Gaming funds can be boon to communities, but landing grants isn’t easy

Last updated: April 05. 2014 10:22PM - 3790 Views
By Andrew M. Seder aseder@civitasmedia.com

Pete G. Wilcox | The Times LeaderPittston Township requested for $515,000 for expansion of the Interstate Window and Door manufacturing plant.
Pete G. Wilcox | The Times LeaderPittston Township requested for $515,000 for expansion of the Interstate Window and Door manufacturing plant.
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Next month, when a state authority awards $11.1 million in grants generated by slot play at Mohegan Sun at Pocono Downs casino, there will be some winners but many losers in the annual jockeying for funding.

The Commonwealth Financing Authority, which meets May 6, is considering requests from 79 proposed projects for $46.5 million generated by a state tax on money pumped into the casino’s 2,332 lot machines.

The complex and competitive process started last year when municipalities began compiling projects suitable for submission.

For some, it was a municipal need, such as a street sweeper in Hanover Township or a paving project in Forty Fort.

For others, it was a combination of public and private projects such as Wilkes-Barre, which applied for six grants totalling more than $8 million. Among the requests:

• Renovations of the Ramada Hotel on Public Square that has been purchased by King’s College for academic use, $3 million.

• Kirby Park track and field renovations, $1.53 million.

• Camera system network upgrade, $1.5 million.

At the end of 2013, the municipalities submitted their applications to the authority, which began analyzing them and reviewing need and impact.

With less than one quarter of the $46.5 million requested, plenty of projects will not be funded and some that are may not be given the full amount they’ve asked for, if past history is repeated.

Payout in 2013

In 2013, only 37 of the 94 requested projects received funding and only about three-quarters of those that were lucky enough to be chosen received the full amount requested.

Case in point: The borough of Ashley, which last year applied for $810,000, the amount needed to pay for a new municipal building.

But the award came through at less than half of that amount. With $400,000 in hand and a necessity to leave the current building, the borough began negotiating to purchase the J.C. Ehrlich building at Main and Cemetery streets.

And this year the borough reapplied for an additional $639,290 in funding to pay for the entire cost of purchasing the building ($550,000) and renovating and upgrading it ($489,000), according to Borough Manager Greg Gulick.

He said if the approval does not come through “we start all over again.”

“Let’s just hope for the best,” he added.

Newport Township Manager Richard Zika said his township was the epitome of Sisyphus, trying to compete with the bigger municipalities by submitting an application year after year and being rejected. Finally, in 2013, the township learned it had been awarded a $500,000 local gaming share grant to be used toward a new municipal building.

The problem was that it had asked for $775,000.

“You’re foolish to say ‘no,’” Zika said. So the plans were redrawn with the building size dropped from a 5,600-square-foot structure down to a 3,700-square-foot-one. With that, the cost was knocked down to $650,000 with the township officials agreeing to take out a loan to cover the extra $150,000.

Zika said he doesn’t fault the Commonwealth Financing Authority for not awarding the entire amount requested.

“It has to be a very difficult thing,” he said, noting that with a small pot to work with and an enormous list of requests each year, he doesn’t envy the position and pressure the seven-member board is put in each year.

“I’m sure they are getting all levels of pressure from different elected officials,” Zika said. He said to make things a bit easier on the authority this year, Newport Township did not file a request for funding for the first time since the grant program was rolled out.

‘We’re grateful for what we got,” Zika said.

Picking winners

While many agree the grants are a nice balance to the headaches the added traffic, crime and stress on local infrastructure and police departments the casino causes, the method by which those projects are selected is mysterious.

The state’s seven-member Commonwealth Financing Authority is made up a bipartisan panel of representatives selected by the governor and minority and majority leaders of the House and Senate.

The current board consists of: Glenn E. Moyer, secretary of Banking; Charles Zogby, secretary of the Budget; C. Alan Walker, secretary of Community and Economic Development; Michael Karp, president of University City Housing Company in Philadelphia; Austin J. Burke, former executive director of the Greater Scranton Chamber of Commerce; John J. Verbanac, CEO of Summa Development in Pittsburgh; and Marc Little, president and CEO of the Minority and Women Educational Labor Agency from Pittsburgh.

In order for a grant to be approved, it needs the support of all four legislative appointees and at least one of the secretaries.

Grants add up

Since the first gaming grants were awarded in 2008, more than $73 million has been allocated to projects big and small throughout Luzerne County. They’ve ranged from $24,144 for a Nescopeck police cruiser to $12 million to help fund roadway work from Interstate 81 and state Route 315 into the sprawling CenterPoint East Commerce & Trade Park in Jenkins Township.

And while some have questioned why some towns get funding for some projects while others are turned away, overall the grants have been successful.

By law, 2 percent of money wagered in Mohegan Sun at Pocono Downs slot machines is earmarked to be allocated to communities submitting grants each year. So far, the allocations have helped pay for municipal buildings, recycling centers, a library and other public projects.

At least 33 projects have been funded and reached completion, more than two dozen more are underway and the rest, mostly those that were just awarded grants last year, could start this year.

Over the years, a mix of private and public projects have been applied for and this year’s lot is no different. A Times Leader review of this year’s 79 applications include nearly a dozen requests for funding to benefit private businesses or non-governmental entities.

Among them:

• $2 million for the Downtown Hazleton Development Project;

• $550,000 for expansion of the Greater Pittston Library;

• $515,000 for expansion of the Interstate Window and Door manufacturing plant in Pittston Township;

• $454,088 for improvements for the Hazleton Little League;

• $450,000 for the modernization of the Finch Technology plant in West Pittston;

• $383,468 for the Pennsylvania Theatre for the Performing Arts in Hazleton; and

• $77,678 for renovations at the Freeland YMCA.

Wilkes-Barre wins

While it hasn’t received the most money in Luzerne County, Wilkes-Barre has been one of only two municipalities to score a grant each year the program has been in place. Plains Township — where the casino is located and is guaranteed annual grants according to the state gaming law — is the other.

The city has received $9.857 million in grants to fund numerous projects from purchasing a police cruiser and buying equipment for a single-stream recycling effort to upgrading the city’s surveillance cameras and establishing a facade improvement grant program.

“It’s an extremely important tool, especially as other governmental funds have been eliminated or reduced over the past few years,” said Drew McLaughlin, the city’s municipal affairs manager.

While the city has been successful in obtaining funds to help city projects, it’s also been able to apply for funds for private entities and have them awarded, including more than $2 million for the Wilkes University science building and $425,000 for energy efficiencies at the F.M. Kirby Center.

“A lot of these projects would not get off the ground without these funds,” McLaughlin said. As for funding the private projects, he said it’s worth it for the city to see upgrades and development.

“Making a small investment with public dollars and watching them mushroom with job creation and rehabilitating dilapidated lots is a win,” he said.

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