Explanation
BACKGROUND: This legislation authorizes the Development Director to amend the Enterprise Zone Agreement (EZA) with US Industrial REIT (USIR), successor in interest to Rickenbacker III LLC (an assignee of Pizzuti Franklin II Limited). Council approved the EZA by Ordinance No. 2195-95 on September 25, 1995 and approved transfer of the EZA to USIR by Ordinance No. 903-02 on June 10, 2002. The amendment will eliminate the personal property tax abatement and the requirement for personal property investment. The real property investment has been made and the tax abatement on real property will remain intact.
The project is a 340,000 square foot multi-tenant warehouse constructed at 2250 Spiegel Drive in Columbus (Rickenbacker area). The EZA provided a 75%/10-yr tax abatement on real property improvements and a 25%/10-yr tax abatement on the M & E of the anchor tenant, Marriott Distribution Services, Inc. The project investment was to be $11 million in real property improvements, $4.4 million in tenant M & E and $3 million in tenant inventory. Marriott Distribution Services closed its operations and moved out of the facility in 1998. The property owner subsequently secured three new tenants.
While the investment requirement in the real property has been met, we are not able to determine if the personal property investment has been met because only one of the three current tenants has been willing to report information personal property investment at the project site. The current tenants are not using the personal property tax abatement. The Columbus Tax Incentive Council voted unanimously on November 13, 2003, to recommend that the City amend the EZA to eliminate the personal property tax abatement as well as the requirement for personal property investment.
FISCAL IMPACT: No funding is required for this legislation.
Title
To authorize the Development Director to amend the Enterprise Zone Agreement (EZA) with USIR, eliminating the personal property tax abatement and the requirement for investment in personal property; and to declare an emergency.
Body
WHEREAS, on September 25, 1995 Columbus City Council passed Ordinance No. 2195-95 approving an Enterprise Zone Agreement (EZA) with Pizzuti Franklin II Limited and on June 10, 2002 passed Ordinance No. 903-02 approving transfer of the EZA to USIR; and
WHEREAS, the EZA required a real property investment of $11 million and granted the project's real property owner a 75%/10-yr tax abatement on real property improvements and this investment level has now been attained; and
WHEREAS, the EZA required a tenant investment of $4.4 million in M & E and a $3 million investment in inventory and granted the original tenant, Marriott Distribution Services, Inc., a 25%/10-yr tax abatement on the M & E; and
WHEREAS, the original tenant, Marriott Distribution Services, Inc., no longer occupies the project facility; and
WHEREAS, compliance with the required level of personal property investment cannot be determined because two of the three replacement tenants have not been willing to report their personal property investment level at the project site; and
WHEREAS, the replacement tenants have not been using the personal property tax abatement; and
WHEREAS, the Tax Incentive Review Council (TIRC) voted unanimously on November 13, 2003 to recommend that the EZA with USIR be amended to eliminate the personal property tax abatement and also the requirement for personal property investment; and
WHEREAS, the City concurs with the TIRC's recommendation to amend the EZA with USIR; and
WHEREAS, an emergency exists in the usual daily operation of the City of Columbus in that it is immediately necessary to amend the Enterprise Zone Agreement with USIR, eliminating the personal property tax abatement and the requirement for investment in personal property in order to preserve the public health, peace, property, safety, and welfare NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. That the Development Director be authorized to amend the EZA with USIR to eliminate the personal property tax abatement and the requirement for personal property investment. The real property tax abatement will be left intact.
Section 2. That for the reasons stated in the preamble thereto, which is hereby made a part hereof, this ordinance is declared to be an emergency measure and shall take effect and be in force from and after its passage and approval by the Mayor, or ten days after passage if the Mayor neither approves nor vetoes the same.