MERCER COUNTY Housing authority to make payments

By HAROLD GWIN
VINDICATOR SHARON BUREAU
FARRELL, Pa. -- Mercer County Housing Authority hasn't made any payments in lieu of taxes on its Steel City Terrace apartment complex on Spearman Avenue for years, but that's about to change.
The Farrell Area School Board approved agreements with the authority, the city, Mercer County and the Steel City Housing Partnership on Monday that require the partnership to make payments in lieu of taxes on some of the new units being built to replace Steel City.
The authority, through the partnership, is tearing down the old 100-unit barracks-style complex and replacing it with 145 units with help from a $9 million federal grant.
Frank Gargiulo, housing authority coordinator for the project dubbed HOPE VI, told the school board that the 119 new rental units in the first two phases of the project include 90 apartments that will pay $240 a year to the three local taxing bodies in lieu of paying property taxes.
The authority is a tax-exempt government entity and isn't required by law to pay any property taxes.
To be divided
The payments in lieu of taxes total $21,600 to be divided among the school district, city and county, Gargiulo said. The remaining 29 units in the first two phases will likely have to pay full taxes because the housing authority doesn't own the land where they will be built, he said.
The revenue picture will improve even further with the third and final phase of the development, which will feature 26 new or remodeled homes that will be sold and pay full taxes, Gargiulo said.
It's a good deal for the school district, said Atty. James Nevant, school board solicitor.
The district won't lose any money and, in fact, will be getting more than it received in the past 30 years from Steel City, he said.
Gargiulo said some of the payments in lieu of taxes will begin in 2003 and the rest in 2004 as the new units are finished and occupied.
The figure of $240 per unit per year was determined by estimating what the project budget can afford, he said.