Explanation
BACKGROUND: The City of Columbus was authorized by Columbus City Council to enter into a Technology Corridor Office Incentive Agreement (Agreement) with Ohio State University Physicians, Inc., (also referred to as the "Grantee" or "OSUP") by Ordinance 1163-2006, passed on June 26, 2006, which was to grant a financial incentive based on an amount equal to thirty percent (30%) of the growth of the Grantee's City of Columbus withholding tax paid by the retention of existing employees and for new employees for a period of ten (10) years commencing calendar year 2006 based on the Grantee maintaining its corporate offices at 700 Ackerman Road and by employing people at 700 Ackerman Road and locations throughout the City of Columbus (Project Site).
The Agreement, made and entered into effective November 22, 2006, identified the Project Site to only be 700 Ackerman Road, not 700 Ackerman Road and locations throughout the City of Columbus. The Agreement also stated that the incentive would commence for calendar year 2006 and continue for a period ending with calendar year 2016, which is an 11-year term not a 10-year term as authorized by Ordinance 1163-2006. The Agreement also identified a baseline municipal income tax withholding amount from 2005 which is to be subtracted from the current year OSUP City of Columbus municipal income tax withholding payments as part of the yearly incentive calculation process.
In a letter from the Grantee dated November 13, 2013, the Grantee indicated that physician employees of OSUP have traditionally been dual employees of both OSUP and the Ohio State University College of Medicine and Public Health (OSUCM) with OSUP compensating the physicians for their clinical services and OSUCM compensating the physicians for their teaching and research services. Additionally, OSUP has other employees who are not physicians and who are not necessarily dual employees of OSUP and OSUCM. The letter went on to say that these former dual employees, those physicians who perform clinical services at OSUP, are now being compensated by The Ohio State University Wexner Medical Center (OSUWMC). As such, the Grantee has requested that the Agreement be amended.
This legislation is requested to be considered as an emergency in order to (1) add The Ohio State University Wexner Medical Center (OSUWMC) as an additional Grantee to the Agreement, to (2) revise the method by which annual payments are to be calculated, to (3) revise the definition of the Project Site from only 700 Ackerman Road to be 700 Ackerman Road and locations throughout the City of Columbus and to (4) correct the description of the 10-year term so that the Agreement can be amended prior to the start of the reporting season for Report Year 2014.
FISCAL IMPACT: No funding is required for this legislation.
Title
To authorize the Director of the Department of Development to amend the Technology Corridor Office Incentive Agreement with Ohio State University Physicians, Inc. to reflect various changes therein; and to declare an emergency.
Body
WHEREAS, Columbus City Council approved a Technology Corridor Office Incentive Agreement (Agreement) with Ohio State University Physicians, Inc. (also referred to as the "Grantee" or "OSUP") by Ordinance 1163-2006, passed on June 26, 2006; and
WHEREAS, Ordinance 1163-2006 authorized the granting of a financial incentive based on an amount equal to thirty percent (30%) of the growth of the Grantee's City of Columbus withholding tax paid by the retention of existing employees and for new employees for a period of ten (10) years commencing calendar year 2006 based on the Grantee maintaining its corporate offices at 700 Ackerman Road and by employing people at 700 Ackerman Road and locations throughout the City of Columbus (to be the Project Site); and
WHEREAS, the Agreement, made and entered into effective November 22, 2006, identified the Project Site to only be 700 Ackerman Road, not 700 Ackerman Road and locations throughout the City of Columbus; and
WHEREAS, the Agreement also stated that the incentive would commence for calendar year 2006 and continue for a period ending with calendar year 2016, which is an 11-year term not a 10-year term as authorized by Ordinance Number 1163-2006; and
WHEREAS, the Agreement also identified a baseline municipal income tax withholding amount from 2005 which is to be subtracted from the Grantee's current year City of Columbus municipal income tax withholding payments as part of the yearly incentive calculation process; and
WHEREAS, a letter from the Grantee dated November 13, 2013, the Grantee indicated that physician employees of OSUP have traditionally been dual employees of both OSUP and the Ohio State University College of Medicine and Public Health (OSUCM) with OSUP compensating the physicians for their clinical services and OSUCM compensating the physicians for their teaching and research services; and
WHEREAS, the letter also indicated that OSUP has other employees who are not physicians and who are not necessarily dual employees of OSUP and OSUCM; and
WHEREAS, the letter also indicated that these former dual employees, those physicians who perform clinical services at OSUP, are now being compensated by The Ohio State University Wexner Medical Center (OSUWMC); and
WHEREAS, an emergency exists in the usual daily operation of the Columbus Department of Development in that it is immediately necessary to seek an amendment to the Technology Corridor Office Incentive Agreement with Ohio State University Physicians, Inc. so that the Agreement can be amended prior to the start of the reporting season for Report Year 2014; thereby preserving the public health, peace, property and safety, NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
SECTION 1. That the Director of Development is hereby authorized to amend the Technology Corridor Office Incentive Agreement (the "Agreement") with Ohio State University Physicians, Inc. (OSUP) for the purpose of adding The Ohio State University Wexner Medical Center (OSUWMC) as an additional Grantee to the Agreement so that OSUP and OSUWMC would together both be Grantees.
SECTION 2. That the Director of Development is hereby authorized to amend the Agreement with OSUP to revise the definition of the Project Site from only 700 Ackerman Road to be 700 Ackerman Road and locations throughout the City of Columbus.
SECTION 3. That the Director of Development is hereby authorized to amend the Agreement with OSUP so that the incentive would commence for calendar year 2006, for a period of ten (10) consecutive taxable years to run from 2006 through 2015.
SECTION 4. That the Director of Development is also hereby authorized to amend the Agreement with OSUP to revise the method by which annual payments are to be calculated, that the OSUP baseline municipal income tax withholding amount from 2005 be subtracted from the combined current year City of Columbus municipal income tax withholding payments attributed to the non-physician employees of OSUP and the physicians of OSUWMC who perform clinical services for OSUP to be the amount of the growth of the Grantee's City of Columbus withholding tax paid by the retention of existing employees and for new employees at the Project Site.
SECTION 5. That the amendment to the City of Columbus Technology Corridor Office Incentive Agreement be signed by Ohio State University Physicians, Inc. and The Wexner Medical Center at The Ohio State University within ninety (90) days of passage of this ordinance, or this ordinance and the incentive authorized herein shall be null and void.
SECTION 6. That for reasons stated in the preamble hereto, which is hereby made a part hereof, the ordinance is hereby 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 days after the passage if the Mayor neither approves nor vetoes the same.