City Council Approves Special Fund for Civic Arena Parking Tax

May 2, 2012

Pittsburgh City Council has given preliminary approval to a bill that would divert parking tax revenue from the former Civic Arena site into a special fund for Hill District redevelopment.

After hours of discussion, the heated debate was cut short and a six-member majority approved the bill. A few Council Members had raised concerns as to the legality and fairness of a special fund to benefit just one neighborhood.

Councilman Patrick Dowd disagreed with that notion.

"This is also about the city, and really reconnecting an important community back to Downtown," said Dowd. He added that there is an "emotional and moral importance" to the effort.

Under Councilman Daniel Lavelle's bill, the city would split the tax revenue of all new parking spaces made within the Civic Arena's "footprint." Half of that revenue would go toward the General Fund, and half would be given to the Urban Redevelopment Authority for use solely in the Hill District.

The URA would dispense the cash to various community projects in the Hill, prioritized by the Greater Hill District Master Plan. The legislation would expire in 2016, at which point Council would have to decide if an extension is warranted or if the lot should be developed.

The bill would only apply to the parking spaces within the surface area under the recently-demolished dome, not the surrounding lots that had served the Civic Arena for decades. Over the next four years, the tax diversion is expected to generate as much as $2 million for the Hill District. Lavelle said he capped the income amount at that level in order to encourage quicker redevelopment of the site.

"We've capped it at [$2 million], so that there's not an incentive for it to remain parking on that site; rather, move actual development forward," said Lavelle.

Councilman Bill Peduto said he supports Hill District redevelopment, but he thinks Pennsylvania law doesn't allow Council to divert parking tax revenue like this.

"If it doesn't go to the General Fund, if it gets sent off before it hits that, then it has to be done through a state act," said Peduto. He said Council has only two legal options: lobby the state legislature for such an act, or provide money for the redevelopment projects directly from the General Fund.

However, that position was criticized by Councilman Dowd. He said the process is legal because money would be collected by the Parking Authority, then diverted into a special fund, not simply funneled into the URA.

The bill now moves on for a final Council vote next Tuesday.