Philadelphia development projects want $341M in state funds” Everyone is looking for a handout”

Developers, institutions and companies that are proposing projects throughout Philadelphia have sought more than $341 million in taxpayer funds from the Pennsylvania’s Redevelopment Assistance Capital Program.

A total of 78 Philadelphia-based projects have filed to receive state financial assistance to support the construction of new or expanded facilities, according to an analysis of a list of candidates who filed to receive money through the capital program. The list is maintained online by the state’s budget office and the program is referred to as RACP.

Philadelphia not only has the largest concentration of projects seeking these funds, it also has the most money being sought. Allegheny County falls a distant second with a total of 44 projects looking for $169.2 million.

So far, Philadelphia entities have received the most awards this year in the first round of the program, which is part of the state budget and awarded annually by the governor. Last year as well as this year, $125 million has been allocated to be distributed through the program, which some say has political undertones.

As of Oct. 9, 10 projects in Philadelphia were awarded given $27.4 million. In Allegheny County, $25.5 million was awarded for nine projects. Some of the Philadelphia developments and the funding received include:

• $5 million for Dietz & Watson to construct a new $50 million facility. The company sought $10 million.
• $1.5 million for Thomas Jefferson University Hospital to relocate and expand a labor and delivery unit. The hospital wanted $5 million.
• $400,000 for Wistar Institute to renovate a building. It asked for a little more than $2 million.
• $2.5 million to the developers of the former Girard Square project now called East Market. A total of $5 million was sought.
• $10 million to Liberty Property Trust for infrastructure associated with the construction of the new Comcast Innovation & Technology Center. The company had asked for $25 million.
• $500,000 to the organizers of the Fringe Arts Festival for the renovation of a building for a restaurant. It filed to receive the amount it requested.

Everyone is looking for a handout

While private entities, such as developers, hospitals, educational and cultural institutions and non-profits apply for these funds, municipalities can also seek out the money though those are few and far between. Some of the biggest have come from companies and universities. For example:

• Sun Center Studios wants $17.5 million to expand.
• Urban Outfitters Inc. wants $15 million to expand and renovate buildings at the Navy Yard where it is headquartered.
• Villanova University wants $10 million for a portion of a proposed development along Lancaster Avenue.
• Sunoco Inc. would like $10 million for its new corporate headquarters in Newtown Square, Pa.
• FMC Corp. is seeking $7 million for improvements for its new headquarters at Cira Centre South.

Local counties also requesting money

While Philadelphia is the heavyweight when it comes to requesting money, suburban counties also have developments seeking a portion of these public funds.

• Bucks County has 10 projects totaling $21.3 million. So far, none has received funding.
• Chester County has six projects totaling $28.3 million; So far, one has been granted money and that was $2.5 million for Sikorsky Global Helicopters Inc. The company, based in Coatesville, Pa., asked and received the total amount of money it wanted. Sikorsky will use the funds for a fascinating project. The money will go toward constructing a tunnel under Washington Lane to connect Sikorsky’s existing manufacturing facility with a 12-acre site adjacent to the Chester County Airport. Sikorsky is the builder of the presidential helicopter, Marine One.
• Delaware County has 16 projects totaling $81.7 million. None has received any money.
• Montgomery County has 14 project totaling $41 million. Just one has been awarded any funds and that was Abington Hospital, which received $3 million of a $10 million request for the construction of a 63,000-square-foot cancer center.

State funds have been dedicated to the program for nearly 30 years.

RACP was established in 1986 with $400 million to help support economic development projects that would not only enhance a community but also produce construction and permanent jobs. The amount of money has increased by hundreds of millions of dollars over the years. In 2010, the state increased the amount it could put into the program by $600 million and the total commitment was a tad more than $4 billion, according to the state budget office website.

In 2013, the Corbett administration revamped the program and reduced its general obligation borrowing capacity for the program by $600 million to $3.45 billion.

The Corbett Administration also altered some ways the program is administered to make it more “transparent.”

Those filing to receive funding must present a detailed plan that shows, among other things, how a project will further economic activity and vitality of a community, create jobs and wages, and generate tax revenues.

While $125 million is expected to be distributed this year, it’s way more than the total amount being sought throughout the state.

In all, 287 requests totaling more than $1 trillion have been made across the state during the first round of RACP this year. Of those, 39 projects have received awards totaling roughly $108 million.

The awards are made throughout the year but most are notified in April and October as to whether they will receive money and some are even made during the last few days of a year. Those applicants who fail to get funding can reapply.

Source: Philadelphia Business Journal