Explanation
BACKGROUND: The Director of the Department of Development is requesting authorization to enter into an Enterprise Zone Agreement on behalf of the City with XPO LTL Properties LLC & XPO Logistics Freight, Inc. (the “Enterprise”). The Ohio Enterprise Zone law Section 5709.62(C) of the Ohio Revised Code authorizes the City to enter into a Council-approved tax abatement agreements between the City and qualifying companies.
Headquartered in Greenwich, Connecticut, XPO LTL is a leader in asset-based less-than-truckload (LTL) freight transportation in North America. As a customer focused company, they efficiently move over 18 billion pounds of freight per year and serve approximately 52,000 customers from 610 locations and employing over 39,000 employees nationwide. Today, XPO LTL prioritizes the integration of new technology and network efficiency into their business plan and continue to serve 99% of all postal codes including Alaska and Hawaii. From building their own trailers in house at their facilities to using proprietary technology including new AI integrated software, XPO LTL is leading the forefront of on-time, damage-free, and efficient freight transportation.
XPO LTL Properties LLC & XPO Logistics Freight, Inc. is proposing to invest a total project cost of approximately $7,500,000.00 in real property improvements to expand their current facility to grow capacity by 100 docking doors. The new construction will consist of an additional approximately 44,360 square feet to their current 149,585 square foot facility. The proposed expansion will take place at their current facility located at 5400 Fisher Road, Columbus, OH 43228 (the “Project Site”), parcel number 570-102664. Additionally, XPO LTL Properties LLC & XPO Logistics Freight, Inc. proposes to create thirty-five (35) net new full-time permanent positions with an estimated annual payroll of approximately $2,085,000.00 (“New Employees”) and retain sixty-five (65) full-time permanent positions with an estimated associated annual payroll of approximately $4,209,300.00 at the proposed Project Site.
The Director of the Department of Development is recommending that Council approve a 75%/10-year Enterprise Zone tax abatement on real property improvements made by the Enterprise at the Project Site, in consideration of it creating the New Employees.
The Columbus City School District has been advised of this project.
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 enter into an Enterprise Zone Agreement with XPO LTL Properties LLC & XPO Logistics Freight, Inc. (the “Enterprise”) for a tax abatement of seventy-five percent (75%) for a period of ten (10) consecutive years in consideration of the Enterprise investing approximately $7,500,000.00 in real property improvements, the creation of thirty-five (35) net new full-time permanent positions with an estimated annual payroll of approximately $2,085,000.00 and retain sixty-five (65) full-time permanent positions with an estimated associated annual payroll of approximately $4,209,300.00.
Body
WHEREAS, the Columbus City Council authorized the designation of the City of Columbus Enterprise Zone by legislation, Ordinance Number 779-85, dated April 22, 1985; and subsequently amended the Zone by Ordinance Nos. 2722-85 in 1986; 2080-89 in 1989; 1949-92, 2690-92 and 2249-92 in 1992; 1079-94 and 1228-94 in 1994; 2196-95 and 2817-95 in 1995; 0533-99 in 1999; 1785-00 in 2000; 1464-02 in 2002; 0225-03 in 2003; 0032-2012 in 2012; 1442-2020 in 2020, 0279-2021 in 2021; and 0736-2022 in 2022; and
WHEREAS, the Director of the Development Department of the State of Ohio (“ODOD”) has determined that the Columbus Enterprise Zone (the “Zone”), as amended by the aforementioned Ordinances, continues to contain the characteristics set forth in Section 5709.61(A) of the Ohio Revised Code. The Director of ODOD has recertified this Zone in 1986, December 20, 1989, September 28, 1992, October 22, 1992, December 17, 1992, May 31, 1994, June 24, 1994, June 16, 1995, October 5, 1995, December 19, 1995, April 1, 1999, September 25, 2000, January 27, 2003, August 19, 2003, April 3, 2012, September 18, 2020, May 20, 2021, and most recently on May 17, 2022 as an “urban jobs and enterprise zone” under Chapter 5709 of the Ohio Revised Code; and
WHEREAS, XPO LTL is headquartered in Greenwich, Connecticut, and is a leader in asset-based less-than-truckload (LTL) freight transportation in North America. As a customer focused company, they efficiently move over 18 billion pounds of freight per year and serve approximately 52,000 customers from 610 locations and employing over 39,000 employees nationwide. Today, XPO LTL prioritizes the integration of new technology and network efficiency into their business plan and continue to serve 99% of all postal codes including Alaska and Hawaii. From building their own trailers in house at their facilities to using proprietary technology including new AI integrated software, XPO LTL is leading the forefront of on-time, damage-free, and efficient freight transportation.; and
WHEREAS, the Enterprise has submitted a proposal (“Proposal”) to invest approximately $7,500,000.00 in real property improvements (the “Project”) to expand their current facility to grow capacity by 100 docking doors. The new construction will consist of an additional approximately 44,360 square feet to their current 149,585 square foot facility (the “Facility”) at 5400 Fisher Road, Columbus, OH 43228, on parcel number 570-102664 (the “Project Site”); and
WHEREAS, the Enterprise anticipates that the Project will create thirty-five (35) net new full-time permanent positions with an estimated annual payroll of approximately $2,085,000.00 (“New Employees”) and retain sixty-five (65) full-time permanent positions with an estimated associated annual payroll of approximately $4,209,300.00; and
WHEREAS, after reviewing and investigating the Proposal submitted by the Enterprise, the Director of the Department of Development believes that the Enterprise has demonstrated that it is qualified by financial responsibility and business experience to create and preserve employment opportunities in the Columbus Enterprise Zone and improve the City’s economic climate; and
WHEREAS, the Director of the Department of Development is recommending that City Council approve a 10-year, 75% abatement on the assessed valuation of the Project Site due to the significant expansion of their current site in the City of Columbus with an associated investment of real property improvements of $7,500,000.00, to incentivize the Enterprise to construct expand in the City’s central corridor; and
WHEREAS, the Development Director has notified the Columbus City School District of the Project; and
WHEREAS, the City desires to enter into an agreement with the Enterprise in order to incentivize economic growth and create employment opportunities for its citizens, and for the preservation of public health, peace, property and safety; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That Columbus City Council, having reviewed the proposal, finds that the Enterprise is qualified by financial responsibility and business experience to create and preserve employment opportunities in the City of Columbus Enterprise Zone and improve the City’s economic climate pursuant to Revised Code Section 5709.62(C).
SECTION 2. That City Council finds and determines (1) that the Enterprise will create, or cause to be created, the New Employee positions in the State and City; (2) that the Project is economically sound and will benefit the people of the State and City by increasing opportunities for employment and strengthening the economy of the State and City; and (3) that receiving the aforementioned tax abatement is a critical factor in the decision by representatives for XPO LTL Properties LLC & XPO Logistics Freight, Inc., the Enterprise hereunder, to go forward with constructing the Project.
SECTION 3. Based on this determination, City Council approves and authorizes a 10-year, 75% abatement on the increase in assessed valuation of real property on the Project Site, contingent upon the Enterprise investing approximately $7,500,000.00 in real property improvements to expand their current facility to grow capacity by 100 docking doors. The new construction will consist of an additional approximately 44,360 square feet to their current 149,585 square foot facility. The proposed expansion will take place at their current facility located at 5400 Fisher Road, Columbus, OH 43228, on parcel number 570-102664, the creation thirty-five (35) net new full-time permanent positions with an estimated annual payroll of approximately $2,085,000.00 (“New Employees”) and the retention of sixty-five (65) full-time permanent positions with an estimated associated annual payroll of approximately $4,209,300.00 at the Project Site.
SECTION 4. That the City and the Enterprise must execute the attached Enterprise Zone Agreement within ninety (90) days of this Ordinance’s passage, or this Ordinance, and the authorization to enter into the tax abatement agreement, is null and void.
SECTION 5. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.