Explanation
BACKGROUND: The purpose of this ordinance is to declare improvements to certain parcels of real property in the vicinity of the former AC Humko site, within the Harrison West neighborhood, to be for a public purpose to allow for the creation of a Tax Increment Finance (TIF) district.
Royal Tallow Holdings Ltd. intends to redevelop the former AC Humko site, at 525 West 1st Avenue, into approximately 222 apartments, 20 condominiums and 41 single-family homes. Royal Tallow has been working extensively with residents of the Harrison West neighborhood of Columbus over the past 12 months to ensure community input and receive neighborhood support. Also, the Department of Development was recently successful in obtaining a $3 million Clean Ohio Brownfield Redevelopment Grant to undertake site clean up and prepare for redevelopment construction.
The City of Columbus and Royal Tallow Holding Ltd. desire to create a TIF District under Ohio Revised Code Sections 5709.40, 5709.42 and 5709.43 to pay for certain public infrastructure improvements and to otherwise support the former AC Humko site development and surrounding Harrison West neighborhood while protecting the Columbus City School District from any loss of tax revenues.
The payments in lieu of taxes provides for payment to the Columbus City School District for its portion of service payments, establishes the City Municipal Improvement Tax Equivalent Fund for the deposit of the remainder of service payments.
FISCAL IMPACT: No funding is required for this legislation.
Title
An Ordinance declaring the improvement to certain parcels of real property to be a public purpose, requiring the owners thereof to make service payments in lieu of taxes, providing for the payment to the Columbus City School District of its portion of those service payments, and establishing a municipal public improvement tax equivalent fund for the deposit of the remainder of those service payments with the City. ($0)
Body
WHEREAS, Ohio Revised Code Section 5709.40(C) authorizes the legislative authority of a municipal corporation, by ordinance, to create an incentive district and to declare improvements to parcels of real property located within the incentive district to be a public purpose and exempt from taxation; and
WHEREAS, the parcels of real property shown in Exhibit A hereto are located in the State of Ohio, County of Franklin and City of Columbus (collectively, the "Property"); and
WHEREAS, by Ordinance No. 0689-04, this Council approved an Economic Development Plan for the Property (the "Development Plan"), which plan is on file in the office of the City Clerk; and
WHEREAS, the Columbus City Engineer has certified to this Council that (i) the Property is less than 300 acres in size, (ii) the Property is enclosed by a continuous boundary, and (iii) the public infrastructure serving the Property is inadequate to meet the development needs of the Property; and
WHEREAS, based on the need for additional public infrastructure to serve the Property, which need is evidence by the Development Plan, this Council has determined to create an incentive district known as the "Harrison West Redevelopment Incentive District" (the "District") pursuant to Ohio Revised Code Section 5709.40(C), the boundary of which shall be coextensive with the boundary of the Property; and
WHEREAS, it is anticipated by the City of Columbus (the "City") that the Property will undergo certain improvements, including residential uses, commercial uses, and other improvements which may be permitted from time to time under applicable zoning regulations (collectively, the "Projects"); and
WHEREAS, the City has determined that Improvements (as defined in Section 2 below) to the parcels comprising the District are or, upon completion, will be a public purpose under Ohio Revised Code Section 5709.40; and
WHEREAS, the City has determined that it is necessary and appropriate and in the best interest of the City to exempt from taxation the Improvements as permitted and provided in Ohio Revised Code Section 5709.40(C), and to simultaneously direct and require the current and future owner(s) of parcels of the Property and the Projects thereon to make annual service payments in lieu of taxes to the Franklin County Treasurer on or before the final dates for payment of real property taxes; and
WHEREAS, pursuant to Ohio Revised Code Section 5709.43(A), this Council has determined to establish a municipal public improvement tax increment equivalent fund into which there shall be deposited all Service Payments and Property Tax Rollback Payments (each as defined in Section 3 below) distributed to the City; and
WHEREAS, Ohio Revised Code Section 5709.40(C) provides that an ordinance adopted by the legislative authority of a municipal corporation pursuant to such Section shall designate the public infrastructure improvements made or to be made that benefit or serve the parcels in the District; and
WHEREAS, attached hereto as Exhibit B is a description of public infrastructure improvements made or to be made that benefit or serve the parcels in the District (collectively, the "Public Improvements"); and
WHEREAS, the City has determined that the life of the District shall be 30 years and it is appropriate and in the best interest of the City, subject to any tax exemptions subsequently granted pursuant to Ohio Revised Code Sections 3735.65 through 3735.70 (a "CRA Exemption"), to exempt 100% of the Improvements to parcels within the District during the 30-year life of the District; and
WHEREAS, the City has determined that Service Payments and Property Tax Rollback Payments (as defined in Section 3 below) shall be paid to the Columbus Public School District (the "School District") in the amount of the real property taxes that the School District would have been paid if the Improvements (as defined) had not been exempted from taxation pursuant to this Ordinance; and
WHEREAS, notice of this proposed Ordinance has been delivered to the Board of Education of the School District in accordance with and within the time period prescribed in Ohio Revised Code Sections 5709.40(D)(2) and 5709.83; and NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1: Pursuant to Ohio Revised Code Section 5709.40(C), the City hereby creates the District, the boundary of which shall be coextensive with the boundary of the Property. The life of the District shall be 30 years from the effective date of this Ordinance.
Section 2. That, in accordance with Ohio Revised Code Section 5709.40, the City hereby finds and determines that the increase in the assessed value of the Property subsequent to the effective date of this Ordinance is and shall be a public purpose, which increase in assessed value is hereinafter referred to as the "Improvements" as defined in Ohio Revised Code Section 5709.40 (A).
Section 3. That, subject to any CRA Exemptions, the City hereby exempts 100% of the Improvements from taxation (the "Exemption"), as and when the an Exemption is claimed and allowed in the manner provided by law, for the period set forth in this Ordinance.
Section 4. That, subject to any CRA Exemptions, the City hereby directs and requires owners of the Property and the Projects thereon to make annual service payments in lieu of real property taxes to the Franklin County Treasurer on or before the final dates for payment of real property taxes. Each payment shall be in the same amount as the real property taxes that would have been charged and payable against the Improvements (after credit for any other payments received by the City under Ohio Revised Code Sections 319.302, 321.24, 323.152 and 323.156, hereinafter referred to as the "Property Tax Rollback Payments") had an exemption for taxation not been granted, and shall otherwise be in accordance with the Ohio Revised Code Sections 5709.40, 5709.42 and 5709.43. Any late payments shall be subject to penalty and bear interest at the then current rate established under Ohio Revised Code Sections 323.121 and 5703.47, as the same may be amended from time to time (the payment of penalties and interest, along with the payments in lieu of taxes are collectively referred to herein as the "Service Payments"). The Service Payments and the Property Tax Rollback Payments shall be allocated and deposited in accordance with Sections 5 and 7 of this Ordinance. This Council further hereby authorizes and directs the Director of the Department of Development, the City Auditor, the Director of Law, or other appropriate officers of the City, to make such arrangements as are necessary and proper for collection from the owners of the Service Payments, including the preparation and filing of any necessary exemption applications.
Section 5. In accordance with Ohio Revised Code Sections 5709.40 and 5709.42 and this Ordinance, the Franklin County Treasurer shall make payments to the School District in lieu of the real property taxes it would have received in the amount of the real property taxes that the School District would have received if the Improvement had not been exempted from taxation pursuant to this Ordinance from the Service Payments and any Property Tax Rollback Payments.
Section 6. The Public Improvements described in Exhibit B hereto made or to be made by the City are hereby designated as public improvements that benefit or serve parcels in the District.
Section 7. The City hereby establishes the Harrison West Municipal Public Improvement Tax Increment Equivalent Fund (the "Fund") into which shall be deposited all of the Service Payments and any Property Tax Rollback Payments and hereby provides that all such Service Payments and any Property Tax Rollback Payments to be deposited into the Fund shall be used to pay costs of the Public Improvements. The Service Payments and Property Tax Rollback Payments to be paid to the School District pursuant to this Ordinance and Ohio Revised Code Sections 5709.40 and 5709.42 shall be paid directly to the School District by the Franklin County Treasurer. Any expenditure of service payments deposited in the Fund is subject to the expenditure restrictions and appropriation requirements of Section 27 through 31 of the Charter of the City. The Fund shall remain in existence so long as Service Payments are collected and used for the aforesaid purposes, after which the Fund shall be dissolved in accordance with Ohio Revised Code Section 5709.43.
Section 8. The Exemption granted in this Ordinance shall commence on the effective date of this Ordinance shall end no later than 30 years from the effective date of this Ordinance.
Section 9. Pursuant to Ohio Revised Code Section 5709.40(E), 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 Exemption remains 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 Ohio Revised Code Section 5709.40(E).
Section 10. This Council finds and determines that all formal actions of this Council concerning and relating to the passage of this Ordinance were taken in an open meeting of this Council and that all deliberations of this Council that resulted in those formal actions were in meeting open to the public in compliance with the law.
Section 11. That this ordinance shall take effect and be in force from and after the earliest period allowed by law.