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Hazelwood LTV site plan raises crucial questions

Jeremy Boren
| Thursday, Jan. 10, 2013, 12:02 a.m.

If taxpayers are to be the first major investors in a nearly $1 billion plan to revitalize the former LTV Steel Co. coke works site, proponents must prove it can attract job-generating investment and help hard-luck Hazelwood, politicians and development experts said on Wednesday.

Almono LP, a collaboration among the Regional Industrial Development Corp. and four foundations, teamed with Pittsburgh Mayor Luke Ravenstahl to announce plans on Tuesday to pursue a $100 million tax-increment financing (TIF) package. The city's Urban Redevelopment Authority expects to begin scrutinizing those plans at a public meeting on Thursday. The financing would require taxpayers to forgo 65 percent of new property tax revenue from the project for 20 years, and allow that money to repay bonds the public would sell to pay for roads and utilities.

“Essentially you and I, taxpayers, bear the risk,” said Daniel Murrer, vice president of RealSTATS, a South Side firm that analyzes real estate transactions. “It would be nice if the developer could take on the risk themselves.”

But Almono officials said market prices on the site wouldn't support the upfront cost of infrastructure and repairing environmental damage.

Murrer said Almono should learn from South Side Works and The Waterfront, major projects that relied on tax-increment financing.

The Waterfront generated little spillover development in economically depressed Homestead and neighboring Rankin and West Homestead. The SouthSide Works attracted primarily corporate tenants, such as UPMC and American Eagle Outfitters, that relocated from within the region, Murrer said.

“We have to realize that overall growth does not result from raiding Cranberry or Southpointe. It results from those operations increasing their operations,” said Jim Richter, executive director of Hazelwood Initiative, a nonprofit working to improve the Hazelwood area.

He said Almono's goal is to recruit technology and alternative energy firms nationwide and encourage startups from Carnegie Mellon University, the University of Pittsburgh and others to stay and set lup jobs.

He said some area corporations seeking spots close to Oakland and Downtown with lower rents and plentiful Class A office space could choose the 178-acre LTV site between Second Avenue and the Monongahela River.

Councilman Bill Peduto, a mayoral candidate, said access to the site is “extremely limited,” a drawback that could impede would-be developers. “There are no major corridors that connect from Hazelwood to anywhere,” he said.

Peduto said missing from the early discussion of TIF funding is the potential for a commuter rail link via Allegheny Valley Railroad tracks that run near the site and CMU's campus in Oakland.

Don Smith Jr., president of RIDC, said Tuesday that market demand would dictate which element of the plan — residential, office, flexible-use industrial space — Almono would build first once the roads and other infrastructure are in place.

Pittsburgh City Controller Michael Lamb, a potential mayoral contender, said he supports using TIFs in general to reclaim blighted land and install public infrastructure to attract developers. But he said some investors might hesitate because of the possibility — albeit remote — that the Pennsylvania Turnpike might still want to extend the Mon/Fayette Expressway to the city through the site. Turnpike Commission officials said those plans are on hold because of a lack of funding.

“They've never actually ruled it out,” Lamb said.

Jeremy Boren is a staff writer for Trib Total Media. He can be reached at 412-320-7935 or

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