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HomeMy WebLinkAbout59-95 Ordinance . nOt "."_.:""~."""""",.....,,,.,.,,.,..,_~~.i- ^O~"^..~__,__. ^~._. _,._~..M~'~_ Ii ORDINANCE N005GJ -95 AN ORDINANCE AUTHORIZING THE EXECUTION AND DELIVERY OF AN ECONOMIC DEVELOPMENT AGREEMENT BETWEEN THE CITY OF DUBLIN AND DUKE REALTY LIMITED PARTNERSHIP TO INDUCE A LEASE BETWEEN DUKE REALTY LIMITED PARTNERSHIP AND - NATIONWIDE MUTUAL INSURANCE COMPANY AND THE i CONSTRUCTION OF AN AT LEAST 300,000 SQUARE FEET ...... ' OF OFFICE SPACE IN ORDER TO INCREASE EMPLOYMENT WITHIN THE CITY, AND DECLARING AN EMERGENCY. WHEREAS, contingent on the passage of this Ordinance and the execution of the Economic Development Agreement as an inducement therefor, Duke Realty Limited Partnership ("Duke") desires to construct on certain real property (the "Property") located in the City of Dublin, Ohio (the "City") at least 300,000 square feet of office space (the "Office Space"), and Duke desires to lease a substantial portion of that Office Space to Nationwide Mutual Insurance Company ("Nationwide"); and WHEREAS, the City desires and intends to induce Duke and Nationwide to construct the Office Space for the purpose of creating jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City as authorized in Article VIII, Section 13 of the Ohio Constitution; NOW, THEREFORE, BE IT ORDAINED by the City of Dublin, Franklin, Union and Delaware Counties, Ohio, that: ,- Section 10 The City hereby finds and determines that it is necessary and appropriate and ........ in the best interests of the City to provide certain assistance to Duke for the purpose of creating jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City as authorized in Article VIII, Section 13 of the Ohio Constitution. Section 2. To provide assistance to Duke and thereby induce Duke and Nationwide to complete the transactions contemplated by and between Duke and Nationwide, the City Manager and the Director of Finance, for and in the name and on behalf of the City, shall execute, acknowledge and deliver the Economic Development Agreement by and among the City, Duke and Nationwide in substantially the form thereof on file with the Clerk of Council. That Agreement is approved with changes therein not inconsistent with this ordinance and not substantially adverse to the City and which are permitted by law, and shall be approved by the City Manager and the Director of Finance; provided, that the approval of those changes by such officers, and their character as not being substantially adverse to the City, shall be evidenced conclusively by their execution of those instruments. Section 3. The City Manager and the Director of Finance shall execute, deliver and, if applicable, file, for and in the name and on behalf of the City, any other materials, documents or certifications which are necessary or appropriate to consummate the transactions contemplated in this ordinance and the Economic Development Agreement. - Section 4. This Council finds and determines that all formal actions of this Council concerning or 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. "",~~ ,",~."'M'" ~~,'~ . -......., ~ Section 5. This ordinance is declared to be an emergency measure and necessary for the immediate preservation of the public peace, health, safety or welfare of this City and for the further reason that this ordinance is required to be immediately effective in order to provide for the implementation of economic development incentives for the construction of the Office Space on the Property at the earliest possible time to create jobs and employment opportunities and improve the economic welfare of the people of the City; wherefore, this ordinance shall be in full force and effect immediately upon its passageo JPF~,.;"", i Signed: lIiIlilIhia ~eSi~~LWf Attest: ~ (I__~ Clerk of Council Passed: ~' 1995 Effective: ~' 1995 ... ~ - ~J.;Jo . I' tl . ~'"1"l'i.,;<J;:e~~lltlfen-l,vere pOSHH. 10 ale .'f.. 1-1-,0' .~,..~~ ~.\" !'> . ,.J \;.. - I \"c:~:,'r ''':'' : . i,; 'd' :\'> Section 731.25 of the Ohio Revised Code, City of Oublin In occor once WI .. ~,{!fJ~~ Clerk of Council, Dublin, Ohio - 2 - ___C-,--,,"_' ,_..~.~,.~~ . DRAFT OF 7/12/95 ECONOMIC DEVELOPMENT AGREEMENT This Economic Development Agreement (the "Agreement"), is made and entered into as of this _ day of , 1995, between the CITY OF DUBLIN, OHIO (the "City"), a municipal corporation organized and existing under the constitution and the laws of the State ,..... of Ohio, and DUKE REALTY LIMITED PARTNERSHIP ("Duke"), an Indiana limited partnership with offices located in Dublin, Ohio. As used herein, references to Duke include ...... any wholly-owned or controlled subsidiary or affiliate to which Duke may assign all or any portion of its rights under this Agreement pursuant to Section 7. The City and Duke may be referenced herein individually as a "Party" and collectively as the "Parties". WITNESSETH; WHEREAS, Duke desires to construct or cause to be constructed on a portion of certain real property located in the City, which property is depicted on Exhibit A-I and described in Exhibit A-2 attached hereto (the "Property"), the private improvements consisting of a building or buildings comprising approximately 300,000 square feet and related facilities more particularly described on Exhibit B hereto (the "Duke Improvements"), and Duke desires to lease the Duke Improvements to Nationwide Mutual Insurance Company ("Nationwide"); and WHEREAS, the City has determined that it is necessary and appropriate and in the best interests of the City to provide certain assistance to Duke for the purpose of creating jobs and employment opportunities and to improve the economic welfare of the people of the State of Ohio and the City as authorized in Article VIII, Section 13 of the Ohio Constitution, and the City has therefore determined to provide or advance from its non-tax revenues a portion (equal to $450,000) of the cost to Duke of acquiring the Property, all for the purpose of inducing Duke to construct the Duke Improvements for the benefit of Nationwide and inducing Nationwide to ,.. lease the Duke Improvements from Duke, and with that amount subject to repayment as provided i in this Agreement; and i ..... WHEREAS, Duke has represented that by January 1, 1997, Nationwide and its subsidiaries, affiliates or associated companies will create a total of not less than 800 jobs in the City; NOW, THEREFORE, in consideration of the premises and covenants contained herein, and to provide incentives to Duke and Nationwide as provided herein, the Parties agree as follows: 1. Payment by City. Not later than December 31, 1995, the City shall provide or advance to Duke, solely from the City's non-tax revenues, a portion (equal to $450,000) of the cost of acquiring the Property for the purpose of inducing the lease of the Duke Improvements by Duke to Nationwide and in consideration of certain obligations of Duke contained herein. ~ ..~.~. .,_..~,_.~.__..~----""~--~._~ - --- '- Nothing herein shall be construed as requiring the City to use any funds or revenues from any source other than non-tax revenues of the City. 2. Duke Improvements. Duke hereby agrees to construct or cause to be constructed the Duke Improvements on the Property. The Duke Improvements will have a construction cost of approximately $30,000,000 and will be substantially completed not later than December 1, 1996. - 3. Payroll Covenant: Repayment. Duke anticipates that Nationwide and its affiliates, ~ subsidiaries and associated companies will by January 1, 1997 have located in the City at the Duke Improvments, and will thereafter maintain in the City at the Duke Improvements at all times through at least December 31, 1998, (the "Calculation Period") employment of a sufficient payroll to generate income tax revenues paid in the form of payroll withholding taxes to the City (the "Payroll Taxes") of not less than $745,000 (the "Withholdings Requirement"). For purposes of this Section 3, the parties shall assume that the City's Payroll Tax rate is not less than 2 % (whether or not the City's tax rate is decreased over such Calculation Period). If the withholdings for City Payroll Taxes from employees of Nationwide and its affiliates, subsidiaries and associated companies located in the Duke Improvements are less than the Withholdings Requirement for the Calculation Period, Duke shall repay to the City an amount equal to sixty-five percent (65%) of the difference between: (a) $745,000, minus (b) the actual amount of Payroll Taxes paid to the City during that Calculation Period, using the assumptions in this Section 3. ; provided, however, that notwithstanding any other provision of this Agreement the maximum repayment by Duke to the City under this Section 3 shall not exceed $450,000.00. ",.. The City shall calculate the repayment amount due from Duke, if any, under this ..... Section 3 and notify Duke in writing not later than February 15, 1999 of the repayment amount due, if any, but the failure to so notify Duke by that date of any repayment amount due the City shall not in any way affect Duke's repayment obligation to the City. Such repayment shall be made by Duke to the City on or before the later of (i) March 15, 1999, or (ii) thirty (30) days after Duke receives that written notice from the City. 4. Force Majeure. Notwithstanding the foregoing, if, by reason of Force Majeure, Duke is unable to perform or observe any agreement, term or condition hereof, Duke shall not be deemed in default or liable for any payments during the continuance of such inability and the time for performance of any of Duke's obligations delayed by such disability shall be suspended until the disability is alleviated 0 However, Duke shall promptly give notice to the City of the existence of an event of Force Majeure and shall use its best efforts to remove the effects thereof; provided that the settlement of strikes or other industrial disturbances shall be entirely within its discretion. - 2 - "'~-~"._." .. .-._~"'..;' -~., ,""''''"' The term Force Majeure shall mean, without limitation, the following: (i) acts of God; strikes, lockouts or other industrial disturbances' acts , of public enemies; orders or restraints of any kind of the government of the United States of America or of the State or any of their departments, agencies, political subdivisions (other than discretionary acts of the City and any entity under the direct legal control of the City) or officials, or any civil or military authority; insurrections; civil disturbances; - riots; epidemics; landslides; lightning; earthquakes; fires; hurricanes; tornados; storms; droughts; floods; arrests; restraint of government and people; explosions; breakage, i malfunction or accident to facilities, machinery, transmission pipes or canals; partial or - entire failure of utilities; shortages of labor, materials, supplies or transportation; or (ii) any cause, circumstance or event not reasonably within the control of the City, Duke or Nationwide, as applicable. 5. A~eement Binding on City: No Personal Liability. All covenants, obligations and agreements of the City contained in this Agreement shall be effective to the extent authorized and permitted by applicable lawo No such covenant, obligation or agreement shall be deemed to be a covenant, obligation or agreement of any present or future member, officer, agent or employee of the City or Duke in other than their official capacity, and neither the members of the City Council nor any official executing this Agreement on behalf of the City or any present or future member, officer, agent or employee of the City or Duke shall be liable personally by reason of the covenants, obligations or agreements of the City or Duke contained in this Agreement. 6. Severability. In case any section or provisions of this Agreement, or any agreement, obligation, act or action, or part thereof, made, assumed, entered into, done or taken under this Agreement, or any application thereof, is held to be illegal or invalid for any reason, or is inoperable at any time, that illegality, invalidity or inoperability shall not affect the ..... remainder of this Agreement or any other section or provision of this Agreement or any other agreement, obligation, act or action, or part thereof, made, assumed, entered into, done or taken .... under this Agreement, all of which shall be construed and enforced at the time as if the illegal, invalid or inoperable portion were not contained therein. Any illegality, invalidity or inoperability shall not affect any legal, valid and operable section, which shall be deemed to be effective, operative, made, assumed, entered into, done or taken in the manner and to the full extent permitted by law from time to time. 7. Asshmments. Except as provided in the second paragraph of this Section, Duke agrees not to assign this Agreement or the Duke Improvements without the prior written consent of the City, which consent shall not be unreasonably withheld. Duke shall not be required to obtain the consent of the City with respect to any assignment of the Agreement or the Duke Improvements directly to an affiliate or subsidiary of Duke if that assignment is required for the general partner of Duke to retain its status as a "real estate investment trust" within the meaning of Section 856(a) of the Internal Revenue Code of 1986, as amended, and any applicable state statutes; provided, however, that Duke shall give - 3 - ,.... ~~._"~~._~~~.=~.. - -;-,..." the City notice of the foregoing assignment not less than ten (10) days prior to the effective date thereof. For the purposes of this Section 7, an affiliate or subsidiary shall mean a corporation or entity which shall be directly or indirectly controlled, under the control of, or be under common control with Duke. For purposes hereof, "control" shall be deemed to mean ownership of more than fifty percent (50%) of the outstanding voting stock of a corporation or other majority equity and controlling interest is not a corporation. 8. Successors. This Agreement shall be binding upon Duke and its beneficiaries, - successors and assigns. -- 9. Amendments. This Agreement may only be amended by written instrument executed by both of the Parties to this Agreement. 100 Notices. All notices, requests or other communications hereunder shall be sufficiently given and shall be deemed given when mailed by registered or certified mail, postage prepaid, addressed to: (a) To Duke at: Duke Realty Limited Partnership 4700 Lakehurst Court, Suite 150 Dublin, Ohio 43017 Attention: Donald J. Hunter With a copy to: Duke Realty Limited Partnership 8888 Keystone Crossing, Suite 1200 Indianapolis, Indiana 46240 Attention: Legal Department (b) To the City at: Department of Development City of Dublin ..... 5800 Shier-Rings Road Dublin, Ohio 43017 .... Attention: Director of Development Duke and the City may, subsequent to the provision of proper notice, designate any further, different or more specific addresses to which mailing shall be sent. 11. Counterparts. This Agreement may be signed in one or more counterparts or duplicate signature pages with the same force and effect as if all required signatures were contained in a single original instrument. Anyone or more of such counterparts or duplicate signature pages may be removed from anyone or more original copies of this Agreement and annexed to other counterparts or duplicate signature pages to form a completely executed original instrument. - 4 - r- "",_._c_~~~.-..o.._.~~,,,~_ - =","".~._-,---~.,......- h:' . ,.... .."'.. -""' IN WITNESS WHEREOF, the Parties have executed this Agreement by their duly authorized officers effective as of the day and date specified above. CITY OF DUBLIN, OHIO By: Timothy C. Hansley, City Manager ....... And by: .... Marsha I. Grigsby, Director of Finance DUKE REALTY LIMITED PARTNERSHIP By: Duke Realty Investments, Inco Its: General Partner By: Name: Donald J. Hunter Title: Vice President -- Columbus Group .... ..... - 5 - ,.. _ .. ....<...._..,._.c,..~.,,~.,._ "._~~._--~....... 'M_._'.'.~~.,.,...,_,.~".,~ . ~".......,-"..", CERTIFICATE As the Director of Finance of the City of Dublin, I certify that the money required to meet the obligations of the City of Dublin during the year 1995 under the attached Agreement has been lawfully appropriated by the Council of the City for those purposes and is in the treasury of the City or in the process of collection to the credit of an appropriate fund, free from any previous encumbrances. This Certificate is given in compliance with Sections 5705.41 and JII"""I 5705.44 of the Revised Code. .... Dated: June , 1995 - Director of Finance City of Dublin, Ohio ...., .... - 6 - ,- --_.~._""-,.~,._"-""",,,,,.~.,.~~---....-~",=.~- ".~...~".=,. - ~..;..-~"""'-=~~..._-,~ STATE OF OHIO ) ) SS: COUNTY OF FRANKLIN ) The foregoing instrument was acknowledged before me this day of , 1995, by Timothy C. Hansley and Marsha 10 Grigsby, the City Manager and Director of Finance, respectively, of the City of Dublin, Ohio, a municipal corporation, on ..... behalf of said municipal corporation. -- Notary Public STATE OF OHIO ) ) SS: COUNTY OF FRANKLIN ) The foregoing instrument was acknowledged before me this day of - , 1995, by Donald J. Hunter, Vice President -- Columbus Group of Duke Realty Investments, Inco, General Partner of Duke Realty Limited Partnership, which executed such instrument on behalf of said limited partnership. Notary Public ...... ~ - 7 - P""" ,- "'._<--'.._'-~~"'~~~.""'~.~~'"" ......._~~"_.~~-"- ,... ... .-- .., . EXHIBIT A-I Depiction of the Property ,... ..... ~ \ .... ,- =._- ~.,,,. """"c,.~___~._.~" . , EXHIBIT A-2 Description of the Property ..... -- ... I -- r- _._-_._-_._-~ "",,~,...=..- . . EXHIBIT B Description of Duke Improvements ,"" I ..... ,... ... r- "<..~'-~'~-_.'~'-- , -~._---...-,_........_, ~~,..- ."~"._,.~~""-~, . 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L/9 'd U99 'ON 66VZ 99t v19 a~ss }'{V89: 11 9661 'vl 'lor .~..........,__~.._~" ~ .-,~...,~",__.,c,..___" ~-~."" .",.~.,.._"..-.,~-,. - ."~=.-" ~ "",,.~._~,"---,.--,- EXlDBIT B Duke Improvements The private improvements to be constnlcted by Duke Realty Limited Partnership ale a 300,000 - square foot corporate office building to be located on approximately 18 acICS of land located at Tuttle Crossing, Dublin, Ohio. Those improvements include all site work. on.site storm water - management work, sub-base and pavement of parking lots and driveways, all stmctural steel, concrete, glass. architecmral precast, etc. for tbe building. The improvements also ioclude all electrical, plumbing, HV AC and mechanical units, and fIre protection, and all related architectural and engineering desi~ building permits, tap fees and related costs. ..... - ',,,-...,, Page 1 of 2 - L/9 'd H99 'oN 66v2 99E v19 a~ss v{'169:11 9661 'vl 'Inr _ _c ~~~,..__."""-_.",",__,_~""",.~~_.._.,~"~~_ _. 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