Explanation
Background: Ordinance No. 2189-2011 established a tax increment financing (TIF) area pursuant to Ohio R.C. Section 5709.40(B) along Olentangy River Road between North Broadway and Ackerman Road (the “Olentangy & North Broadway TIF”). The City is now in the process of partnering with the Central Ohio Transit Authority to develop bus rapid transit from Downtown Columbus to Dublin including along Olentangy River Road (the “Northwest BRT Corridor”). The City has implemented ZoneIn Phase 1 and is implementing ZoneIn Phase 2 to allow for higher density residential and mixed-use developments along parts of the Northwest BRT Corridor. In addition, two separate projects have been proposed along the Northwest BRT Corridor with one such project proposed by Crawford Hoying, Ltd. and/or its affiliates (together, the “Developer”) within the Olentangy & North Broadway TIF for which the Developer has requested tax increment financing to support public infrastructure improvements for the project as allowed under R.C. Section 5709.40(A)(8).
This Ordinance will authorize the Director of the Department of Development to enter into an Economic Development Agreement with the Developer, and authorize an amendment to the Olentangy & North Broadway TIF for such aforementioned purposes. This Ordinance will also establish a new tax increment financing area near 3368 and 3380 Olentangy River Road on Franklin County Tax Parcel ID Nos. 010-103644, 010-087765, 010-305899, 010-305900, and 010-305901 (the “Olentangy 315 South TIF”) pursuant to R.C. Sections 5709.40(B), 5709.42, 5709.43. The proposed Olentangy 315 South TIF will provide for a one-hundred percent (100%) exemption from real property taxation on the improvements to the parcel(s) within such TIF for a concurrent period for all parcel(s) of not more than thirty (30) years. Columbus City Schools will receive, in the same manner as usual, all amounts they would have received in real property taxes had the tax exemption herein not been granted. Annual service payments in lieu of taxes will be made by the owner(s) of each parcel with respect to the improvements to the Olentangy 315 South TIF parcel(s). The applicable portion of those service payments in lieu of taxes will be distributed directly to the school district described herein, and the remaining portion of those service payments in lieu of taxes will be paid to the City for deposit into the appropriate TIF fund established by this Ordinance to be used to finance public infrastructure improvements, as allowed under R.C. Section 5709.40(A)(8), benefiting the Olentangy 315 South TIF parcel(s). A companion ordinance is being submitted for City Council consideration to remove Franklin County Tax Parcel ID Nos. 010-305899, 010-305900, and 010-305901 from the OhioHealth TIF created pursuant to Ordinance No. 1224-2009 to combine those parcels with Franklin County Tax Parcel ID Nos. 010-103644 and 010-087765 removed from the Olentangy & North Broadway TIF hereunder to create the new Olentangy 315 South TIF for this project.
Fiscal Impact: No funding is required for this legislation. The City is foregoing one-hundred percent (100%) of the real property tax revenue that it would have received from the improvements within the new Olentangy 315 South TIF. Instead, the non-school portion of that revenue will be diverted to a new Olentangy 315 South TIF Fund.
Title
To amend Ordinance No. 2189-2011 to remove certain tax parcels exempted by that ordinance from the Olentangy & North Broadway TIF; to create the Olentangy 315 South TIF with those removed parcels and additional parcels removed from the OhioHealth TIF by separate ordinance; to declare the improvements to the Olentangy 315 South TIF parcel(s) to be a public purpose and exempt from real property taxation; to require the owner(s) of the parcel(s) in the Olentangy 315 South TIF to make service payments in lieu of taxes; to require the distribution of the applicable portion of those service payments to the Columbus City School District; to deposit the remainder of those service payments into the Olentangy 315 South TIF Fund for financing public infrastructure improvements as allowed under R.C. Section 5709.40(A)(8); and to authorize the Director of the Department of Development to enter into an Economic Development Agreement between the City and Crawford Hoying, Ltd. and/or its affiliates. ($0.00)
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WHEREAS, pursuant to R.C. Section 5709.40(B) and Ordinance No. 2189-2011, City Council created a tax increment financing (TIF) area along Olentangy River Road between North Broadway and Ackerman Road (the “Olentangy & North Broadway TIF”); and
WHEREAS, the City is now in the process of partnering with the Central Ohio Transit Authority to develop bus rapid transit from Downtown Columbus to Dublin including along Olentangy River Road (the “Northwest BRT Corridor”); and
WHEREAS, the City has implemented ZoneIn Phase 1 and is implementing ZoneIn Phase 2 to allow for higher density residential and mixed-use developments along parts of the Northwest BRT Corridor; and
WHEREAS, two separate projects have been proposed along the Northwest BRT Corridor with one such project proposed by Crawford Hoying, Ltd. and/or its affiliates (together, the “Developer”) within the Olentangy & North Broadway TIF (the “Northwest BRT Project”) for which the Developer has requested tax increment financing to support public infrastructure improvements benefiting the proposed project as allowed under R.C. Section 5709.40(A)(8); and
WHEREAS, the City contemplates entering into an Economic Development Agreement with the Developer for the Northwest BRT Project to establish the proper implementation and use of incentives for the Northwest BRT Project together with the commitments from the Developer for such incentives; and
WHEREAS, the new TIF will provide indirect support towards the creation of new housing units within the Northwest BRT Project in close proximity to major employers such as Riverside Methodist Hospital, Wexner Medical Center, and The Ohio State University; and
WHEREAS, to maximize the tax increment financing available for the Northwest BRT Project and the public infrastructure projects as described on Exhibit B attached hereto (the “Public Infrastructure Improvements”), the City has determined that it is in the City’s best interests to remove the applicable parcels of the Northwest BRT Project from the Olentangy & North Broadway TIF and add the parcels of the Northwest BRT Project to a new TIF; and
WHEREAS, R.C. Sections 5709.40(B), 5709.42, and 5709.43 (collectively, the “TIF Statutes”) authorize this Council, by ordinance, to declare the improvement to parcels of real property located within the City to be a public purpose and exempt from taxation, require the owner of each parcel to make service payments in lieu of taxes, provide for the distribution of the applicable portion of such service payments in lieu of taxes to the school district in which those parcels are located and to the City, establish a municipal public improvement tax increment equivalent fund for the deposit of those non-school service payments in lieu of taxes, and specify the purposes for which money in that fund will be expended; and
WHEREAS, in order to pay for the costs of the Public Infrastructure Improvements, this Council has determined that it is necessary and appropriate and in the best interest of the City to establish a tax increment financing area near 3368 and 3380 Olentangy River Road on Franklin County Tax Parcel ID Nos. 010- 103644, 010-087765, 010-305899, 010-305900, and 010-305901 as depicted on Exhibit C attached hereto (the “Olentangy 315 South TIF”) to exempt from taxation one-hundred percent (100%) of the improvements to each parcel of real property within the Olentangy 315 South TIF (collectively the “Parcels” and each a “Parcel”) as permitted and provided in R.C. 5709.40(B) for up to a thirty (30) year concurrent period for all Parcels and to simultaneously direct and require the current and future owners of each Parcel (each individually an “Owner” and collectively the “Owners”) to make annual payments in lieu of taxes, in the same amount as they would have made real property tax payments but for the exemptions provided by this Ordinance; and
WHEREAS, the City has determined that the applicable portion of the service payments in lieu of taxes shall be paid directly to Columbus City Schools (the “School District”) in an amount equal to the real property taxes that the School District would have been paid if the improvement to each Parcel located within the School District had not been exempt from taxation pursuant to this Ordinance; and
WHEREAS, pursuant to R.C. Section 5709.43(A), this Council has determined to establish a municipal public improvement tax increment equivalent fund in which there shall be deposited the appropriate remaining non-school service payments in lieu of taxes distributed to the City as provided herein; 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 periods prescribed in R.C. Sections 5709.40 and 5709.83, respectively; and
WHEREAS, a companion ordinance is being submitted for City Council consideration to remove additional parcels from the OhioHealth TIF created pursuant to Ordinance No. 1224-2009 to combine those parcels with the parcels removed from the Olentangy & North Broadway TIF hereunder to create the Olentangy 315 South TIF for the Northwest BRT Project; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. TIF Amendments. That this Council finds and determines that amending Ordinance No. 2189-2011 is in furtherance of, and supports, the Northwest BRT Corridor and ZoneIn Phases 1 and 2. Exhibit A to Ordinance No. 2189-2011 is hereby repealed and replaced with Exhibit A-1 attached hereto to remove Franklin County Tax Parcel ID Nos. 010- 103644 and 010-087765 and to remove the .754 acres formerly known as Franklin County Tax Parcel ID No. 010-103643 within the .911-acre “Common Element” identified on Instrument No. 202202180028234 recorded with the Franklin County, Ohio Recorder’s Office from the Olentangy & North Broadway TIF (collectively, the “Removed Parcels”). Upon passage of this Ordinance, Ordinance No. 2189-2011 shall be read and interpreted to mean that the Removed Parcels depicted on Exhibit A-1 were included in the Olentangy & North Broadway TIF from the passage of Ordinance No. 2189-2011 to the passage of this Ordinance. Henceforth from passage of this Ordinance, the Removed Parcels shall no longer be part of the Olentangy & North Broadway TIF but shall be included in the Olentangy 315 South TIF with other additional territory identified herein this Ordinance. Exhibit B to Ordinance No. 2189-2011 is hereby repealed and replaced with Exhibit B-1 attached hereto to supplement the list of eligible public infrastructure made, to be made, or in the process of being made that directly benefit, or that once made, will directly benefit the remaining parcels in the Olentangy & North Broadway TIF
Section 2. No Other Modifications. That except as provided herein, all provisions of Ordinance No. 2189-2011 shall remain in full force and effect; it is the intent of City Council that Ordinance No. 2189-2011 and this Ordinance be construed together as a single instrument, as appropriate.
Section 3. Parcels and Creation of TIF Area. That the Parcels, and each individual Parcel as currently or subsequently configured, subject to this Ordinance are identified and depicted on Exhibit C. The Parcels, the .453-acre “Common Element” identified on Instrument No. 202202180028234 recorded with the Franklin County, Ohio Recorder’s Office. and the .911-acre “Common Element” identified on Instrument No. 202202180028234 recorded with the Franklin County, Ohio Recorder’s Office will be included in a new tax increment financing area the boundaries of which shall be corresponding with the boundary of, and shall include, the Parcels, the .453-acre “Common Element” identified on Instrument No. 202202180028234 recorded with the Franklin County, Ohio Recorder’s Office., and the .911-acre “Common Element” identified on Instrument No. 202202180028234 recorded with the Franklin County, Ohio Recorder’s Office known hereafter as the Olentangy 315 South TIF. As applicable, such aforesaid Common Elements may be each treated as one of the Parcels for purposes of this Ordinance.
Section 4. Public Infrastructure Improvements. That this Council hereby designates the Public Infrastructure Improvements described on Exhibit B and any other public infrastructure improvements hereafter designated by ordinance as public infrastructure improvements made, to be made, or in the process of being made that directly benefit, or that once made, will directly benefit the Parcels.
Section 5. Exemption. That, pursuant to R.C. Section 5709.40(B), this Council hereby finds and determines that one-hundred percent (100%) of the increase in assessed value of each Parcel subsequent to the effective date of this Ordinance (which increase in assessed value is hereinafter referred to as the “Improvement” as defined in R.C. Section 5709.40(A)) is hereby declared to be a public purpose and exempt from taxation for a coextensive period for all Parcels, which commences for all Parcels with the tax year in which an exempted Improvement, due to a new structure, first appears on the tax list and duplicate of real and public utility property and that commences after the effective date of the ordinance and ending on the earlier of (a) thirty (30) years after such commencement 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 the TIF Statutes (the “TIF Exemption”). The TIF Exemption provided by this Ordinance is subordinate to any exemption for a Parcel granted pursuant to R.C. Section 3735.65 et. seq. (community reinvestment area), R.C. Section 5709.61 et. seq. (enterprise zone) and R.C. Section 5709.08 (government and public property) (collectively, the “Authorized Superior Exemptions”). In accordance with R.C. Section 5709.911(B), by this duly enacted Ordinance, this Council provides its duly authorized consent to any Authorized Superior Exemptions to the Parcels applied for after the TIF Exemption.
Section 6. Service Payments. That, as provided in R.C. Section 5709.42, each Owner and collectively the Owners are hereby required to make service payments in lieu of taxes with respect to the Improvement allocable to each Parcel to the Franklin County Treasurer or its designee on or before the final dates for payment of real property taxes. The service payments in lieu of taxes will be charged and collected in the same manner and in the same amount as the real property taxes that would have been charged and collected against that Improvement if it were not exempt from taxation pursuant to this Ordinance, including any penalties and interest (collectively, the “Service Payments”). The Service Payments, and any other payments with respect to each Improvement that are received in connection with the reduction required by R.C. Sections 319.302, 321.24, 323.152 and 323.156, as the same may be amended from time to time, or any successor provisions thereto as the same may be amended from time to time (the “Property Tax Rollback Payments”), will be deposited and distributed in accordance with this Ordinance.
Section 7. TIF Fund. That this Council establishes, pursuant to and in accordance with the provisions of R.C. Section 5709.43, the Olentangy 315 South Municipal Public Improvement Tax Increment Equivalent Fund (the “TIF Fund”) into which the appropriate Service Payments and Property Tax Rollback Payments collected with respect to the Parcels and not required pursuant to this Ordinance to be distributed to the School District will be deposited. The TIF Fund will be maintained in the custody of the City. The City may use amounts deposited into the TIF Fund only for the purposes authorized in the TIF Statutes and this Ordinance (as it may be amended from time to time). The TIF Fund will remain in existence so long as the Service Payments and Property Tax Rollback Payments are collected and used for the aforesaid purposes, after which time the TIF Fund will be dissolved and any surplus funds remaining therein transferred to the City's General Fund, all in accordance with R.C. Section 5709.43.
Section 8. Distributions; Payment of Costs. That, pursuant to the TIF Statutes, the County Treasurer is requested to distribute the Service Payments and Property Tax Rollback Payments as follows:
a. To the School District, an amount equal to the amount the School District would otherwise receive as real property tax payments (including the applicable portion of any Property Tax Rollback Payments) derived from the Improvement to each Parcel if the Improvement had not been exempt from taxation pursuant to this Ordinance.
b. To the City, all remaining amounts for further deposit into the TIF Fund for payment of costs of the Public Infrastructure Improvements, including, without limitation, debt charges on any notes or bonds issued to pay or reimburse finance costs or costs of those Public Infrastructure Improvements.
All distributions required under this Section are to be made at the same time and in the same manner as real property tax distributions.
Section 9. Further Authorizations. That this Council hereby authorizes the Director of the Department of Development, the City Clerk, or other appropriate officers of the City to deliver a copy of this Ordinance to the Ohio Development of Development and to make such arrangements as are necessary and proper for collection of the Service Payments and Property Tax Rollback Payments. This Council further authorizes the Director of the Department of Development, the City Clerk, the City Attorney or other appropriate officers of the City to prepare and sign all agreements and instruments and to take any other actions as may be appropriate to implement this Ordinance.
Section 10. TIRC. That the City’s Tax Incentive Review Council (“TIRC”) shall review annually all exemptions from taxation resulting from the declarations set forth in this Ordinance and any other matters as may properly come before the TIRC, all in accordance with Section 5709.85 of the Ohio Revised Code.
Section 11. Economic Development Agreement. That the Director of the Department of Development or his or her designee (together, the “Director”), on behalf of the City, is hereby authorized to enter into an Economic Development Agreement with the Developer presently on file with the Department of Development, along with any changes or amendments thereto not inconsistent with this Ordinance and not substantially adverse to the City and which shall be approved by the Director and the City Attorney, provided that the approval of such changes and amendments thereto, and the character of those changes and amendments not being substantially adverse to the City, shall be evidenced conclusively by the execution and delivery thereof.
Section 12. Effective Date. That this Ordinance shall take effect and be in force from and after the earliest period allowed by law.