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HomeMy WebLinkAbout13-06 Ordinance RECORD OF ORDINANCES Dayton Legal Blank. Inc. Form No. 30043 Ordinance No. 13-06 passed , 20 AN ORDINANCE AUTHORIZING THE PROVISION OF CERTAIN INCENTIVES FOR PURPOSES OF ENCOURAGING HINETICS NOISE CONTROL TO EXPAND ITS OPERATIONS WITHIN THE CITY, AND AUTHORIZING THE EXECUTION OF AN ECONOMIC DEVELOPMENT AGREEMENT. WHEREAS, consistent with its Economic Development Strategy (the "Strategy") approved by Dublin City Council Resolution No. 07-94 adopted on June 20, 1994, and the updated strategy approved by Dublin City Council Resolution No. 30-04 adopted on July 6, 2004, the City desires to encourage commercial office and retail development and provide for the creation of employment opportunities within the City; and WHEREAS, Kinetics Noise Control, Inc. ("Kinetics is desirous of expanding its operations and workforce within the City in consideration for the provision by the City of economic development incentives; and WHEREAS, this Council has determined to offer economic development incentives, the terms of which are set forth in a substantially final form of Economic Development Agreement presently on file in the office of the Clerk of Council, to induce Kinetics to retain its operations and workforce within the City, to create jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City, all as authorized in Article VIII, Section 13 of the Ohio Constitution; and WHEREAS, this Council finds that it is in the best interest of the City to provide those economic development incentives to induce Kinetics to retain and expand its operations and workforce within the City and to provide for the execution and delivery of that Economic Development Agreement with Kinetics; NOW, THEREFORE, BE IT ORDAINED by the Council of the City of Dublin, Franklin, Union and Delaware Counties, Ohio, State of Ohio, of the elected members concumng, that: Section 1. The Economic Development Agreement by and between the City and Kinetics, in the form presently on file with the Clerk of Council, providing for, among other things, the provision of incentives to Kinetics in consideration for Kinetics' agreement to retain and expand its operations and workforce within the City, is hereby approved and authorized with changes therein not inconsistent with this Ordinance and not substantially adverse to this City and which shall be approved by the City Manager and Director of Finance. The City Manager and Director of Finance, for and in the name of this City, are hereby authorized to execute that Economic Development Agreement, provided further that the approval of changes thereto by those officials, and their character as not being substantially adverse to the City, shall be evidenced conclusively by their execution thereof. This Council further authorizes the City Manager and the Director of Finance, for and in the name of the City, to execute any amendments to the Economic Development Agreement, which amendments are not inconsistent with this Ordinance and not substantially adverse to this City. Section 2. This Council further hereby authorizes and directs the City Manager, the Clerk of Council, the Director of Law, the Director of Finance, or other appropriate officers of the City to prepare and sign all agreements and instruments and to take any other actions as maybe appropriate to implement this Ordinance. Section 3. This Council finds and determines that all formal actions of this Council concerning and relating to the passage of this Ordinance were taken in an open meeting of this Council and that all deliberations of this Council that resulted in those formal actions were in meetings open to the public in compliance with the law. RECORD OF ORDINANCES Dayton Legg] Blank, Inc. Form No. 30043 13-06 Page 2 Ordinance No. Passed , 24 Section 4. This Ordinance shall be in full force and effect on the earliest date permitted by law. Signed: Mayor -Presiding Officer Attest: Clerk of Council Passed: ~G2Y~ ~ ~ , 2006 Effective: 2006 I hereby certify that copies of this Ordinance/Resolution were posted in the City of Dublin in accordance with Section 731.25 of the Ohio Revised Code. D ty Clerk of Council, Dublin, Ohio Economic Development 5800 Shier Rings Road, Dublin, Ohio 43016-1236 CITY of DUBLIiV phone: 614-410-4600 • Fax: 614-761-6506 emo To: Members of Dublin City Council From: Jane S. Brautigam, City Manage~o-Y•,c..5 • _ Date: March 1, 2006 Initiated By: Colleen M. Gilger, Acting Director of Economic Development Re: Ordinance 13-06 -Economic Development Agreement with Kinetics Noise Control Summary: Staff has been in discussions with Kinetics Noise Control regarding the possibility of expanding their operations by acquiring additional facility space. Economic Development presented a proposal after Kinetics officials expressed an interest in purchasing the Washington Township administration building at 6279 Shier-Rings Road. The proposal calls for a technology grant up to $10,000 fora 50% reimbursement to Kinetics for any telecommunications upgrades needed to connect their current facility to the township building, in addition to expedited reimbursement of the cost they incurred for the installation of the main water line along Irelan Place. In 2004, the City created a TIF district on the current Kinetics property as a result of their expansion in 2004 to reimburse the company for its upfront installation of the water line ($77,937). The projected payback to Kinetics was to be at least eight years. The City is proposing to make the reimbursement in two years to help offset the cost of purchasing the new facility, by providing a $40,000 payment in the first year, and the remaining $37,937 payment one calendar year later. The City will then be reimbursed as service payments are received from the TIF district. Kinetics is finalizing its purchase of the Shier Rings facility from Washington Township, and hopes to complete its transaction by second quarter 2006. Kinetics currently employs approximately 120 people, equating to an annual payroll of approximately $4.5 million. Recommendation: Staffrecommends the Economic Development Agreement and Ordinance No. 13-06 be approved by City Council on March 20, 2006. ECONOMIC DEVELOPMENT AGREEMENT THIS ECONOMIC DEVELOPMENT AGREEMENT (the "Agreement") is made and entered into this day of , 2006, by and between the CITY of DUBLIN, OHIO (the "City"), a municipal corporation duly organized and validly existing under the Constitution and the laws of the State of Ohio (the "State") and its Charter, and KINETICS NOISE CONTROL, INC. ("Kinetics"), an Ohio corporation with offices located in Dublin, Ohio, under the circumstances summarized in the following recitals. RECITALS: WHEREAS, consistent with its Economic Development Strategy (the "Strategy") approved by Dublin City Council Resolution No. 07-94 adopted on June 20, 1994, and the updated Strategy approved by Dublin City Council Resolution No. 30-04 adopted on July 6, 2004, the City desires to encourage commercial office and retail development and provide for the retention and creation of employment opportunities within the City; and WI-IEEREAS, on October 6, 2003, the City passed Ordinance No. 105-03, pursuant to and in accordance with Ohio Revised Code Sections 5709.40, 5709.42 and 5709.43 (the "TIF Ordinance', declaring 100% of the increase in assessed value of the real property owned by Kinetics (as described and depicted on Exhibit A of the TIF Ordinance) to be a public purpose and exempt from taxation for a period commencing with the first tax year that begins after the effective date of the TIF Ordinance and in which an improvement to the property first appears on the tax list and duplicate of real and public utility property and ending on the earlier of (a) thirty (30) years after such exemption commenced or (b) the date on which the City can no longer require service payments in lieu of taxes, and in order to provide for the collection of service payments in lieu of taxes and to enable the construction of certain public and private pursuant to the TIF Ordinance, the City and Kinetics entered into an agreement dated as of February 27, 2004 (the "TIF Agreement," together with the TIF Ordinance, the "TIF Documents"); and WHEREAS, based on the results of Kinetics' recent comprehensive examination of workforce needs, and induced by and in reliance on the economic development incentives provided in this Agreement, Kinetics is desirous of retaining its existing workforce within the City and purchasing a new facility located at 6279 Shier-Rings Road in the City (the "Shier-Rings Facility"); and WHEREAS, pursuant to Ordinance No. 13-06 passed , 2006 (the "Ordinance"), the City has determined to offer economic development incentives described herein, including an expedited reimbursement pursuant to the TIF Documents, to induce Kinetics to retain and expand its workforce within the City, and to create jobs and employment opportunities through the purchase of the Shier-Rings Facility, and to improve the economic welfare of the people of the State of Ohio and the City, all as authorized in Article VIII, Section 13 of the Ohio Constitution; and WHEREAS, the City and Kinetics have determined to enter into this Agreement to provide these incentives to induce Kinetics to retain its operations and purchase the Shier-Rings Facility in the City; Now THEREFORE, the City and Kinetics covenant agree and obligate themselves as follows: Section 1. Kinetics' Aa*-PPment to Retain Current Workforce and Purchase the Shier- RiY_„gs Facility. Kinetics' has operations and presently employs 120 employees at its site located at 6300 Irelan Place in the City (the "Irelan Place Facility," together with the Shier-Rings Facility, the "Facilities"). In consideration for the economic development incentives to be provided by the City herein, Kinetics agrees that it will retain its current workforce of 120 employees within the City, and will use its best efforts to purchase the Shier-Rings Facility. Section 2. City Agreement to Provide Incentives. (a) General. In consideration for Kinetics' agreement to purchase the Shier-Rings Facility and to retain its current operations, workforce and associated payroll within the City, the City agrees to provide economic development incentives to Kinetics in accordance with this Section. (b) Technology Grant. Upon purchasing the Shier-Rings Facility, Kinetics will connect the Facilities with new telecommunication abilities in order to support the cohesive operation of both Facilities within the City. In consideration of Kinetics' agreement to upgrade the telecommunication equipment and to retain its workforce within the City, the City agrees to provide a grant of fifty percent (50%) of the telecommunication installation costs, in the maximum amount of $10,000 (the "Technology Grant"). The City agrees that it will remit payment to Kinetics in the amount of the grant only after Kinetics has delivered an accounting and proof of payment of the final installation costs for the telecommunication equipment. (c) Expedited Tax Increment Financing_Payment Reimbursement. In accordance with the TIF Documents, the City has agreed to reimburse Kinetics for the construction of certain public improvements (described in Exhibit C of the TIF Ordinance, the "Public Improvements"), from monies collected in connection with the grant of the exemption pursuant to the TIF Documents. The City has calculated and estimated the reimbursement to take place over an eight-year reimbursement period. In consideration of Kinetics' agreement to purchase the Shier- Rings Facility and retain its current workforce in the City, the City agrees to expedite the estimated eight-year reimbursement period, and will reimburse Kinetics in two (2) payments totaling $77,937. The City shall make the initial payment in the amount of $40,000 (the "Initial TIF Payment") to Kinetics within thirty (30) days of receiving proof of ownership of the Shier- Rings Facility from Kinetics. The City shall make the final payment in the amount of $37,937 (the "Final TIF Payment") to Kinetics within thirty (30) days upon its request for payment, however, in no case shall the Final TIF Payment or a request for the Final Payment be made within twelve (12) calendar months of Kinetics' receipt of the Initial TIF Payment. (e) Forfeiture of Kinetics Incentives. Kinetics agrees and acknowledges that the Technology Grant, the Initial TIF Payment and the Final TIF Payment provided for in this Section 2 are being made by the City to Kinetics in consideration for Kinetics' agreement to retain its workforce within the City, purchase the Shier-Rings Facility and upgrade its telecommunication abilities to connect the Facilities after the purchase of the Shier-Rings Facility. Kinetics further agrees that if the telecommunication upgrades or the purchase of the Shier-Rings Facility are not completed, the City shall not be obligated to provide the Technology Grant, or make the Initial TIF Payment or the Final TIF Payment as set forth under this Agreement. -2- (e) Method of Payment. The payments provided for in this Section 2 shall be made by the City to Kinetics by electronic funds transfer or by such other manner as is mutually agreed to by the City and Kinetics. (f) City°s Obligation to Make Payments Not Debt• Payments Limited to Nontax Revenues. Notwithstanding anything to the contrary herein, the obligations of the City pursuant to this Agreement shall not be a general obligation debt or bonded indebtedness, or a pledge of the general credit or taxes levied by the City, and Kinetics shall have no right to have excises or taxes levied by the City, the State or any other political subdivision of the State for the performance of any obligations of the City herein. Consistent with Section 13 of Article VIII, Ohio Constitution, any payments or advances required to be made by the City pursuant to this Section 2 shall be payable solely from the City's non-tax revenues. Further, since Ohio law limits the City to appropriating monies for such expenditures only on an annual basis, the obligation of the City to make payments pursuant to this Section 2 shall be subject to annual appropriations by the City Council and certification by the Director of Finance of the City as to the availability of such non-tax revenues. Section 3. Miscellaneous. (a) Notices. Except as otherwise specifically set forth in this Agreement, all notices, demands, requests, consents or approvals given, required or permitted to be given hereunder shall be in writing and shall be deemed sufficiently given if actually received or ifhand-delivered or sent by recognized, overnight delivery service or by certified mail, postage prepaid and return receipt requested, addressed to the other party at the address set forth in this Agreement or any addendum to or counterpart of this Agreement, or to such other address as the recipient shall have previously notified the sender of in writing, and shall be deemed received upon actual receipt, unless sent by certified mail, in which event such notice shall be deemed to have been received when the return receipt is signed or refused. For purposes of this agreement, notices shall be addressed to: (i) the City at: 5800 Shier Rings Road Dublin, Ohio 43016-7295 Attention: Economic Development Director (ii) Kinetics at: 6300 Irelan Place Dublin, Ohio 43017 Attention: Virgil Temple The parties, by notice given hereunder, may designate any further or different addresses to which subsequent notices; certificates, requests or other communications shall be sent. (b) Extent of Provisions• No Personal Liability. All rights, remedies, representations, warranties, covenants, agreements and obligations of the City under this Agreement shall be effective to the extent authorized and permitted by applicable law. No representation, warranty, covenant, agreement, obligation or stipulation contained in this Agreement shall be deemed to constitute a representation, warranty, covenant, agreement, obligation or stipulation of any present or future trustee, member, officer, agent or employee of the City or Kinetics in other than his or her official capacity. No official executing or approving the City's or Kinetics' participation in this -3- Agreement shall be liable personally under this Agreement or be subject to any personal liability or accountability by reason of the issuance thereof. (c) Successors. This Agreement shall be binding upon and inure to the benefit of Kinetics and its successors and assigns. (d) Recitals. The City and Kinetics acknowledge and agree that the facts and circumstances as described in the Recitals hereto are an integral part of this Agreement and as such are incorporated herein by reference. (e) Amendments. This Agreement may only be amended by written instrument executed by the City and Kinetics. (f) Executed Counterparts. This Agreement may be executed in several counterparts, each of which shall be regarded as an original and all of which shall constitute but one and the same agreement. It shall not be necessary in proving this Agreement to produce or account far more than one of those counterparts. (g) Severability. In case any section or provision of this Agreement, or any covenant, agreement, obligation or action, or part thereof, made, assumed, entered into or taken, or any application thereof, is held to be illegal or invalid for any reason, (i) that illegality or invalidity shall not affect the remainder hereof or thereof, any other section or provision hereof, or any other covenant, agreement, obligation or action, or part thereof, made, assumed, entered into or taken, all of which shall be construed and enforced as if the illegal or invalid portion were not contained herein or therein, (ii) the illegality or invalidity of any application hereof or thereof shall not affect any legal and valid application hereof or thereof, and (iii) each section, provision, covenant, agreement, obligation or action, or part thereof, shall be deemed to be effective, operative, made, assumed, entered into or taken in the manner and to the full extent permitted by law. (h) Captions. The captions and headings in this Agreement are for convenience only and in no way define, limit or describe the scope or intent of any provisions or sections of this Agreement. (i) Governing Law and Choice of Forum. This Agreement shall be governed by and construed in accordance with the laws of the State of Ohio or applicable federal law. All claims, counterclaims, disputes and other matters in question between the City, its agents and employees, and Kinetics, its employees and agents, arising out of or relating to this Agreement or its breach will be decided in a court of competent jurisdiction within Franklin County, Ohio. (j) Survival of ReRresentations and Warranties. All representations and warranties of Kinetics and the City in this Agreement shall survive the execution and delivery of this Agreement. -4- (k) Notwithstanding any clause or provision of this Agreement to the contrary, in no event shall City or Kinetics be liable to each other for punitive, special, consequential, or indirect damages of any type and regardless of whether such damages are claimed under contract, tort (including negligence and strict liability) or any other theory of law. (signature page to follow) -5- IN WITNESS WHEREOF, the City and Kinetics have caused this Agreement to be executed in their respective names by their duly authorized representatives, all as of the date first written above. CITY OF DUBLIN, OHIO By: Printed: Jane Brauti~~am Title: City Manager Approved as to Form: By: Printed: Stephen J. Smith Title: Director of Law KINETICS NOISE CONTROL, INC. By: Printed: Title: -6- FISCAL OFFICER'S CERTIFICATE The undersigned, Director of Finance of the City under the foregoing Agreement, certifies hereby that the moneys required to meet the obligations of the City under the foregoing Agreement have been appropriated lawfully for that purpose, and are in the Treasury of the City or in the process of collection to the credit of an appropriate fund, flee from any previous encumbrances. This Certificate is given in compliance with Sections 5705.41 and 5705.44, Ohio Revised Code. Dated: , 2006 Marsha I. Grigsby Deputy City Manager/Director of Finance City of Dublin, Ohio -7-