58-06 Ordinance RECORD OF ORDINANCES
Dayton Legal Blank, Inc. Form No ~OOd~
Ordinance No. 5g-~6 Passed , 20
AN ORDINANCE AUTHORIZING THE PROVISIONS OF
CERTAIN INCENTIVES FOR PURPOSES OF
ENCOURAGING THE ESTABLISHMENT BY HALCYON
SOLUTIONS INC. OF ITS OPERATIONS AND WORKFORCE
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, Halcyon Solutions, Inc. ("Halcyon is desirous of establishing 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 Halcyon to
establish 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 Halcyon to establish its operations and
workforce within the City and to provide for the execution and delivery of that
Economic Development Agreement with Halcyon;
NOW, THEREFORE, BE IT ORDAINED by the Council of the City of Dublin,
Franklin, Union and Delaware Counties, State of Ohio, ~ of the elected members
concurring, that:
Section 1. The Economic Development Agreement by and between the City and
Halcyon, in the form presently on file with the Clerk of Council, providing for, among
other things, the provision of incentives to Halcyon in consideration for Halcyon's
agreement to establish 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 Legal Blank, Inc. Form No. 30043
Pa e 2
Ordinance No. $g-06 Passed g 20
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: ~fi0~ ~ , 2006
Effective:,~G~ r/Ll~ ~ , 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.
De y Clerk of Council, Dublin, Ohio
Office of the City Manager
5200 Emerald Parkway, Dublin, Ohio 43016
Phone: 614-410-4400 Fax: 614-410-4490
CITY OF DUBLIN M e m o
To: Members of Dublin City Council
From: Jane S. Brautigam, City Manager ~~~~j.
Date: September 12, 2006
Initiated By: Colleen M. Gilger, Acting Director of Economic Development
Re: Ordinance 58-06 -Economic Development Agreement with Halcyon Solutions
Summary
Staff has been in discussions with Halcyon Solutions, Inc. regarding the possibility of a Dublin location
for its expanding corporate headquarters. The company has identified 5880 Innovation Drive for its
corporate office, after outgrowing leased space in Gahanna.
Company officials approached Dublin nearly two years ago to begin searching for real estate.
Executives desired owning a facility versus leasing; the CEO was committed to finding a location closer
to his new home in Dublin; and the company faced an expiring lease and no expansion room at its
current location on Taylor Station Road. Buildings in both Dublin and Hilliard were considered.
Halcyon is an Enterprise Resource Planning (ERP) Product development company, providing custom
solutions and consulting services to its international customer base on technologies including SAP,
Peoplesoft, Datawarehousing, Oracle Apps and Siebel. It focuses in a few selected technology areas,
where it has expertise and core strengths, and focuses on financial services, manufacturing, public sector
and telecommunications industry customers.
Ordinance 58-06 authorizes an Economic Development Agreement between the City and Halcyon that
includes a $90,000 Technology & Property Grant for facility acquisition and technology upgrades to the
owner-occupied 5880 Innovation Drive facility, payable in three increments ($20,000 in 2007, $35,000
in 2008 and $35,000 in 2009) tied to the company meeting predetermined, annual job and payroll
withholdings growth commitments.
Halcyon is committing to 90 employees upon move-in during October 2006, and the hiring of at least 85
employees with an average salary of approximately $54,000 over the next two years, equating to an
annual payroll of $9.5 million by 2008. Halcyon will add at least $353,800 in new income tax revenue
over the course of this Agreement.
Recommendation
Staff recommends the Economic Development Agreement and Ordinance No. 58-06 be approved by
City Council at the second reading/public hearing on October 2, 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 Halcyon Solutions Inc. ("Halcyon")
an Ohio corporation, 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
WHEREAS, Halcyon desires to locate its operations and initial workforce of approximately
90 fulltime employees within the City of Dublin in 2006, growing to 175 employees by 2008; and
WHEREAS, pursuant to Ordinance No. 58-06 passed , 2006
(the "Ordinance"), the City has determined to offer economic development incentives described
herein to induce Halcyon to locate and establish 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, the City and Halcyon have determined to enter into this Agreement to provide
these incentives to induce Halcyon to locate operations and create its workforce within the City.
Now, THEREFORE, the City and Halcyon covenant agree and obligate themselves as follows:
Section 1. Halcyon's Agreement to Create Jobs. Halcyon agrees that it will establish its
office at 5880 Innovation Drive in the City of Dublin (the "Dublin Facility") before November 1,
2006. Halcyon will employ at least 90 fulltime employees within the City of Dublin as part of its
operations, growing that workforce with the addition of 85 employees by December 31, 2008. The
average annual wage of these employees for this period is estimated to be approximately $54,286
with total estimated payroll withholdings during the term of the agreement of approximately
$353,800 by December 31, 2008. Halcyon will acquire the facility at 5880 Innovation Drive. Proof
of such facility purchase will be presented to the City of Dublin as soon as practical after execution
and prior to receiving any incentive from the City of Dublin.
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Section 2. City Agreement to Provide Incentives.
(a) General. In consideration for Halcyon's agreement to locate its operations,
workforce and associated payroll within the City, the City agrees to provide economic development
incentives to Halcyon in accordance with this Section.
(b) Technology & Property Grant. Halcyon will purchase 5880 Innovation Drive for
its Dublin Facility. In consideration of that agreement to purchase such facility and otherwise
h locate its operations and workforce within the City, the City agrees to provide a grant to Halcyon
in the amount of $90,000 (the "Grant"). The City will make the first Grant installment payment
to Halcyon (1 } upon proof of an executed facility purchase, (2) after a minimum six (6) months
of occupancy at the facility of at least 90 Employees, and (3) if Halcyon meets or exceeds the
Treget Withholdings for 2006 as outlined below. At its sole discretion, and prior to the
payment(s) of the Grant, the City may request any reasonable documentation with respect to how
Halcyon intends to use the Grant, to ensure that the Grant achieves the purpose for which it has
been granted under this Agreement.
(c) Performance.
(i) Calculation of Actual Withholdings. On or before March 15 of each of the
years 2007 thru 2009 the City shall determine whether the actual payroll withholding
taxes, net of refunds, collected during the preceding calendaz years 2006 thru 2008 by the
City from all employees (the "Actual Withholdings") meet or exceed the target
withholdings for that preceding calendar year (the "Target Withholdings"), all in
accordance with the schedule set forth in subparagraph (iii) below. For purposes of this
Section 2, "Employees" shall include all individuals employed by Halcyon in the City of
Dublin and working at the Dublin Facility. Halcyon agrees that, in accordance with the
Dublin City Code, the annual payroll reconciliation relating to the Employees will be
provided to the City prior to February 28 of each calendar yeaz.
(ii) Paxtnents to Halc~n. If the Actual Withholdings, net of refunds, meets or
exceeds the Target Withholdings for the preceding calendaz yeaz, the City shall, on or before
April 15 of the then current calendar year, pay to Halcyon, solely from non-tax revenues the
applicable Grant payments as outlined in Section 2c(iii) below.
(iii) Withholdings and Incentive Payments. With respect to the Actual
Withholdings collected during each of the calendar years 2006 thru 2008, inclusive, the
Target Withholdings and Grant payment to be paid in respect of each of those calendar years
shall be paid in accordance with the following schedule:
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Year Aaorox Emalovees Tagtet Payroll Tagtet WH Grant Payment
2006* 90 $1,791,667 $17,200 $20,000 (in 1Q 2007)
2007 130 S7,080,000 $141,600 $35,000 (in IQ 2008)
2008 175 $9,500,000 $195,000 $35,000 (in 1Q 2009)
* Dublin assumes Halcyon will move into its Dublin Facility by October 2, 2006. The 2006 Target Withholdings is
prorated for the 3-month term October through December 2006.
The payments provided for in this Section 2 shall be made by the City to Halcyon by
electronic funds transfer or by such other manner as is mutually agreed to by the City and Halcyon.
The total maximum payment associated with the Agreement is $90,000.
(d) Forfeiture of Incentive Payment and Repayment of Grant. Halcyon agrees that if the
Target Withholdings is not met, as set forth in 2(c)(iii) above for any given year, the City is not
obligated to make any Grant payment to Halcyon for the year in which the Target Witholdings was
not met. Failure to meet the Target Withholdings in any one incentive year does not prohibit
Halcyon from receiving a Grant payment for any subsequent year in which the Target Withholdings
is met. No financial obligation is incurred by Halcyon for failure to meet the Target Withholdings
set forth in Section 2(c)(iii).
(e) City's Obligation to Make Payments Not Debt• Payments Limited to Non-tax 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 Halcyon 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.
(g) Applicable City Payroll Tax Rate. For purposes of calculating the Actual Withholdings
in each calendar year under this Section 2, the City's payroll tax rate shall be assumed to be two
percent (2%).
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
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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) Halcyon at: 5880 Innovation Drive
Dublin, OH 43016
Attention: Mohan Viddam
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 Halcyon in other than his or her
official capacity. No official executing or approving the City's or Halcyon's participation in this
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 Halcyon
and its successors and assigns.
(d) Recitals. The City and Halcyon acknowledge and agree that the facts and circumstances
as described in the Recitals hereto aze an integral part of this Agreement and as such are
incorporated herein by reference.
(e) Amendments. This Agreement may only be amended by written instnament executed
by the City and Halcyon.
(f) Executed Counterpazts. 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 for 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
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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 Halcyon, 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 Representations and Warranties. All representations and warranties of
Halcyon and the City in this Agreement shall survive the execution and delivery of this
Agreement.
(k) Notwithstanding any clause or provision of this Agreement to the contrary, in no
event shall City or Halcyon be liable to each other for punitive, special, consequential, or
indirect damages of any type and regazdless of whether such damages aze claimed under
contract, tort (including negligence and strict liability) or any other theory of law.
Remainder of
Page Intentionally Left Blanl~
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Itv WITNESS Wr-~I~oF, the City and Halcyon 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 S. Brautigam
Title: City Manager
Approved as to Form:
By:
Printed: Stephen J. Smith
Title: Director of Law
Halcyon Solutions, Inc.
By:
Printed:
Title:
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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, free 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 ofFinance
City of Dublin, Ohio
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