Downtown plan may use Philly strategies

By Stephanie Franken
TRIBUNE-REVIEW
Thursday, January 30, 2003

Gov. Ed Rendell likely will use tax incentives and grants to attract more businesses and residents to downtown Pittsburgh.

Rendell used such a strategy to encourage investment in Philadelphia when he served as the city’s mayor, and he likely will try a similar approach in Pittsburgh, said Ken Snyder, a spokesman for the governor. Mayor Tom Murphy has been working for several years to attract investment in the ailing Fifth and Forbes corridor, once a bustling retail district.

“Individuals don’t just move in” to lackluster downtowns, Snyder said. “They move into developed properties where rent is affordable and it’s an attractive place to live, and there are things to do. The governor relied a lot on tax incentives to bring developers (to Philadelphia) to build these attractions, and also used some bond money.”

Rendell has convened an “economic crisis task force” that would, in part, explore using similar tools in Pittsburgh, Snyder said.

It is too early to know how much money would go toward improving Downtown, or what type of aid might be available. Snyder also didn’t identify where Rendell would get the money, although he said during the campaign he would issue bonds for economic- revitalization projects.

Mulugetta Birru, executive director of the Urban Redevelopment Authority, said he and eight others met with Rendell about 10 days ago to discuss the Downtown. Birru said he could not offer details about their four-hour conversation, but said the meeting was “an excellent beginning to signal that Gov. Rendell has placed a high priority on economic development.”

Birru said the city would need at least $10 million to $15 million from the state for the Fifth and Forbes project. Former Gov. Tom Ridge gave the city a $10 million grant, but the money was used for North Shore development after Downtown revitalization efforts stalled, Birru said.

Craig Kwiecinski, Murphy’s spokesman, said, “Creating a vibrant Fifth and Forbes corridor continues to be a top priority for the mayor, and we look forward to partnering with Gov. Rendell on this important issue for Pittsburgh.”

Murphy’s initial plan to improve the corridor called for $100 million in taxpayer money to attract national retailers, the razing of as many as 62 buildings and the threat of eminent domain to force owners to sell their properties to the city. Murphy abandoned those plans in 2000 in the face of criticism.

The mayor resurrected efforts to revitalize the corridor in November 2000.

He formed a task force that produced a report in 2002, known as Plan C, that called for preserving more buildings, keeping local retailers, and creating more residential and hotel space. The plan calls for $51.5 million in public money, $39.5 million in corporate and philanthropic investment, and $264 million in private investment.

The city has not named a developer to lead the project.

Birru has said the city is having a hard time attracting a developer because, in part, it needs to own more property in the corridor to attract a developer. Companies often would rather develop government-owned land that is ready to build on, rather than having to buy properties from private owners.

Still, Downtown Works, a division of King of Prussia-based Kravco, said it is interested in the project.

“Pittsburgh has something going for it that most other cities don’t have, and that’s a great array of department stores,” Midge McCauley, director of Downtown Works, said last week. “What they don’t have is the glue to hold those department stores together, the infrastructure between them.”

By taking advantage of city, state and federal incentives, she said, her firm could profit from the project.

“You have a new governor who is very pro-development and a mayor who understands what he needs to do to make the city economically healthy,” McCauley said.

Snyder, Rendell’s spokesman, said an estimated state deficit of $2.5 billion is daunting, but “the governor doesn’t believe that economic development is a place to skimp.”

“The governor’s going to fly this plane while he’s fixing it,” Snyder said.

The mayor’s Plan C task force will meet on Feb. 10. The group hasn’t met for several months, and Kwiecenski, Murphy’s spokesman, would not discuss the purpose of the meeting.

Plan C task force member Cathy McCollom, director of operations and marketing for the Pittsburgh History & Landmarks Foundation, said she hopes that Tom Cox, executive assistant to Murphy, and Susan Golomb, the city’s planning director, will name a developer for the Fifth and Forbes project.

Stephanie Franken can be reached at sfranken@tribweb.com.

This article appeared in the Pittsburgh Tribune Review. © Pittsburgh Tribune-Review