Explanation
BACKGROUND: Community Reinvestment Areas (CRAs) have been designated by Columbus City Council ("Council") under the general guidelines of Ordinance 1698-78. Such areas allow for the granting of real property tax incentives to encourage industrial, commercial, and residential growth.
Columbus City Council by Resolution Number 0090X-2007, as approved on June 11, 2007 and certified by the State of Ohio on July 14, 2007, created the Rickenbacker Community Reinvestment Area (the "Rickenbacker CRA"), which Council subsequently amended by Resolution Number 03I8X-2011 on December 5, 2011 and certified by the State of Ohio on January 23, 2012, providing for tax exemptions for improvements to real property up to one hundred percent (100%) not exceeding fifteen (15) years for the new construction of non-retail, non-hotel, non-residential business or industrial structures as described in Section 3735.67 of the Ohio Revised Code.
Beginning in the early 1960’s, Morris Dach began buying and selling used restaurant equipment out of his garage in the hopes of finding a cost-efficient way to help other restauranteurs start and expand their businesses. Then in 1966, Morris officially opened up an equipment warehouse store in Columbus, Ohio which offered food service equipment and supplies directly to operators throughout the area. This quickly became successful and led to the development of various trusted relationships with leading manufacturers in the industry which only continued to aid the business. Since then, the Morris family still continues to run and expand the business both locally and nationally and has become one of the largest restaurant equipment warehouse companies in the country.
Dach Family Limited Partnership is proposing to invest a total project cost of approximately $8.0 million in real property improvements to expand their existing distribution facility of 171,000 square feet by another 109,000 square feet (totaling approximately 280,000 square feet) at 6375 LaSalle Dr. Columbus, OH 43137, parcel number 495-263842 (the “Project Site”). Additionally, Dach Family Limited Partnership proposes the creation of four (4) net new full-time permanent positions with an estimated annual payroll of approximately $191,360.00 (“New Employees”) and the retention of twenty-two (22) full-time jobs with an estimated annual payroll of approximately $1,381,961.00 at the proposed Project Site.
The Director of the Department of Development is recommending the Council approve a Community Reinvestment Area property tax abatement of seventy-five percent (75%) for a period of fifteen (15) consecutive years on real property improvements related to construction of 109,000 square foot expansion to the 171,000 square foot distribution facility. This proposal is consistent with the Columbus Tax Incentive Policy for Community Reinvestment Area projects.
The Columbus City School District has been advised of this project.
This legislation is presented as 30-day legislation.
FISCAL IMPACT:
No funding is required for this legislation.
Title
To authorize the Director of the Department of Development to enter into a Community Reinvestment Area Agreement with Dach Family Limited Partnership for a property tax abatement of seventy-five percent (75%) for a period of fifteen (15) consecutive years on real property improvements in consideration of the proposed total investment of approximately $8,000,000.00 to expand its’ current distribution facility, the creation of four (4) net new full-time permanent positions with an estimated annual payroll of approximately $191,360.00 and the retention of twenty-two (22) full-time jobs with an estimated annual payroll of approximately $1,381,961.00.
Body
WHEREAS, Ordinance 1698-78 passed August 3, 1978, authorized the Department of Development to implement a Community Reinvestment Area Program, pursuant to Section 3735.65 to 3735.70 of the Ohio
Revised Code, and approved certain administrative procedures for the program; and
WHEREAS, the Columbus City Council by its Resolution Number 0090X-2007, approved June 11, 2007,
designated the Rickenbacker Community Reinvestment Area pursuant to Chapter 3735 of the Ohio Revised Code; and
WHEREAS, effective July 24, 2007, the Director of the Development Department of the State of Ohio determined that the aforementioned Area designated in the aforementioned Council Resolution contained the characteristics set forth in Ohio Revised Code Section 3735.66 and confirmed that Area as a "Community Reinvestment Area" pursuant to said Chapter 3735; and
WHEREAS, the Columbus City Council by its Resolution Number 0318X-2011, approved December 05, 2011, subsequently amended the Area; and
WHEREAS, the Director of the Development Department of the State of Ohio determined that the Rickenbacker Community Reinvestment Area, as amended by the aforementioned Resolution, continued to contain the characteristics set forth in Section 3735.66 of the Ohio Revised Code and recertified said Area on January 23, 2012; and
WHEREAS, the City's intent in creating the Rickenbacker Community Reinvestment Area was to gain the ability to use tax incentives to encourage the maintenance of existing and construction of new structures in the CRA to encourage economic stability, maintain real property values, and generate new employment opportunities; and
WHEREAS, Dach Family Limited Partnership is proposing to invest a total project cost of approximately $8,000,000.00 in real property improvements to expand approximately 109,000 square feet to the existing 171,000 square foot distribution facility located at 6375 LaSalle Dr. Columbus, OH 43137, parcel number 495-263842 (the “Project Site”); and
WHEREAS, contingent on the City granting a Community Reinvestment Area property tax abatement, Dach Family Limited Partnership is proposing to invest a total project cost of approximately $8,000,000.00 in real property improvements to expand its’ current distribution facility and the creation of four (4) net new full-time permanent positions with an estimated annual payroll of approximately $191,360.00 (“New Employees”), and the retention of twenty-two (22) full-time jobs with an estimated annual payroll of approximately $1,381,961.00 at the proposed Project Site, thereby increasing job opportunities and strengthening the economy of the City; and
WHEREAS, representatives for Dach Family Limited Partnership have indicated that receiving this tax incentive from the City is crucial to their decision to advance the aforementioned expansion in Columbus; and
WHEREAS, the Board of Education for the Columbus City School District has been notified in accordance with Ohio Revised Code Section 5709.83 and has been provided with a copy of the tax incentive application; and
WHEREAS, the City, having the appropriate authority to offer a tax incentive on this project, is desirous of providing Dach Family Limited Partnership a property tax abatement of seventy-five percent (75%) for a period of fifteen (15) consecutive years on real property improvements in order to encourage the development of the Project Site, with its associated new job creation projections, within the Rickenbacker Community Reinvestment Area; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That City Council hereby finds and determines that the project will (1) create jobs in the State and City (2) the project is economically sound and will benefit the people of the State and City
by increasing opportunities for employment and strengthening the economy of the State and City; and (3) receiving the aforementioned tax abatement is a critical factor in the decision by representatives for Dach Family Limited Partnership to go forward with the project.
SECTION 2. That the Director of the Department of Development is hereby authorized and directed to enter and execute a Community Reinvestment Area Agreement with Dach Family Limited Partnership to provide therewith an exemption of seventy-five percent (75%) on real property improvements on parcel number 495-263842 within the City of Columbus [Franklin County] for a term of fifteen (15) consecutive taxable years in association with the project’s proposed total investment of approximately $8,000,000.00 in the construction of the 109,000 square foot expansion to their existing 171,000 square foot distribution facility, the creation of four (4) net new full-time permanent positions with an estimated annual payroll of approximately $191,360.00 and the retention of twenty-two (22) full-time jobs with an estimated annual payroll of approximately $1,381,961.00 at the proposed Project Site.
SECTION 3. That the City of Columbus Community Reinvestment Area Agreement shall be signed by Dach Family Limited Partnership within ninety (90) days of this Ordinance’s passage, or this Ordinance, and the authorization to enter into the tax abatement agreement, is null and void.
SECTION 4. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.