5 pieces of Armstrong property to be tax-free
Five pieces of Armstrong School District-owned property could become tax-free Keystone Opportunity Expansion Zones.
The Ford City High School in Ford City, Kittanning Township Elementary School in Kittanning Township, Kittanning Middle School and Kittanning High School in Kittanning, and 144.7 acres in East Franklin's West Hills Industrial Park campus will be designated Keystone Opportunity Expansion Zones, after receiving approval from each of the municipalities, the Armstrong School District board and the Armstrong County Commissioners.
In Keystone Opportunity Zones, multiple taxes, including state corporate net income tax, state capital stock and foreign franchise tax, state personal income tax, state sales and use tax, local earned income and net profits tax, local business gross receipts, business occupancy, business privilege and mercantile tax, and local property, sales and use taxes, are waived.
Officials hope the tax breaks on the properties will encourage developers to move into the old school facilities, which tend to be harder to sell, according to Michael Coonley, executive director of the county's Department of Economic Development.
“These properties are usually older, which present unique challenges, such as an aging infrastructure, some design issues and older mechanical systems,” Coonley said. “The program is made to incentivize these properties, with the idea that if you can get tax abatements and realize the savings, potential developers may be more inclined to redevelop.”
Kittanning Middle School, Kittanning High School and Ford City High School will remain in use until the end of the 2014-15 school year, when the district expects to open its newest building, the $55 million Armstrong Junior-Senior High School, off Buffington Drive in Manor Township.
Kittanning Township Elementary School sits vacant, because students were relocated to Lenape Elementary School.
Coonley said the application for the latest round of KOZs is in cooperation with Indiana County, which claims about 50 of the 350 acres of land to be included in the program. The remainder sits in Armstrong County, Coonley said.
“This is a very aggressive incentive program,” Coonley said. “It's a 10-year, tax-free zone, which is different because it's a cooperative program with the three local taxing bodies giving up their property taxing ability, and the state also abates taxes.”
Coonley said, last year, state legislators allowed the creation of an additional 15 Keystone Opportunity Zones across Pennsylvania, and allowed the possibility of extensions to existing zones.
According to the state's Keystone Opportunity Zone website, Armstrong County currently has seven KOZ sites, ranging from 4.5 acres in the Manor Township Business Park, to 42.6 acres at the Ford City Heritage & Technology Park.
“The program has been very successful, and surrounding counties are applying for these designations and have a lot of acreage as well,” Coonley said. “As much as we want to cooperate regionally and within the state, it's a dog-eat-dog business, and we want to attract business and industry here.”
The Armstrong County Commissioners were the final governing body needed to approve the zones. They granted approval in a 2-1 vote, with Republican Commissioner David Battaglia, who is the board president, dissenting.
The state's Clean and Green program is a preferential tax assessment, which bases property taxes on use values, rather than on fair market values for agricultural and forest land meeting specific criteria.
County property owners enrolled in the program will see a dramatic increase in their taxes next year, as the county adjusts to rates set by the Department of Agriculture, which will bring in an estimated $441,663 revenue increase for the county, and an additional $984,817 for the Armstrong School District.
“I don't want to see these KOEZs as an unfair way of adding insult to injury to people in the Clean and Green program,” Battaglia said. “We're trying to be equitable with every concern, and deal with that issue fairly.”
Brad Pedersen is a staff writer for Trib Total Media. He can be reached at 724-543-1303, ext. 1337, or email@example.com.