Ordinance 053-15RECORD OF ORDINANCES
Dayton Legal Blank, Inc. Form No. 30043
Ordinance No. Passed 20
AN ORDINANCE APPROVING A COMPENSATION AGREEMENT WITH
THE FRANKLIN COUNTY BOARD OF COUNTY COMMISSIONERS
FOR THE BRIDGE PARK RESIDENTIAL INCENTIVE DISTRICT.
WHEREAS, the City has prepared a strategy for comprehensive development within an area of the
City known as the Bridge Street District (which area is referred to herein as the "District") and has
endeavored to work collaboratively with the Franklin County Board of County Commissioners (the
"Commissioners ") to plan for and facilitate the development of the District; and
WHEREAS, the City is taking steps pursuant to Ohio Revised Code Sections 5709.40, 5709.42
and 5709.43 to create the Bridge Park Incentive District (the "Incentive District") located within
the District and will declare improvements within the Incentive District to be a public purpose
(the "Improvements ") thereby exempting those Improvements from real property taxation; and
WHEREAS, the City desires to compensate the County of Franklin, Ohio (the "County ") for
forgone tax revenues in connection with the Incentive District for levies collected by the County
and providing for County operations and services; and
WHEREAS, this Council has determined that it is necessary and appropriate and in the best
interests of the City to provide for the execution of a compensation agreement with the
Commissioners which will facilitate the creation of the Incentive District, payment of compensation
to the Commissioners and further development in the Incentive District;
NOWT, THEREFORE, BE IT ORDAINED by the Council of the City of Dublin, State of Ohio,
of the elected members concurring, that:
Section 1. Authorization of Compensation Agreement. The Franklin County Compensation
Agreement by and between the City and the Commissioners (the "Compensation Agreement") and
in the form presently on file with the Clerk of Council is hereby approved and authorized with such
changes and completions therein not inconsistent with this Ordinance and not substantially adverse
to the City and which shall be approved by the City Manager. The City Manager, for and in the
name of the City, is hereby authorized to execute the Compensation Agreement, provided further
that the approval of changes or completions to such agreement by that official, and their character
as not being substantially adverse to the City, shall be evidenced conclusively by the execution
thereof.
Section 2. Further Authorizations. This City Council further hereby authorizes and directs the
City Manager, the Director of Finance, the Director of Law, the Director of Development, the Clerk
of Council or other appropriate officers of the City to prepare and sign all documents and
instruments and to take any other actions as may be appropriate to implement this Ordinance.
Section 3. Open Meetings. This City Council finds and determines that all formal actions of this
City Council and any of its committees concerning and relating to the passage of this Ordinance were
taken in an open meeting of this City Council or any of its committees, and that all deliberations of
this City Council and any of its committees that resulted in those formal actions were in meetings
open to the public, all in compliance with the law including Ohio Revised Code Section 121.22.
Section 4. Effective Date. This Ordinance shall be in full force and effect on the earliest date
permitted by law.
Signed:
VICZ_Mayor — Presiding Officery
Attest:
Clerk of Council
Passed: 2015
Effective:
2015
Office of the City Manager
5200 Emerald Parkway • Dublin, OH 43017 -1090
City of Dublin Phone: 614 - 410 -4400 • Fax: 614 - 410 -4490
Memo
To: Members of Dublin City Council
From: Dana L. McDaniel, City Mana5e
Date: August 6, 2015
Initiated By: Angel L. Mumma, Director of Finance
Re: Ordinance No. 53 -15 — Approving a Compensation Agreement with the
Franklin County Board of County Commissioners for the Bridge Park
Residential Incentive District
Summary
In conjunction with Ordinance No. 45 -15 which authorizes the establishment of the Bridge Park
Incentive District, Ordinance 53 -15 proposes the approval of a compensation agreement with the
Franklin County Board of County Commissioners for the Bridge Park Incentive District.
As Council is aware, an Incentive District is a type of Tax Increment Financing (TIF) that applies to
owner - occupied housing. Like commercial TIFs, improvements to a parcel are considered a public
purpose and exempt from taxation. Property owners are required to make service payments in
lieu of the incremental increase in taxes (referred to as PILOTS — payments in lieu of taxes or
Service Payments). The amount of these payments is equal to the taxes that would have been
due had the Incentive District not been in place. Therefore, a property owner pays no more or
less in property taxes /service payments as a result of an Incentive District.
Incentive Districts differ from commercial TIFs in that there are some property tax levies which are
protected by statute. These include levies approved after January 1, 2006 for MRDD, senior
services, ADMH, the library, children's services, and the zoo. Additionally, ORC stipulates if there is
not a mutually agreed upon compensation agreement with the Board of County Commissioners, a
prescribed compensation amount must be paid to the County in years 11 -30 of the Incentive
District.
The City proposed the TIF ordinance to Franklin County. The TIF ordinance was rejected by the
Franklin County Board of Commissioners on June 16, 2015. Such rejections are not unusual for
these ordinances, and the County's resolution contemplated continued negotiations toward a
mutually acceptable compensation agreement with the City of Dublin. In July, Franklin County
officials proposed a compensation agreement that was deemed financially acceptable by the City
and the Developer. (Note: Given that any compensation due to the County will be paid directly
from the service payments received within the Incentive District, thus reducing the TIF revenues
available to the Developer to fund public improvements, the Developer has a financial interest in
ensuring the compensation agreement is not detrimental to the overall financial feasibility of the
project). Based on the estimated value of the owner - occupied housing, to which the
compensation agreement is based on, the agreement calls for the following compensation (in both
mills and dollar amounts):
Memo re. Ordinance No. 53 -15 — Approving a Compensation Agreement with the Franklin County Board of
County Commissioners for the Bridge Park Residential Incentive District
August 6, 2015
Page 2 of 2
■ Years 1— 15 — the compensation payments shall be equal to zero percent (0 %) of the
amount of taxes the County levies would have collected for the improvements but for
the exemption granted by the TIF Ordinance.
■ Years 16 — 20 — the compensation payments shall be equal to twenty -five percent
(25 %) of the amount of taxes the County levies would have collected for the
improvements but for the exemption granted by the TIF Ordinance.
o Estimated compensation based on 4.2 mills - $77,300
■ Years 21— 25 — the compensation payments shall be equal to thirty percent (30 %) of
the amount of taxes the County levies would have collected for the improvements but
for the exemption granted by the TIF Ordinance.
o Estimated compensation based on 5.0 mills - $92,100
■ Years 26 — 30 — the compensation payments shall be equal to thirty -five percent (35 %)
of the amount of taxes the County levies would have collected for the improvements
but for the exemption granted by the TIF Ordinance.
o Estimated compensation based on 5.9 mills - $108,700
When compiling the financial proforma for the Bridge Park Development, the Developer took into
account the most conservative scenario — one in which the City and the County did not come to
agreement on the terms of a compensation agreement, thus resorting to higher statutory
compensation levels.
Recommendation
Staff recommends that Ordinance No. 52 -15 be adopted by City Council at the second
reading /public hearing on August 24, 2015.
* * * * Draft of August 6, 2015 — For Discussion Purposes Only * * * *
FRANKLIN COUNTY COMPENSATION AGREEMENT
This FRANKLIN COUNTY COMPENSATION AGREEMENT (this "Compensation
Agreement ") by and between the CITY OF DUBLIN, OHIO, a municipal corporation with its
offices at 5200 Emerald Parkway, Dublin, Ohio 43017 (the "City "), and the FRANKLIN
COUNTY BOARD OF COUNTY COMMISSIONERS, a county government with its principal
offices at 373 South High Street, Columbus, Ohio 43215 (the "Commissioners "), specifies the
manner and procedure to be used to compensate the Commissioners for certain foregone tax
revenues resulting from Dublin City Ordinance No. 45 -15 (the "TIF Ordinance "), granting a
one - hundred percent (100 %) tax exemption for a period not to exceed thirty (30) years pursuant
to Ohio Revised Code Section 5709.40(C).
WITNESSETH:
WHEREAS, the City and the Commissioners desire to encourage the development of the
real property described and depicted on Exhibit A attached to this Agreement (the "Property"),
as may be owned now and in the future by one or more owners (the "Owners "), to further the
economic development goals of the City; and
WHEREAS, the City is taking steps pursuant to Ohio Revised Code Sections 5709.40,
5709.42 and 5709.43 (collectively, the "TIF Statutes ") to create an incentive district comprised
of the Property (the "Incentive District ") and will declare improvements to the Property within
the Incentive District to be a public purpose (the "Improvements ") thereby exempting those
Improvements from real property taxation, and will provide for annual service payments in lieu
of taxes to be made by the Owners with respect to the Property (the "Service Payments "), and
will establish a municipal public improvement tax increment equivalent fund (the "TIF Fund') to
pay a portion of the cost of related public infrastructure improvements (the "Public
Improvements "); and
WHEREAS, pursuant to Ohio Revised Code Section 5709.40(F), the exemption of the
Improvements from real property taxation does not include certain additional real property tax
levies and certain renewal or replacement real property tax levies that exceed the effective tax
rate of the levy renewed or replaced; and
WHEREAS, the exemption of the Improvements from real property taxes does include
current real property tax levies; and
WHEREAS, 1.47 mills (effective rates of 1.47 mills for residential/agricultural property
and 1.47 mills for commercial/industrial property) is being levied currently for providing or
maintaining general County operations (the "Inside Millage Levy "); and
WHEREAS, 1.3 mills (effective rates of 1.296250 mills for residential/agricultural property
and 1.3 mills for commercial/industrial property) is being levied currently for providing or
maintaining senior citizens services or facilities (the "Senior Levy "); and
WHEREAS, 7.0 mills, consisting of two 3.5 mill levies (each with effective rates of
3.489906 mills for residential/agricultural property and 3.5 mills for commercial industrial
* * * * Draft of August 6, 2015 — For Discussion Purposes Only * * * *
property) is being levied currently for community mental retardation and development
disabilities programs and services (collectively, the "BDD Levy"); and
WHEREAS, 2.2 mills (effective rates of 2.193655 mills for residential/agricultural property
and 2.2 mills for commercial industrial property) is being levied currently for alcohol, drug
addiction and mental health services or facilities (the "AD"HLevy "); and
WHEREAS, 5.0 mills, consisting of a 1.9 mill levy and 3.1 mill levy (effective rates of
1.752902 mills and 3.091059 mills, respectively, for residential/agricultural property and 1.9
mills and 3.1 mills, respectively, for commercial/industrial property) is being levied currently for
the support of children's services and the placement and care of children (collectively, the
"Children's Levy ", and together with the Inside Millage Levy, the Senior Levy, the BDD Levy
and the ADAMH Levy, the "County Levies "); and
WHEREAS, notice of the City's intention to pass the TIF Ordinance and declare the
Improvements exempt from real property taxes in excess of 75 percent for more than ten years
has been delivered to the Commissioners in accordance with Ohio Revised Code Section
5709.40(E)(1); and
WHEREAS, by Resolution No. 0464 -15 adopted on June 16, 2015, and as certified by the
Commissioners, the Commissioners formally objected to the exemptions from real property taxes
of the Improvements as described in the TIF Ordinance, in accordance with Ohio Revised Code
Section 5709.40(E)(2); and
WHEREAS, the Commissioners remain in objection to the real property tax exemptions
granted pursuant to the TIF Ordinance unless and until a mutually acceptable compensation
agreement with the City is negotiated to compensate for tax revenues foregone pursuant to the
TIF Ordinance for the County Levies; and
WHEREAS, the City and the Commissioners have negotiated this Compensation
Agreement to compensate the Commissioners for tax revenues foregone for the County Levies
pursuant to real property tax exemptions granted by the TIF Ordinance;
Now, THEREFORE, in consideration of the foregoing and of the mutual promises,
covenants and agreements hereinafter set forth, the parties agree as follows:
Section 1. Commissioners Compensation Rates. For each year for which the Owners
receive a real property tax exemption and make corresponding Service Payments which are
deposited into the TIF Fund, the City shall make payments (the "Compensation Payments "),
solely from the TIF Fund, to the Commissioners as follows:
(a) In respect of the first through the fifteenth tax year during the exemption period
set forth in the TIF Ordinance, the Compensation Payments shall be equal to zero percent (00%)
of the amount of taxes the County Levies would have collected for the Improvements but for the
exemption granted by the TIF Ordinance.
(b) In respect of the sixteenth through the twentieth tax year during the exemption
period set forth in the TIF Ordinance, the Compensation Payments shall be equal to twenty -five
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* * * * Draft of August 6, 2015 — For Discussion Purposes Only * * * *
percent (25 %) of the amount of taxes the County Levies would have collected for the
Improvements but for the exemption granted by the TIF Ordinance.
(c) In respect of the twenty -first through the twenty -fifth tax year during the
exemption period set forth in the TIF Ordinance, the Compensation Payments shall be equal to
thirty percent (30 %) of the amount of taxes the County Levies would have collected for the
Improvements but for the exemption granted by the TIF Ordinance.
(d) In respect of the twenty -sixth through the thirtieth tax year during the exemption
period set forth in the TIF Ordinance, the Compensation Payments shall be equal to thirty-five
percent (35 %) of the amount of taxes the County Levies would have collected for the
Improvements but for the exemption granted by the TIF Ordinance.
Section 2. Timing of the Payments. Commencing in the calendar year next succeeding
the sixteenth tax year of the exemption period set forth in the TIF Ordinance and continuing in
each calendar year thereafter for so long as the City receives Service Payments pursuant to the
TIF Ordinance, the City shall pay to the Commissioners, on or prior to March 31 of each such
calendar year, the Compensation Payment accruing in the immediately preceding year. Each
Compensation Payment will include an explanation of the calculation used to determine the
amount of the Compensation Payment, including the true value of the Improvements as
determined by the Franklin County Auditor on the applicable tax lien date and the applicable
property tax millage rate and any other adjustments then in effect. The City and the
Commissioners shall cooperate in calculating the Compensation Payments to ensure accuracy,
fairness and that the spirit of this Compensation Agreement is maintained.
Section 3. Amendment of Compensation Payments. The intent of this Compensation
Agreement is to lessen the revenues foregone for the County Levies pursuant to the real property
tax exemption granted by the TIF Ordinance. Should the TIF Statutes be amended in a manner
that would cause (a) the County Levies to be excluded, in whole or in part, from the real property
tax exemption granted pursuant to the TIF Ordinance, or (b) those tax levies excluded pursuant
to Ohio Revised Code Section 5709.40(F) from the real property tax exemption granted pursuant
to the TIF Ordinance to be included, in whole or in part, in the real property tax exemption
granted pursuant to the TIF Ordinance, the City and the Commissioners agree that they shall
negotiate an amendment to this Compensation Agreement to adjust the Compensation Payments.
Section 4. Commissioners Acknowledgment and Consent. In consideration of the
Compensation Payments, the Commissioners hereby:
(a) Acknowledge that notice by the City was proper and timely per requirements set
forth in Ohio Revised Code Section 5709.40(E) with respect to the TIF exemptions;
(b) Relinquish any and all objection to the real property tax exemptions to be granted
under the TIF Ordinance for the Property, including such objection previously stated in
Commissioners Resolution No. 0464 -15; and
(c) Waive any defects or irregularities relating to the exemption from taxation of the
Property.
* * * * Draft of August 6, 2015 — For Discussion Purposes Only * * * *
Section 5. Application of Ohio Revised Code Section 5709.40(E). The
Commissioners acknowledge and agree that this Compensation Agreement provides the only
compensation to be received by the Commissioners in connection with real property tax
exemptions granted pursuant to the TIF Ordinance and the compensation provided for in this
Compensation Agreement is in lieu of any other compensation as may be contemplated under
Ohio Revised Code Section 5709.40(E)(2).
Section 6. Miscellaneous.
(a) Assi ent. This Agreement may not be assigned without the prior written
consent of all non - assigning parties.
(b) Binding Effect. The provisions of this Agreement shall be binding upon and inure
to the benefit of the parties and their respective successors and permitted assigns.
(c) Cations. 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.
(d) Day for Performance. Wherever herein there is a day or time period established
for performance and such day or the expiration of such time period is a Saturday, Sunday or legal
holiday, then such time for performance shall be automatically extended to the next business day.
(e) Entire Agreement. This Agreement constitutes the entire Agreement between the
parties on the subject matter hereof and supersedes all prior negotiations, agreements and
understandings, both written and oral, between the parties with respect to such subject matter. This
Agreement may not be amended, waived or discharged except in an instrument in writing executed
by the parties.
(f) Events of Default and Remedies. Except as otherwise provided in this Agreement,
in the event of any default in or breach of this Agreement, or any of its terms or conditions, by any
party hereto, such defaulting party shall, upon written notice from any non - defaulting party, proceed
immediately to cure or remedy such default or breach, and, in any event, within thirty (30) days
after receipt of such notice. In the event such default or breach is of such nature that it cannot be
cured or remedied within said thirty (30) day period, then in such event the defaulting party shall
upon written notice from any non - defaulting party commence its actions to cure or remedy said
breach within said thirty (30) day period, and proceed diligently thereafter to cure or remedy said
breach. In case such action is not taken or not diligently pursued, or the default or breach shall not
be cured or remedied within a reasonable time, the aggrieved non - defaulting party may institute
such proceedings as may be necessary or desirable in its opinion to cure and remedy such default or
breach, including, but not limited to, proceedings to compel specific performance by the defaulting
party.
(g) Executed Counterpart s. This Agreement may be executed in several counterparts,
each of which shall be deemed to constitute an original, but all of which together shall constitute but
one and the same instrument. It shall not be necessary in proving this Agreement to produce or
account for more than one of those counterparts.
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(h) Extent of Covenants, No Personal Liabili ty. All covenants, obligations and
agreements of the parties contained in this Agreement shall be effective to the extent authorized and
permitted by applicable law. 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 the Commissioners other than in his or her official capacity, and neither the members of
the legislative body of the City or the Commissioners nor any official executing this Agreement
shall be liable personally under this Agreement or be subject to any personal liability or
accountability by reason of the execution thereof or by reason of the covenants, obligations or
agreements of the City and the Commissioners contained in this Agreement.
(i) Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the State of Ohio without regard to its principles of conflicts of laws. All claims,
counterclaims, disputes and other matters in question between the City, its agents and employees,
and the Commissioners, 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.
0) Legal Authority. The parties respectively represent and covenant that each is legally
empowered to execute, deliver and perform this Agreement and to enter into and carry out the
transactions contemplated by this Agreement. The parties further respectively represent and
covenant that this Agreement has, by proper action, been duly authorized, executed and delivered by
the parties and all steps necessary to be taken by the parties have been taken to constitute this
Agreement, and the covenants and agreements of the parties contemplated herein, as a valid and
binding obligation of the parties, enforceable in accordance with its terms.
(k) Limit on Liability. Notwithstanding any clause or provision of this Agreement to
the contrary, in no event shall City or the Commissioners 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.
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* * * * Draft of August 6, 2015 — For Discussion Purposes Only * * * *
(1) 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 if hand - 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:
City: City of Dublin, Ohio
City Manager
5200 Emerald Parkway
Dublin, Ohio 43017
With a copy to: Frost Brown Todd LLC
°o Dublin Director of Law
10 West Broad Street — Suite 2300
Columbus, Ohio 43215
County: Franklin County Board of Commissioners
% Board President
373 South High Street, 26th Floor
Columbus, Ohio 43215
With a copy to: Franklin County Prosecutor
373 South High Street, 14'h Floor
Columbus, Ohio 43215
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.
(m) No Waiver. No right or remedy herein conferred upon or reserved to any party is
intended to be exclusive of any other right or remedy, and each and every right or remedy shall be
cumulative and in addition to any other right or remedy given hereunder, or now or hereafter legally
existing upon the occurrence of any event of default hereunder. The failure of any party to insist at
any time upon the strict observance or performance of any of the provisions of this Agreement or to
exercise any right or remedy as provided in this Agreement shall not impair any such right or
remedy or be construed as a waiver or relinquishment thereof. Every right and remedy given by this
Agreement to the parties hereto may be exercised from time to time and as often as may be deemed
expedient by the parties hereto, as the case may be.
(n) Recitals. The parties 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.
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(o) Severabilitv. If any provision of this Agreement, or any covenant, obligation or
agreement contained herein is determined by a court to be invalid or unenforceable, that
determination shall not affect any other provision, covenant, obligation or agreement, each of which
shall be construed and enforced as if the invalid or unenforceable portion were not contained herein.
That invalidity or unenforceability shall not affect any valid and enforceable application thereof, and
each such provision, covenant, obligation or agreement shall be deemed to be effective, operative,
made, entered into or taken in the manner and to the full extent permitted by law.
(p) Survival of Representations and Warranties. All representations and warranties of
the parties in this Agreement shall survive the execution and delivery of this Agreement.
(c) Third Party Beneficiaries. Nothing in this Agreement, express or implied, is
intended to or shall confer upon any other person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement.
(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK - SIGNATURE PAGES FOLLOW)
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* * * * Draft of August 6, 2015 — For Discussion Purposes Only * * * *
In witness thereof, the parties have caused this Compensation Agreement to be executed
as of , 2015.
CITY OF DUBLIN, OHIO
LE
Name: Dana L. McDaniel
Title: City Manager
Approved as to form:
Stephen J. Smith, Director of Law
City of Dublin, Ohio
FRANKLIN COUNTY BOARD OF COUNTY
COMMISSIONERS
un
Name:
Title:
Approved as to form:
Ron O'Brien
Prosecuting Attorney
Franklin County, Ohio
I:
Assistant Prosecuting Attorney
EXHIBIT A
PROPERTY DESCRIPTION
Real property described on the attached map, which is a part of this Exhibit A, and which such
property is collectively enclosed in a continuous boundary in the City of Dublin, Franklin
County. This Property shall include any purported subdivisions of the enumerated parcels.
This real property may be identified by such Parcel Numbers as may be reassigned by the
Franklin County Auditor and street addresses as assigned by the City of Dublin.
[The remainder of this page left intentionally blank]
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