SHARPSVILLE Borough weighs tax breaks to spur property upgrading

Sharpsville will need help from the state if it hopes to enact the tax break plan.
SHARPSVILLE, Pa. -- Borough officials think residential and commercial property owners should be encouraged to improve their buildings and to stay in town.
They'd like to consider enacting a tax abatement program that would temporarily forgive any property tax increase generated by additions to residential or commercial properties.
The problem is, there's no authority under state law to put such a program in place.
Borough council has gone on record as favoring a 5- to 10-year abatement plan and is seeking the help of local state legislators to get the law changed to permit it, said Borough Manager Michael Wilson.
"It's not just going to benefit Sharpsville; it's going to benefit Pennsylvania," said Councilman Gary Grandy, known as Gus, the driving force behind the plan.
Idea inception: It was Grandy who first proposed the idea to council in August when he was running for his council post, though he said it didn't originate with him. He said he got the idea from Robert Lucas, who ran for mayor in Sharon last year.
"I think it's something owed to the residents," Grandy said, adding that it wouldn't cost local taxing bodies anything because they wouldn't be losing any existing property tax revenues.
It would help in the long run because those who take advantage of the tax break and improve their properties now would be paying full taxes on those additions in five or 10 years, he said.
Municipalities, school districts and counties should be able to enact the program at their option. It shouldn't be mandatory, he added.
Tax abatements are already available, primarily for new industrial construction, in state-designated enterprise zones and Keystone Opportunity Zones and in some municipalities, but existing commercial businesses can't get that break if they want to improve their properties, Grandy said.
Sharpsville has a number of restaurants and other small businesses as well as residential properties that could benefit from an abatement program, he said.
Possible complications: Getting the state to authorize the program may be a lot more complicated than just getting some new legislation enacted, said state Sen. Robert Robbins of Greenville, R-50th.
It might take a constitutional amendment, he said, explaining that the Pennsylvania Constitution has a tax uniformity clause that could be a problem. It doesn't allow different levels of taxation within a single classification of property, he said.
"When you get into these issues, things get very complicated," Robbins said, adding that he is willing to sit down with Sharpsville to hear its plan and then take it to Harrisburg for review.
State Rep. Michael Gruitza of Hermitage, D-7th, said he was interested in drafting a bill implementing Sharpsville's plan but learned that a simple bill might not be enough.
He said he was also told that a constitutional amendment might be required.
New homes: Gruitza said he has a staff member researching the issue and has found there is a 1986 New Home Construction Abatement Act that allows municipalities to give a two-year abatement on new home construction.
His staff is examining that law to see if it might be applicable to Sharpsville's proposal, he said.

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