Explanation
Background: The Department of Development is proposing the establishment under Section 5709.41 of the Revised Code of a tax increment financing (TIF) district at the Gowdy field site.
The attached ordinance establishes the TIF district and provides for a 100% exemption on all development within the TIF district for a period of not more than 30 years. Annual service payments in lieu of taxes with respect to development within the TIF district will be paid into a TIF Fund established in this ordinance. It is important to note that the Columbus City School District will receive, at the same time, and in the same manner as usual, all monies that it would have received in real property taxes had the TIF exemption not been granted. Revenue derived from the service payments in lieu of taxes from the TIF district will be used to find various public improvements benefiting the TIF district.
Fiscal Impact: No funding is required for this legislation. The City is foregoing real property tax revenue that it would have received in respect of development within the TIF district. Instead, that revenue will be diverted to the TIF Fund to be used for public infrastructure improvements benefiting the TIF district.
Title
An ordinance creating a tax increment financing district pursuant to Section 5709.41 of the Revised Code; declaring improvements to the real property located in the TIF district to be a public purpose; exempting from real property taxation 100 percent of those improvements; requiring the owners thereof to make service payments in lieu of taxes; establishing a municipal public improvements tax increment equivalent fund for the deposit of the service payments collected from the TIF district property owners; protecting the school district serving the TIF district against any loss of tax revenue as a result of the exemptions granted by this Ordinance; and describing the public infrastructure improvements to be made benefiting the TIF district.
Body
WHEREAS, the owner (the "Owner") of the real property located in the City of Columbus, County of Franklin, Ohio (the "City") depicted on Exhibit A attached hereto (the "Property") or its successors or assigns, have or will develop a commercial project in the Property described in Exhibit B attached hereto (collectively, the "Project") and this Council expects to make the public infrastructure improvements described on Exhibit C hereto (the "Public Infrastructure Improvements"), that once made will directly benefit the Property; and
WHEREAS, this Council has determined that it is necessary and appropriate and in the best interest of the City to exempt from taxation 100% of the improvements to the Property as permitted and provided in Section 5709.41 of the Ohio Revised Code (the "Revised Code") for up to 30 years, and to simultaneously direct and require the current and future owner(s) of the Property to make annual service payments in lieu of the real property tax payments in the same amount as they would have made real property tax payments except for the exemption provided by this Ordinance (the "Service Payments"), which Service Payments shall be made to the Franklin County Treasurer on or before the final dates for payment of real property taxes; and
WHEREAS, Section 5709.41 of the Revised Code requires that the City have held title to the Property prior to the adoption of an ordinance declaring that the Improvements (as that term is defined in Section 5709.41 of the Revised Code) to the Property to be a public purpose; and
WHEREAS, the City has previously held title to the Property prior to the passage of this Ordinance; and
WHEREAS, the City has determined that a portion of the Service Payments shall be paid to the Columbus City School District (the"School District") in an amount equal to the real property taxes that the School District would have been paid if improvements to the Property located in such School District had not been exempted from taxation pursuant to this Ordinance; and
WHEREAS, pursuant to Section 5709.43(A) of the Revised Code, this Council has determined to establish a municipal public improvement tax increment equivalent fund for the Property which there shall be deposited Service Payments distributed to the City; and
WHEREAS, notice of this proposed Ordinance has been delivered to the Board of Education of the School Districts in accordance with and within the time periods prescribed in Sections 5709.41 and 5709.83 of the Revised Code; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. The City has held title to the Property prior to the passage of this Ordinance.
Section 2. Subject to any tax exemptions previously or subsequently granted pursuant to Sections 3735.61 through 3735.66 of the Revised Code (a "EZ Exemption") and pursuant to and in accordance with the provisions of Section 5709.41 of the Revised Code, this Council hereby finds and determines that 100% of the increase in the assessed value of the Property subsequent to the effective date of this ordinance (which increase in value is hereinafter referred to as the "Improvement" as defined in Section 5709.41 of the Revised Code) is hereby declared to be a public purpose, and shall be exempt from taxation for a period commencing on the first tax year that begins after effective date of this Ordinance and ending on the earlier of (a) thirty (30) years after such exemption commenced or (b) the date on which the City can no longer require service payments in lieu of taxes, all in accordance with the requirements of Sections 5709.41 to 5709.43 of the Revised Code.
Section 3. Pursuant to Section 5709.42 of the Revised Code, the City hereby directs and requires the current and future owners of the Property to make annual Service Payments to the Franklin County Treasurer on or before the final dates for payment of real property taxes.
Section 4. In accordance with the Sections 5709.41 and 5709.42 of the Revised Code, and this Ordinance, the Franklin County Treasurer shall pay directly to the School District a portion of the Service Payments made to the Franklin County Treasurer equal to the amount of the real property taxes that the School District would have received if the Improvements had not been exempted from taxation pursuant to this Ordinance. The Franklin County Treasurer shall pay to the City for deposit into the TIF Fund (defined in Section 5 hereof) the remainder of those Service Payments.
Section 5. The City hereby establishes the "Gowdy Field Tax Equivalent Fund" (the "TIF Fund"), into which the City Auditor shall deposit payments from the Franklin County Treasurer of that portion of the Service Payments collected from the Property not required to be distributed to the School District pursuant to Section 4 hereof. Any expenditure of Service Payments deposited into the TIF Fund is subject to the expenditure restrictions and appropriation requirements of Sections 27 through 31 of the Charter of the City. The TIF Fund shall remain in existence so long as Service Payments are collected and used for the aforesaid purposes, after which the TIF Fund shall be dissolved in accordance with Section 5709.43 of the Revised Code.
Section 6. Pursuant to Section 5709.41 of the Revised Code, the City Clerk is hereby directed to deliver a copy of this Ordinance to the Director of Development of the State of Ohio within fifteen days after its effective date. Further, and on or before March 31 of each year that the exemptions set forth in Section 1 hereof remain in effect, the City Clerk or other authorized officer of the City shall prepare and submit to the Director of Development of the State of Ohio the status report required under Section 5709.41(E) of the Revised Code.
Section 7. This Ordinance shall take effect and be in force from and after the earliest period allowed by law.