Explanation
BACKGROUND: With this legislation, City Council reduces to 50% the rate of tax abatement granted under the Enterprise Zone Agreement with Océ Imagistics (the "EZA") as of tax year 2007, unless Océ Imagistics converts some of the temporary jobs at the project site to permanent jobs such that the EZA job goal (73 jobs) is met by December 31, 2006. The current existing rate of tax exemption under the EZA is 75%. This legislation is consistent with the August 25, 2006 recommendation by the Tax Incentive Review Council (the "TIRC").
Columbus City Council approved the EZA with Imagistics International Inc., renamed Océ Imagistics in October 2005, by Ord. No. 324-03, adopted on March 10, 2003. Imagistics International Inc. was a distributor of document imaging equipment and supplies. The EZ project site is a distribution facility located in the Ricenbacker area, at 2525 Rohr Road. The EZA provides for a 75%/10-yr tax abatement (2004-2014) on new machinery & equipment and inventory, and requires an investment of $650,000 in real property improvements, $2.7 million in machinery & equipment and $28 million in new average value of inventory, the retention of 57 existing jobs, and the creation of 16 new full-time permanent jobs by December 31, 2004 (i.e., a total of 73 jobs). Océ Imagistics has satisfied the real and personal property investment goals and the job retention goal of 57 jobs. But as of December 2005 and August 2006, the company had created only 3 out of the 16 new jobs required by the EZA (19% attainment). The City warned the company in January 2006 about the shortfall in job creation.
Océ is a Dutch company that supplies high-end products and services for professional printing and document management. Océ acquired Imagistics in Fall 2005 and is integrating the two companies under the name Océ Imagistics. The company reported that it has decided to relocate some of Océ's warehouse operations from Chicago to Columbus. Improvem...
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