Keystone Opportunity Zones

Keystone Opportunity Zones (KOZ) Program and
Erie City Area Site Descriptions

KOZ PROGRAM
The Commonwealth of Pennsylvania under Governor Tom Ridge created the Keystone Opportunity Zone (KOZ) Program in 1999. This program now includes Keystone Opportunity Expansion Zones, KOEZ, which were added in 2001, and Enhancements to the KOZ-KOEZ effective January 2004 along with a special Keystone Opportunity Improvement Zone (KOIZ) [By Executive Order of the Governor]). This Program provides for an exemption of specific state and local taxes from now until December 31, 2013, and to December 31, 2018 for business and property owners in a KOIZ. In Erie City we have identified 17 KOZ-KOEZ areas comprised of 352 /- Acres at various locations throughout the community, and One (1) KOIZ area comprised of 115 /- Acres (Former International Paper Company Hammermill Plant Site north of East Lake Road).

The Commonwealth has agreed to forego PA Corporate Net Income Taxes, Capital Stock and Foreign Franchise Taxes, and Personal Income Taxes on income generated by businesses located in the zone, and the Sales and Use Tax on purchases used and consumed by businesses in the zone. Erie City, Erie County and the Erie School District, the local taxing bodies, have also agreed to forego certain local taxes: Real Estate Taxes, Business Gross Receipts and Mercantile Taxes, and Occupancy and Business Privilege Taxes during the term of the Program.

The KOZ Act requires Pennsylvania businesses that move into the zone to do one of two things: 1) Increase full-time employment by at least 20 percent in the first full year of operation, or 2) Make a capital investment in the property located within the KOZ that is equal to 10 percent of the gross revenues of the business in the immediately preceding calendar or fiscal year. Other conditions and requirements are detailed in the Act, for instance, businesses must be current with all present taxes and code requirements of local communities in order to qualify for participation in the program. Note: Benefits are not automatic as there is an annual renewal process.

ERIE CITY AREA SITES: In an effort to enable manufacturers, industrial and certain other businesses to create more jobs and to reclaim underutilized sites in the City of Erie, the City identified several areas as shown on the attached Erie New Communities Enterprise Zone Map (Click Here to View). Together these sites constitute one Keystone Opportunity Zone (KOZ) sub-zone (KOZ-KOEZ and KOIZ Sites) within the City of Erie.

INFORMATION/CONTACT:
Christopher M. Groner, Phone: (814) 870-1272
Fax: (814) 870-1443
E-Mail: cgroner@erie.pa.us
City of Erie, Department of Community and Economic Development
626 State Street, Room 404
Erie, PA 16501

ADDITIONAL BENEFITS TO LOCATING IN THE ERIE CITY KOZ-KOEZ and KOIZ SUBZONE

COMMONWEALTH OF PENNSYLVANIA PROGRAMS: Projects in KOZ's shall receive priority consideration for state assistance under various programs contained in the Project for Community Building including Charter Schools. Family Savings Accounts, PA Community Development Bank, Crime Prevention Grants and Self-Employment Assistance Programs. Additional Department of Community and Economic Development (DCED) programs for priority KOZ consideration are the State Customized Job Training Program, Community Conservation and Employment, Communities of Opportunity, Infrastructure Development, Industrial Site Reuse and Opportunity Fund. DCED will provide limited programmatic funding support to KOZ’s from other existing DCED programs.

As some of the property included in the KOZ may require environmental assessments and remediation to bring the blighted land into productive use, the Greater Erie Industrial Development Corporation (GEIDC) will assist potential developers with the Industrial Site Reuse Program for a grant and/or loan. This program covers, Phase I, II, or III Environmental Assessments and Remediation of Hazardous Substances.

UTILITIES: All sites within the Erie City KOZ sites can be adequately serviced by area utilities. Some of the sites are within close proximity of existing utilities and some, as noted, need utilities along with other infrastructure.

Water: Where Erie really makes a big splash is with its Water Authority. The $300 Million system pulls a limitless supply of fresh water direct from the Great Lakes. With a rated capacity of 88 million gallons daily, the utility is able to offer rates that are the lowest in Pennsylvania. For more information call 814-455-1049.
Natural Gas: The primary supplier of natural gas is National Fuel Gas Corporation. Rates and services may be obtained by calling 814-871-8000.
Electric: General Public Utilities provides the electrical service. Rate comparisons, special economic development rates and other information may be obtained by dialing 814-868-8790 or 800-335-0183.
Telecommunications: Verizon provides the telecommunications infrastructure. Information on its fiber-optic capabilities, digital switching, as well as rates are available by calling 800-483-5600.

TRANSPORTATION: Erie is blessed to be served more than adequately by all major forms of transportation: highway, rail, water, and air. Erie is the only Pennsylvania city west of Philadelphia that is served by ocean-going freighters. Strategically situated on the Great Lakes and the St. Lawrence Seaway, the Port of Erie possesses the largest stiff-leg derrick crane on the Great Lakes, and has the capacity to handle any cargo, with single lifts up to 300 tons.

WORKFORCE/EDUCATION: As a manufacturing center, Erie is the beneficiary of a two-hundred-year-old tradition of craftsmanship. Few cities the size of Erie can boast the per-capita skill level of its work force. The region also places a premium on education and training. There are five colleges and universities within the county (three within the City), and a variety of post-secondary training facilities. There is also specialized training available to meet the needs of manufacturing and industrial firms