Local Government Commission Releases Report: Identifying Success Indicators Among Municipal PILOT Agreements

May 20th, 2020

The Local Government Commission has released a report about payments in lieu of taxation, or PILOTs, deployed as a tool by local taxing entities in the Commonwealth as a way for local governments to partner with tax-exempt entities.

To better understand this process, the Local Government Commission surveyed municipalities and county assessment offices throughout the Commonwealth on their experience with PILOT agreements, hoping to determine how national findings and best practices align with the challenges and opportunities of using PILOT agreements in Pennsylvania.

In brief, our study resulted in four conclusions:

• There is a strong relationship between PILOT success and higher participation rates and informed negotiations.
• Developing a PILOT requires resources that smaller municipalities may not have.
• There is a systemic lack of record keeping of PILOTs.
• There is not a one-size-fits-all approach to PILOTs.

These conclusions led us to make the following three recommendations:

• Municipalities should approach PILOT negotiations with a justifiable, specific dollar request, and a cooperative, collaborative attitude.
• Regional or cooperative efforts may provide support for negotiating and implementing PILOT agreements.
• A consistent method for documenting PILOT agreements and payments could benefit all parties involved.

Click here to read the full report.

Supplemental Materials:

Municipal Survey

County Survey

Statistical Test Results