Explanation
BACKGROUND: Columbus City Council (Council), by Ordinance 1726-2005, passed October 26, 2005, authorized the City of Columbus (City) to enter into an Enterprise Zone Agreement (the Agreement) with Grange Mutual Casualty Company (Enterprise) for a tax abatement of seventy-five percent (75%) for a period of ten (10) years in consideration of investment of between $61,500,000 and $71,800,000 in real property improvements, up to $14,000,000 in personal property investment, the relocation and/or retention of 835 permanent full-time jobs and the creation of 262 full-time permanent jobs related to the renovation of an existing facility, the construction of an approximately 200,000 square foot facility along with the construction of a 1,000 space parking garage at the site of their corporate headquarters at 650 South Front Street, in Columbus, Ohio and within the City of Columbus Enterprise Zone (Zone #023). Construction of the project was to begin July 1, 2006 and be completed by December 31, 2008. The Agreement was made and entered into to be effective November 11, 2005 (EZA #023-05-12).
The Agreement was subsequently authorized by Council to be amended for the first time to revise the scope of the project site and to extend the estimated completion date to December 31, 2009 by Ordinance 1143-2007, passed July 23, 2007; and that this Agreement was subsequently authorized by Council to be amended for the second time to remove any and all language pertaining to personal property investment and tax abatements related to this personal property investment from the Agreement by Ordinance 0614-2009, passed May 11, 2009.
The 2011 Columbus Tax Incentive Review Council reviewed the Grange Mutual Casualty Company Enterprise Zone project on August 18, 2011, and recommended that the Agreement be continued.
As per a letter dated November 11, 2011, Mark C. Russell, Vice President of Insurance Operations, indicated that due to the recent unprecedented economic downturn it was the desire of Enterprise to terminate the Agreement. This legislation is to dissolve the Agreement.
This legislation is presented as an emergency measure in order for this dissolution to be legislated prior to the end of 2011 so that this dissolution of the Agreement can be reported to the necessary local and state agencies prior to the end of calendar year 2011.
FISCAL IMPACT: No funding is required for this legislation.
Title
To dissolve the Enterprise Zone Agreement with Grange Mutual Casualty Company; to direct the Director of the Department of Development to notify as necessary the local and state tax authorities; and to declare an emergency.
Body
WHEREAS, the Columbus City Council approved the Enterprise Zone Agreement with Grange Mutual Casualty Company (the "EZA") on October 26, 2005 by Ordinance 1726-2005 and entered into effective November 11, 2005; and
WHEREAS, the EZA granted Grange Mutual Casualty Company a 75%/10-Year abatement on real property improvements and personal property investment; and
WHEREAS, the EZA committed Grange Mutual Casualty Company to an investment of between $61,500,000 and $71,800,000 in real property improvements, up to $14,000,000 in personal property investment, the relocation and/or retention of 835 permanent full-time jobs and the creation of 262 full-time permanent jobs related to the renovation of an existing facility, the construction of an approximately 200,000 square foot facility along with the construction of a 1,000 space parking garage at the site of their corporate headquarters at 650 South Front Street, in Columbus, Ohio and within the City of Columbus Enterprise Zone; and
WHEREAS, the EZA was subsequently authorized by Council to be amended for the first time by Ordinance 1143-2007, passed July 23, 2007, to revise the project site and to extend the estimated completion date; and
WHEREAS, the EZA was subsequently authorized by Council to be amended for the second time by Ordinance No. 0614-2009, passed May 11, 2009, to eliminate any and all language from the EZA that pertained to personal property investment; and
WHEREAS, the 2011 Columbus Tax Incentive Review Council reviewed the Grange Mutual Casualty Company Enterprise Zone project on August 18, 2011, and recommended that the Agreement be continued; and
WHEREAS, Grange Mutual Casualty Company indicated in a letter dated November 11, 2011 that due to the recent unprecedented economic downturn it was their desire to terminate the EZA; and
WHEREAS, the Department of Development recommends the EZA be dissolved; and
WHEREAS, an emergency exists in the usual daily operation of the Department of Development, in that it is immediately necessary to take action on this agreement in order for this dissolution to be legislated prior to the end of 2011 so that the dissolution of the EZA can be reported to the necessary local and state agencies prior to the end of calendar year 2011, and to preserve the public health, property, safety and welfare; NOW, THEREFORE,
BE IT ORDAINED BY THE COUNCIL OF THE CITY OF COLUMBUS:
Section 1. That Columbus City Council hereby dissolves the Grange Mutual Casualty Company Enterprise Zone Agreement (Agreement Number 023-05-12) which applies a 75%/10-year real property tax abatement to parcel numbers 010-004071 and 010-014149 within the City of Columbus Enterprise Zone as of December 31, 2010, with 2010 being the final reporting year and the final year for the tax exemptions.
Section 2. That the Director of Development is hereby directed to notify the necessary local and state agencies of any changes to the Grange Mutual Casualty Company Enterprise Zone Agreement.
Section 3. For the reasons stated in the preamble hereto, which is made a part hereof, this Ordinance is 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 (10) days after passage if the Mayor neither approves nor vetoes this Ordinance.