Explanation
BACKGROUND: The Department of Development is proposing to enter into a 65%/10 year Job Creation Tax Credit Agreement and a 35%/8 year Jobs Growth Incentive Agreement with JPMorgan Chase Bank, National Association, and JPMorgan Chase &
Co. ("JPMorgan Chase") in consideration of their proposed investment of approximately $16 million in real and personal property at its current Columbus facility. The project will allow JPMorgan Chase to retain 10,427 full-time positions, create approximately 1,000 new permanent full-time jobs with an annual payroll of $40 million and increase job opportunities and strengthen the economy of Columbus.
The Ohio Tax Credit Legislation (Section 718.15 of the Ohio Revised Code) authorizing such City agreements became effective January 14, 1993, and requires the City to enter a Council-approved agreement between the City and a participating company.
JPMorgan Chase is one of the oldest financial institutions in the world. Headquartered in New York City, JPMorgan Chase operates in six segments, investment banking, commercial banking, treasury & security services, asset management, retail financial services and card services.
JP Morgan Chase is one of the "Big Four Banks" of the United States with Bank of America, Citigroup and Wells Fargo. It is a leader in financial services with $2.3 trillion in assets. JPMorgan Chase has 5,410 branches in 23 states, third behind Wells Fargo and Bank of America.
JPMorgan Chase is proposing to expand its operations at the 1111 Polaris Parkway facility by adding 1,000 new jobs. JPMorgan Chase is also considering the company's Texas, Michigan, New York and Louisiana locations for this expansion.
Emergency action is requested in order to allow JPMorgan Chase to begin investing and creating jobs as quickly as possible.
FISCAL IMPACT: No funding is required for this legislation.
Title
To authorize the Director of Development to enter into a Job Creation Tax Credit Agreement and a Jobs Growth Incentive Agreement with JPMorgan Chase Bank, National Association and JPMorgan Chase & Co. (JPMorgan Chase); and to declare an emergency. (AMENDED BY ORD. 1342-2010 PASSED 10/4/2010)
Body
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 agreement with taxpayers of the State for the purpose of granting taxpayers a job creation tax credit (the "State Credit") to be applied against their corporation franchise tax and commercial activity tax liability, which tax credits are provided to create new jobs in the State; and
WHEREAS, pursuant to Section 718.15 of the Ohio Revised Code (the "City Act"), the City is authorized to grant local income tax credits (the "Local Credit") to taxpayers who have received State Credits, which Local Credits are applied against the taxpayer's City income tax liability; and
WHEREAS, contingent on the City granting a Job Creation Tax Credit and a Jobs Growth Incentive, JPMorgan Chase plans to invest approximately $16 million in real and personal property at its current facility in the City (the "Project"), which Project will allow JPMorgan Chase to retain 10,427 full-time positions, create approximately 1,000 new permanent full-time jobs with an annual payroll of $40 million and increase job opportunities and strengthen the economy of the City; and
WHEREAS, on April 27, 2009, the Ohio Tax Credit Authority approved a 75%/15 year State Credit for the Project; and
WHEREAS, the City Act requires the City to enter into a formal and binding agreement in order to provide a local credit to JPMorgan Chase; and
WHEREAS, the Department of Development has received a completed application for the Jobs Growth Incentive and the Jobs Creation Tax Credit from JPMorgan Chase; and
WHEREAS, receiving the State of Ohio Jobs Creation Tax Credit, the City of Columbus Jobs Creation Tax Credit, and the Jobs Growth Incentive is a critical factor in JPMorgan Chase's decision to go forward with the Project in the City; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development in that it is immediately necessary to enter into contract with JP Morgan Chase in order to allow JPMorgan Chase to begin investing and creating jobs as quickly as possible, all 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 is hereby authorized and directed to enter into and execute a 65%/10 year Job Creation Tax Credit Agreement and a 35%/8 year Jobs Growth Incentive Agreement with JPMorgan Chase Bank, National Association and JPMorgan Chase & Co. ("JPMorgan Chase").
Section 2. Each year of the term of the Jobs Growth Incentive Agreement with JPMorgan Chase the City's obligation to pay is expressly contingent upon the passage of an ordinance appropriating and authorizing the expenditure of monies sufficient to make such payment and the certification of the City Auditor pursuant to Section 159 of the Columbus City Charter.
Section 3. That the City Job Creation Tax Credit Agreement and Jobs Growth Incentive Agreement must be signed by JPMorgan Chase within 45 days of receiving the Agreement for signature, or this Ordinance and the Local Credit and incentive provided herein shall be null and void.
Section 4. 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.