Explanation
Background: The Department of Development is proposing the establishment under Ohio Revised Code Section 5709.40(C) of ten tax increment financing (TIF) incentive districts in the northeast area of Columbus.
The attached ordinance establishes those incentive districts and provides for a 100% exemption on all development within the incentive district for a period of not more than 30 years. Annual service payments in lieu of taxes with respect to development within an incentive district will be paid into special funds established for that purpose. It is important to note that the Columbus City School District and the Plain Local 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 will be used to fund public infrastructure improvements benefiting the entire northeast corridor of the City.
Fiscal Impact: No funding is required for this legislation. The City is foregoing real property tax revenue that it would have received with respect to development within the incentive districts. Instead, that revenue will be diverted to the special funds.
Title
To create ten tax increment financing incentive districts in northeast Columbus; to declare the increase in assessed valuation of the parcels within each incentive district to be a public purpose; to exempt from taxation 100 percent of that increase in assessed valuation; to describe the public infrastructure improvements to be made to benefit those parcels; to require the owners of those parcels to make service payments in lieu of taxes; to establish municipal public improvement tax increment equivalent funds for the deposit of the service payments and to protect the Columbus City School District and the Plain Local School District against any loss of tax revenue; and to declare an emergency. (AMENDED BY ORDINANCE 0715-2009 PASSED 6/8/2009) (AMENDED BY ORDINANCE 2258-2014 PASSED 10/20/2014) (AMENDED BY ORD. 3123-2016 PASSED 12/12/2016) (AMENDED BY ORD. 2188-2020; PASSED 10/5/20) (AMENDED BY ORD.2791-2020; PASSED 12/14/2020)
Body
WHEREAS, Ohio Revised Code Sections 5709.40(C), 5709.42 and 5709.43 (collectively, the "TIF Statutes") authorize the legislative authority of a municipal corporation, by ordinance, to create one or more incentive districts, declare the improvement to each parcel of real property located within each incentive district 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 to the city, local or exempted village school districts affected by the exemption, establish one or more municipal public improvement tax increment equivalent fund for the deposit of the remainder of such service payments and specify public infrastructure improvements made or to be made that benefit or serve the parcels in each incentive district; and
WHEREAS, this Council has determined to create the following incentive districts:
• Preserve Incentive District
• Dublin-Granville South Incentive District
• Dublin-Granville North Incentive District
• Albany Crossing Incentive District
• Ulry-Central College Incentive District
• Upper Albany West Incentive District
• Walnut South Incentive District
• Hamilton-Central College Incentive District
• Harlem-Central College Incentive District
• New Albany West-Central College Incentive District
(each individually an "Incentive District" and together the "Incentive Districts"), the boundaries of which shall be coextensive with the boundaries of, and shall include, the parcels of real property specifically identified and depicted in Exhibit A attached hereto (each, individually, a "Parcel" and collectively, the "Parcels"); and
WHEREAS, by Ordinance 2534-2005, passed on December 1, 2003, and by Ordinance 1883-2005, passed on November 28, 2005, this Council previously approved economic development plans which together encompass the Incentive Districts (the "Development Plans"), which plan is on file in the office of the Clerk of Council; and
WHEREAS, each Incentive District is less than 300 acres in size and each Incentive District is enclosed by a continuous boundary; and
WHEREAS, the City Engineer has certified to this Council that the public infrastructure serving each Incentive District is inadequate to meet the development needs of the Parcels as evidenced by the Development Plans; and
WHEREAS, the owners of the Parcels (each, individually, an "Owner" and collectively, the "Owners") intend to make or cause to be made certain improvements to the Parcels as described in Exhibit B attached hereto (collectively, the "Project"); and
WHEREAS, this Council has determined that the applicable portion of the service payments shall be paid to the Columbus City School District and the Plain Local School District (the "School Districts") in an amount equal to the real property taxes that the School Districts would have been paid if the Improvements (as defined herein) to each Parcel had not been exempted from taxation pursuant to this Ordinance; and
WHEREAS, this Council has determined to return a portion of the service payments collected pursuant to this Ordinance to Franklin County and the county-wide agencies; and
WHEREAS, notice of this proposed Ordinance has been delivered to the board of education of each affected school district in accordance with and within the time periods prescribed in Ohio Revised Code Sections 5709.40 and 5709.83; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in that it is immediately necessary to pass this Ordinance as an emergency in order to make this Ordinance immediately effective to provide for the funding of the Public Infrastructure Improvements so that the Public Infrastructure Improvements may be constructed in a timely manner and permit the responsible development of the Parcels so as to better provide for the preservation of public health, peace, property, safety and welfare; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. Creation of Incentive Districts. Pursuant to the TIF Statutes, this Council hereby creates the Incentive Districts, the boundaries of which shall be coextensive with the boundaries of the Parcels and shall include the Parcels as specifically identified and depicted in Exhibit A.
Section 2. Authorization of Tax Exemption. This Council hereby finds and determines that 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 Ohio Revised Code Section 5709.40(A)) is hereby declared to be a public purpose and shall be exempt from taxation for a period coextensive with the life of the Incentive District containing such Parcel, which commences for each Incentive District separately with the first tax year that begins after the effective date of this Ordinance and in which an Improvement due to a Project structure first appears on the tax list and duplicate of real and public utility property for a Parcel in that Incentive District and ends 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.
Section 3. Service Payments and Property Tax Rollback Payments. As provided in Ohio Revised Code Section 5709.42, the Owner of each Parcel is hereby required to and shall make service payments in lieu of taxes with respect to the Improvements allocable thereto to the Treasurer of Franklin County, Ohio (the "County Treasurer") on or before the final dates for payment of real property taxes. Each service payment in lieu of taxes shall be charged and collected in the same manner and in the same amount as the real property taxes that would have been charged and payable against that Parcel if it were not exempt from taxation pursuant to Section 2 of this Ordinance, including any penalties and interest (collectively, the "Service Payments"). The Service Payments, and any other payments with respect to each Parcel that are received by the County Treasurer in connection with the reduction required by Ohio Revised Code 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"), shall be allocated and distributed in accordance with Section 4 of this Ordinance.
Section 4. Distribution of Funds. Pursuant to the TIF Statutes, the County Treasurer is requested to distribute the Service Payments and the Property Tax Rollback Payments as follows:
• to each School District, an amount equal to the amounts each 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 located within each School District absent the exemption provided for in this Ordinance, and
• to the City, all remaining amounts for further deposit into the appropriate Funds (as defined in Section 5 of this Ordinance).
All distributions required under this Section 4 are requested to be made at the same time and in the same manner as real property tax distributions.
Section 5. Tax Increment Equivalent Fund. This Council hereby establishes, pursuant to and in accordance with the provisions of Ohio Revised Code Section 5709.43, the following funds for the corresponding Incentive District (each referred to herein as a "Fund" and collectively as the "Funds"):
• Preserve Incentive Tax Equivalent Fund
• Dublin-Granville South Tax Equivalent Fund
• Dublin-Granville North Tax Equivalent Fund
• Albany Crossing Tax Equivalent Fund
• Ulry-Central College Tax Equivalent Fund
• Upper Albany West Tax Equivalent Fund
• Walnut South Tax Equivalent Fund
• Hamilton-Central College Tax Equivalent Fund
• Harlem-Central College Tax Equivalent Fund
• New Albany West-Central College Tax Equivalent Fund
Each Fund shall be maintained in the custody of the City and shall receive distributions to be made to the City pursuant to Section 4 of this Ordinance for the corresponding Incentive District. Those Service Payments and Property Tax Rollback Payments received by the City with respect to the Improvement of each Parcel and so deposited pursuant to Ohio Revised Code Sections 5709.42 and 5709.43 shall be used solely for the purposes authorized in the TIF Statutes or this Ordinance. Any expenditure of amounts deposited into the Funds is subject to the expenditure restrictions and appropriation requirements of Sections 27 through 31 of the City Charter. Each Fund shall remain in existence so long as such Service Payments and Property Tax Rollback Payments are collected and used for the aforesaid purposes, after which time each Fund shall be dissolved and any surplus funds remaining therein transferred to the City's General Fund, all in accordance with Ohio Revised Code Section 5709.43.
Section 6. Public Infrastructure Improvements. This Council hereby designates the public infrastructure improvements described in Exhibit C attached hereto and any other public infrastructure improvements hereafter designated by ordinance as public infrastructure improvements made or to be made that benefit or serve the Parcels in the Incentive Districts.
Section 7. Reimbursements to County. This Council hereby determines that it is in the best interest of the City to return to Franklin County and each county-wide agency a portion of the Service Payments and Property Tax Rollback Payments deposited into the Funds attributable to the effective millage of each such taxing subdivision. The portion of the Service Payments and Property Tax Rollback Payments returned to Franklin County and the applicable county-wide agencies shall be equal to fifteen percent (15%) of the Service Payments and Property Tax Rollback Payments deposited into the Funds during each year that remain in the Funds at the end of that year after the payment of debt service on any debt issued to pay for the Public Infrastructure Improvements and after providing for any necessary debt service reserves for payment of debt service in future years. The Director of the Department of Development (the "Director") is hereby authorized and instructed to prepare and sign all agreements and instruments and take any other actions as may be appropriate to implement this Section 7.
Section 8. Authorizations. This Council hereby authorizes and directs the Director, the Clerk of Council, the Director of Law, the City Auditor, 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. This Council further hereby authorizes and directs the Director, the Clerk of Council, the Director of Law, the City Auditor, 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 9. Filings with Ohio Department of Development. Pursuant to Ohio Revised Code Section 5709.40(G), the Clerk of Council 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 adoption. Further, on or before March 31 of each year that the exemption set forth in this Ordinance remains in effect, the Director 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(G).
Section 10. Open Meetings. This Council finds and determines that all formal actions of this Council and any of its committees concerning and relating to the passage of this Ordinance were taken in an open meeting of this Council or its committees, and that all deliberations of this Council and any of its committees that resulted in those formal actions were in meetings open to the public, all in compliance with the law including Ohio Revised Code Section 121.22.
Section 11. That for the reasons stated in the preamble hereto, which is hereby made a part hereof, this 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 passage if the Mayor neither approves nor vetoes the same.