CENTER TWP — Township officials said Wednesday night that a proposed tax increment financing district along North Duffy Road could lead to a surge of development beyond a new VA Butler Healthcare center.

The proposed TIF district would include about 46 acres where Cambridge Healthcare Solutions is building the new VA center, but also would include 100 acres of the Herold farm surrounding the VA site and potentially other land in Butler Township.

The district would take a certain percentage of real estate taxes on those properties and use that funding to pay for infrastructure improvements to support further commercial development outside the VA center.

“There could be four other VA-sized projects on the property,” said Ron Olsen, township engineer. “This could be huge.”

Those improvements could include a road connecting North Duffy Road to the Route 422 and New Castle Road interchange, Olsen said.

The township and Cambridge on Monday night presented a proposal for a 20-year TIF with an 80 percent reduction in taxes to the Butler school board, one of the three taxing bodies on the property.

The school board took no action on the request but solicitor Tom King said a shorter length of time and a smaller percentage would be more palatable to that board.

Butler County, as the third taxing body, also would have to approve the TIF district.

Olsen said both the percentage and term of the TIF are negotiable.

“That hasn’t been decided yet,” he said.

The tax money would not fund construction of the VA center or any other private business development, but rather public infrastructure work that would support more development, Olsen said.

“People are very much interested in locating near the new clinic,” Olsen said.

If approved, the district could help connect North Duffy Road to the Route 422 and New Castle Road interchange, which was left unfinished and is missing three connecting ramps.

Olsen said the state Department of Transportation already is planning to renovate the interchange to connect it to Lions Road in Butler Township due to bridge problems on the road.

Olsen said TIF money would allow the township to extend a road from that interchange to North Duffy Road.

He said initial thoughts would be to have the road extend up around the perimeter of the Herold property and connect near North Duffy Road’s sharp 90 degree bend.

“But it could connect anywhere,” Olsen said.

The TIF funding also could pay for sewage and other road work in the district.

Cambridge’s VA center is the lone project currently set to be built in the proposed district, but Olsen said none of the TIF money would go toward improvements on that 46-acre lot.

The developer is building a 168,000 square-foot health care center on the land that used to be part of the Herold property. The U.S. Department of Veterans Affairs will rent the facility for 20 years for $163 million.

The total annual taxes on the property would be about $467,000 for the three taxing bodies. Olsen said Cambridge would still be paying its full taxes each year, but said the percentage of the tax money would be designated to improvements in the district, if it were approved.

Olsen said the TIF district would only account for new revenues on the property, meaning current real estate taxes would not be counted into the equation.

Cambridge will be developing the VA project regardless of whether a TIF is approved. The developer also has first right of refusal to buy the rest of the Herold property, so it likely would be the developer for most work done within the district.

Supervisor Ken Frenchak said further development on the Herold property will likely occur with or without a TIF district, but said the development might be limited without connecting North Duffy Road to the interchange.

Olsen said the township cannot afford to do the roadwork on its own, meaning it would be up to the developers of the property to pay for the work if it were to be done without the tax district.

There is no estimated cost on the infrastructure work, Olsen said.

Officials said the development on the land could lead to 2,000 new jobs.

Outside help

Center Township officials said the Bocci property in Butler Township also could be considered as part of the TIF district, if Butler Township officials are interested.

The land, which is on the opposite side of the interchange from the Herald farm, was a finalist to be selected as the site for the new VA.

“This could be a good consolation for the township,” Olsen said.

Butler Township was originally set to be home to the new VA center before the government relocated the project from the Deshon Woods property on New Castle Road to Center Township following issues with the previous developer.

Center Township supervisors voted to send a letter to Butler Township requesting they consider joining the proposed district. They are also requesting a joint meeting to discuss the plans.

The township also expects to seek help from Art Cordwell and Butler’s city redevelopment authority.

Cordwell, who recently resigned as the executive director of the authority after four years, created a TIF district for the Centre City project, which is bringing a new hotel, parking garage and Rite Aid pharmacy downtown.

“I think it would be a great benefit to us to have someone who has done this before,” Frenchak said.

Cordwell is continuing to work as a consultant for the authority.