad range of organizations, including the Pennsylvania State Conference of NAACP Branches, the League of United Latin American Citizens, the Mexican American Legal Defense and Education Fund, the Farm Bureau, and the National Federation of Independent Business. The bill now heads to the state's House of Representatives, which overwhelmingly passed a similar and slightly more stringent eminent domain reform bill in November 2005 and is expected to approve the Senate bill. "The unanimous nature of the Senate vote speaks volumes to the bipartisan support for property rights and eminent domain reform," said Scott Bullock, another senior attorney for the Institute for Justice. Republicans and Democrats should both be applauded for passing this bill. "As the Pennsylvania legislature illustrates, the tide is turning against state and local governments that engage in eminent domain abuse," Bullock added.

End of a Legend

When Joe Louis retired as Heavyweight Champion in 1949, he had beat all challengers for a dozen years. Before winning the title, he had avenged the only loss in his career by knocking out Germany's Max Schmeling, in one of the most famous fights in ring history. The only man he feared was the tax man, who wouldn't let Joe rest. On October 26, 1951, he climbed back into the ring to fight a young, undefeated Rocky Marciano, who had won 31 out of 36 fights by knockout. In the eighth round, the aging legend was knocked through the ropes, down and out, in what would be his last fight.

An Eminent Domain Failure

During the early 1970's, Allentown demolished the entire neighborhood between Union and Lawrence Streets. It was, in a large part, home to the black community. How ironic that we destroyed the cohesion of a neighborhood, but renamed Lawrence Street after Martin Luther King. The only remnant of the neighborhood is the St. James A.M.E. Church. Going up the hill today we now have a vacant bank call center on the east, and the Housing Authority Project on the west. A whole neighborhood existed in from both sides of Lehigh Street, including black owned shops. The houses were old and humble, but people owned them, many for generations. Some blacks at the time wondered if the project was Urban Renewal or Negro Removal?
above reprinted from January 24, 2011 (then titled Downhill on Lehigh Street)

You don't have to go far from Hamilton Street to see an eminent domain failure; Only several blocks and 40 years. Fortunately, for our imported leaders, memory of this debacle has faded. Allentown now wants to discard the most historic mercantile block of Hamilton Street, so that an out of state developer can force feed hotdogs to people from Catasauqua, at minor league hockey games.

A Promise Kept

Irena Sendler was 30 in 1940, when the 400,000 Jews of Warsaw were herded into the ghetto and sealed off in the first step of the plan to exterminate them. In late 1942, after 280,000 had been deported to the death camp Treblinka, Sendler and others formed Zegota, a Polish underground council to aid the Jews. Sendler's heart-rending mission, was to explain to a Jewish mother, that the only possible way to save her child was to give the boy or girl over to her. She promised that after the war she would try to reunite the families. The children were secreted in convents, orphanages and with Polish families. Captured by the Nazi's and tortured, she was freed by the underground on her way to be executed. She had put the name of each child on a slip of paper, and buried them in a jar for safekeeping. After the war she did attempt to reunite the families, but almost all the parents had perished. Irena Sendler's remarkable courage has become widely known because of ninth grade school project in Kansas, Life in a Jar.

A Better Arena Site

As a boy growing up three blocks from the Mack assembly plant, I was always fascinated by the giant doors at the S. 12th and Lehigh Street end. Only recently did I learn that Catalina Flying Boats were assembled there during the War (Second World). What I did see everyday was endless Mack trucks, in every color, filling the huge yard next to the plant. They would be driven away, piggyback, to destinations all over the country. That plant has been gone now about fifty years, with only the footprint still visible in the above photo. Since that time, Route 78 now intersects with Lehigh Street, 1.5 miles away. Imagine a public arena fronting on a major road, with easy access to a main highway. Ed Pawlowski probably doesn't know about the old Mack parcel, but he's welcome to use the idea. It sure beats destroying center city with an illegal arena. I do think it's illegal; At Wednesday's meeting, City Council indicated it had full knowledge of the arena plans. This secret knowledge allowed them to approve the location, and permit eminent domain with no due diligence between the first reading of the resolution and the passing of the vote. Although public comment was permitted, there was no public input or discussion. In an unusual move, the City Solicitor was there, instead of an assistant. Despite Attorney Snyder's presence, there appears to be multiple violations of the Sunshine Act of 1976.

UPDATE: Councilman Michael Donovan elaborates on Arena

Sign electronic petition against eminent domain

Pawlowski Muscles Redevelopment Authority

Although Pawlowski effectively gutted the Redevelopment Authority earlier this year by de-funding it's director, that agency is still fighting for survival. Here we see a City Solicitor dress down an attorney for the Agency, at the apparent amusement of City Council. Despite the solicitor's overbearing, the assessment record does show the Redevelopment Authority as owner. I have added two more short video's by Grounzero's Imantrek at the bottom of Pawlowski's Sham, two posts ago. Apparently, citizens of Allentown don't deserve much in the way of democracy.

Our School Taxes for Hockey Arena

Guest Post by David Fehr Zimmerman
Sports Arena Financing through the NIZ (Neighborhood Improvement Zone)
An article on the WFMZ web site, perhaps, provides some insight into this issue(March 3, 2011 - Jocelyn Moes).
It refers to the establishment of a Neighborhood Improvement Zone empowered inHB 1614 THE FISCAL CODE - OMNIBUS AMENDMENTS Act of Oct. 9, 2009, P.L.537, No. 50 Cl. 72 Session of 2009 No. 2009-50 ARTICLE XVI-B as a financing mechanism for this project.The articles states:"A majority of the project will be paid for by the creation of a 130-acre Neighborhood Improvement Zone, or NIZ.""It essentially is a self-financing part of the project because what you will use are future tax receipts that the project generates to pay for the debt service for the project's existence," said Mann, who added that sales and use taxes, state income taxes, and property taxes could all be used as long as they're generated within the130 acres."That could include not only the arena, but surrounding homes and businesses."Mann said people in the NIZ zone wouldn't be paying any more taxes than they normally pay. The money would just be going directly to pay off the project." Instead of being collected and going to their normal coffers, those taxes generated from the facility will be redirected towards debt service on the facility," said Mann.From my review of the legislation it is unclear as to exactly what tax revenues will be included relative to real estate. I am waiting to hear from Pat Browne's legal staff on this issue. It is critical to consider Mann indicating the list of taxes that "could be used as long as they are generated within the 130 acres".Within a 409 meter radius of the center of the block proposed for development,approximately the same area as 130 acres, there are approximately 708 structureand/or land parcels with an assessed value of approximately $88,823,000.If property taxes are included the property tax liability to the school district could beapproximately $4,049,618. The city is $1,533,874 and the county is $1,056,994 A sizable sum given the current financial condition of the state, county, city and school district of Allentown. If the property taxes are ear marked for diversion the school district may need tocome up with another $4,000,000 to balance the budget as declared by the new authority? This year or next? I question if we could end up trading education for economic development? I hope the reference by Ms Mann to property taxes in the WFMZ article is a misstatement. It seems to me the enactment of this bill and the development of this project could result in the diversion of tax dollars to pay the debt services on the financing of a development for entertainment based services without any real regard for the state of the other entities and the economy. Could this really happen?
Channel 69 Article
Google Map-130 Acre Area
List of NIZ properties and tax liability calculations
Act 50-2009
title and photograph added by molovinsky