Explanation
BACKGROUND: Columbus City Council, by Ordinance 0795-2008, passed May 12, 2008, authorized the Director of Development to enter into a Job Creation Tax Credit (JCTC) Agreement of sixty-five percent (65%) for a period of eight (8) years with Express, LLC and Express Holding, LLC (collectively known as "Express" and hereinafter referred to as the "Grantee"), based on the company's commitment to expand its corporate headquarters by investing approximately $7,900,000.00 in leasehold improvements and personal property, the retention of 359 jobs and the creation of 120 new full-time permanent positions with an annual payroll of approximately $7,800,000.00.
Subsequent to the execution of the agreement, the Grantee determined that several new employees would be employed by two additional affiliates. Columbus City Council, by Ordinance 1915-2008, passed December 1, 2008 amended Ordinance 0795-2008 to add Express Topco, LLC and Express Parent, LLC as additional grantees to the JCTC Agreement.
The JCTC Agreement was made and entered into by the City and Express, LLC, Express Holding, LLC, Express Topco, LLC and Express Parent, LLC, effective January 19, 2010 to commence January 1, 2008 for a term of eight (8) consecutive years to end December 31, 2016.
On April 12, 2011 the Department of Development received a letter from Grantee, dated March 24, 2011, requesting that Express Parent, LLC be removed as a grantee to the JCTC Agreement and to be replaced with Express, Inc. Columbus City Council, by Ordinance 0940-2011, passed June 20, 2011, authorized the Director of Development to amend the JCTC Agreement for the purposes of adding Express, Inc. as a grantee and removing Express Parent, Inc. from the agreement.
This first Amendment was made and entered into effective January 1, 2008, but executed by the City Attorney on November 30, 2011, between the City of Columbus and Express, LLC, Express Holding, LLC, Express Topco, LLC and Express, Inc.
Subsequently, on December 21, 2012, the Department of Development received another letter from Grantee requesting that the JCTC Agreement be amended. Effective August 26, 2012, Express formed a wholly-owned single member limited liability company, Express Fashion Operations, LLC as part of a supply chain restructuring initiative. Approximately, 100 Columbus, Ohio-based employees employed by Express, LLC are now employees of Express Fashion Operations, LLC.
The need exists to amend the JCTC Agreement with Express, LLC, Express Holding, LLC, Express Topco, LLC and Express, Inc. for the purpose of adding Express Fashion Operations, LLC as another grantee to the agreement. Therefore, Express, LLC, Express Holding, LLC, Express Topco, LLC, Express, Inc. and Express Fashion Operations, LLC (henceforth, all five entities will collectively be referred to hereinafter as "Express"), will become the new grantees on the amended Job Creation Tax Credit Agreement.
Additionally, the JCTC Agreement termination date will be adjusted to reflect City Council approval term of the incentive. City Council, by Ordinance 0795-2008, passed on May 12, 2008, authorized the Director of the Department of Development to enter into a JCTC Agreement with Express for a term of eight (8) consecutive years, to commence on January 1, 2008 ending December 31, 2015, for an 8-year credit. The JCTC Agreement has a termination date of December 31, 2016, reflecting a 9-year credit instead of an 8-year credit as approved by City Council.
This legislation is requested to be considered as an emergency in order to allow the Grantee to get paid for the jobs they moved in August of 2012 under a newly created entity, Express Fashion Operations, LLC.
FISCAL IMPACT: No funding is required for this legislation.
Title
To amend the Job Creation Tax Credit Agreement with Express, LLC et al for the purpose of adding Express Fashion Operations, LLC to the agreement; and to declare an emergency.
Body
WHEREAS, contingent on the City granting an amendment to the JCTC Agreement, Express will maintain its corporate headquarters at 1 Limited Parkway Columbus, Ohio; and
WHEREAS, the Grantee has invested approximately $7,900,000.00 to established their corporate headquarters; and
WHEREAS, the Grantee committed to hire approximately 120 new full-time employees and retain 368 employees at the project site; and
WHEREAS, on May 12, 2008, Columbus City Council passed Ordinance 0795-2008 approving a 8-year, 65% Job Creation Tax Credit Incentive for Express, LLC and Express Holding, LLC in connection with the project; and
WHEREAS, subsequent to the execution of the JCTC Agreement, the Grantee determined that several new employees would be hired by one of four Express affiliates, which include Express, LLC, Express Holding, LLC, Express Topco, LLC and Express Parent, LLC; and
WHEREAS, Columbus City Council, by Ordinance 1915-2008, passed December 1, 2008 amended Ordinance 0795-2008 to add Express Topco, LLC and Express Parent, LLC as additional grantees to the JCTC Agreement; and
WHEREAS, the JCTC Agreement was made and entered into by the City and Express, LLC, Express Holding, LLC, Express Topco, LLC and Express Parent, LLC, effective January 19, 2010 to commence January 1, 2008 for a term of eight (8) consecutive years to end December 31, 2016; and
WHEREAS, subsequently, on April 12, 2011 the Department of Development received a letter, dated March 24, 2011, from Grantee requesting that the JCTC Agreement be amended for the purposes of removing Express Parent, LLC as a grantee and to add Express, Inc. as a new grantee; and
WHEREAS, Columbus City Council, by Ordinance 0940-2011, passed June 20, 2011 amended the JCTC Agreement to add Express, Inc. as grantee to the JCTC Agreement and removed Express Parent, Inc.; and
WHEREAS, this first Amendment was made and entered into effective January 1, 2008, but executed by City Attorney on November 30, 2011, between the City of Columbus and Express, LLC, Express Holding, LLC, Express Topco, LLC and Express, Inc.; and
WHEREAS, subsequently, on December 21, 2012, the Department of Development received another letter from Grantee requesting that the JCTC Agreement be amended for the purpose of adding another affiliate. Effective August 26, 2012 the Grantee formed a wholly-owned single member limited liability company, Express Fashion Operations, LLC as part of a supply chain restructuring initiative; and
WHEREAS, additionally, the JCTC Agreement has a termination date of December 31, 2016, reflecting a 9-year credit term instead of an 8-year credit term as approved by City Council, Ordinance 0795-2008; and
WHEREAS, a second amendment is now needed to add Express Fashion Operations, LLC as another grantee to the JCTC Agreement and to change the JCTC Agreement termination date from December 31, 2016 to December 31, 2015; and
WHEREAS, an emergency exists in the usual daily operation of the Columbus Department of Development in that it is immediately necessary to seek an amendment from Columbus City Council for the purpose of adding Express Fashion Operations, LLC as an additional grantee to the JCTC Agreement, thereby preserving the 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 to amend the Job Creation Tax Credit Agreement with Express, LLC, Express Holding, LLC, Express Topco, LLC and Express, Inc. to add Express Fashion Operations, LLC as an additional grantee to the agreement.
Section 2. That the Director of the Department of Development is hereby authorized to amend the Job Creation Tax Credit Agreement termination date by changing it from December 31, 2016 to December 31, 2015, reflecting a 8-year credit term as approved by City Council with Ordinance 0795-2008.
Section 3. That City Council hereby finds and determines that the project has completed all the requirements of the City Act.
Section 4. That the City of Columbus Job Creation Tax Credit Amendment is signed by Express, LLC, Express Holding, LLC, Express Topco, LLC, Express, Inc. and Express Fashion Operations, LLC within 90 days of passage of this ordinance, or this ordinance and the credit herein shall be null and void.
Section 5. 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.