LERTA

LERTA, A PROGRAM DESIGNED TO ENCOURAGE REINVESTMENT IN THE CITY OF ERIE.
A TAX ABATEMENT PROGRAM

 

LERTA = Local Economic Revitalization Tax Assistance
City Council File No. 15,816, Official Ordinance No. 35-2012
Effective November 1, 2012 superseding all prior LERTA Ordinances
Sunset Provision 10/31/2022, unless otherwise amended or extended by ordinance duly adopted

Woodland-Hills-005

Woodland Hills Condominiums qualify for LERTA

 

LERTA, A PROGRAM DESIGNED TO ENCOURAGE REINVESMENT
IN THE CITY OF ERIE – A TAX ABATEMENT PROGRAM
(LERTA = Local Economic Revitalization Tax Assistance)
City Council File No. 15,816, Official Ordinance No. 35-2012
Effective November 1, 2012

In October 2012, the City, School District and County taxing bodies adopted ordinances to provide for a beneficial investment incentive for Commercial/Industrial and Residential properties to continue throughout the City of Erie. This real estate tax abatement program applies to improvements (renovations, new construction, etc) that are completed. This ordinance also allows for the continuance of an Appeals Board to hear cases regarding the benefits given for job creation, and established a ten-year sunset provision. Please note that the property owner will continue to pay existing real estate taxes on the property (and an increased level of taxes on a vacant lot that is converted to an improved lot), but they will not be fully taxed on the improvements until the abatement time period ends.

“Improvements” means repair, construction, reconstruction, alterations or additions, having the effect of rehabilitating a deteriorated property, either commercial or residential so that it becomes habitable or attains higher standards of safety, health, economic use or amenity, or is brought into compliance by laws, ordinances or regulations governing such standards. Ordinary upkeep and maintenance shall not be deemed an improvement and should not result in an increased assessed value and taxation.

Improvements that do not result in an increased assessed value on the subject property will not qualify for LERTA.

LERTA will only be granted when a LERTA application accompanies a building permit. Benefits will not be applied retroactively to projects started without the proper permits.

The Schedule for New ‘Residential’ real estate development tax exemptions shall be as follows:

Year of Abatement Target Area
Abatement
Non-Target Area
Abatement
1 100% 100%
2 90% 80%
3 80% 60%
4 70% 40%
5 60% 20%
6 50%
7 40%
8 30%
9 20%
10 10%

The Schedule for New ‘Commercial/Industrial’ real estate development tax exemptions City-wide, shall be as follows:

  • Business and Industry will receive a 50% tax break for a 10-year period for all such physical improvements throughout the City.
  • Business and Industry will receive an additional tax break of 10% to 40%, depending on the number and salaries of jobs created; full details on the job creation process will be provided upon request.

The Schedule for all ‘Additions and Alterations’ to existing buildings real estate tax exemption shall be as follows:

Year of Abatement Abatement
1 100%
2 90%
3 80%
4 70%
5 60%
6 50%
7 40%
8 30%
9 20%
10 10%

Special Note on Deteriorated/Demolished Property (Commercial/Industrial, or Residential): In any case where deteriorated property (Commercial/Industrial, or Residential) is damaged, destroyed or demolished, by any cause or for any reason, and the assessed valuation of the property affected has been reduced as the result of such damage, destruction or demolition, the exemption from real property taxation shall be limited to the actual cost of improvements or construction that is in excess of the original assessment that existed prior to damage, destruction or demolition of the property. In the event that a property has been fully demolished by demolition permit, and has remained vacant of any structure after the expiration of one year from the time of issue of the permit, then the assessed value of the demolished improvements shall thereafter not be subject to taxation.

Board of LERTA Appeals: The LERTA Ordinance provides for the establishment of a Seven (7) member Board of LERTA Appeals, which shall hear all appeals by business owners aggrieved by the additional job creation credit decisions of the LERTA Administrator. The Board will publicize a list of rules and guidelines used for reviewing each application so appealed.

Processing: To ensure the property owners receive the benefit, the City of Erie files the LERTA Application and a copy of the approved Building Permit with the Erie County Tax Assessors Office on behalf of the property owner prior to the start of new construction/renovations. The City of Erie Zoning Officer and staff members of the City’s Building Inspection/Permits Office will assist property owners and/or their contractors with this process. They may be reached at (814) 870-1313.

Sunset Provision: The provisions of the LERTA Ordinance shall expire on the tenth anniversary of its enactment (10/31/2022), unless extended by ordinance duly adopted.

For more information on this real estate tax incentive, please contact us today.