Shapiro Administration Delivers Funding to Bethlehem, Lancaster, & Tamaqua through City Revitalization and Improvement Zone (CRIZ) Program
Erie and Reading Take Important Steps Forward to Benefit from CRIZ Program, Spur Economic Development in their Cities
-
Harrisburg, PA – Secretary of Revenue Pat Browne today announced that $16.2 million will be returned to three communities participating in the City Revitalization and Improvement Zone (CRIZ) program. The program helps Pennsylvania municipalities that have faced economic challenges revitalize vacant or rundown spaces with the goal of attracting new businesses and creating jobs.
The funding is based off the period from January 1, 2024 to December 31, 2024. It will go to:
- Bethlehem (Lehigh/Northampton Counties) – $2,052,067.07
- Lancaster (Lancaster County) – $12,185,988.91
- Tamaqua (Schuylkill County) – $2,000,819.11
Additionally, the Department of Revenue has established the state tax baselines for two additional cities, Erie and Reading, that have been approved for the CRIZ program. Setting the baseline is another important step forward for both cities, as this plays a factor in determining the amount of funding that each will receive starting in 2026 to spur economic development in their respective communities.
“Since its inception, the CRIZ program has delivered a total of nearly $102 million to participating communities, helping them to attract development, revitalize their downtowns, and bring new jobs to their regions,” said Secretary Browne. “This program is a proven model that has been a critical tool for growth in Bethlehem, Lancaster, and Tamaqua. Recognizing this success, Governor Shapiro worked to reopen the program and open the door for more communities to apply. That historic step was a gamechanger for both Erie and Reading, and we’re excited to see the program support economic development in both cities.”
Next Steps for Erie and Reading
Governor Josh Shapiro paved the way to reopen the CRIZ program when he signed the 2024-25 bipartisan budget into law. Following that step, the Shapiro Administration allowed new qualified communities to participate in the program for the first time since its inception in 2013.
Applications from Erie and Reading were both approved, paving the way for both cities to benefit from the CRIZ program. That led the Department of Revenue to move forward with the process to determine the state tax baseline for each city. This involves analyzing the businesses in each respective CRIZ and determining the total amount of state taxes attributable to the zones between January 1, 2024 and December 31, 2024.
The baseline serves as a reference point for calculating annual incremental growth from existing businesses that have established baselines within the zone and file an annual CRIZ report.
The certified tax dollars, calculated after the baseline year, are derived from a formula that includes tax revenue from both baseline and newly established businesses, as well as construction projects. Tax revenue generated from new businesses and construction is directly incorporated into the annual certification.
Incremental growth in tax revenue, exceeding the baseline, calculated on a per business basis, for each business in the zone with an established baseline is also factored into the certification. The result is the amount of certified tax dollars that are transferred from the General Fund to each respective CRIZ authority.
About the CRIZ Program
The City Revitalization and Improvement Zone (CRIZ) program, modeled after the transformative Neighborhood Improvement Zone (NIZ) program administered in Allentown, was established by Act 52 of 2013 and amended under Act 84 of 2016. Its purpose is to spur new growth in cities that have struggled to attract development, helping to revive downtowns and create jobs for the residents in the regions. A CRIZ is an area of up to 130 acres, comprised of parcels designated by an authority to capture state and local taxes for the purpose of improvement and development in the designated CRIZ zone.
The program is similar to a tax incremental financing program. It is structured to protect the existing state and local tax base, while providing incremental funding for tax revenues based on new growth generated over and above an established baseline per business and new tax.
The funds are paid to the local development authority for the zone, and can be used for debt service, property acquisition, new construction, and other costs related to development projects in the zone.
The CRIZ program is administered by the Department of Revenue, the Department of Community and Economic Development (DCED), and the Governor’s Budget Office.
For more information about the Department of Community and Economic Development, visit the DCED website, and be sure to stay up-to-date with all of our agency news on Facebook, X, and LinkedIn.