With the coronavirus pandemic causing an economic swoon, some major Lancaster city hotels and attractions have been taking a big hit.
The economic pain is prompting requests for additional support from the Lancaster CRIZ authority which can redirect state taxes – and a small amount of city taxes -- to support qualifying economic development projects.
The good news is the CRIZ Authority should have plenty of extra money to spread around this fall since its disbursements will be based on tax receipts from 2019, before the coronavirus pandemic.
At a 4 p.m. meeting Tuesday, the CRIZ Authority board will consider new requests to help fund additional debt payments for some existing projects it supports, which include Clipper Magazine Stadium, Lancaster Marriott at Penn Square and Holiday Inn at Ewell Plaza, formerly Lancaster Square.
The downtown Marriott is owned and operated by Penn Square Partners in a building leased from the city development authority. The general partner in Penn Square Partners is an affiliate of High Real Estate Group. An affiliate of LNP Media Group, publisher of LNP and operator of the website LancasterOnline, is a limited partner.
How it works
A city designates a CRIZ — a zone where it wants to stimulate development — which can be up to 130 acres. A CRIZ authority is set up to administer the program.
Officials determine how much the businesses in the zone are paying in certain state and local taxes in the year the CRIZ was set up. Every year after that, state and local taxes above that baseline are transferred to the local CRIZ authority, which uses them to “to repay debt service to stimulate economic development projects within the CRIZ."
With $7.2 million to work with last November, the CRIZ was only able to avoid returning some money by using nearly $4 million toward principal and interest on a loan of its own.
This time around, the expected surfeit of money could be used to support economic development projects hammered by the pandemic, CRIZ authority CEO Randy Patterson says.
While the CRIZ could be a financial lifeline this year, Patterson noted it too will eventually feel the economic impact of the coronavirus pandemic.
“Next year is a different story,” he said.