Explanation
Background: Pulte Homes of Ohio, LLC and Harmony Development Group, LLC (together, the “Developers”) purchased or have options to purchase ±369.2 acres within Columbus near the intersection of Alton & Darby Creek Road and Renner Road (the “Developers’ Property”) in order to construct the “Sugar Farm” and “Renner South” residential developments in addition to public infrastructure improvements serving both of these areas. Pursuant to Ordinance 1557-2020, the Director of the Department of Development entered into the “Big Darby - Sugar Farm and Renner South Plan Agreement” dated March 10, 2021 with the Developers to outline the plans and respective commitments of the City and the Developers for the fulfillment of the “Big Darby Revenue Program” requirements as established by Resolution 0216X-2008, including but not limited to, establishing a new community authority (“NCA”) and new tax increment financing (“TIFs”). Resolution 0118X-2021 and Resolution 0243X-2021 established the Sugar Farm-Renner South NCA (“SFRS NCA”) according to Ohio Revised Code (“ORC”) Chapter 349 as a body politic and corporate within the boundaries of the Developers’ Property. The Developers and the City agreed the SFRS NCA would impose 6.5 mills on the Developers’ Property for thirty years. The NCA charges received from the 6.5 mills by the SFRS NCA will be allocated first to provide an allowance to cover administrative costs of the SFRS NCA, and the remaining balance (the “Available Charge Revenue”) will be used for public infrastructure improvements. Ordinance 3248-2021 established a new 30-year, 95% TIF area pursuant to ORC Section 5709.40(B) for the part of Sugar Farm including parcel number 203-304335 (the “Sugar Farm 40(B) TIF”). Following approval, pursuant to Ordinance 3319-2021, of the “County Compensation Agreement” with Franklin County required by ORC Section 5709.40(E), Ordinance 3259-2021 established two new 30-year, 95% TIF incentive districts pursuant to ORC Section 5709.40(C) for the remaining area of Sugar Farm (the “Sugar Farm Incentive District”) and for all of Renner South (the “Renner South Incentive District”). Service payments in lieu of taxes from these three TIFs (the “Service Payments”) will be first distributed by the county to the Hilliard City Schools and Tolles Career and Technical Center, and then, to the appropriate taxing authorities as required by ORC Section 5709.40(F). The remaining portion of the Service Payments will be distributed to the City for deposit into new TIF funds to use for compensating Norwich Township (the “Township”) and for public infrastructure improvements.
In order to implement the Big Darby Revenue Program and the Big Darby - Sugar Farm and Renner South Plan Agreement, this Ordinance will authorize the City to enter into: 1) the “Intergovernmental Cooperative Agreement” with the SFRS NCA in order for the City to accept the Available Charge Revenue for deposit into a new NCA fund, 2) the “Township Compensation Agreement” with the Township to provide it Service Payments equivalent to the amount of property taxes it would have received from its levies that are not otherwise directly available to the Township’s fire department and emergency medical services under ORC Section 5709.40, and 3) the “TIF & NCA Reimbursement Agreement” with the Developers to provide them reimbursement for eligible costs of public infrastructure improvements using the Available Charge Revenue and the remaining Service Payments after the City has first made payment to the Township (the “Available TIF Revenue”).
This Ordinance will also appropriate and authorize the expenditure of the Service Payments to the Township as well as appropriate and authorize the expenditure of the Available Charge Revenue and the Available TIF Revenue to the Developers pursuant to the respective terms and conditions of the Township Compensation Agreement and the TIF & NCA Reimbursement Agreement. It is contemplated that Pulte Homes of Ohio, LLC will receive the Available Charge Revenue and the Available TIF Revenues generated from Sugar Farm, and Harmony Development Group, LLC will receive the Available Charge Revenue and Available TIF Revenues from Renner South for reimbursement of each of the Developers’ respective costs of the public infrastructure improvements plus their corresponding accrued interest on those costs.
Emergency Justification: Emergency legislation is required to allow for the immediate effectiveness of this ordinance, which is necessary to enable the immediate execution of the agreements contemplated herein to provide for the timely financing and redevelopment of the above described public infrastructure improvements already in process.
Fiscal Impact: No funding is required for this legislation. The City is appropriating and authorizing the expenditure of its received community development charges generated by the parcels in the Sugar Farm-Renner South NCA and the service payments in lieu of taxes generated by the parcels in the Sugar Farm 40(B) TIF, Sugar Farm Incentive District, and Renner South Incentive District, that are to be deposited in each new herein described NCA fund and TIF Funds, all in accordance with the Intergovernmental Cooperative Agreement, Township Compensation Agreement, and the TIF & NCA Reimbursement Agreement.
Title
To authorize the Director of the Department of Development to execute and deliver the: 1) Intergovernmental Cooperative Agreement between the City and Sugar Farm-Renner South NCA, 2) Township Compensation Agreement between the City and Norwich Township; and 3) TIF & NCA Reimbursement Agreement between the City, Pulte Homes of Ohio, LLC, and Harmony Development Group, LLC, all for the benefit of implementing the Big Darby Revenue Program; to establish the Sugar Farm-Renner South NCA Fund; to authorize the City Auditor to accept the community development charges from the Sugar Farm-Renner South NCA and to deposit said funds into the Sugar Farm-Renner South NCA Fund pursuant to the Intergovernmental Cooperative Agreement; to appropriate and authorize the expenditure of the service payments in lieu of taxes generated by the parcels subject to the Sugar Farm 40(B) TIF, Sugar Farm Incentive District, and Renner South Incentive District ordinances deposited in the Sugar Farm 40(B) TIF, Sugar Farm Incentive District, and Renner South Incentive District Municipal Public Improvement Tax Increment Equivalent Funds pursuant to the Township Compensation Agreement; to appropriate and authorize the expenditure of both the remainder of those same service payments in lieu of taxes in those same funds after making payment to Norwich Township and the community development charges the City receives for deposit into the new NCA fund pursuant to the TIF & NCA Reimbursement Agreement; and to declare an emergency.
Body
WHEREAS, Pulte Homes of Ohio, LLC and Harmony Development Group, LLC (together, the “Developers”) plan to develop an approximately ±369.2 acre site within the City of Columbus near the intersection of Alton & Darby Creek Road and Renner Road (the “Developers’ Property”) to construct 525 single family homes and 220 multi-family apartment units to the north of Renner Road (“Sugar Farm”) and to construct 147 single family homes and 196 other residential units south of Renner Road (“Renner South”) along with appropriate associated amenities and parking necessary to support those; and
WHEREAS, Sugar Farm and Renner South will require, among other things, a new pump station, water line extension, stormwater BMP’s, multi-use trails, stream restoration, and improvements to existing streets and intersections including Hilliard-Rome Road, Alton & Darby Creek Road, Feder Road, Roberts Road, and Renner Road (collectively, the “Public Infrastructure Improvements”); and
WHEREAS, the Director of the Department of Development and the Developers entered into a development agreement dated March 10, 2021 (the “Big Darby - Sugar Farm and Renner South Plan Agreement”) authorized by Ordinance 1557-2020 to outline the plans and respective commitments of the City and the Developers for the fulfillment of the “Big Darby Revenue Program” requirements as established by Resolution 0216X-2008, including establishing a new community authority (“NCA”) and tax increment financing (“TIF”) for the Developers’ Property; and
WHEREAS, Resolution 0118X-2021 and Resolution 0243X-2021 established the Sugar Farm-Renner South NCA (“SFRS NCA”) pursuant to Chapter 349 of the Ohio Revised Code (“ORC”) as a body politic and corporate within the boundaries of the Developers’ Property to impose 6.5 mills on the Developers’ Property for thirty years; and
WHEREAS, the City and the SFRS NCA will enter into an “Intergovernmental Cooperative Agreement” whereby the SFRS NCA will annually retain a portion of the charges generated from the 6.5 mills for an allowance towards its administrative costs and the balance of those charges (the “Available Charge Revenue”) will be remitted to and accepted for deposit by the City into a new NCA fund to pay for the Public Infrastructure Improvements; and
WHEREAS, City Council passed Ordinance 3248-2021 to create a new separate TIF area pursuant to ORC Section 5709.40(B) for parcel number 203-304335 within Sugar Farm (the “Sugar Farm 40(B) TIF”); and
WHEREAS, pursuant to Ordinance 3319-2021, the City entered into the “County Compensation Agreement” required by ORC Section 5709.40(E) with Franklin County, which then allowed City Council to pass Ordinance 3259-2021 to establish two new TIF incentive districts pursuant to ORC Section 5709.40(C) for the remaining area in Sugar Farm (the “Sugar Farm Incentive District”) and the entire area of Renner South (the “Renner South Incentive District”); and
WHEREAS, in adherence to the TIF statues under the ORC, the schools districts and taxing authorities named in ORC Section 5709.40(F) will first receive the applicable service payments in lieu of taxes (the “Service Payments”) from these TIFs directly from the county with the balance being remitted to the City for deposit into the appropriate TIF funds; and
WHEREAS, in accordance with the Big Darby Revenue Program and the County Compensation Agreement, the City will enter into the “Township Compensation Agreement” with Norwich Township (the “Township”) to provide it a portion of the appropriated and authorized Service Payments equivalent to the amount of property taxes it would have receive from its levies that are not otherwise directly available to the Township from the county under ORC Section 5709.40; and
WHEREAS, pursuant to the Big Darby - Sugar Farm and Renner South Plan Agreement, the Developers have agreed to provide front-end financing for the design and construction of the Public Infrastructure Improvements provided that the City reimburses the eligible costs and associated accrued interest of those Public Infrastructure Improvements over time from the City’s portion of its remaining Service Payments after first making payment to the Township (the “Available TIF Revenue”); and
WHEREAS, the City is willing to appropriate and authorize the expenditure of the Available Charge Revenue deposited in the new NCA fund and the Available TIF Revenue to be deposited in the Sugar Farm 40(B) TIF, Sugar Farm Incentive District, and Renner South Incentive District TIF Funds to reimburse the Developers’ eligible costs and associated accrued interest of the Public Infrastructure Improvements provided that the Developers approve and enter into the “TIF & NCA Reimbursement Agreement” with the City; and
WHEREAS, it is contemplated that Pulte Homes of Ohio, LLC will receive the Available Charge Revenue and the Available TIF Revenue from the Sugar Farm properties, and Harmony Development Group, LLC will receive the Available Charge Revenue and the Available TIF Revenue from the Renner South properties for reimbursement of each of the Developers’ respective costs and associated accrued interest on those costs of the Public Infrastructure Improvements; and
WHEREAS, pursuant to the TIF & NCA Reimbursement Agreement, the City and the Developers may enter into further subsequent agreements as necessary to further define the terms and conditions pursuant to which the Public Infrastructure Improvements will be designed, constructed, and maintained, including but not limited to, Guaranteed Maximum Reimbursement Agreements, Contribution Agreements, Maintenance Agreements, Easement Agreements, and Restrictive Covenants (each as referenced herein and those agreements hereinafter individually and collectively referred to as the "Subsequent Agreements"); and
WHEREAS, an emergency exists in the usual daily operations of the Department of Development in that it is immediately necessary to appropriate and authorize the expenditure of a portion of the Service Payments to the Township and the Available Charge Revenue and Available TIF Revenue to the Developers, and to enter into the foregoing Intergovernmental Agreement, Township Compensation Agreement, TIF & NCA Reimbursement Agreement, and Subsequent Agreements to expedite the development and financing of the Public Infrastructure Improvements in progress all for the preservation of the public health, peace, property, and safety, that preservation; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. Intergovernmental Cooperative Agreement. That the Director of the Department of Development (the “Director”), or his or her designee, for and in the name of the City, is hereby authorized to execute and deliver the “Intergovernmental Cooperative Agreement” presently on file with the Director along with any changes or amendments thereto not inconsistent with this Ordinance and not substantially adverse to the City and which shall be approved by the Director and the City Attorney, provided that the approval of such changes and amendments thereto, and the character of those changes and amendments as not being substantially adverse to the City, shall be evidenced conclusively by the Director’s execution and delivery thereof.
Section 2. Township Compensation Agreement. That the Director, or his or her designee, for and in the name of the City, is hereby authorized to execute and deliver the “Township Compensation Agreement” presently on file with the Director along with any changes or amendments thereto not inconsistent with this Ordinance and not substantially adverse to the City and which shall be approved by the Director and the City Attorney, provided that the approval of such changes and amendments thereto, and the character of those changes and amendments as not being substantially adverse to the City, shall be evidenced conclusively by the Director’s execution and delivery thereof.
Section 3. TIF & NCA Reimbursement Agreement. That the Director, or his or her designee, for and in the name of the City, is hereby authorized to execute and deliver the “TIF & NCA Reimbursement Agreement” presently on file with the Director along with any changes or amendments thereto not inconsistent with this Ordinance and not substantially adverse to the City and which shall be approved by the Director and the City Attorney, provided that the approval of such changes and amendments thereto, and the character of those changes and amendments as not being substantially adverse to the City, shall be evidenced conclusively by the Director’s execution and delivery thereof.
Section 4. Subsequent Agreements. That the Director or other appropriate officers of the City are authorized to execute Subsequent Agreements, defined within the recitals herein, as well as any ensuing amendments to those Subsequent Agreements, subject to approval by the City Attorney’s Office, and to take all actions as may be necessary to implement this Ordinance and the transactions contemplated by the Intergovernmental Cooperative Agreement, Township Compensation Agreement, the TIF & NCA Reimbursement Agreement, and/or any Subsequent Agreement as may be required to implement same.
Section 5. SFRS NCA Fund. That this Council hereby establishes, in line with the Intergovernmental Cooperative Agreement, a city fund related to the Sugar Farm-Renner South NCA (the “SFRS NCA Fund”) into which there shall be deposited the community development charges collected by the City from the Sugar Farm-Renner South NCA, defined herein, after the Sugar Farm-Renner South NCA retains an allowance pursuant to the Intergovernmental Cooperative Agreement for its administrative costs (the “Available Charge Revenue”). The City Auditor is hereby authorized to deposit the monies contributed by Sugar Farm-Renner South NCA to the City into the SFRS NCA Fund. The City Auditor may establish the SFRS NCA Fund as a new City fund including with any necessary subfunds or project accounts. The SFRS Fund shall remain in existence so long as the Available Charge Revenue is collected from the Sugar Farm-Renner South NCA and used for the purposes of the “Big Darby Revenue Program,” as may be amended from time to time and as defined herein and also by Resolution 0216X-2008.
Section 6. Appropriation and Expenditure to Township. That the service payments in lieu of taxes and property tax rollback payments deposited into the Sugar Farm 40(B) TIF Municipal Public Improvement Tax Increment Equivalent Fund created by Ordinance 3248-2021 and the Sugar Farm Incentive District, Renner South Incentive District Municipal Public Improvement Tax Increment Equivalent Funds created by Ordinance 3259-2021 (all three funds, collectively, the “TIF Funds”) equal to the amount of property taxes the Norwich Township (the “Township”) Fire Department and Emergency Medicals Services would have received if not for the TIF exemption granted by Ordinance 3248-2021 and Ordinance 3259-2021 and not otherwise distributed directly to the Township by Franklin County shall be deemed appropriated for the purposes set forth in the Township Compensation Agreement and authorized to be expended therefrom in accordance with the Township Compensation Agreement, and the City Auditor is authorized to make payments to the Township or its designee from the TIF Funds in accordance with the Township Compensation Agreement upon order of the Director, or his or her designee, and that no order shall be drawn or money paid except by voucher, the form of which shall be approved by the City Auditor.
Section 7. Appropriation and Expenditure to Developers. That the Available Charge Revenue deposited into the SFRS NCA Fund and the remaining service payments in lieu of taxes and property tax rollback payments deposited into the TIF Funds, after making payment to the Township (the “Available TIF Revenue”), shall be deemed appropriated for the purposes set forth in the TIF & NCA Reimbursement Agreement and/or the Subsequent Agreements and authorized to be expended therefrom in accordance with the TIF & NCA Reimbursement Agreement and/or the Subsequent Agreements, and the City Auditor is authorized to make payments to Pulte Homes of Ohio, LLC and Harmony Development Group, LLC or their designees from the Available Charge Revenue in the SFRS NCA Fund and the Available TIF Revenue in the TIF Funds in accordance with the TIF & NCA Reimbursement Agreement and/or the Subsequent Agreements upon order of the Director, or his or her designee, and that no order shall be drawn or money paid except by voucher, the form of which shall be approved by the City Auditor.
Section 8. ED Fees. That the City Auditor is authorized to make annual transfers of $5,000 from each of the TIF Funds, or up to $15,000 total annually from any combination of the TIF Funds, to the Business Tax Incentive Fund (2229), subject to the authorization of the Director, or his or her designee, for the City TIF Administrative Fee, as defined in and in accordance with the TIF & NCA Reimbursement Agreement and Ordinance 3221-2018.
Section 9. Account Codes. That the City Auditor is authorized to establish such accounting codes as necessary, to make any accounting changes to revise the funding source for all agreements, contracts, amendments, or modifications associated with this Ordinance and the transactions contemplated by the Intergovernmental Cooperative Agreement, the Township Compensation Agreement, the TIF & NCA Reimbursement Agreement, the Subsequent Agreements and/or their amendments.
Section 10. Transfers. That the City Auditor is hereby authorized to transfer the unencumbered balance in a project account or subfund to the unallocated balance account within the same fund upon receipt of certification by the Director of the Department administering said project that the project has been completed and the monies are no longer required for said project.
Section 11. Emergency. That for reasons stated in the preamble hereto, which is hereby made a part hereof, this ordinance is hereby declared to be an emergency measure and shall take effect and be in full 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.