Explanation
BACKGROUND: Columbus City Council, by Ordinance 0863-2007, passed June 11, 2007, authorized the City to enter into an Enterprise Zone Agreement (the Agreement) with DCT Mohawk, LLC (Enterprise) for a tax abatement of seventy-five percent (75%) for a period of ten (10) years in consideration of a $6,115,000 investment in real property improvements and the creation of 20 permanent full-time jobs related to a 180,000 square foot expansion of their existing 350,000 square foot facility on parcel number 495-269365 at 6450 Lasalle Drive within the City of Columbus Enterprise Zone (Project). The Agreement was made and entered into to be effective November 7, 2007 (EZA# 023-07-06).
At the 2009 Columbus Tax Incentive Review Council (TIRC) held on August 18, 2009, the DCT Mohawk, LLC Enterprise Zone project was recommended to be continued as part of the Consent Agenda, as the project was in compliance as of December 31, 2008. The project was listed as a Future project on the Consent Agenda as the construction window was to be no later than the January 2009 to July 2009 time frame and the job creation window was the 2009 through 2011 time frame. As per the most recent reporting period ending December 31, 2009, Enterprise had not yet begun construction and no new jobs had been created. Enterprise has related through communication with the City that market conditions have resulted in the inability to initiate construction and begin new employment at this facility as per the Agreement, and that this time Enterprise has no immediate plans to do so. As the Agreement is now out of compliance both the City and Enterprise have agreed to dissolve the Agreement.
This legislation is presented as an emergency measure in order for this amendment to be legislated prior to the 2010 TIRC.
FISCAL IMPACT: No funding is required for this legislation.
Title
To dissolve the Enterprise Zone Agreement with DCT Mohawk, LLC; to direct the Director of the Department of Development to notify as necessary the local and state tax authorities; and to declare an emergency.
Body
WHEREAS, the Columbus City Council approved the Enterprise Zone Agreement with DCT Mohawk, LLC (the "EZA") on June 11, 2007 by Ordinance No. 0863-2007 and entered into effective November 7, 2007; and
WHEREAS, the EZA grants DCT Mohawk, LLC a 75%/10-Year abatement on real property improvements; and
WHEREAS, the EZA requires DCT Mohawk, LLC to invest $6,115,000 in real property improvements and create 20 new full-time jobs at an expanded facility at 6450 Lasalle Drive; and
WHEREAS, the Tax Incentive Review Council (the "TIRC") met on August 18, 2009 and it was reported then that the project was in compliance with the terms of the EZA as the project was considered to be a future project as of December 31, 2008 in that it was at that time still within the parameters of the construction and job creation time frames and as part of the Consent Agenda the project was recommended to be continued; and
WHEREAS, an analysis of the Report Year 2009 Annual Report submitted to the City by Enterprise during the most recent reporting cycle indicated that the project had not yet begun in that construction had not been started and completed within the parameters of the EZA and no new jobs had been created; and
WHEREAS, the project is now out of compliance with the EZA and as the City and Enterprise have discussed the situation, Enterprise has indicated that due to market conditions it has no immediate plans to bring the project into compliance and both the City and Enterprise desire to dissolve the EZA; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development, in that it is immediately necessary to take action on these agreements in order for this amendment to be legislated prior to the 2010 TIRC, all for the preservation of the public health, property, safety and welfare; NOW, THEREFORE
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. That Columbus City Council hereby dissolves the DCT Mohawk, LLC Enterprise Zone Agreement as of December 31, 2009, with 2009 being the final reporting year.
Section 2. That the Director of Development is hereby directed to notify the necessary local and state agencies of any changes to the DCT Mohawk, LLC Enterprise Zone Agreement.
Section 3. For the reasons stated in the preamble hereto, which is 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 (10) days after passage if the Mayor neither approves nor vetoes the same.