Economic Impact of Project Considering PA LERTA

szaricki

September 23, 2019 15:36

Pennsylvania has a Local Economic Revitalization Tax Assistance (LERTA) tax abatement program. I know that IMPLAN can be used to estimate the taxes that would be generated as a result of a project at a certain period of time.

According to your post in "Tax Reduction Economic Impact Study," IMPLAN cannot be used in estimating the economic impact of a reduction of real property taxes because "it does not have the ability to predict firms' and proprietors' behavioral responses to lower property taxes." Can you please confirm?

Thank you in response and hope to hear from you soon.

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Candi Clouse, PhD
September 30, 2019 15:10

You are correct that IMPLAN itself does not predict the behavior of firms or individuals nor does it make any assumptions about how tax dollars or tax savings will be handled., However, this is presents an opportunity for you as the analyst to model potential scenarios. You can decide how the taxes generated from the program will be spent and could even model different outcomes.

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