This story was produced by the Berks County bureau of Spotlight PA, an independent, nonpartisan newsroom. Sign up for Good Day, Berks, a daily dose of essential local stories at spotlightpa.org/newsletters/gooddayberks.
UPPER BERN — A Berks County school district temporarily paused planning for a multimillion-dollar high school renovation after ICE purchased a local warehouse to convert into a detention center.
The January sale to the federal government means the warehouse is no longer subject to property taxes paid to the Hamburg Area School District and Upper Bern Township government.
And while district officials say the financial impact is limited, the pause does demonstrate the uncertainty that ICE’s warehouse purchase — which is not moving forward as an immigration facility — is creating locally.
“We’re trying to be strategic as far as our long-term planning with this new kind of circumstance that we’ve been presented with,” Superintendent Christopher Beissel told Spotlight PA. “So there’s just uncertainty, but we’re trying to navigate that in a thoughtful way.”
Before the sale, the school district was set to receive nearly $600,000 sometime between July and the end of the year. Instead, on March 3, it received just over $437,000 in transfer taxes from the sale in a one-time payment.
Like districts across Pennsylvania, Hamburg’s budget is largely funded by local taxes; about $32 million is collected annually in property and other taxes, which is more than half of the district’s $58 million budget. About $18.6 million in revenue comes from state sources, and roughly $530,000 comes from federal sources.
District Business Manager Michele Zimmerman told Spotlight PA that transfer tax revenues supplement Hamburg’s annual budget, and any surplus funds are designated for capital improvement projects like the high school renovation.
But large transfer tax payments, like the one from the sale of 3501 Mountain Road, are “extremely difficult to budget for due to the timing and amounts,” she said.
Between February and May, the district worked with architects on a high school renovation design that would “lower the cost” and still update the learning environments, Zimmerman said in an email to financial advisors working with the school on the project.
Spotlight PA obtained emails, school board meeting minutes, and other documents from the district about the planned renovations through a Right-to-Know request.
While the district is moving forward with construction plans, Beissel said administrators are aware of multiple scenarios that could play out since federal authorities haven’t said what the plans are for the Upper Bern warehouse.
ICE told the Shapiro administration in July that it does not intend to convert warehouses in Berks and Schuylkill Counties into detention centers. The confirmation followed reporting that the Department of Homeland Security intends to sell or give away seven of the 11 warehouses purchased over the past year as part of a sweeping $38.3 billion plan to expand immigrant detention capacity.
However, the agency has not said whether it plans to sell the Pennsylvania warehouses, which would put them back on the tax rolls, or use them for some other government purpose.
‘We did slow-walk it for a bit of time’
DHS and ICE purchased the Mountain Road facility in January, removing $597,000 in property tax revenue from the rural district’s rolls.
It is one of eight warehouses within the district’s boundaries that have been built since 2018, according to Zimmerman.
Beissel said the sale “didn’t necessarily have the substantial impact that you would maybe think it would.” Still, the district paused the planning stage of the high school renovations to thoroughly assess the situation: “We did slow-walk it for a bit of time.”
Efforts were paused for about two months. Beissel said administrators and school board members wanted to make sure the sale wouldn’t impact long-term financing or the scope of the renovations.
The agreement with AEM Architects estimates the construction project could cost anywhere from $48 million to $105 million, but the Hamburg district’s board of directors has yet to make a final decision on the scope of the high school renovations. Officials continue to work with contractors on the design and amenities that will dictate construction costs.
An email exchange between architects and school administrators indicated that officials hope to finalize the renovation plans in September.
The recent news that DHS no longer plans to turn several of the warehouses it purchased earlier this year into mass detention centers has put Hamburg administrators and the Berks County community more at ease. But everyone remains cautious given the uncertainty that lies ahead.
Neither federal, state, nor local officials contacted by Spotlight PA in early July — before the Shapiro administration released letters from ICE confirming the warehouses won’t be used as detention centers — provided new information about 3501 Mountain Road in Upper Bern or the ICE-owned warehouse in Schuylkill County. A DHS spokesperson provided the same quote from June when news about the warehouses broke, and did not answer specific questions about those in Pennsylvania.
“DHS is moving swiftly to utilize EXISTING detention space with our state and county partners,” an agency spokesperson said.
Kevin Barnhardt, Berks County’s chief operations officer, said commissioners had a brief conversation with U.S. Rep. Dan Meuser (R., Pa.) at a recent event, and the representative indicated DHS still plans to sell the warehouses, but “has nothing in writing.”
“The Board of Commissioners has had no direct communication with DHS,” Barnhardt added in an emailed response to Spotlight PA.
Meuser’s office did not respond to Spotlight PA’s request for information about DHS intentions for the future of the warehouse.
On Thursday, following news that ICE has confirmed it won’t use the warehouses as detention centers, Berks County Commissioner Dante Santoni Jr. said he’s ecstatic about the federal government’s decision to abort plans.
“I’m happy that the federal government made that decision. Hopefully, it was because of some of the things that our people talked about, and some of the rallies that we had against the opening of those facilities,” he told Spotlight PA after a regular county commissioners meeting in Reading. “We want to make sure that they get back on the tax rolls.”
Upper Bern Township received the same amount in transfer taxes from the sale as the school district, but officials have declined to say how the federal government’s purchase has impacted municipal operations and budgeting. The township previously collected $31,229 in property taxes from the vacant warehouse on Mountain Road.
With the Upper Bern warehouse potentially going back on the real estate market, residents are now concerned that the site could turn into a data center. Communities across the state, including Upper Bern, have been developing ordinances to regulate the industry as some Pennsylvania municipalities weigh data center proposals. Even state legislators have considered regulations.
Upper Bern board supervisors proposed a data center ordinance during the township’s July 9 meeting. Officials encouraged residents to read it over and provide comments and suggestions in the coming weeks as the proposal is reviewed.
The Planning Commission, which will review the proposal, meets at 7 p.m. on July 28. The next Board of Supervisors meeting will be held at 9 a.m. on Aug. 13.
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