By Matt Assad
Of The Morning Call
February 13, 2009
Despite an economy that has put millions of people out of work, shut down businesses across the nation and stunted charitable
giving, developers of Bethlehem's SteelStacks performing arts center and broadcast studio have raised more than $30 million
and are planning a summer groundbreaking.
Just a few hundred yards from where financial problems have prompted Sands Casino Resort Bethlehem to halt part of its project,
the $40 million SteelStacks project is scheduled to be under construction in late August and to open by the spring of 2011.
On the strength of $2 million in new grants from state lawmakers and the arrival of millions of dollars in tax credit investments,
ArtsQuest and WLVT-TV PBS-39 have raised enough money to tentatively schedule construction and hire Alvin H. Butz Inc. as
construction manager for the 18-month project.
''We continue to seek creative funding for the SteelStacks project,'' said ArtsQuest Chief Executive Officer Jeffrey Parks.
''If we are successful in obtaining the balance of our funding, we will continue to be on track to break ground in late
summer, with a completion date for the first phase of the project in May 2011.''
Butz, of Allentown, is also helping to guide construction of the $743 million casino project. The casino is scheduled to
open May 22, but work on the adjoining shopping mall, hotel and events center has stopped until Sands can raise more money.
Phase 1 of SteelStacks is to include a 350-seat theater, a two-screen art-house cinema, new offices and studios for PBS-39,
and the Musikfest Cafe, which is a 450-seat restaurant and performance venue modeled on the World Cafe Live in Philadelphia.
ArtsQuest is the parent company of Musikfest.
A second phase calls for a music festival venue in Bethlehem Steel's former turn-and-grind shop, said Musikfest spokeswoman
Kim Plyler.
Roughly 80 percent of the funding has been committed. PBS-39 Chief Executive Officer Pat Simon said the station has raised
$13.5 million of the $17 million it needed for the broadcast studio, and ArtsQuest has raised more than $17 million of the
$23 million needed for the performing arts center.
''It's encouraging that the community is so committed to this project, that even in this economy, people are fully behind
it,'' she said. ''We still have a couple of large commitments to secure, but we are right on schedule. This is going to
add money and jobs at a time when the community needs it most.''
Democratic state Rep. Joseph Brennan, whose 133rd District includes south Bethlehem, said the SteelStacks project is ''such
a regional asset, and it's a great redevelopment of a brownfield site. Few projects have so many pluses.''
The money raised includes $10 million in state grants delivered by Gov. Ed Rendell, $2 million from Northampton County and
a $125,000 federal grant. The new grants totaling $2 million come from Pennsylvania's four legislative caucuses.
Filling the gap in funding is millions of dollars in private donations and federal and state tax credit investments, which
are designed to promote investment in community projects that benefit low- to moderate-income families.
Under the tax credit programs, investors in a project can deduct a large portion of that investment from their taxes in
future years. The credits are highly competitive and generally go to projects that will have the most impact on a community.
Pennsylvania's Neighborhood Partnership Program, which gives investors tax credits of 70 percent of their investment, last
month approved ArtsQuest for $400,000 in tax credits this year.
The project has also received federal New Market Tax Credits, which allow investors to deduct taxes equal to 39 percent
of their investment. But ArtsQuest and PBS-39 officials would not say how much has been approved.
If the bulldozers begin humming on schedule in August, the fundraising still won't be done.
''The day we break ground,'' Musikfest's Plyler said, ''is the day we start the campaign to raise money for Phase 2.''
matthew.assad@mcall.com
610-559-2148
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