Along 422 in Amity Township, Island Pizza, a great lunch stop, stands alone. For decades, Amity Township wanted development along and north of this major state road. For decades, they courted developers who looked hard to make projects work but ultimately walked away. The sticking point? Infrastructure.
This is all about to change. This spring, a partnership between all three taxing bodies, BerksIDA, and a developer is bringing water and sewer to a long unserved part of the County. The tool used to build the pipelines? Tax Increment Financing (TIF).
In simple terms, using Tax Increment Financing means to pay for necessary public improvements by designating future tax dollars gained from the project. For a TIF to work, new taxes need to be generated. In this case, the new taxes are coming from a
338-unit age restricted housing development – roughly 148 duplexes and 190 single family homes. Currently, the ~130 acres sit vacant and is assessed $395,000, generating ~$17,000 per year in property taxes. Once the homes are complete, the development will have a market value hovering around $120M, generating roughly $2M more in annual property taxes to the benefit of Berks County, Amity Township, and Daniel Boone School District. Over the first decade of the project, a portion of those new taxes will be used to finance the water and sewer expansion necessary for the project and surrounding properties, after which the full property tax value will continue to flow to the taxing bodies. No one is given a discount on their tax bill, but TIFs allow the public infrastructure to be built that otherwise stop a project like this one.
Already nearly half the water and sewer being financed by the TIF have been installed, with completion of work expected by end of summer. Home construction is expected to commence in September.
Reach out to BerksIDA today if you have a project in need of public infrastructure to get it across the finish line.