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 Georgesville Properties LLC and Aerospace Lubricants LLC (collectively and hereinafter referred to as 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.
Georgesville Properties LLC is a real estate holding company that was created to purchase, sell and develop real estate and is owned by Aerospace Lubricants LLC (“Aerospace Lubricants”). Established in 1973, Aerospace Lubricants is a premium grease and lubrication provider to the automotive, industrial, aviation, and defense industries. Aerospace Lubricants is quickly becoming the industry leader with state-of-the-art manufacturing facilities supported by a similar lab offering innovative products that solve industry problems. In July 1, 2024, the company was purchased by one of the largest premium oil and lubrication companies in the world, Amsoil, a specialist in developing synthetic lubricants that offer innovative answers to the greatest challenges vehicles and equipment present. The company has the opportunity to expand because of this partnership.
Georgesville Properties LLC and Aerospace Lubricants are proposing to invest in a total capital expenditure of approximately $5,050,000.00, which includes $1,800,000.00 real property improvements, and $3,250,000.00 in machinery and equipment to expand its existing office building and manufacturing facility. The first facility consists of a 5,000 square foot expansion to the company’s existing 25,862 square foot manufacturing facility at 1600 - 1604 Georgesville Road, Columbus, Ohio 43228, Parcel No. 570-118051 and the second facility consists of a 30,000 square foot expansion to the company’s existing 17,280 square foot office building located at 1616 Georgesville Road, Columbus, Ohio 43228, Parcel No. 570-121022 (collectively and hereinafter referred to as the “Project site”). Aerospace Lubricants will enter into a lease agreement with Georgesville Properties LLC (the “landowner”), create fifteen (15) net new full-time permanent positions with an estimated annual payroll of approximately $1,476,800.00 (“New Employees”), and retain thirty-seven (37) full-time permanent positions with an estimated associated annual payroll of approximately $4,090,000.00 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 the creation of employment opportunities for the residents of the City.
The Columbus-Southwestern 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 Georgesville Properties LLC and Aerospace Lubricants LLC (collectively, 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 a total project cost of approximately $5,050,000.00, which includes $1,800,000.00 in real property improvements, and $3,250,000.00 in machinery & equipment, the creation of fifteen (15) net new full-time permanent positions with an estimated annual payroll of approximately $1,476,800.00 and the retention of thirty-seven (37) full-time permanent positions with an estimated associated annual payroll of approximately $4,090,000.00 at the proposed Project Site. ($0.00)
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, Georgesville Properties LLC is a real estate holding company that was created to purchase, sale and develop real estate and is owned by Aerospace Lubricants LLC (“Aerospace Lubricants”) and collectively, referred to as the “Enterprise”; and
WHEREAS, established in 1973, Aerospace Lubricants is a premium grease and lubrication provider to the automotive, industrial, aviation, and defense industries. Aerospace Lubricants is quickly becoming the industry leader with state-of-the-art manufacturing facilities supported by a similar lab offering innovative products that solve industry problems. In July 1, 2024, the company was purchased by one of the largest premium oil and lubrication companies in the world, Amsoil, a specialist in developing synthetic lubricants that offer innovative answers to the greatest challenges vehicles and equipment present; and
WHEREAS, Georgesville Properties LLC and Aerospace Lubricants (collectively, the “Enterprise”) has submitted a proposal (“Proposal”) to invest approximately $1,800,000.00 in real property improvements (the “Project”) for the expansion of its office building and manufacturing facility, to meet its increased market demand and consumer growth. The first facility consists of a 5,000 square foot expansion to the company’s existing 25,862 square foot manufacturing facility at 1600 - 1604 Georgesville Road, Columbus, Ohio 43228, Parcel No. 570-118051 and the second facility consists of a 30,000 square foot expansion to the company’s existing 17,280 square foot office building located at 1616 Georgesville Road, Columbus, Ohio 43228, Parcel No. 570-121022 (collectively and hereinafter referred to as the “Project site”); and
WHEREAS, the Enterprise anticipates that the Project will create fifteen (15) net new full-time permanent positions with an estimated annual payroll of approximately $1,476,800.00 (“New Employees”) and retain thirty-seven (37) full-time permanent positions with an estimated associated annual payroll of approximately $4,090,000.00 at the proposed Project Site; 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 proposed expansion of Enterprise’s manufacturing and office facilities in the City of Columbus with an associated investment of real property improvements of $1,800,000.00, to incentivize the Enterprise to construct/expand in the City’s south-western corridor; and
WHEREAS, the Development Director has notified the Columbus-Southwestern City School District of the Project; and
WHEREAS, it has become necessary in the usual daily operation the City desires to enter into an agreement with the Enterprise in order to incentivize economic growth and create employment opportunities for its citizens; 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 Georgesville Properties LLC and Aerospace Lubricants LLC, (collectively, 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 $1,800,000.00 in real property improvements to expand its office building and manufacturing facility. The manufacturing component will consist of a 5,000 square foot expansion to the company’s existing 25,862 square-foot manufacturing facility and the office component will consist of a 30,000 square-foot expansion to the company’s 17,280 square foot office building located at 1600 - 1604 Georgesville Road, Columbus, Ohio 43228, Parcel No. 570-118051 and 1616 Georgesville Road, Columbus, Ohio 43228, Parcel No. 570-121022 (collectively and hereinafter referred to as the “Project Site”). Additionally, the Enterprise proposes to create fifteen (15) net new full-time permanent positions with an estimated annual payroll of approximately $1,476,800.00 (“New Employees”) and retain thirty-seven (37) full-time permanent positions with an estimated associated annual payroll of approximately $4,090,000.00 at the proposed 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.