State bill to sell property on fast track
Sen. Browne filed the legislation; City Center Investment Corp. is the buyer
HARRISBURG — It appears Sen. Pat Browne’s bill to sell the Allentown State Hospital property to City Center Investment Corp. will get quick consideration in Harrisburg, but not everyone in Allentown is on board.
The proposal ditches any chance of further competitive bidding for the roughly 195-acre tract off Hanover Avenue, deemed the biggest redevelopment opportunity in the city in generations, and it fails to take into account the wishes of some of the city’s communities, critics said.
The bill, filed without public notice in mid-September, calls for a sale of the state-owned property for $5.5 million directly to City Center Investment Corp.
A legislative official said it would likely be discussed Oct. 18, just weeks before the deadline of the end of lawmakers’ terms.
The move to a direct
sale comes after the end of a competitive bid process. Carried out under a law passed in 2019, it produced two bids that were deemed nonresponsive.
Browne — a politically powerful, veteran Republican whose tenure in Harrisburg will end in December after his defeat in the primary election — said Wednesday a direct sale was the best move forward.
“I didn’t think we would find an opportunity better than this,” Browne said.
City Center is lead developer of Allentown’s one-ofa-kind Neighborhood Improvement Zone, created by legislation written by Browne.
The direct sale has the backing of Democratic Rep. Mike Schlossberg, Allentown Mayor Matt Tuerk and the state Department of General Services.
But Nat Hyman, a rival developer who previously offered to buy the property and preserve the buildings on the site, called it outrageous.
“Once again, Pat Browne and Mike Schlossberg are operating without transparency and in secrecy,” Hyman said of the new approach and the fact that the bill was not shared with the public until Browne filed it.
What should have followed the disqualification of the two earlier bids, Hyman said, was a new, competitive process.
Two prominent members of the city’s Latino community, Yamelisa Taveras and Enid Santiago, said the estimated $1 billion in NIZ development, mostly by City Center Investment Corp., on Hamilton Street or nearby, has not taken into account the needs of less-influential communities.
“There are many people who are upset about this,” Santiago said of the new approach to the sale of the huge property. “They are handpicking a specific developer and saying, ‘Here you go.’ “
A City Center spokesman has said that if the sale bill is enacted into law, it will start working with the city right away “to develop a project that creates various housing options, public green space, retail, jobs and local tax revenue for the City and Allentown School District.”
A unique approach
Schlossberg said he and Browne crafted the process for competitive bidding in the 2019 law.
Normally, the property would go to the highest qualified bidder. Schlossberg said he and Browne came up with “best use” language that replaced the typical approach.
Specifically, the law said the proposal process would be to “evaluate and select a buyer based upon best value and return on investment post-demolition.” That, the law said, could include proposed use of the property, job creation, getting the property on tax rolls and other criteria.
The law created a committee to evaluate bids, comprised of two lawmakers, a city official and the state secretary of general services.
Schlossberg said it was the first time an evaluation-committee approach was used for selling state property.
In retrospect, he said, restrictions in the solicitation for bids may have been too great.
Schlossberg said the committee met about three or four times, sometimes in person and sometimes remotely. In addition to himself, Browne and Tuerk, Schlossberg said others who attended at one time or another included General Services Secretary Curt Topper, former Allentown Mayor Ray O’Connell and former city Chief Operating Officer Leonard Lightner.
Schlossberg said one of the two disqualified bids was from City Center. Tuerk said the other was from a group based north of Philadelphia.
Browne referred questions about bidder identities to the state, which refused to disclose them.
General Services spokesperson Troy Thompson also declined to say why the two bids were rejected.
The buildings on the site were torn down starting in 2020. The complex, which once had more than 2,000 residents, closed in 2010.
Browne said discussions about the future of the hospital property have been underway for more than 50 years.
“It’s time to move on,” Browne said.
According to Schlossberg, if action doesn’t happen on the property now, it’s back to the drawing board.
“I am ready to move forward on this,” Schlossberg said. He added that “the only people who matter to me are constituents.” Since the announcement of the new approach, he said, “I have barely heard a negative peep out of anybody.”
Latino consideration
About 54% of Allentown’s population identify as Hispanic, according to the 2020 census, but they have had little direct say in Harrisburg.
None of the 11 legislative candidates on city election ballots Nov. 8 is Latino. Santiago and Taveras, who are Latinas, lost in the Democratic primaries for the 134th House District and 14th Senate District, respectively.
Both are city residents and were sharply critical of the proposed direct sale to City Center.
Taveras said the pricing of downtown apartments in the NIZ fails to take into account the economics of communities elsewhere in the city. She questioned whether new businesses in the NIZ have hired an appropriate number of city residents, and said there was not enough input from non-downtown communities on what went into the NIZ.
“The fabric of Allentown does not get heard when it comes to decisions of this magnitude,” Taveras said of the hospital sale. “It is nothing new.”
Earlier this year, a two-year effort by The Morning Call to obtain information on some taxes paid in the NIZ was squelched when Browne drafted wording placed deep in a 114-page bill that precluded the data from becoming public.
Asked about that lack of transparency, Schlossberg said, “I can understand why people would be concerned.”
Awaiting action
The Browne bill is awaiting action in the Senate State Government Committee.
The committee’s executive director, Chad Davis, said it would likely be discussed at a meeting tentatively scheduled for Oct. 18. Multiple votes are required for passage through the Legislature, and its two-year session ends Nov. 30.
If the bill is not passed this session, it would have to be resubmitted.
“It is a tight schedule,” Davis said.
He said lawmakers are used to dealing with multiple property transfer bills near the end of a session.
Browne said, “I don’t see any issues with getting this done before the end of the session, and the governor signing it.”