Explanation
BACKGROUND: Columbus City Council (“COUNCIL”), by Ordinance No. 2963-2021, passed November 22, 2021, authorized the City of Columbus (“CITY”) to enter into an Enterprise Zone Agreement (the “AGREEMENT”) with Buckeye XO LLC (“ENTERPRISE”), for a real property tax abatement of seventy-five percent (75%) for a period of ten (10) consecutive years in consideration of a proposed total capital investment of approximately $14,800,000.00 in real property improvements to construct a proactive industrial distribution and warehouse facility consisting of approximately 234,900 square-feet (Building 1A) on undeveloped land at 4882 Trabue Road, Columbus, Ohio 43228, Parcel Number 560-154558 (the “ORIGINAL PARCEL”), within the City of Columbus and within the City of Columbus Enterprise Zone (the “PROJECT SITE”). Additionally, the ENTERPRISE committed to create or cause to be created twenty-nine (29) net new full-time permanent positions with an associated annual payroll of approximately $904,800.00 at the PROJECT SITE. The AGREEMENT was made and entered into effective February 7, 2022 with the PROJECT expected to begin approximately August 2022, with all real property improvements expected to be completed approximately by October 2023 and with the abatement to commence no later than 2024 nor extend beyond 2033 (Agreement No. 023-22-01).
As of this date, the company has not yet received any foregone tax benefits because it has not filed Form DTE-24 with the Franklin County Auditor’s Office, and the Ohio Department of Taxation has not issued a Final Determination.
Subsequently, in a letter dated August 26, 2026, submitted by Xebec on behalf of the ENTERPRISE and confirmed through ensuing correspondence, the CITY was notified of project delays. Although the ENTERPRISE initially intended to break ground immediately following tax abatement approval, a combination of adverse market conditions and unforeseen site complications disrupted the original timeline. Specifically, the project navigated a period characterized by market oversupply, rising interest rates, and expanding cap rates. Furthermore, unexpected site conditions arose, which have since been successfully remediated, allowing the project to advance. Additionally, the boundaries of the PROJECT SITE were revised to Parcel Number 560-316943 (split from the "ORIGINAL PARCEL"), now designated by the street address of 1524 Buckeye Yard Loop W, Columbus, Ohio 43228. Consequently, the ENTERPRISE formally requests that the CITY amend the AGREEMENT to update the project's construction timeline, adjust the tax exemption period accordingly, and revise the PROJECT SITE description to reflect the new parcel number and the corresponding street address.
This legislation is to authorize the Director of the Department of Development to amend the AGREEMENT with Buckeye XO LLC (Building 1A) for the first time for the purposes of (1) to revise the expected project start date in Section 1 of the AGREEMENT from "August 2022" to "August 2026"; (2) update the expected completion date for all real property improvements from "October 2023" to "December 2027", (3) revise the Section 3 tax exemption period so that no exemption commences after 2028 or extends beyond 2037, replacing the original 2024 to 2033 timeframe; and (4) to revise the legal description of 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 Enterprise Zone Agreement with Buckeye XO LLC (Building 1A) for the first time for the purposes of (1) to revise the expected project start date in Section 1 of the agreement from "August 2022" to "August 2026"; (2) update the expected completion date for all real property improvements from "October 2023" to "December 2027", (3) revise the Section 3 tax exemption period so that no exemption commences after 2028 or extends beyond 2037, replacing the original 2024 to 2033 timeframe; and (4) to revise the legal description of the project site. ($0.00)
Body
WHEREAS, the City of Columbus (“CITY”) entered into an Enterprise Zone Agreement (the “AGREEMENT”) with Buckeye XO LLC (“ENTERPRISE”), approved by Columbus City Council (“COUNCIL”), by Ordinance No. 2963-2021, passed November 22, 2021, with this AGREEMENT made and entered into effective February 7, 2022; and
WHEREAS, the AGREEMENT granted a 75%/10-Year abatement on real property improvements; and
WHEREAS, the incentive was granted in consideration of a proposed total capital investment of approximately $14,800,000.00 in real property improvements to construct a proactive industrial distribution and warehouse facility consisting of approximately 234,900 square-feet (Building 1A) on an undeveloped land at 4882 Trabue Road, Columbus, Ohio 43228, Parcel Number 560-154558 (the “ORIGINAL PARCEL”), within the City of Columbus and within the City of Columbus Enterprise Zone (the “PROJECT SITE”). Additionally, the ENTERPRISE committed to create or cause to be created twenty-nine (29) net new full-time permanent positions with an associated annual payroll of approximately $904,800.00 at the PROJECT SITE. The AGREEMENT was made and entered into effective February 7, 2022 with the PROJECT expected to begin approximately August 2022, with all real property improvements expected to be completed by approximately October 2023 and with the abatement to commence no later than 2024 nor extend beyond 2033 (Agreement No. 023-22-01); and
WHEREAS, as of this date, the company has not yet received any foregone tax benefits because it has not filed Form DTE-24 with the Franklin County Auditor’s Office, and the Ohio Department of Taxation has not issued a Final Determination; and
WHEREAS, subsequently, in a letter dated August 26, 2026, submitted by Xebec on behalf of the ENTERPRISE and confirmed through ensuing correspondence, the CITY was notified of project delays. Although the ENTERPRISE initially intended to break ground immediately following tax abatement approval, a combination of adverse market conditions and unforeseen site complications disrupted the original timeline. Specifically, the project navigated a period characterized by market oversupply, rising interest rates, and expanding cap rates. Furthermore, unexpected site conditions arose, which have since been successfully remediated, allowing the project to advance. Additionally, the boundaries of the PROJECT SITE were revised to Parcel Number 560-316943 (split from the "ORIGINAL PARCEL"), now designated by the street address of 1524 Buckeye Yard Loop W, Columbus, Ohio 43228. Consequently, the ENTERPRISE formally requests that the CITY amend the AGREEMENT to update the project's construction timeline, adjust the tax exemption period accordingly, and revise the PROJECT SITE description to reflect the new parcel number and the corresponding street address; and
WHEREAS, it has become necessary in the usual daily operation a First Amendment is now needed to the AGREEMENT with Buckeye XO LLC, to (1) revise the project's construction timeline, (2) revise the tax exemption window, and (3) to revise the PROJECT SITE description to reflect the new parcel number and the corresponding street address; and NOW THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That the Council of Columbus finds that the enterprise submitting this proposal is qualified by financial responsibility and business experience to create and preserve employment opportunities in the zone and improve the economic climate of the municipal corporation.
SECTION 2. That the Director of the Department of Development is hereby authorized to amend within Section 1 (Establishment by Corporation) of the AGREEMENT, to amend the start date from “the PROJECT is expected to begin August 2022” to “the PROJECT is expected to begin August 2026”.
SECTION 3. That the Director of the Department of Development is hereby authorized to amend within Section 1 (Establishment by Corporation) of the AGREEMENT, from “All real property improvements are expected to be completed by October 2023” to “All real property improvements are expected to be completed by December 2027”.
SECTION 4. That the Director of the Department of Development is hereby authorized to amend within Section 1 (Establishment by Corporation) of the AGREEMENT, the PROJECT SITE is now revised from “Parcel Number 560-154558 (“ORIGINAL PARCEL”) located at 4888 Trabue Road” to “Parcel Number 560-316943 (split from the ORIGINAL PARCEL) with the current street address of 1524 Buckeye Yard Loop W, Columbus, Ohio 43228.
SECTION 5. That the Director of the Department of Development is hereby authorized to amend within Section 3 (Tax Incentive) of the AGREEMENT, the exemption period from “No real property exemption shall commence after 2024 nor extend beyond 2033” to “No real property exemption shall commence after 2028 nor extend beyond 2037”.
SECTION 6. That this FIRST AMENDMENT to the City of Columbus Enterprise Zone Agreement be signed by Buckeye XO LLC within ninety (90) days of passage of this ordinance, or this ordinance and the incentive authorized herein shall be null and void.
SECTION 7. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.