The board that oversees Lancaster’s City Revitalization & Improvement Zone approved the distribution of about $9.5 million in CRIZ revenue this week.
That leaves $3.5 million of this year’s “increment” remaining. It must be allotted at the board’s next meeting on Dec. 19, or else be returned to the state treasury.
Through the CRIZ program, business taxes paid within a designated area are returned to Lancaster to fund redevelopment initiatives. The amount returned is the incremental amount above the program’s base year; hence the term “increment.” This total this year, $13 million, is the largest to date.
The local CRIZ authority distributes the increment in various ways. Several projects have contracts to receive increment that they themselves generate. Allocations of that type approved this week include the Marriott Hotel at Penn Square expansion ($1,355,449), Holiday Inn Lancaster ($439,803) and Southern Market Center ($214,488).
Similarly, the Lancaster Parking Authority receives increment from retailers at 101NQ next door and the Lancaster Public Library for debt service on the Christian Street Garage complex.
Uniquely, its contract guarantees that the CRIZ will pay its debt service in full. The CRIZ board elected to prepay the garage’s 2024 debt service, too, resulting in a total appropriation of $4.2 million, the largest in this week’s round.
Jeremy Young is director of Community & Economic Development at the Lancaster City Alliance, which administers the CRIZ program under a contract with the city. The prepayment advances the authority’s goal of prioritizing public debt for reduction when possible, he said.
The authority also makes grants of increment that is not otherwise committed. Such grants went to the Spanish American Civic Association’s Duke Street Plaza business center ($1,192,396), LancasterHistory’s planned Thaddeus Stevens & Lydia Hamilton Smith Center for History and Democracy Project ($901,465) and Tenfold’s Transitional Living Center renovations. ($76,417).
Roughly $611,000 of the increment was earmarked for CRIZ administration costs, such as legal, accounting and compliance services.
In other business, the board passed a resolution to allow a project to receive all the CRIZ increment it generates. The informal policy up to this point has been to allot no more than 80% of eligible funds.
Young explained that the 80% limit had been put in place in the very early phases of the CRIZ, when it was unclear both what the administrative costs and the revenues would be.
Last year, CRIZ funds were allocated to the Lancaster County Redevelopment Authority, which owns Clipper Magazine Stadium, for roof renovations and the conversion to artificial turf. The redevelopment authority had not expected to need further revenues, but the projects are incurring additional expense, so it will be making a request in December, Executive Director Justin Eby confirmed to One United Lancaster.
Young said the Lancaster City Alliance may also receive a request for an additional CRIZ grant from the Parking Authority for costs associated with the interior fit out of the Busy Bodies Play Cafe that opened at Ewell Plaza a couple of weeks ago.
Meanwhile, several restaurant and hospitality businesses’ CRIZ applications are awaiting approval by state officials. If those come through in time, they too could be approved for funding at the December meeting, Young said.
To date, Lancaster is one of only three municipalities with a CRIZ, along with Tamaqua and Bethlehem. Marshall Snively, president of the alliance and executive director of the CRIZ authority, said there is increasing interest in the CIZ program in the surrounding region, especially in York, Harrisburg and Reading.