Explanation
BACKGROUND: The Tax Incentive Review Council (the "TIRC") recommended on August 25, 2006, that the City should amend the Enterprise Zone Agreement with The Trane Company and Millennium Court II LLC (the "EZA") to allow the jobs of the other tenant in the facility to be counted towards the job creation goal, providing that adequate annual reporting information on jobs and payroll is supplied to the City, and to require that if the project does not attain at least 75% of the job creation requirement as of December 31, 2007, the project's real property tax savings from tax years 2006 and 2007 will be repaid and the EZA will be dissolved and the 2007 tax year will be the final year of abatement.
Columbus City Council approved the EZA in December 2001 and it became effective on August 12, 2002. The Trane Company ("Trane") is the tenant and Millennium Ct II LLC is the owner of the real property. The project entailed $5 million to construct a new facility at 2300 CityGate Drive on the city's east side, $529,000 to acquire new machinery & equipment and an increase of $1.2 million in the average value of inventory. As of December 2005, the project had met the investment goals. Trane committed to retain 103 existing jobs and create 54 new jobs. Trane is owned by American Standard Companies Inc., a global corporation, headquartered in New Jersey, with employment of 61,500 and sales of over $10 billion in the U.S.
The tax abatement the EZA provided was 50% on the real property improvements for eight (8) years. However, in October 2005, City Council reduced the abatement to a term of seven (7) years (2003-2009) and also extended the job creation deadline to December 31, 2007. This was due to a lack of job creation and based on a recommendation by the TIRC in 2005. Although there is a second tenant in the facility that could potentially help to satisfy the EZA job requirements, to date this tenant has elected not to be identified (for security r...
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