Economic Revitalization Strategy Kittanning Borough
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- Buildings in need of facade improvements and/or other rehabilitation
- The visual environment on Market Street is harsh. The streetscape could benefit from the introduction of
- Job Creation/Retention as Low/Moderate Income Area Benefit Activity.
- Aggregation of Housing Units.
- Aggregate Public Benefit Standard Exemption.
- Economic Empowerment
- Performance Measurements
- Structures on the site to the right as seen from the intersection of Market Street and Grant Street
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C HAPTER 6: P OTENTIAL FOR M AIN S TREET D ESIGNATION
The Kittanning downtown business district has a number of physical, economic, and organizational resources available to begin the process of developing a business district that leverages its strengths and opportunities. The strengths of the Kittanning business district include its position as the county seat, its location in proximity to the Allegheny riverfront, and the low cost of living. Programs aimed at revitalizing and enhancing the business district will enhance the viability of the Borough and its surrounding areas.
The Main Street program provides grant funds to municipalities to help a community’s downtown economic development efforts through the establishment of a local organization dedicated to downtown revitalization and the management of downtown revitalization efforts through the hiring of a full-time professional downtown coordinator. Main Street funds can be used for administrative costs associated with the Main Street Manager position, planning grants, façade improvement grants, operational grants, Anchor Building grants, Downtown Reinvestment grants, and Regional Main Street Coordination designation.
Anchor Building grants can be used for renovations to a significant downtown building, usually provided as a grant to the applicant and as a loan to the developer. Downtown Reinvestment grants can be used to fund acquisition or rehabilitation of commercial structures, improving public sites in a commercial target area, streetscape projects, and other construction costs determined to be a part of a larger project necessary for revitalization of a downtown area. Local match requirements vary based on the program being funded, i.e. Anchor Building, planning grants, etc.
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landscaping, green space, pedestrian-scale lighting and removal of utility poles and overhead wiring.
In order to meet the criteria to apply for Main Street designation, a municipality must complete the updated Main Street Profile, raise local matching funds of at least $125,000 over five years, meet certain population thresholds, and have a 501 (c)(3) organization in place to manage the program. In addition, the organization must have a mission statement, a vision for the downtown, and organizational by-laws. A preliminary Five Year Action Strategy must also be developed that establishes goals for each of the four functional areas, which are design, promotion,
program to the vision of the downtown, prioritize the program goals by implementation year, and clearly identify the objectives to attain goals for each Main Street Committee.
DCED’s Main Street Program is highly competitive. DCED’s policy is to award only one new Main Street designation per region per year. With continued weakening in the state’s economy, further DCED budget cuts are likely. In order to become designated as a Main Street community, Kittanning must be willing to provide the requisite matching funds and “cue up” an application for funding. It may take several years to achieve designation.
Even if the Borough of Kittanning is not interested in applying for Main Street designation or lacks the capacity to fund and administer the Main Street program, the Borough can still seek funds, in the form of grants and loans from the state, for streetscape improvements, façade improvements, and rehabilitation/ construction of anchor buildings critical to the downtown revitalization of the Borough. These funds could be used to plant trees along Market Street or to provide financing to construct a new mixed use office building on the vacant lot at the corner of Grant and Market Streets. Page 41 Page 42 C HAPTER 7: P OTENTIAL FOR E LM S TREET D ESIGNATION Overview of Elm Street Program The Elm Street Program allows communities to integrate a Main Street or downtown revitalization strategy with a neighborhood renewal strategy. The Elm Street Program is designed to provide assistance and resources to mixed use residential areas in proximity to central business districts to further enhance the downtown area and to improve the viability of older neighborhoods. The overall goals of the Elm Street program are as follows:
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To revitalize neighborhoods in proximity to the existing downtown by improving the exterior appearance of the buildings and streetscape. •
downtown revitalization activities. •
To prevent neighborhood decline by developing a plan that includes the establishment of a sustainable community organization that will implement an Elm Street Plan. •
established residential neighborhoods either in the vicinity of a Main Street project, or in proximity to an existing commercial district.
Several different entities are eligible to apply for Elm Street funding, including local governments, redevelopment authorities, nonprofit economic development organizations and other nonprofit organizations, as well as business improvement districts, neighborhood improvement districts, and similar organizations.
In order to be eligible for the Elm Street Program, the potential Elm Street District must be a residential area in an established neighborhood. The neighborhood must also be within one-half mile from a commercial district and must have existed as a residential neighborhood since 1961. In addition, the neighborhood must display signs of deterioration and be in need of revitalization.
Eligible activities that can be funded through Elm Street include planning grants, façade improvement grants, and operational grants for program operation and administrative costs only. Furthermore, Elm Street funds can be used for Elm Street designation to cover personnel and other administrative costs as well as residential reinvestment grants. Residential reinvestment grants are to be used for infrastructure and structural improvements, promoting home ownership, façade grants, and other related neighborhood revitalization activities.
A match is required in order to receive Elm Street funding. The required match is 10% of the grant award from the Pennsylvania Department of Community and Economic Development. The match can be from local, private, or public sources and can be in the form of cash or documented in-kind sources.
Just a few blocks north of the downtown Kittanning business district is a quaint residential neighborhood with a healthy mix of housing types, including single-family detached homes, town homes, and multi-unit apartment buildings. This area, bounded by Water Street to the west, Page 43 McKean Street to the east, Hazel Street to the north, and Vine Street to the south, is an ideal area for Elm Street designation.
Many homes in the potential Elm Street District are in excellent condition. However, there are clusters of certain streets and areas where homes are in need of façade improvements as well as more extensive building rehabilitation. Overall, many of the streetscapes and sidewalks are also in need of improvements, including pedestrian enhancements and street trees.
Left: McKean Street looking towards Chestnut Street. Right: A view looking northeast on Maple Street.
Above: Close up of a beautiful, bungalow-style house on Maple Street. The houses on McKean Street, Maple Street, and Hazel Street are very well-maintained and feature an array of architectural styles and designs. In contrast, a few homes on North Water Street are in need of substantial rehabilitation. Furthermore, the streetscape along North Water Street would benefit significantly from the introduction of street trees to improve the visual environment and sidewalk improvements to enhance pedestrian safety. Page 44
Left: A view of the lower end of North Water Street. Right: Looking at the section of homes on North Water Street towards Hazel Street.
Above: A well-maintained yellow brick duplex along North Water Street. Another area in the potential Elm Street District that is very well maintained is the area along N. Jefferson Street, between Vine Street and High Street. This section of the proposed Elm Street neighborhood includes a mix of residential and commercial uses. In addition, this area has undergone a slight transition over the past decade, as several of the older style homes have been converted to commercial office space for use by doctors, attorneys, and accountants. In addition, the Kittanning Library is also located along this stretch of North Jefferson Street.
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Above: Several houses, in excellent condition, located along North Jefferson Street.
Left: A stretch of homes located along Chestnut Street that are in need of minor renovations and façade improvements. Right: A condemned house on the corner of Rebecca and North Water Streets.
Another street with homes in need of façade improvements is Chestnut Street. While some homes on Chestnut Street
appear to be in good condition and well maintained, others are quite the opposite and are in need of renovations, particularly façade improvements.
Overall, the neighborhood just north of the downtown Kittanning business district is a good example of a potential Elm Street neighborhood. It is an older, mixed-use neighborhood with a healthy mix of housing types and an overall housing stock in good condition. There are pockets of homes scattered throughout the neighborhood that are in need of rehabilitation. In addition, several streets could benefit from the placement of street trees and from pedestrian enhancements and sidewalk improvements.
Provided a community organization is in place to manage the Elm Street Program for this neighborhood, it would be eligible to apply for Elm Street funding to enhance the streetscapes in the neighborhood as well as to fund sidewalk improvements to promote enhanced pedestrian safety. Furthermore, Elm Street funds could be used to finance façade improvement projects on several of the homes in the neighborhood that are dilapidated and in need of renovation. Page 46 Page 47 C HAPTER 8: P OTENTIAL FOR C OMMUNITY R EVITALIZATION S TRATEGY A REA (CRSA) D ESIGNATION A Community Revitalization Strategy Area (CRSA) is a designation provided by Pennsylvania’s Department of Community and Economic Development (DCED) under the state’s Community Development Block Grant (CDBG) program. Kittanning receives its CDBG allocation through the state’s small cities program. Per HUD CPD Notice 97-01, the U. S. Department of Housing and Urban Development (HUD) has sought to encourage a comprehensive approach towards community improvement. HUD provided flexibility under the state’s CDBG program to approve CRSA designation based on set criteria that mirrors the Neighborhood Revitalization Strategy Area (NRSA) program requirements. Community Development Block Grant (CDBG) entitlement recipients such as Kittanning would have certain flexibility under the program to use federal resources to the maximum extent possible in a designated area. For an area to become a designated CRSA, a strategy should be developed that provides for the economic empowerment of low- and moderate-income residents of a particular neighborhood. The five-year strategic plan should identify specific projects designed to meet the needs within the CRSA. Once a CRSA strategy is developed for a neighborhood, it is submitted to DCED for approval. The following are some of the incentives provided as a designated CRSA: •
Job Creation/Retention as Low/Moderate Income Area Benefit Activity.
Job creation/retention activities undertaken pursuant to the strategy may be qualified as meeting area benefit requirements, thus eliminating the need for a business to track the income of persons that take, or are considered for, such jobs. •
Aggregation of Housing Units. Housing units assisted pursuant to the strategy may be considered to be part of a single structure for purposes of applying the low/moderate income national objective criteria, thus providing greater flexibility to carry out housing programs that revitalize a neighborhood. •
carried out under the strategy may, at the grantee’s option, be exempt from the aggregate public benefit standards, thus increasing a grantee’s flexibility for program design as well as reducing its record-keeping requirements. •
Public Service Cap Exemption. Public services carried out pursuant to the strategy by a Community-Based Development Organization will be exempt from the public service cap.
The following sections will outline the steps that must be undertaken by Kittanning to engage in the development of a Community Revitalization Strategy as prescribed by HUD and DCED.
A strategy should be designed to provide for the economic empowerment of the low and moderate-income residents of a particular neighborhood and other long-term improvements Page 48 within a reasonable period of time. Therefore, the strategy should clearly describe how it meets the following criteria:
• Boundaries: The grantee must identify the neighborhood’s boundaries for which the strategy applies. ALL AREAS WITHIN THOSE BOUNDARIES MUST BE CONTIGUOUS. •
The designated area must be primarily residential and contain at least 70% low- and moderate-income persons. All of the census tract/block numbering areas must have at least a 20% poverty rate, and at least 90% of them must have a 25% poverty rate. •
Consultation: The grantee must describe how the strategy was developed in consultation with the area’s stakeholders, including residents, owner/operators of business and financial institutions, non- profit organizations, and community groups that are in or serve the neighborhood. •
The strategy must include an assessment of the economic conditions of the area and an examination of the opportunities for economic development improvement and the problems likely to be encountered. •
Empowerment: There must be a realistic development strategy and implementation plan to promote the area’s economic progress focusing on activities to create meaningful jobs for the unemployed and low/moderate income residents of the area, as well as activities to promote the substantial revitalization of the neighborhood. •
Performance Measurements: The strategy must identify the results (e.g., physical improvements, social initiatives, and economic empowerment) expected to be achieved, expressing them in terms that are readily measurable. This will be in the form of “benchmarks.”
Page 49 C HAPTER 9: K ITTANNING S ITE A NALYSIS
In order to better understand the potential demand for office space in Kittanning borough, an inventory was conducted of the Armstrong County departments. Departments were asked to provide projections of their respective space needs, whether they wished to rent or own their space, and other pertinent questions (see Appendix D). The result of the survey indicated that a total of 14,780 square feet of space, including office space, conference rooms, storage area, training rooms, and dispatch rooms. This data was one important tool used to determine the viability of a office/commercial/retail development that could provide adequate cash flow for development and ongoing maintenance.
This chapter provides an overview on the key sites within the Kittanning central business district that were identified as having a prominent place in the economic make-up of the community. The three sites include the lot on the corner of Market Street and Grant Street, the Train Station site, and the former Pollock Manufacturing Building.
The site was once the location of a prominent hotel that was the site of many large events in the community, including weddings and anniversary parties. Many people in Kittanning can recall how beautiful the hotel was and the important role it played in the community. The subject property consists of one parcel that provides 167 feet of frontage on Market Street. The total area of the site is 44,861 square feet or 1.03 acres. There is an alley located between the length of the parcel and the Rosebud Mining Company building west of the parcel. There are two existing buildings on the North Grant Street side of the parcel. The structures are both single- story brick buildings.
Structures on the site to the right as seen from the intersection of Market Street and Grant Street
Page 50 Owners:
Darren and Lisa Stolitza Purchase Price: $300,000 (lot plus two buildings behind it on Grant Street) Lot size: 167 feet by 268.63 feet (44,861 square feet or just over one acre)
Zoning: B-2, Central Business District Permitted Uses: Offices (businesses, professional, and governmental), restaurants, dry goods and variety stores Permitted Size: Maximum lot coverage: 80% Maximum Permitted Building Height: 8 stories, or 85 feet
There are number of issues that should guide the development of the corner lot: •
The need to create an anchor building for the block that will create a positive street wall along the primary street, Market Street, and the secondary street, Grant. •
potential space for medical offices and related functions.
There are also a number of added beneficial factors to consider in developing the site: •
It will improve the municipal tax base by developing a vacant parcel. •
It will expand the development potential and optimize available resources to revitalize the Kittanning business district. •
•
It will reduce public infrastructure costs and maximize existing investments in Kittanning services. Methodology In conducting this analysis, M&L visited the site and met with the owners of the site, Armstrong County officials, and Kittanning Borough officials to discuss plans for the site and potential opportunities for infill development. A survey was conducted, as discussed earlier, to determine the demand for office space. In analyzing the site, M&L considered the size of the parcel, its location within Kittanning’s downtown, topography, and surrounding land uses. M&L utilized the Borough’s zoning ordinance and met with Borough officials to determine the applicable development standards for the proposed project.
As part of the economic analysis, M&L consulted with local Realtors and property owners to determine achievable square footage rents for commercial uses in downtown Kittanning. In addition, regional office market data from Cushman & Wakefield was used to supplement the information. M&L attempted to identify comparable properties in the downtown to determine likely operating expenses, including insurance and utilities.
M&L then prepared a multi-year hypothetical operating budget for the project that reflects various sources of operating income and estimates operating costs. We used this operating budget to determine the likely amount of amortized debt that could be serviced by net operating income. M&L then prepared a development pro-forma that identified sources and uses of funds. We identified any shortage of sources as a financing gap for analysis purposes. Page 51 Objectives of the proposed project The concept for the project was created with the following goals in mind:
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Create an attractive mixed-use building that will blend harmoniously with existing downtown architecture and contribute to the character of the downtown •
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Maintain the Main Street façade line (zero lot line; no setback) •
Create a downtown landmark that reflects a vibrant community that cares about its image •
Create a new investment that will set the tone for additional development in the downtown and lift real estate values, both rental and sales •
Limit the building height to three stories •
Provide Armstrong County and possibly USDA with adequate office, meeting and storage space
The circulation objectives of the building are to: •
Provide a first floor lobby to serve retail and public functions from Market Street, with access from North Grant Avenue for other government-related functions •
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Provide two stair towers to satisfy code requirements for emergency egress Observations on the local real estate market . . . a case for public subsidy in support of the project Kittanning borough serves as the economic nucleus of a large geographic area and is home to a variety of businesses. Kittanning’s downtown is pedestrian friendly and includes many attractive older structures of interest. The recent redevelopment of the Rosebud Mining Company building at the corner of E. Market Street and McKean Street demonstrates that the downtown area is conducive to private investment.
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