Tuesday, October 16, 2012

Is Scranton Playing Hardball on PILOTs?

From the Nonprofit Quarterly comes a story about the city council of Scranton, PA and the city council's potential "hardball" approach to coaxing PILOTs from the city's nonprofit sector. 

The story recounts how the City Council has asked that it be given notice of any zoning variance applied for by a nonprofit, so that the council can (if it chooses to do so) oppose the variance before the zoning authorities.  The undercurrent of the story is that the potential opposition might be tied to whether the nonprofit agrees to a PILOT.  The author of the NPQ article indignantly claims this is discriminatory, because the tax status of the organization requesting the variance should have no bearing on whether the variance is granted:

If a tax-exempt and a tax-paying entity both apply for variances regarding off-site parking requirements, for example, it would seem to be a big stretch to argue that the tax status of an applicant trumps the empirical questions about the land use.

Well, I'm not sure I agree.  Zoning is clearly about land use, but in a larger sense it is about the overall economic health of a particular geographic area.  Tax revenues are certainly a consideration in that overall economic health and I don't find it untoward for zoning variances to consider the effect on the local tax base (assuming, of course, that consideration is not prohibited by local zoning laws; I have to believe that if the city council's attorney thinks that such consideration is appropriate, there probably isn't a Pennsylvania statute prohibiting it).  If Scranton wants to play hardball with nonprofit organizations, potentially holding zoning variances "hostage" in return for payments, that's life in big city politics.  There's some saying about "kitchens" and "heat" that seems appropriate here . . .

JDC

 

http://lawprofessors.typepad.com/nonprofit/2012/10/is-scranton-playing-hardball-on-pilots.html

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