Explanation
BACKGROUND: The Columbus Department of Development is proposing to enter into a dual-rate Jobs Growth Incentive Agreement with Northern Safety Co., Inc. dba Wurth Industry North America in an amount equal to (i) twenty-five percent (25%) of the City of Columbus income tax withheld on the Columbus payroll of new employees and (ii) thirty percent (30%) of the City of Columbus income tax withheld on the Columbus payroll of new employees, who are also City of Columbus residents at the end of each calendar year, both for a term up to five (5) consecutive years.
Founded in 1983, Northern Safety Co., Inc. was established by CEO Salvatore Longo who began selling first aid supplies and gloves out of the back of a pickup truck; since then, they have become a prominent player in the safety equipment industry. In mid-2015 Northern Safety Co., Inc. has since been acquired by their current parent organization the Wurth Group. Established in 1954, Wurth was founded in Monsey, New York and has slowly carved its way to becoming the world’s largest industrial supplier with over 400 locations and over 86,000 employees worldwide. Family-owned and privately owned, Wurth has been able to ensure customers of security and confidence while continuing building close-knit relationships.
Northern Safety Co., Inc. is proposing to invest a total project cost of approximately $42,500,000.00, which includes $27,000,000.00 in acquisition costs, $14,500,000.00 in machinery and equipment, and $1,000,000.00 in furniture and fixtures to establish a new distribution facility. With this investment, the company proposes to enter into a lease agreement on an existing vacant industrial ware house consisting of approximately 472,000 square feet at 1568 Georgesville Road, Columbus, OH 43228, parcel number 570-291527 (the “Project Site”). The proposed project will allow Northern Safety Co., Inc. to expand into the Columbus region by creating 160 net new full-time permanent positions with a cumulative associated estimated annual payroll of approximately $8,075,056.00 at the proposed Project Site.
This legislation is presented as 30-day legislation.
FISCAL IMPACT: No funding is required for this legislation
Title
To authorize the Director of the Department of Development to enter into a dual-rate Jobs Growth Incentive Agreement with Northern Safety Co., Inc. dba Wurth Industry North America for a term of up to five (5) consecutive years in consideration of the company’s proposed total capital investment of $42,500,000.00 and the creation of 160 net new full-time permanent positions with an estimated annual payroll of approximately $8,075,056.00.
Body
WHEREAS, the City desires to increase employment opportunities and encourage the creation of new jobs in the City in order to improve the overall economic climate of the City and its citizens; and
WHEREAS, the Department of Development received a completed Jobs Growth Incentive Application from Northern Safety Co., Inc.; and
WHEREAS, Northern Safety Co., Inc. proposes to invest a total project cost of approximately $42,500,000.00, which includes $27,000,000.00 in acquisition costs, $14,500,000.00 in machinery and equipment, and $1,000,000.00 in furniture and fixtures to establish a new distribution facility. With this investment, the company proposes to enter into a lease agreement on an existing vacant industrial ware house consisting of approximately 472,000 square feet at 1568 Georgesville Road, Columbus, OH 43228, parcel number 570-291527 (the “Project Site”); and
WHEREAS, Northern Safety Co., Inc. will create 160 net new full-time permanent positions with a cumulative associated estimated annual payroll of approximately $8,075,056.00 at the proposed Project Site; and
WHEREAS, Northern Safety Co., Inc. has indicated that a Jobs Growth Incentive is crucial to its decision to establish new distribution facility operations within the City of Columbus; and
WHEREAS, the City of Columbus desires to facilitate the future growth of Northern Safety Co., Inc. at the proposed Project Site by providing a Jobs Growth Incentive; 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 to enter into a dual-rate Jobs Growth Incentive Agreement with Northern Safety Co., Inc. dba Wurth Industry North America equal to (i) twenty-five percent (25%) of the City of Columbus income tax withheld on the Columbus payroll of new employees and (ii) thirty percent (30%) of the City of Columbus income tax withheld on the Columbus payroll of new employees, who are also City of Columbus residents at the end of each calendar year, both for a term up to five (5) consecutive years.
SECTION 2. Should Northern Safety Co., Inc. not be able to sufficiently document residency for an employee associated with this project during a calendar year of the term of the agreement, the default rate of the Jobs Growth Incentive to be applied that calendar year for that new employee shall be twenty-five percent (25%).
SECTION 3. Each year of the term of the agreement with Northern Safety Co., Inc. the City’s obligation to pay the incentive 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 4. That the City of Columbus Jobs Growth Incentive Agreement is signed by Northern Safety Co., Inc. within 90 days of passage of this ordinance, or this ordinance and the credit herein shall be null and void.
SECTION 5. The Columbus City Council hereby extends authority to the Director of the Department of Development to amend Northern Safety Co., Inc.’s City of Columbus Jobs Growth Incentive Agreement for certain modifications to the agreement requested in writing by the company and or the City and deemed appropriate by the Director of Development with these certain modifications being specifically limited to reductions in length of term, methods of calculating the incentive, or adding or deleting business entities associated with the employment commitments related to this incentive. Columbus City Council must approve all other requested amendments.
SECTION 6. That this ordinance shall take effect and be in force from and after the earliest period allowed by law.