Explanation
Background: The need exists to enter into an Enterprise Zone and Jobs Creation Tax Credit Agreement with Stone Barn, LLC, DBA Steve & Barry's University Sportswear. Ohio Enterprise Zone law (O.R.C. Section 5709.62) and Jobs Creation Tax Credit law (O.R.C. Section 718.08) requires the City to enter into a Council-approved agreement with a participating company.
Stone Barn, LLC DBA Steve & Barry's University Sportswear, established in 1985, is a large distributor of university sportswear and apparel for adults and children with locations in 70 (seventy) malls throughout the United States. Stone Barn, LLC DBA Steve & Barry's University Sportswear is headquartered in Port Washington, NY and has locations in twenty-six states.
The company is proposing to lease 1.2 million square feet for distribution at a facility located at 4545 Fisher Road, the former Sears Distribution Center building. The investment in real and personal property will be between $22.4-$24.4 million with the creation of 250 new jobs. The Ohio Department of Development has offered a 5-year, 60% Jobs Creation Tax Credit for this project to help secure the jobs and investment for Ohio.
The Columbus Department of Development is proposing a 10-year, 75% (percent) personal property abatement under the City's Enterprise Zone Program and a 10-year, 65% (percent) Jobs Creation Tax Credit. Only jobs that pay $10.00 and above are eligible for the tax credit.
This legislation is requested to be considered as an emergency in order to allow Stone Barn, LLC DBA Steve & Barry's University Sportswear to make a decision on the location of the proposed project as quickly as possible.
Fiscal Impact: No funding is required for this legislation.
Title
To authorize the Director of the Department of Development to enter into a 10 year/75% Enterprise Zone Agreement on personal property and a 65%/10 year Jobs Creation Tax Credit Agreement with Stone Barn, LLC DBA Steve & Barry's University Sportswear; and to declare an emergency.
Body
WHEREAS, the City has established an Enterprise Zone pursuant to Sections 5709.61 to 5709.66 of the Ohio Revised Code ("O.R.C.") which has been certified by the Director of the Department of the State of Ohio as required by the O.R.C.; and
WHEREAS, Stone Barn, LLC DBA Steve & Barry's University Sportswear, ("Stone Barn, LLC DBA Steve & Barry's University Sportswear") has submitted a proposal to the City as required by, but not limited to, Section 5709.62, O. R. C. including all of the information required by Section 5709.62; and
WHEREAS, pursuant to Section 122.17 of the Ohio Revised Code, the State of Ohio is authorized to establish the Tax Credit Authority and to execute agreements with taxpayers of the State of Ohio for the purpose of granting these taxpayers job creation tax credits against their corporate franchise or income tax, which tax credits are provided to create new jobs in the State of Ohio; and
WHEREAS, legislative approval is contingent upon a Jobs Creation Tax Credit being granted by the State of Ohio; and
WHEREAS, pursuant to Section 718.08 of the Ohio Revised Code a municipal corporation is authorized to grant local income tax credits to taxpayers who have received tax credits from the State; and
WHEREAS, Stone Barn, LLC DBA Steve & Barry's University Sportswear proposes to invest $22.2 million in real property improvements and personal property and create 250 new jobs, and is located within Columbus Enterprise Zone and is qualified for consideration of both Enterprise Zone and Jobs Creation Tax Credit incentives; and
WHEREAS, Stone Barn, LLC DBA Steve & Barry's University Sportswear has indicated that tax incentives are crucial to its decision to locate the aforementioned project to the Columbus site; and
WHEREAS, the Columbus Department of Development has investigated Stone Barn, LLC DBA Steve & Barry's University Sportswear's proposal and application for tax incentives and has determined that Stone Barn, LLC DBA Steve & Barry's University Sportswear has the financial ability to undertake the proposed project in Columbus, and
WHEREAS, it is required by law to enter into a formal, binding agreement in order to provide and obtain both Enterprise Zone and Jobs Creation Tax Credit tax incentives in the State and City; and
WHEREAS, the City desires to enter into such agreements with Stone Barn, LLC DBA Steve & Barry's University Sportswear to foster economic growth; and
WHEREAS, an emergency exists in the usual daily operation of the Columbus Department of Development in that it is immediately necessary to enter into an agreements with Stone Barn, LLC DBA Steve & Barry's University Sportswear for the preservation of 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 the Department of Development be and is hereby authorized to enter into an Enterprise Zone Agreement and Jobs Creation Tax Credit Agreement with Stone Barn, LLC DBA Steve & Barry's University Sportswear, and to provide therewith an exemption of 75% on the value of personal property investments for a term of ten (10) taxable years and a 65% Jobs Creation Tax Credit, for a term of ten (10) taxable years, in association with Stone Barn, LLC DBA Steve & Barry's University Sportswear's proposed expansion investment.
Section 2. That the City of Columbus Enterprise Zone Agreement and the Jobs Creation Tax Credit Agreement, shall be signed by Stone Barn, LLC DBA Steve & Barry's University Sportswear within ninety (90) days of passage of this ordinance, or this ordinance, abatement and credits authorized herein, are null and void.
Section 3. 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 passage if the Mayor neither approves nor vetoes the same.