Urban Redevelopment Authority of Pittsburgh
Development Opportunities
Financial Assistance/Tools: Tax Incentives
The following tax incentives may be available depending on the project type. The URA can assist in securing and administering these options.
Local Economic Revitalization Tax Abatement (LERTA)
This is a tax credit on improvements to existing buildings and new construction that is available in selected areas of the City. In these select areas within the City of Pittsburgh an accelerated tax credit is available for the conversion of commercial buildings and land to residential use and hotels. See LERTA documents for further details.
ACT 42
Allows a 100% abatement of City, County and School taxes on new construction housing and substantial rehabilitation housing. The enitre city of Pittsurgh is eligible for Act 42 tax abatement. For more information, see Allegheny County's web page: City ACT 42 New Construction/Improvements.
Keystone Opportunity Zones (KOZ/KOEZ/KOEZ Enhancement Sites)
This tax abatement program is available for specific parcels in several economically distressed neighborhoods throughout the City. This program abates virtually all state and local taxes for property owners, residents, and business tenants until 2010. The majority of the designated properties are either publicly owned, or are in severely deteriorated condition.
View this KOZ presentation for additional details.
Tax Increment Financing (TIF)
When large-scale projects are proposed which are anticipated to generate significant new tax revenue on properties that are currently generating little or no tax revenue, Tax Increment Financing is a possible option to fill funding gaps. Tax Increment Financing requires the approval of all three local taxing bodies to agree to pledge a portion of the anticipated NEW revenues towards project costs.
The Urban Redevelopment Authority was the first entity in Pennsylvania to utilize Tax Increment Financing with the Pittsburgh Technology Center Project in 1993. The projected tax revenues were much higher than initially projected and allowed the TIF bonds to be retired a full twelve years earlier than scheduled.
TIFs are complicated deals to structure. Development projects utilizing TIFs must demonstrate a significant benefit to the City of Pittsburgh and to the community in which it is built to gain the necessary support.
See TIF FAQs for more information on what TIFs are and how TIFs work.
Federal Historic and Renovation Tax Credits
Federal historic and renovation tax credits are available when renovating historic or other older buildings and can generate equity in the amount of up to 20% of eligible development costs. For more information please visit the National Park Service's Federal Historic Tax Incentive's website: www2.cr.nps.gov/tps/tax/brochure1.htm
Pennsylvania Historic Renovation Tax Credits
Twenty-one states have enacted state historic tax credits to complement the Federal Credit and capitalize on the economic benefits of historic renovation. Legislation has been introduced in both houses of the the Pennsylvania Legislature (Senate Bill 820 and House Bills 951 and 952). The House Bills passed unanimously in October 2003 and are currently in the Senate Appropriations Committee.
Please visit: www.pataxcredit.com if you would like to find out more information or join the URA in advocating for the passage of these bills.
See the recently issued draft document Preserving Pittsburgh, a joint effort by Pittsburgh History and Landmarks Foundation (www.phlf.org) and the URA. This publication details exactly how to use every tax incentive available to preserve and rehabilitate historic buildings in Pittsburgh.