Norristown council OKS tax abatement for apartment building

By Carl Rotenberg crotenberg@21st-centurymedia.com

Council voted 4-1 for the tax abatement and deteriorated area designation after a brief public hearing. Councilman Sonya Sanders voted against the designation. Council members Marlon Millner and Linda Christian were absent for the vote.

The Local Economic Revitalization Tax Assistance Act (LERTA) zone designation will allow Westrum Development Company (WDC) of Fort Washington not to pay real estate taxes on a diminishing yearly schedule. The tax exemption contains a 100 percent tax abatement in the first year and a 10 percent abatement in the 10th year with 10 percent changes each year.

If the Luxor at Sandy Street project were developed without the LERTA public subsidy, annual tax revenue would be $280,000 for the Norristown Area School District, $110,000 for the Norristown municipality and $28,000 for Montgomery County. If the 10-year, LERTA tax abatement for 900 Sandy St. is adopted by all three taxing authorities, full tax revenue would be postponed to the 11th year.

The resolution adopted by council said the property abuts a property (770 Sandy St.) that contains an unsafe building built with a defective design, is vacant, and has been condemned as unsafe for human habitation by the municipality of Norristown and thus is considered a deteriorated area pursuant to Section 4725(a) of LERTA.

However, the building at 770 Sandy St. was vacant after Norristown condemned it in May 2010 under a court order. Nine condo owners and 15 renters were forced to vacate. The municipality repaired it for more than $3.4 million at taxpayer expense. Four condo owners resided in the repaired building after the first condemnation was lifted on Aug. 17, 2012, and until it was condemned for a second time in August, said Ryan Schofield, a 770 Sandy St. condominium owner who lived there before the first condemnation.

The 26-unit condo building at 770 Sandy St. has been vacant since the August condemnation, Schofield said.

In February, Norristown officials announced they would no longer pay the $40,000 annual cost for maintenance, electricity and repairs at the building after winning that right in Montgomery County Common Pleas Court.

John Westrum, chairman of WDC, said the mix of 113 one-bedroom units, eight studio apartments and 36 two-bedroom apartments at 900 Sandy St. would discourage rentals from families who children that would attend the Norristown Area School District.

The Lofts at Valley Forge in West Norriton has 388 units and six school-age children attending the district, Westrum said at an earlier council workshop meeting. Continued...

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Norristown council OKS tax abatement for apartment building