Explanation
BACKGROUND: Columbus City Council (“COUNCIL”), by Ordinance No. 0722-2014, passed April 7, 2014, authorized the City of Columbus (CITY) to enter into an Enterprise Zone Agreement (the “AGREEMENT”) with AirSide One LLC (the “ENTERPRISE”) for a tax abatement of seventy-five percent (75%) for a period of ten (10) years in consideration of a proposed $6.0 million investment in real property improvements and the creation of 10 full-time jobs with an associated annual payroll of approximately $350,000 related to the construction of a new 100,000-square-foot speculative office and distribution center on parcel number 520-164556, within the City of Columbus Enterprise Zone. The AGREEMENT was made and entered into effective June 19, 2014 (EZA #023-14-03) with the abatement currently effective from 2015-2024. Following execution of the AGREEMENT, the parcel was split and the abatement now applies to parcel number 520-293795 at 4480 Bridgeway Avenue, Columbus, OH 43219.
Following discussions, a letter to the CITY from The Daimler Group, Inc. on behalf of AirSide One dated February 6, 2018 was received February 9, 2018, confirming that BVK US II Columbus, LLC had acquired ownership of parcel number 520-293795 from AirSide One LLC on February 2, 2018. Due diligence has been undertaken by the CITY in that BVK US II Columbus, LLC has agreed to fully assume the terms and commitments of the ENTERPRISE pursuant to the AGREEMENT, has submitted an updated Economic Development Incentive Application and that this application and all other pertinent information has been reviewed and vetted.
This legislation is to authorize the Director of the Department of Development to amend the AGREEMENT for the first time to remove AirSide One LLC as ENTERPRISE and party to the AGREEMENT and to be replaced with BVK US II Columbus, LLC as ENTERPRISE and party to the AGREEMENT, whereby BVK US II Columbus, LLC will assume the terms and commitments of the AGREEMENT.
This legislation is being presented as an emergency measure in order for this amendment to be legislated in as expedient a manner as possible so that this amendment to the AGREEMENT might be fully executed prior to the 2018 Tax Incentive Review Council (the “TIRC”) so that the TIRC might be advised of this amendment.
FISCAL IMPACT: No funding is required for this legislation.
Title
To authorize the Director of the Department of Development to amend the Enterprise Zone Agreement with AirSide One LLC, to remove AirSide One LLC as the party to the agreement and to be replaced with BVK US II Columbus, LLC; and to declare an emergency.
Body
WHEREAS, the City of Columbus (CITY) entered into an Enterprise Zone Agreement (the “AGREEMENT”) with AirSide One LLC approved by Columbus City Council (COUNCIL) on April 7, 2014 by Ordinance No. 0722-2014 with this AGREEMENT made and entered into effective June 19, 2014; and
WHEREAS, the AGREEMENT granted a 75%/10-Year abatement on real property improvements; and
WHEREAS, the incentive was granted in consideration of a $6.0 million investment in real property improvements and the creation of 10 full-time jobs with an annual payroll of approximately $350,000 related to the construction of a new 100,000-square-foot speculative office and distribution center at 4480 Bridgeway Avenue, Columbus Ohio 43219, and within the City of Columbus Enterprise Zone with the abatement currently effective from 2015-2024. Following execution of the AGREEMENT, the parcel was split and the abatement now applies to parcel number 520-293795.
WHEREAS, a letter to the CITY from The Daimler Group, Inc., dated February 6, 2018 and received February 9, 2014 confirmed that AirSide One LLC has sold its real estate ownership interest in the project to BVK US II Columbus, LLC with the sale having occurred on February 2, 2018; and
WHEREAS, due diligence has been undertaken by the CITY in that BVK US II Columbus, LLC has agreed to fully assume the terms and commitments of the ENTERPRISE pursuant to the AGREEMENT, has submitted an updated Economic Development Incentive Application and that this application and all other pertinent information has been reviewed and vetted; and
WHEREAS, an amendment for assignment and assumption is needed to remove AirSide One LLC as ENTERPRISE and party to the AGREEMENT and to be replaced with BVK US II Columbus, LLC as ENTERPRISE and party to the AGREEMENT; 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 to the AGREEMENT with AirSide One LLC for the purpose of removing AirSide One LLC as ENTERPRISE and party to the AGREEMENT to be replaced by BVK US II Columbus, LLC as ENTERPRISE and party to the AGREEMENTso that this amendment to the AGREEMENT might be fully executed prior to the 2018 Tax Incentive Review Council (the “TIRC”) so that the TIRC might be advised of this amendment;
NOW, THEREFORE
BE IT ORDAINED BY THE COUNCIL OF COLUMBUS
Section 1. That the Director of the Department of the Department of Development is hereby authorized to amend the Enterprise Zone Agreement for assignment and assumption with AirSide One LLC, to remove AirSide One LLC as ENTERPRISE and party to the AGREEMENT to be replaced by BVK US II Columbus, LLC as ENTERPRISE and party to the AGREEMENT, whereby BVK US II Columbus, LLC will assume the terms and commitments of the AGREEMENT.
Section 2. That this FIRST AMENDMENT for assignment and assumption to the City of Columbus Enterprise Zone Agreement be signed by BVK US II Columbus, LLC within ninety (90) days of passage of this ordinance, or this ordinance and the incentive authorized herein shall be null and void.
Section 3. 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.