Street Corner Soapbox: Merry CRIZ-mas!
The Hotel Wars rage on, and Erie gets a second chance at key funds for development.
Erie received quite a belated Christmas gift this year! Well, not quite a "gift." More like a lump of coal. Erie's application for a CRIZ program designation was denied shortly after the holiday. The state played the Grinch to our CRIZ-mas.
Okay. So maybe you don't know what a "CRIZ" is. Maybe you were busy when it went down. Maybe following closely the alphabet soup of government designations and programs and tax policy and agencies and...well, maybe that's not your thing. But this is kind of a big deal. Or it might not be. But regardless, it's interesting as hell.
So, "CRIZ" stands for "City Revitalization and Improvement Zones." Basically, a CRIZ allows a city to designate an area for redevelopment, and tax revenue from businesses in that zone can be funneled directly back to that zone for development. That is, that money wouldn't go to Harrisburg, it wouldn't go to prisons or as subsidies to Gov. Tom Corbett's oil and gas buddies. It could go directly back to that zone and help build – oh, I don't know – parks, sports stadiums, entertainment venues, streets, floating entertainment barges...
You see where I'm going with this. The idea was to designate the Bayfront as a CRIZ. After all, there's a frenzy of planning going on for the area. There's the GAF site, and the plan is to rework that empty lot next to the Bayfront Convention Center into... well, something. Maybe just a parking garage and sidewalk, or maybe something delicious and marvelous. There's a new hotel in the works next to the Convention Center itself, funded in part by a $25-million state grant. And then there's the Scott Enterprises extravaganza, the plan to turn the area next to the Erie Maritime Museum into a public area with park, skating rink, offices and apartments, stores, lighthouse, and... a floating entertainment barge.
(You might be able to tell, but I am charmed by the idea of a floating entertainment barge. A barge! That floats! And on which you're entertained! What could possibly go wrong with that?)
It's the Scott Enterprises plan, especially, that would benefit from the CRIZ program. We could take the tax money from the area businesses and use it to build the infrastructure that would give access to the Bayfront, that would draw people to the Bayfront, and that would make that Scott Enterprises development the new entertainment and social focal point of the city.
Alas. Only two Pennsylvania cities each year in 2013 and 2014 can win a CRIZ designation. Eight applied. Bethlehem and Lancaster won.
So why did Erie lose out on the CRIZ? Here's where it gets fun. According to an Erie Times-News report, the city proposed using the Sewer Authority as the administrative agency over the CRIZ. The state claimed the Sewer Authority did not qualify for such a role. Why? The authority "did not amend its articles of incorporation to include administering the CRIZ programs," said a state spokesman in that same report.
Which is a lot like getting banned from driving because your birth certificate is in the wrong font.
In other words, it sounds a lot like they were looking for reasons to reject Erie. That is, people's minds were made up long before any paperwork was in.
Of course, it turns out the guy who wrote the CRIZ bill in the Pennsylvania Assembly – Sen. Llyod Smucker – is from Lancaster, one of the cities that won the CRIZ designation. (Which should hopefully prompt Erie's Sen. Sean Wiley to immediately start working on a bill establishing a state "GIMEE MUNY" development project plan.) So Lancaster's designation was probably in the works from the beginning.
And maybe Bethlehem got the second designation because, well, it hosted the real Christmas and everything, and the jolly ol' governor – full of good cheer and good will towards his fellow man – just wanted to get into the spirit of things.
Or maybe Bethlehem deserved it.
Okay, you can stop laughing. Let's be serious now.
Maybe Erie's CRIZ rejection had something to do with the hotel wars down on the Bayfront. Maybe Gov. Corbett – who, er, graciously gave one hotel project $25 million, and not the hotel that would be helped the most by the CRIZ – maybe the Governor's taking sides among the forces marshaling on Erie's waterfront. Because, after all, there have been some questions about the need to use public money on a hotel, when a private company – Scott Enterprises – is more than willing to spend private capital on a similar project.
Because maybe, just maybe, if the CRIZ goes through and Scott Enterprises' plan gets cranking, and more private capital gets interested in the Bayfront, there won't be a need for a publicly-supported Convention Center hotel. There'll be no need for state grants and county bonds. And maybe, just maybe, some folks might just lose out on a sweetheart deal because of that. And maybe, just maybe, they're fishing pals or drinking buddies of the Governor.
But that would be reckless and irresponsible thinking. Right? I guess we'll see soon. Erie gets to bid on another CRIZ next year.
Jay Stevens can be contacted at Jay@ErieReader.com, and you can follow him on Twitter @Snevets_Yaj.