Bethlehem Wins New Economic Development Zone

Bethlehem has been selected to host one of two new Pennsylvania economic development zones, which will allow the city to invest future state and local tax revenue to pay for infrastructure and development for new projects, state and city officials announced Monday.

Mayor John Callahan said the new designation for a City Revitalization and Improvement Zone (CRIZ) will pave the way for another $350 to $400 million in new private investment and put the city in position to have most former Bethlehem Steel land on track to be fully redeveloped in the next four or five years.

In preparing a successful application that was chosen by Gov. Tom Corbett’s administration, the city’s newly minted Revitalization and Improvement Zone Authority prepared an application with 11 shovel-ready projects to build.

Those projects alone are expected to bring 3,000 construction jobs and more than 4,000 new permanent full-time jobs.

One of the first projects likely to benefit from the designation is the planned conversion of the former Bethlehem Steel No. 2 Machine Shop into a shopping mall anchored by a giant Bass Pro Shop, city officials said.

The zone includes 130 acres on the north and south sides of the city, much of which at one time belonged to the 20th Century industrial behemoth. The designation is available for development use for the next 30 years.

Callahan said Bethlehem’s selection might not be quite as big a game changer as when Sands BethWorks was selected in 2006 to receive one of Pennsylvania’s gaming licenses, which led to the construction of the Sands Casino complex. But the feeling of elation in City Hall was pretty close, he said.

“It’s gratifying for the city and it’s gratifying for me personally,” said the mayor, who is wrapping up 10 years at the city’s helm this week.

The other city chosen to benefit from the improvement zones was Lancaster. State Sen. Lloyd Smucker, R-13, who represents Lancaster, wrote the law that created the CRIZ.

Other Bethlehem projects that could benefit from the new designation include a new convention center on former Bethlehem Steel land near the Sands Casino, a proposed office and retail complex at Third and New streets and the redevelopment of the long-vacant Martin Tower.

“This designation will enable Bethlehem to both enhance and accelerate its efforts to bring more jobs and businesses into the city,” said state Sen. Lisa Boscola, D-18, who helped announce the city’s designation at Town Hall today. “I am proud of the role I played in helping the city capture one of only two available eligibility slots.”

Smucker’s bill would have limited the size of cities eligible for CRIZ designation to between 30,000 and 70,000, which would have kept Bethlehem—with a population of about 75,000—out of the running. But Boscola lobbied successfully to remove the size limitations from the law.

The program has been described as a less potent version of the Neighborhood Improvement Zone that is fueling development in downtown Allentown—including construction of a new hockey arena.

Under the CRIZ program, new state and city revenue generated from the program can be used to help fund bonds for economic development initiatives. Qualifying taxes include sales, income, earned income, business privilege and corporate net income.