Allentown neighborhood improvement zone

The NIZ is a powerful economic development program that has spurred more than a billion dollars in redevelopment activity utilizing a unique tax incentive and financing tool.  A special taxing district created by state law, the NIZ is being utilized to encourage development and revitalization in center city Allentown and along the western side of the Lehigh River.

*Photos and Video Courtesy of Anthony Androu, Aerial Imaging

 The Neighborhood Improvement Zone or NIZ in Allentown is a one-of-a-kind special taxing district created to incentivize new development and growth in downtown Allentown Pennsylvania. Allentown is part of the Lehigh Valley region of Pennsylvania, 90 minutes west of Manhattan and 60 minutes north of Philadelphia.

The unique structure of the tax zone, which includes recapture of many taxes paid by businesses, investors and developers, help to pay the debt service on projects within the NIZ. This attractive mix of incentives has lead to more than a billion dollars in investment in the area from the private sector.

While typical Tax Increment Financing Districts (TIFs) are used throughout Pennsylvania and the nation as a method of making loans available to developers for roadway improvements and other infrastructure, the Allentown NIZ legislation allows developers to invest in developing private-sector businesses with subsidies in the form of the recapturing of many taxes commonly paid by businesses.

In addition to private development, a complex of public projects has helped fuel growth including an 8,500-seat hockey arena and entertainment venue, a 200,000-square-foot office building, several restaurants, and a 170-bed hotel. 

Some of the taxes that can be applied back toward a developer’s debt service include Corporate Net Income Tax, Bank Shares Tax, Gross Premiums Tax, Sales, Use & Hotel Occupancy Tax, Employer Withholding Tax, Unemployment Compensation, Realty Transfer Tax, Cigarette Tax, Tobacco Products Tax, Personal Income Tax, Malt Beverage Tax, Liquor and Wine Excise and Sales Tax and many others.