KOZ Study "Appalling"

A new report suggests that a state tax incentive program is being abused. The Keystone Opportunity Zone program was created a decade ago to encourage the redevelopment of brownfields and create jobs. Businesses that locate in the zones are exempt from several local and state taxes. But a study from the Legislative Budget and Finance Committee finds that 75% of KOZ businesses haven't created any jobs. Some KOZ businesses include real estate investment trusts, venture capital firms and hedge funds that have established an address in a KOZ but have no employees there.

70% of land in KOZs has not been developed. And the report says it's difficult to evaluate how much value Pennsylvania is getting from the program, if any, because of a lack of data collection in the Department of Community and Economic Development.

Pennsylvania Representative David Levdansky of Elizabeth has called for studies into all of the state's tax credit programs to determine their effectiveness. He says the findings about the KOZ program are "appalling." And he says he'd especially like to know where KOZ businesses were located before. He says he has a strong suspicion that many of them were already in Pennsylvania--and that means they're taking advantage of tax breaks while not contributing any extra jobs or investment.

KOZs in Allegheny County include sites in California-Kirkbride, Allentown, East Liberty, Garfield, Hazelwood, the Hill District, Homewood, Larimer, Mt. Washington, Perry South, Uptown, Windgap, McKeesport, McKees Rocks, Tarentum and Duquesne.