A Q&A with state Sen. Jarrett Coleman

Republican state Sen. Jarrett Coleman took office in 2023, and since that time has introduced a variety of proposals that could shake up the economic development landscape in Pennsylvania.

Coleman recently took time to speak with City & State about his work in the economic development space, including his “regulatory sandbox” bill that would give businesses flexibility to test out new ideas without fear of reprisal and his efforts to improve transparency around Allentown’s Neighborhood Improvement Zone, which directs state and local tax dollars toward economic development projects.  

This conversation has been edited and condensed for length and clarity.

Where do you think Pennsylvania should be going in terms of its economic climate?

I think we should be making Pennsylvania more competitive on a broader stage.

The governor, especially with his latest initiative (an expansion of the Pennsylvania Strategic Investments to Enhance Sites Program) likes to go around touting this program of picking winners and losers. Bureaucrats selecting winners and losers here of who’s going to get the tax dollars to subsidize the site investments. He likes to tout that our neighbors are doing this, like Ohio or South Carolina, North Carolina, for example, that we have to be doing this. You can do all of these programs, but at the end of the day we have to be a state that is better for business. 

So I think that more large-scale initiatives – reducing the corporate net income tax, reducing the (personal) income tax, getting rid of our gross receipts tax for electricity – I think we need to make bigger changes that make the commonwealth more competitive.

You’ve sponsored legislation to eliminate the Realty Transfer Tax here in Pennsylvania. How would that impact the state’s economic climate and ultimately help taxpayers?

For those that are going into the first time homebuyers maybe with as little as 3% down, every little fee adds up and it becomes a stressor for a young family or first-time homebuyer who’s trying to come up with that down payment money. 

The real estate transfer tax is just one of those taxes I hear time and time again from people that see on their closing disclosure, and they’re like, “Wait, am I really just paying this tax to transfer? Is this like a privilege tax of being able to transfer the property from one person to the next?” I think the reality is that elimination of that is just one example of a step that we can take to make the goal of home ownership more attainable for more Pennsylvanians. I think homeownership is so important on so many levels. 

You also have legislation to create a “regulatory sandbox” in the state. What would that look like in practice? 

Essentially, the sandbox allows Pennsylvanians to have a place where, in their business – whether it’s a new business or an established business – when the businesses feel that the government’s getting in their way and stopping their growth or their development, it lets them say to the government, “Hey, wait a second, I want you to take another look at this.” As opposed to just denying them and that being the end of the story. We’ve got to be bold with our thoughts here if we’re really going to try to spur growth. I get it, the governor wants to copy other states, but at some point, you gotta start to just be a leader and do things on your own and be original. But if the governor likes to do what other states are doing, other states have done this.

The beautiful part about the sandbox is that it allows businesses within a certain state to apply for the relief they’re getting specific to their state. So in Pennsylvania, let’s say it was a DEP issue. It lets us track the issues. It allows us, the legislators, and the executive branch to see what type of regulatory relief people are actually applying for. 

You have a resolution centered around Allentown’s Neighborhood Improvement Zone. How effective do you think Allentown’s NIZ has been? Could you speak to why you want to audit it as well?

I want what’s best for Allentown, and I want what’s best for the people of Allentown. I want to make sure that taxpayers in Bradford County or Pittsburgh understand what they’re paying for. I want to make sure that we’re getting a good return on my investment. The truth is, no one really knows if it’s been a success or not. 

There’s no question the Allentown Neighborhood Improvement Zone has facilitated the taxpayer-financed real estate development of Allentown. Everyone that goes there is able to see beautiful buildings and Allentown really (is) unrecognizable in some senses, as it was before. There’s no question about that. The question is: What is the zone actually producing?

I’m a kid from Allentown – born in Allentown, raised in Allentown. I get elected to the State Senate; I’m the state senator and I’m told I can’t see into the program that we’ve all spent over half a billion dollars on, year-to-date, because my predecessor, the drafter of that legislation, has changed the law to encapsulate it in a veil of secrecy. I don’t think that’s acceptable. I think taxpayers absolutely have a right to know what the revenues are coming out of the zone. 

I don’t know what you’re trying to hide. That’s the part that I can’t wrap my head around. My constituents are questioning the amount of cigarette revenue – tobacco taxes that are being collected to finance the building. Is it $50 million? Is it $80 million a year in cigarettes financing the construction in Allentown? How many cigarettes do you have to sell to people to build that many buildings? What does that look like? How come I can’t see that? We deserve to know that. 

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