Penn State Behrend has reached a 10-year agreement with three local taxing bodies to provide annual payments in lieu of taxes for property in Knowledge Park, a 106-acre innovation complex owned and operated by the college.
A payment in lieu of taxes, also known as a P.I.L.O.T., allows nonprofit entities to compensate local governments for police, fire and other public services. A previous Knowledge Park P.I.L.O.T. expired at the end of 2014.
Under the new agreement, which was approved by Erie County Council on Jan. 10, Penn State Behrend will make annual payments to the county, Harborcreek Township and the Harbor Creek School Board. Those payments will exceed $267,000 in 2017 – the full tax amount for undeveloped land in the park and roughly half the tax rate for developed properties.
The Harborcreek Township supervisors approved the agreement on Dec. 7. The Harbor Creek School Board approved the measure at its Nov. 17 meeting.
The structure of the payments reflects the unique mission of Knowledge Park, which opened in 1998, said Amy Bridger, senior director of corporate strategy and external engagement for the college. It also recognizes that the park has become a key economic driver for the Erie region.
“The companies in Knowledge Park stay competitive, and stay in Erie, in part because they can leverage the resources of a major research university,” Bridger said. “Our open-lab environment provides access to state-of-the-art labs and equipment, including the region’s most powerful environmental scanning electron microscope, and the expertise of faculty experts and students who know how to use it.
“Our students also benefit,” she said, “when they work with technology companies on a day-to-day basis.”
Twenty-one companies currently employ more than 500 people in the park. Almost all of the companies are actively working with Penn State Behrend.
Several companies, including Cybersonics, Truck-Lite, Process and Data Automation and SKF Aeroengine North America, moved to the park to gain better access to University resources. Additional commercial development, including a hotel and a planned restaurant and brewpub, has occurred just outside the park, providing new tax revenue for the municipalities and schools.
In July, the college opened a 60,000-square foot Advanced Manufacturing and Innovation Center, the first known example of a U.S. college or university co-locating academia and industry in a shared open-lab environment. That will add approximately $100,000 to the annual P.I.L.O.T. payments beginning this year, Bridger said.