Reading is one of two cities approved for a new Community Revitalization and Improvement Zone (CRIZ) created through legislation in Pennsylvania’s 2024-2025 budget. (Getty Images)
Community leaders in Reading celebrated the city’s inclusion this year in a Pennsylvania program to incentivize redevelopment and job creation by reinvesting new tax revenue in the community.
The Berks County city is one of two new Community Revitalization and Improvement Zones (CRIZ) created through legislation in the state’s 2024-2025 budget. Reading and Erie join Bethlehem, Lancaster and Tamaqua, which received their designations more than a decade ago, to bring the number of CRIZs across the state to five.
“This designation sends a clear message,” Reading Mayor Eddie Moran said in a news conference Thursday. “Reading is ready to take its place as a city of opportunity. Ready to attract the kinds of investments and developments that will transform a future. Ready to welcome new businesses, create jobs and foster innovation ready to show that our community is stronger, more resilient and more ambitious than ever before.”
Established in 2013, the CRIZ program encourages investment in blighted or under-utilized areas of small cities by designating up to 130 acres within their boundaries as areas where developers can access tax-increment financing backed by state and local tax revenue.
The program is administered by the state departments of Revenue and Community and Economic Development and the governor’s budget office. It’s similar to the Neighborhood Improvement Zone program, a program unique to Allentown that has attracted about $1 billion in new development since its inception in 2009.
Both allow businesses and developers to use tax revenue generated from businesses inside the zones to repay construction loans.
State Rep. Manny Guzman (D-Berks) was among a group of state lawmakers from Berks and Erie counties who negotiated the reopening of the CRIZ program as part of the budget. In the news conference Thursday, Guzman said Reading’s new CRIZ was hard-fought and won.
“So many folks told me, man, this is a pipe dream. They’re never going to open up the CRIZ program again,” Guzman said. State Sen. Judith Schwank (D-Berks) and state Rep. Johanny Cepeda-Freytiz (D-Berks) were also instrumental in negotiating Reading’s designation as a CRIZ, Guzman said.
The CRIZ program was based on the Neighborhood Improvement Zone (NIZ) in Allentown, which was an initiative of former Lehigh County state Sen. Pat Browne, who is now Gov. Josh Shapiro’s revenue secretary. Unlike the NIZ, where the program receives all revenue from most state taxes collected in the zone, CRIZs collect only new revenue.
The NIZ and Browne faced scrutiny last year after a state Senate committee sought more detailed data about the taxes collected from the zone. Browne declined to provide the information, saying the law that created the program forbids the release of individual taxpayer data. After a months-long standoff and weeks of legal saber rattling, Browne appeared before the Senate and agreed to increase transparency of the program.
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Bethlehem and Lancaster received their CRIZ designations in 2013 and Tamaqua was granted a pilot zone in 2014, according to the Department of Community and Economic Development (DCED). Last year, the program returned nearly $15 million to those communities, according to Gov. Josh Shapiro’s office.
Under the program, the Revenue Department establishes a baseline for tax revenue from businesses in the CRIZ in the first year of the program. Any increases in revenue from existing businesses above the baseline amount and all revenues from businesses established after the first year of the program are transferred to a CRIZ fund for each community, according to a DCED report on the program in 2023.
Implementation of the program is overseen by a municipal authority with a board appointed by leaders in each participating municipality. The board determines which projects in the CRIZ should be funded.
Guzman said he hopes Reading will emulate the success Allentown, Bethlehem and Lancaster have experienced through their tax-backed financing programs.
“We’re at the precipice, here, of something great,” Guzman said. “I want to be clear, though … that while this is an awesome opportunity, this is just the start of a 30-year process.”
“We got us this far, but now we need the community to take us the rest of the way,” he said.
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