Explanation
BACKGROUND: This legislation authorizes the Director of the Department of Development to amend the Enterprise Zone Agreement with Columbus Urban Growth Corporation to eliminate the requirement for personal property. The project is located at 1407 and 1393 Cleveland Avenue (Four Corners). Columbus City Council approved the Enterprise Zone Agreement (EZA) by Ordinance No. 1100-00 on May 15, 2000.
The project committed to the construction of two facilities consisting of 15,000 and 52,000 square feet. The investment commitment included $450,000 for acquisition of building, $1.3 million for additions/new construction, $160,000 for machinery and equipment, $500,000 for improvements to existing building and $100,000 for furniture and fixtures. The project also was expected to create 41 new full-time jobs. The EZA provided for a 75%/10 year tax abatement on the real property improvements. Columbus Urban Growth has met its real property investment goal and 90% of its job creation goal. The project also reported $301,000 in personal property investment for the multiple small businesses that comprise the project. However, it is impossible to verify this personal property investment information by cross-checking against personal property returns because returns could not be identified for the businesses. Personal property tax is not required for businesses with listed value of $10,000 or less, or for certain types of businesses such as insurance. Since it is not possible to verify the personal property investment information, the Columbus Tax Incentive Review Council (TIRC) recommended on August 11, 2004 to eliminate the requirement for the $260,000 personal property investment.
The Development Department concurs with the TIRC's recommendation. Emergency action is requested in order to meet the new deadline under State law for City Council to vote on TIRC recommendations.
FISCAL IMPACT: No funding is required for this legislation.
Title
To authorize the Director of Development to amend the existing Enterprise Zone Agreement with Columbus Urban Growth Corporation to eliminate the requirement for personal property investment; and to declare an emergency.
Body
WHEREAS, City Council approved an Enterprise Zone Agreement (EZA) with Columbus Urban Growth by Ordinance
1100-00 passed on May 15, 2000; and
WHEREAS, the EZA grants Columbus Urban Growth a 75%/10 year tax abatement on real property improvements; and
WHEREAS, Columbus Urban Growth promised a project investment of $1.8 million in real property improvements
and $260,000 in new personal property; and
WHEREAS, the project has met all of its real property investment goal and most of its job creation goal; and
WHEREAS, the personal property investment was made by small businesses and an insurance agency at the
project site and these businesses are not required to file personal property tax returns; and
WHEREAS, the Tax Incentive Review Council (TIRC) has determined that it is impossible to verify the annual
personal property investment information reported for the project; and
WHEREAS, the TIRC recommended on August 11, 2004 that the EZA be modified to eliminate the requirement for
personal property investment; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in that it is immediately
necessary to obtain City Council's vote in order to meet the new State deadline for voting on TIRC recommendation,
thereby preserving the public health, peace, prosperity, safety and welfare; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. That the Director of Development is hereby authorized to amend the Enterprise Zone Agreement with
Columbus Urban Growth to eliminate the requirement for personal property investment.
Section 2. That for the reasons stated in the preamble hereto, this ordinance is hereby declared to be an emergency
and shall take effect and be in force from and after its passage and approval by the Mayor or ten days if the Mayor neither
approves nor vetoes the same.