Explanation
BACKGROUND: The need exists to amend the Downtown Office Incentive Agreement between the City of Columbus (“CITY”) and Coastal Ridge Real Estate Partners, LLC, Coastal Ridge Management, LLC, PPG Management, LLC and Foxen Insurance Company, LLC (collectively and hereafter referred to as “GRANTEE”). Columbus City Council (“COUNCIL”), per Ordinance No. 2561-2019, passed October 14, 2019, authorized the Director of the Department of Development of the CITY to enter into a Downtown Office Incentive Agreement (the “DOI AGREEMENT”) for an annual cash payment equal to fifty percent (50%) of the City of Columbus income tax withheld on the payroll for new employees added to the City of Columbus for a term of up to five (5) consecutive years. The financial incentive was granted in consideration of the GRANTEE’s total proposed investment of approximately $300,000.00, which included $156,000.00 in machinery and equipment, $120,000.00 in stand-alone computers, and $24,000.00 in furniture and fixtures to relocate and expand its corporate headquarters (HQ) into the newly constructed commercial office space known as “80 on the Commons” located at 80 E. Rich Street, Columbus, Ohio 43215, parcel number 010-296465 (the “PROJECT SITE”). Additionally, the GRANTEE committed to create 80 net new full-time permanent positions with an annual payroll of approximately $6,138,700.00, and to retain and relocate 75 full-time positions with an estimated annual payroll of approximately $5,793,200.00 (the (“PROJECT”), which will be new jobs to the CITY but not incentivized at the PROJECT SITE. The DOI AGREEMENT was made and entered into effective January 10, 2020 with the incentive term to begin January 1, 2020 through December 31, 2024 for a 5-year credit.
Paragraph four within Section 13 (Miscellaneous) of the AGREEMENT states, “No amendment of modification shall be effective unless in writing and signed by both parties to this agreement. Any requested amendment or modification to any of the terms of the AGREEMENT made to the CITY by the GRANTEE shall require the payment to the CITY by the GRANTEE of an AMENDMENT FEE in the amount of two-hundred fifty dollars ($250.00).”
The DOI AGREEMENT was amended for the first time (“FIRST AMENDMENT”) pursuant to Ordinance No. 1914-2021, approved by COUNCIL on July 19, 2021 which the GRANTEE was granted an additional year on the incentive term. Unfortunately, the project was delayed due to the affects from the COVID-19 global pandemic. The GRANTEE requested that the incentive term of the DOI AGREEMENT be amended from “beginning January 1, 2020 through December 31, 2024” to “beginning January 1, 2021 through December 31, 2025”, thereby giving the GRANTEE another year to complete the proposed PROJECT. The FIRST AMENDMENT was entered into effective September 21, 2021.
Subsequently, in a letter received by the CITY dated October 3, 2023, and through ensuing correspondence, it was confirmed that one of the entities of the GRANTEE changed its name from Foxen Insurance Company to Foxen Administration, LLC. As a result of the 2019 expansion project, the GRANTEE’s common owners decided to fill a broader need in their marketplace by commercializing resident insurance compliance monitoring and property damage liability waiver program services, and establishing Foxen Insurance Company. During its progression, the company commenced an organizational restructuring and forming a new limited liability company, Foxen Administration, LLC who serves as the operating company and employer of record. Additionally, the GRANTEE expanded operation into a second location that is also located within the downtown boundaries. The GRANTEE is requesting that the DOI AGREEMENT be amended to (i) change one of the GRANTEE entities name from Foxen Insurance Company to Foxen Administration, LLC, and (ii) to add 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number: 010-279858 as an additional location to the PROJECT SITE.
This legislation is to authorize the Director of the Department of Development to amend the DOI AGREEMENT for the second time to (1) change one of the GRANTEE’s entity name from Foxen Insurance Company to Foxen Administration, LLC, and (2) to add 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number: 010-279858 as an additional location to the PROJECT SITE.
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 amend the Downtown Office Incentive Agreement with Coastal Ridge Real Estate Partners, LLC, Coastal Ridge Management, LLC, PPG Management, LLC and Foxen Insurance Company, LLC for the second time to (1) change one of the GRANTEE’s entity name from Foxen Insurance Company to Foxen Administration, LLC, and (2) to add 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number: 010-279858 as an additional location to the PROJECT SITE.
Body
WHEREAS, the need exists to amend the City of Columbus Downtown Office Incentive Agreement (“DOI AGREEMENT”) between the City of Columbus (“CITY”) and Coastal Ridge Real Estate Partners, LLC, Coastal Ridge Management, LLC, PPG Management, LLC and Foxen Insurance Company, LLC (collectively, and hereafter referred to as “GRANTEE”). Columbus City Council (“COUNCIL”), per Ordinance No. 2561-2019, passed October 14, 2019, authorized the Director of the Department of Development of the CITY to enter into a DOI AGREEMENT for an annual cash payment equal to fifty percent (50%) of the City of Columbus income tax withheld on the payroll for new employees added to the City of Columbus for a term of up to five (5) consecutive years. The DOI AGREEMENT was made and entered into effective January 10, 2020; and
WHEREAS, the financial incentive was granted in consideration of the GRANTEE’s total proposed investment of approximately $300,000.00, which included $156,000.00 in machinery and equipment, $120,000.00 in stand-alone computers, and $24,000.00 in furniture and fixtures to relocate and expand its corporate headquarters (HQ) into a newly constructed commercial office facility known as “80 on the Commons” located at 80 E. Rich Street, Columbus, Ohio 43215, parcel number 010-296465 (the “PROJECT SITE”); and
WHEREAS, additionally, the GRANTEE committed to create 80 net new full-time permanent positions with an annual payroll of approximately $6,138,700, and to retain and relocate 75 full-time positions with an estimated annual payroll of approximately $5,793,200 (the (“PROJECT”), which will be new jobs to the CITY but not incentivized at the PROJECT SITE; and
WHEREAS, paragraph four within Section 13 (Miscellaneous) of the DOI AGREEMENT states “No amendment of modification shall be effective unless in writing and signed by both parties to this agreement. Any requested amendment or modification to any of the terms of the DOI AGREEMENT made to the CITY by the GRANTEE shall require the payment to the CITY by the GRANTEE of an AMENDMENT FEE in the amount of two-hundred fifty dollars ($250.00)”; and
WHEREAS, the DOI AGREEMENT was amended for the first time (“FIRST AMENDMENT”) pursuant to Ordinance No. 1914-2021, approved by COUNCIL on July 19, 2021 which the GRANTEE was granted an additional year on the incentive term. Unfortunately, the project was delayed due to the affects from the COVID-19 global pandemic, the GRANTEE requested that the incentive term of the DOI AGREEMENT be amended from “beginning January 1, 2020 through December 31, 2024” to “beginning January 1, 2021 through December 31, 2025”, thereby giving the GRANTEE another year to complete the proposed PROJECT. The FIRST AMENDMENT was entered into effective September 21, 2021; and
WHEREAS, subsequently, in a letter received by the CITY dated October 3, 2023, and through ensuing correspondence, it was confirmed that one of the entities of GRANTEE changed its name. As a result of the 2019 expansion project, the GRANTEE’s common owners decided to fill a broader need in their marketplace by commercializing resident insurance compliance monitoring and property damage liability waiver program services, and establishing Foxen Insurance Company. During its progression, the company commenced an organizational restructuring forming a new limited liability company, Foxen Administration, LLC who serves as the operating company and employer of record; and
WHEREAS, additionally, the GRANTEE expanded operation into a second location that is also located within the downtown boundaries. As a result of the GRANTEE’s combined workforce growth reaching full capacity at the original PROJECT SITE, the GRANTEE expanded a portion of their company into a second downtown office space located at 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number: 010-279858; and
WHEREAS, the GRANTEE is requesting that the DOI AGREEMENT be amended for the second time to (i) change one of the GRANTEE entity’s name from Foxen Insurance Company to Foxen Administration, LLC, and (ii) to add 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number: 010-279858 as an additional location to the PROJECT SITE; and
WHEREAS, a Second Amendment to the DOI AGREEMENT is now needed to (1) change one of the GRANTEE’s entity name from Foxen Insurance Company to Foxen Administration, LLC and (2) to add 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number: 010-279858 as an additional location so as to allow for the inclusion of the employees located at the additional location for the reporting and compliance process purposes; and
WHEREAS, the City of Columbus desires to facilitate the future growth of the GRANTEE at the PROJECT SITE and capture all net new employees as required by the incentive and annual reporting; and NOW THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF COLUMBUS:
SECTION 1. That the Director of the Department of Development is hereby authorized to amend the City of Columbus Downtown Office Incentive Agreement (“DOI AGREEMENT”) with Coastal Ridge Real Estate Partners, LLC, Coastal Ridge Management, LLC, PPG Management, LLC and Foxen Insurance Company, LLC to (1) change one of the entity’s as GRANTEE from Foxen Insurance Company to Foxen Administration, LLC and (2) to add 333 W. Nationwide Blvd. Columbus, OH 43215, parcel number 010-279858 as an additional office location to the PROJECT SITE.
SECTION 2. That this SECOND AMENDMENT to the City of Columbus Downtown Office Incentive Agreement be signed by Coastal Ridge Real Estate Partners, LLC, Coastal Ridge Management, LLC, PPG Management, LLC and Foxen Insurance Company, LLC within ninety (90) days of passage of this ordinance, or this ordinance and the incentive authorized herein shall be null and void.
SECTION 3. That the remaining terms of the City of Columbus Downtown Office Incentive Agreement remain in full effect relative to the Ordinance.
SECTION 4. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.