52-07 OrdinanceRECORD OF ORDINANCES
Dayton Legal Blank, Inc Form No 30043
Ordinance No. 52-07 Passed , 20
AN ORDINANCE AUTHORIZING THE PROVISION OF
CERTAIN INCENTIVES FOR PURPOSES OF
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ENCOURAGING THE EXPANSION BY CARDINAL
HEALTH, 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 City Council Resolution No. 07 -94 adopted on June 20, 1994, and the
updated strategy approved by City Council Resolution No. 30 -04 adopted on July 6,
2004, this Council desires to encourage commercial office development and provide for
the retention and creation of employment opportunities within the City; and
WHEREAS, consistent with the Strategy, the City and Cardinal Health, Inc.
( "Cardinal") have heretofore entered into the tax increment financing and economic
development agreements on June 30, 1995, September 20, 1999 and November 5, 2003
(the "Prior Agreements ") wherein the City agreed to provide certain economic
development incentives to induce Cardinal to locate certain of its operations within the
City and expand its workforce; and
WHEREAS, based on the results of Cardinal's most recent examination of workforce
needs, and induced by and in reliance on the economic development incentives to be
provided by the City pursuant to this Ordinance, Cardinal is desirous of further
expanding its workforce within the City by relocating approximately 675 new jobs
from outside the State of Ohio to the City and constructing an approximately 250,000
square foot facility on its west campus within the City (together, the "Expansion ");
and
WHEREAS, the State of Ohio, in cooperation with the Columbus - Franklin County
Financing Authority, intends to provide certain incentives to Cardinal in the form of a
Job Creation Tax Credit and land purchase /lease of Cardinal's land within the City
located south of Interstate I -270 for the purpose of inducing Cardinal's Expansion; and
WHEREAS, this Council has determined to also offer certain economic development
incentives (the "Incentives ") to amend and supplement economic development
incentives set forth in the Prior Agreements, with the terms of such Incentives set forth
in the form of Economic Development Agreement by and between the City and
Cardinal presently on file with the Clerk of Council (the "Economic Development
Agreement "), in order to induce Cardinal to further expand its workforce and facilities
within the City, thereby improving the economic welfare of the people of the State of
Ohio, the Central Ohio region and the City, all as authorized in Article VIII, Section 13
of the Ohio Constitution.
NOW, THEP BE IT ORDAINED by the Council of the City of Dublin, State
of Ohio, of the elected members concurring, that:
Section 1 . This Council hereby finds and determines that Cardinal's Expansion and the
related Incentives are in furtherance of the Strategy. This Council further finds and
deterimines that it is necessary and appropriate and in the best interests of the City to
provide the Incentives to Cardinal 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. The Economic Development Agreement, providing for, among other things,
the Incentives in consideration for Cardinal's Expansion, 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
RECORD OF ORDINANCES
Dayton Legal Blank, Inc Form No 30043 1
Ordinance No. 52 -07 Passed Page 2 20
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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 3. 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 may be appropriate to implement this Ordinance.
Section 4. This Council finds and determines that all formal actions of this Council and
any of its committees concerning and relating to the passage of this Ordinance were
taken in an open meeting of this Council or its committees and that all deliberations of
this Council and any of its committees that resulted in those formal actions were in
meetings open to the public in compliance with the law.
Section 5. This Ordinance shall be in full force and effect on the earliest date permitted
by law.
Signed:
Mayor - Presiding Officer
Attest:
Clerk of Council
1 1 11 111 1 12 W-1-0 Ma.
Passed: ' 2007
Effective: , 2007
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CITY OF DUBLIN
Economic Development
5800 Shier Rings Road • Dublin, OH 43016
Phone: 614 - 410 -4619 • Fax: 614 - 923 -5529
Memo
TO: Members of the Dublin City Council
FROM: Jane S. Brautigam, City Manager
DATE: August 2, 2007
INITIATED BY: Dana L. McDaniel, Deputy City Manager /Director of Economic Development
RE: Ordinance No. 52 -07, Cardinal Health Economic Development Agreement
Summary:
Ordinance No. 52 -07 authorizes the execution of an Economic Development Agreement with
Cardinal Health, Inc. for the purpose of encouraging the expansion of its workforce and office
facilities within the City. As Council is aware, Cardinal Health, Inc. intends to expand its
workforce in the City of Dublin by 675 jobs based on incentives offered by Dublin and the State
of Ohio. Cardinal Health, Inc. will construct an additional 250,000 square feet (Phase I) of new
office space to accommodate these new jobs consistent with its previously approved facilities plan
for its Dublin West Campus.
Enclosure 1 provides a "redlined" version of the proposed Economic Development Agreement for
Council's review. At the last Council meeting, Staff informed Council that the proposed
Agreement would be finalized prior to Council's second reading/public hearing of the Ordinance
and that Council would be made aware of the key changes. Changes shown in the redline version
are definitional in nature and do not represent any changes to the incentives originally offered.
Enclosure 2 provides a review of the incentives offered in the proposed Economic Development
Agreement.
The following outlines a few key points regarding the Agreement
1. West Campus Facility. The City continues to work expeditiously with Cardinal Health
and its architects, engineers and agents to facilitate commencement of construction as soon
as possible. The City of Dublin's Review Services team continues to meet with Cardinal
Health regarding the new facility. It appears Cardinal's designs remain in compliance with
their previous approvals. Staff had hoped to be able to share a rendering of the new facility
at the August 6 Council meeting. However, final renderings are still being reviewed by
Cardinal Health and were not available for public release at the time of this report. As soon
as these are available, Staff will forward them to Council.
2. Traffic Signals & Turn Lanes. Council expressed some concern regarding the
signalization of Emerald Parkway between Coffman Road and Dublin Road. These
improvements are currently required under the approved development for Cardinal
Health's West Campus Facility. The costs associated with the placement of these
improvements are incorporated in the proposed 2008 -2012 CIP.
3. Road & Associated Utility Improvements on South Campus. Strikethroughs in the
redlined Agreement regarding total square footage and parking spaces were made to match
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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the approved text for the south campus. Enclosure 3 is the drawing used to discuss the
Frantz Road Extension and completion of Emerald Parkway. Council should find these to
be consistent with the City's Draft Thoroughfare Plan. Again, the proposed 2008 -2012 CIP
will request funding to complete the design of these improvements.
4. State of Ohio Land Acquisition Incentive. The details of this incentive are being
finalized between the State, Cardinal Health and the Columbus - Franklin County Finance
Authority (the "Authority "). As Council may recall, the Authority intends to act as the
"land bank" and /or third party to enable the State of Ohio to provide this incentive to
Cardinal Health. At this time, Staff anticipates that this arrangement will occur. However,
should the Authority not be able to do this, the proposed EDA would enable the City to
fulfill that role.
Cardinal Health's continued expansion of its corporate campus brings great value to the City in
terms of new job growth and new office development. Additionally, the Sate of Ohio is offering
aggressive incentives to Cardinal to attract jobs from outside the State of Ohio. The State's
partnership is greatly appreciated.
Recommendation:
Staff recommends that City Council approve Ordinance No. 52 -07. Please contact Dana
McDaniel or myself with any questions you may have.
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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MEMO — EXHIBIT 1
ECONOMIC DEVELOPMENT AGREEMENT
THIS ECONOMIC DEVELOPMENT AGREEMENT (the `Agreement") is made and entered into
this day of , 2007, 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 CARDINAL HEALTH, INC., an Ohio
corporation with its executive offices located in Dublin, Ohio ( "Cardinal "), under the
circumstances summarized in the following recitals.
RECITALS:
WHEREAS, consistent with its Economic Development Strategy (the "Strategy") approved
by City Council Resolution No. 07 -94 adopted on June 20, 1994, and the updated strategy
approved by City Council Resolution No. 30 -04 adopted on July 6, 2004, the City desires to
encourage commercial office development and provide for the retention and creation of
employment opportunities within the City; and
WHEREAS, consistent with the Strategy, the City and Cardinal have heretofore entered
into the tax increment financing and economic development agreements on June 30, 1995 and
September 20, 1999 (the agreement delivered on September 20, 1999 being referred to herein as
the "1999 Incentive Agreement") wherein the City agreed to provide certain economic
development incentives to induce Cardinal to locate certain of its operations within the City and
expand its workforce; and
WHEREAS, consistent with the Strategy, on November 5, 2003, the City and Cardinal
have heretofore entered into an Economic Development Agreement (the "2003 Incentive
Agreement") wherein the City agreed to provide further incentives to induce Cardinal to further
expand its workforce within the City; and
WHEREAS, based on the results of Cardinal's most recent examination of workforce
needs, and induced by and in reliance on the economic development incentives provided in this
Agreement, Cardinal is desirous of further expanding its workforce within the City and
constructing an approximately 250,000 square foot facility on its West Campus (as defined in the
1999 Incentive Agreement)(the "West Campus Facility "); and
WHEREAS, pursuant to Ordinance No. -07 passed , 2007, the City has
determined to offer economic development incentives described herein to induce Cardinal to
expand its workforce within the City, to create jobs and employment opportunities, to construct
the West Campus Facility and to improve the economic welfare of the people of the State and the
City, all as authorized in Article VIII, Section 13 of the Ohio Constitution; and
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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WHEREAS, the City and Cardinal have determined to enter into this Agreement to
terminate the 2003 Incentive Agreement and to provide these incentives to induce that expansion
by Cardinal of its operations within the City;
Now, THEREFORE, the City and Cardinal covenant, agree and obligate themselves as
follows:
Section 1. Termination of 2003 Incentive Agreement: Reinstatement Subject to
reinstatement as provided in this Section 1, the 2003 Incentive Agreement is hereby terminated.
If Cardinal does not achieve Substantial Completion (as defined in Section 3(b)) of the
West Campus Facility by December 31, 2009, this Agreement shall, upon delivery of notice by
the City to Cardinal, terminate and be of no further force and effect (except as to Section 3(n))
and whereupon, the City and Cardinal agree that the 2003 Incentive Agreement shall be
reinstated. Any payments made by the City to Cardinal pursuant to Section 3(d) that exceed the
payments that would have been made under the 2003 Incentive Agreement shall be repaid by
Cardinal to the City within forty -five (45) days following the termination of this Agreement.
Upon reinstatement of the 2003 Incentive Agreement, the City shall calculate any applicable
Deficiency Carrvforward Amount pursuant to Section 2(D —of the 2003 Incentive Agreement and
any applicable Surplus Carryforward Amount pursuant to Section 2(g) of the 2003 Incentive
Agreement for years in which payment is made or was to have been made pursuant to Section
3(d) of this Agreement.
Section 2. Cardinal Agreement to Increase Emplovment and Construct the West
Campus Facilitv Cardinal represefAr the City acknowledge that 4, an d 4S Subsidiaries °44a
on April
30, 2007. the Ohio Tax Credit Authority (the "Tax CreditAuthoritv") approved an amendment to
Cardinal's Tax Credit Agreement with the Tax Credit Authority in connection with Cardinal's
agreement to increase by six hundred seventy five (675) its creation of full -time iobs in the City.
Cardinal and the City agree that in consideration of the economic development incentives to be
provided by the City herein, Cardinal t will expand its presefA -° er f ore ,.c
ealendaf year 201 workforce in the City and achieve Substantial Completion (as defined in
Section 3(b)) of the West Campus Facility by December 31, 2009.
Section 3. Citv Agreement to Provide Incentives
(a) General In consideration for Cardinal's agreement to expand its workforce,
construct the West Campus Facility and to increase the levels of Cardinal employment and
associated payroll within the City, the City agrees to provide economic development incentives
to Cardinal in accordance with this Section.
(b) Payment Related to Prior Workforce Expansion The 1999 Incentive Agreement
provided that the City would make a payment to Cardinal in the amount of $701,300 (the "Final
1999 Incentive Payment") in consideration for Cardinal constructing an additional owner-
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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occupied building containing at least 120,000 square feet of space. In consideration of
Cardinal's leasing of 60,000 square feet of space in the City, the City paid to Cardinal one -half
of the Final 1999 Incentive Payment in the amount of $350,650 within forty -five (45) days
following the execution of the 2003 Incentive Agreement. The City and Cardinal agree that in
consideration for Cardinal's construction of the West Campus Facility, the City will pay to
Cardinal the remaining one -half of the Final 1999 Incentive Payment within forty -five (45) days
following Substantial Completion of the West Campus Facility. As used in this Agreement, the
term "Substantial Completion" means the issuance of a temporary certificate of occupancy for
the West Campus Facility.
(c) Withholdings Calculations
(i) Calculation of Actual Withholdings On or before March 15 of each year
from 2008 through the year in which the Maximum Payment Amount (as defined in
Section 3(h)) is reached, the City shall calculate the actual payroll withholding taxes
collected during the then preceding calendar year by the City from all Employees, net of
refunds (the Actual Withholdings "). For purposes of this Section 3, "Employees" shall
include only those individuals employed by Cardinal working at a location within the
City.
(ii) Information Relating to Employees Cardinal agrees that, in accordance
with City Code, the annual payroll reconciliation and related W -2 forms relating to its
Employees will be provided to the City prior to February 28 of each calendar year.
(d) Payments to Cardinal If the Actual Withholdings for the then preceding calendar
year exceed the Target Withholdings for the then preceding calendar year, the City shall, on or
before April 15 of the then current calendar year, pay to Cardinal, solely from nontax revenues,
an amount equal to the product of (i) an amount equal to the Actual Withholdings (net of
refunds) minus the Target Withholdings, multiplied by (ii) the Incentive Factor (as defined below
for each applicable year). The payments provided for in this Section 3 shall be made by the City
to Cardinal by electronic funds transfer or by such other manner as is mutually agreed to by the
City and Cardinal. The Target Withholdings and Incentive Factor for each year are described in
the following table:
Calendar Year Target Withholdings Incentive Factor
2007
$3,456,639
38.00%
2008
$3,543,055
38.00%
2009
$3,667,062
38.00%
2010
$3,795,409
36.00%
2011
$3,928,248
36.00%
2012
$4,065,737
36.00%
2013
$4,208,037
34.00%
2014
$4,313,238
34.00%
2015
$4,421,069
34.00%
2016
$4,531,596
34.00%
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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2017 $4,644,886 34.00%
2018 $4,761,008 34.00%
With respect to the Actual Withholdings collected during calendar year 2019 or any
subsequent calendar year, the Incentive Factor shall be thirty -four percent (34 %). The Target
Withholdings for each such calendar year shall be calculated by multiplying the Target
Withholdings for the previous calendar year by 1.025.
(e) 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 Cardinal 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 3 shall be payable solely from the City's nontax 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 3 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 nontax revenues.
(f) Deficiency CaMforward Amounts If and to the extent the amount of nontax
revenues are insufficient in a particular calendar year for appropriation and payment to Cardinal,
the City will make payment to Cardinal in the amount of nontax revenues available for
appropriation and payment to Cardinal. The difference between the amount required to be paid
by the City to Cardinal pursuant to this Section 3 and the amount actually paid (referred to herein
as a "Deficiency Carryforward Amount") shall be carried forward to the next succeeding
calendar year and paid to Cardinal in addition to any other payment for that succeeding year
required by this Section 3. This Agreement shall not terminate until the City has paid to Cardinal
all Deficiency Carryforward Amounts required to be paid to Cardinal in accordance with this
Section 3; provided, however, the aggregate of all payments to Cardinal pursuant to this
Agreement shall not exceed the Maximum Payment Amount (as defined in Section 3(h)).
(g) Surplus Carryforward Amounts If and to the extent the annual payment as
calculated pursuant to Section 3(d) is greater than the Maximum Annual Payment (as defined in
Section 3(h)), any such amount or portion thereof (referred to herein as a "Surplus Carryforward
Amount") shall be paid by the City to Cardinal in any future calendar year where the annual
payment as calculated pursuant to this Section 3 is less than the Maximum Annual Payment;
provided, however, the aggregate of that annual payment, together with any Surplus
Carryforward Amount and excluding any Deficiency Carryforward Amount paid to Cardinal,
does not exceed the Maximum Annual Payment.
(h) Maximum Economic Development Incentive Pam In no event shall (i) the
amount of payments made by the City to Cardinal pursuant to this Section 3 in any one calendar
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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year (excluding any Deficiency Carryforward Amount paid to Cardinal) exceed the Maximum
Annual Payment for that year or (ii) the aggregate amount of payments made by the City to
Cardinal pursuant to the 2003 Incentive Agreement or this Section 3 exceed Seven Million Five
Hundred Thousand Dollars ($7,500,000) (the `Maximum Payment A mount' ); provided, however,
the limitation on payments as set forth in this subsection shall not include the payment to be
made by the City to Cardinal pursuant to Section 3(b) of this Agreement or Section 2(b) of the
2003 Incentive Agreement. As used herein, the term `Maximum Annual Payment" means, for all
years except the years 2009, 2010 and 2011 (for 2008, 2009 and 2010 Actual Withholdings,
respectively), Seven Hundred Fifty Thousand Dollars ($750,000), and for each of the years 2009,
2010 and 2011 (for 2008, 2009 and 2010 Actual Withholdings, respectively), Eight Hundred
Fifty Thousand Dollars ($850,000).
(i) Applicable City Pavroll Tax Rate For purposes of calculating the Actual
Withholdings in each calendar year under this Section 3, the City's payroll tax rate shall be
assumed to be two percent (2 %).
0) West Campus Facility: Traffic Controls and Further Assurances The City agrees
to install, at its own expense (currently estimated to be $740,000), the traffic improvements
described under the heading "Traffic /Roadway" on Exhibit A attached hereto. The City agrees
to coordinate with Cardinal with respect to the construction of these traffic improvements so as
to not unreasonably interfere with the construction or operation of the West Campus Facility, and
agrees to use its good faith effort to complete these traffic improvements by December 31, 2009.
The City further agrees to cooperate in all reasonable ways with Cardinal and its architects,
engineers and agents to facilitate the commencement of construction of the West Campus
Facility.
(k) South Campus Land Bank The City acknowledges that Cardinal intends to enter
into one or more agreements with the Columbus - Franklin County Finance Authority (the
"Finance Authority ") and/or the State whereby the Finance Authority will purchase the South
Campus (as defined in the 1999 Incentive Agreement) land from Cardinal upon terms and
conditions to be agreed upon by the Finance Authority and /or the State and Cardinal. The City
agrees to reasonably cooperate with Cardinal, the Finance Authority and the State in connection
with this purchase. If. despite the good faith efforts of Cardinal, the Finance Authority, the State
and Cardinal are unable to complete this purchase, the City will proceed in good faith to
negotiate with the State and Cardinal to purchase the South Campus with funds made available
by the State, provided Cardinal will agree, in any purchase agreement with the City for the South
Campus, to pay all maintenance costs, financing costs and taxes for the South Campus and
indemnify the City for all costs incurred by the City during its period of ownership of the South
Campus.
(1) South Campus Road and UtilitImprovements The City agrees to construct, in
accordance with all then - existing City laws and regulations, road and associated water, sanitary
sewer and storm sewer improvements on the South Campus deemed necessary, in the City's
sele reasonable discretion, to provide traffic ingress and egress and water, sanitary sewer and
storm sewer services for an office facility of 317,000 square feet with 4-,609 associated parking
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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spaces as provided under then - existing zoning laws or other then - existing City laws or
regulations (the "South Campus Improvements "). To the extent the City has sufficient interests
in real property to do so, the City will make rights -of -way available to the electric and gas
utilities for the extension of those utilities to the South Campus beyond the current connections
to the South Campus on Dublin Road. The City and Cardinal intend that the road improvements
comprising the South Campus Improvements will generally have an eighty (801 foot right -of-
way and consist of a 2/3 road section (i.e. one lane each direction with a center turn lane), will
extend from the western boundary of the South Campus to Dublin Road, will be located as close
as feasible from an engineering perspective to the southern boundary of the South Campus, and
will be situated, to the extent feasible from an engineering perspective, so as to permit the
construction of an office facility of 317,000 square feet with 4-,699 associated parking spaces as
provided under then - existing zoning laws or other then- existing City laws or regulations The
City will provide Cardinal with the same notices with respect to zoning or land use matters that
affect the South Campus as any owners of the South Campus The City agrees to use its best
effort to complete the design of the South Campus Improvements by December 31, 2008. The
City shall obtain Cardinal's written approval of the design of the South Campus Improvements
(not to be unreasonably withheld) prior to the commencement of the South Campus
Improvements. Upon receipt of Cardinal's written approval of the design plans for the South
Campus Improvements, the City shall use its best efforts to complete construction of the South
Campus Improvements no later than the date on which a temporary certificate of occupancy is
issued for an owner- occupied building (whether occupied by Cardinal or otherwise) on the South
Campus containing at least 120,000 square feet of space (the "South Campus Facility "). The
City agrees to coordinate with Cardinal with respect to the construction of the South Campus
Improvements so as to not unreasonably interfere with the construction or operation of the South
Campus Facility and, to the best of the City's ability, uphold the zoning for the South Campus as
provided in Ordinance No. 124 -98 (as amended and approved July 19, 1999) The cost of the
South Campus Improvements is presently estimated to be $2,775,000, with this cost to be paid
by the City. The City and Cardinal agree that (i) the South Campus Improvements include the
Phase I Public Improvements (as defined in the 1999 Incentive Agreement) and (ii) the
provisions of Section 3(a) of the 1999 Incentive Agreement are superseded by the provisions of
this Section. Furthermore, the City and Cardinal agree that, notwithstanding the provisions
contained in the second paragraph of Section 4 of the 1999 Incentive Agreement regarding the
deposit and use of tax increment financing revenues from the South Campus, the City may use
those revenues for any purpose permitted by law and City Ordinance No. 19 -99 or any successor
tax increment financing ordinance applicable to the South Campus, as each may be amended
from time to time.
(m) Emerald Parkway Extension The City agrees to use its best effort to complete, at
its expense, the design work for the remaining portion of Emerald Parkway from Riverside Drive
to approximately Bright Road by April 1, 2008. The City and Cardinal agree that,
notwithstanding the provisions of Section 3(b) of the 1999 Incentive Agreement, the City may
elect to construct the remaining portion of Emerald Parkway prior to the completion of the South
Campus Improvements.
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(n) TIE Modification Cardinal acknowledges and agrees that the City may, if the
City deems it to be in its best interest, amend or otherwise modify (including by repeal and
passage of new tax increment financing legislation) all or a portion of City Ordinances No. 19 -99
and No. 57 -94 to maximize the length of the tax increment financing exemption applicable to the
West Campus Facility and future developments on the West Campus or South Campus. If
necessitated by these changes, Cardinal agrees to cooperate in the negotiation, execution and
recordation of a tax increment financing agreement and /or tax increment financing declaration
for real property it or any of its affiliates own within the South Campus or West Campus.
Section 4. 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 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:
(i) the City at:
City of Dublin, Ohio
5800 Shier Rings Road
Dublin, Ohio 43016 -7295
Attention: Economic Development Director
(ii) Cardinal at:
Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Vice President — Corporate Real Estate and
Workplace Services
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
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
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present or future trustee, member, officer, agent or employee of the City or Cardinal in other than
his or her official capacity. No official executing or approving the City's or Cardinal'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
Cardinal and its successors and assigns.
(d) Recitals The City and Cardinal 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 Cardinal.
(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 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 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 Cardinal, 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.
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0) Survival of Representations and Warranties All representations and warranties of
Cardinal and the City in this Agreement shall survive the execution and delivery of this
Agreement.
(k) Cardinal's Obligations. All obligations of Cardinal under this Agreement may be
satisfied by any combination of Cardinal and entities controlled by or under common control
with Cardinal. For purposes of this Agreement_ "controlled by." or "under common control
with" refers to the possession, directly or indirectly, of the legal power to direct or cause the
direction of the management and policies of an entity, whether through the exercise of, or the
ability to exercise, voting power or by contract.
(Signature Pages to Follow)
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
8 -02 -07
Page 12 of 19
IN WITNESS WHEREOF, the City and Cardinal 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
MM
Printed: Jane Brautigam
Title: Citv Manager
C
Printed: Marsha I. Grigsbv
Title: Director of Finance
Approved as to Form:
C
Printed: Stephen J. Smith
Title: Director of Law
CARDINAL HEALTH, INC.
Printed:
Title:
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
8 -02 -07
Page 13 of 19
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 during the year 2007
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: 1 2007
Director of Finance
City of Dublin, Ohio
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
8 -02 -07
Page 14 of 19
Agreement - Exhibit A
West Campus Facility Traffic Improvements
The following letter describes the traffic improvements to be constructed in connection with
the West Campus Facility under the heading "Traffic /Roadway ".
EXNIBITA
Cem Muk
Bandonthe ffi imfollice intense, plw sig ]by Ne Cily forreviwmApnl I],
En ginsnry olim the fllwiae item. m M nddrcael'.
TnllidRnedway,
o AslWykrtquuN bdemmi Ne nR¢t ti, an aim e d ab Neei
6acaunafNeaecurily Systems Will need! b be pnfom.M and should deaniM Iww
Nemwimum 4aeue udclemtiaN,mM r.Imw this gmpNa'NIY Onnsi¢Plea The
phcemml a(IFezxuntygaln ehnuld iptaequire Ne queue In lnev<Ne pnvute
psapmy. Alm, 006 will nml to ba ly Vi iestei al lheef Manayss a savew a x ftgr t
Ibe will afrt We t islowi n g er e, to Emerald Parkway in n on e ye
I We will wavlall kllowig impmcnu to Emerald Vy shm one al
o(PUblic hnpmvemeotdrewingvav Neyall need to beio placewben lFe buJding ee
penlld
• IX[npaoai
ab
beco a ged IQ me common moWest tla Wil be Winning UWlhisdava
Mc Atlah We cauat IQ Tim Themmian should be rsslaml to
• Add 1 0R Nu ming mciian In Emwld P ream Wilding
Wml .
• tl1I na "iffic Win lane eco building's Weui to ag vmre.
a letion o(a wW at Me west b ull na main deNmeto oMe
new
location, T i left Ium g anm length a boiling 40 g fyi
• the
• installation bm as and a tme hould be 400 fm
En M of e It u m me t IO (ct On wa@mshvWJnvcrvay.
Extend NeRbm lane IW s of wwourn Parkw a�dnvewo y.
• o a
two mi t War me s. Also ollM1
NhnuM luau of Enemas an Pam Read Pwt image to no lude
two engaged! tam Imm'. o Imould be Ymlion al City POST ei In emle nun
boW lanx. no good wd be it nomie minlwmg Mewemmm but no be implemmlN with
the up a i
wy on of Wsl Boas it nwd w 4 the wuan ltli ng is 8slilN
xupmay.
o Theweaemehueddmeway nee tha hipalwi n nne i a lane and Nrte
o ulWwW mn
Ix (uueddie "alN left, one SM1rM left vW eight. add omdalicaletl rigM1l) .
Public amid lighting and wvarappouncei may exist at me new bmtion ofthe main
mtrnscedng: DoWlsurveyworkshouldbepafm wN titus wnwbathss be
=via
RECEIVED
MAY 10
D
Eliot DER.
Muy 8, 3007
cmbrmeuh.
Mr. More M ust
may'•+
Coolant HmlN
W osmum
700 Plxe
Oub lin.OM10 4]01]
16, 0"Aam
py...alyu.
RE. Carelma111ea1N West Campus
Cem Muk
Bandonthe ffi imfollice intense, plw sig ]by Ne Cily forreviwmApnl I],
En ginsnry olim the fllwiae item. m M nddrcael'.
TnllidRnedway,
o AslWykrtquuN bdemmi Ne nR¢t ti, an aim e d ab Neei
6acaunafNeaecurily Systems Will need! b be pnfom.M and should deaniM Iww
Nemwimum 4aeue udclemtiaN,mM r.Imw this gmpNa'NIY Onnsi¢Plea The
phcemml a(IFezxuntygaln ehnuld iptaequire Ne queue In lnev<Ne pnvute
psapmy. Alm, 006 will nml to ba ly Vi iestei al lheef Manayss a savew a x ftgr t
Ibe will afrt We t islowi n g er e, to Emerald Parkway in n on e ye
I We will wavlall kllowig impmcnu to Emerald Vy shm one al
o(PUblic hnpmvemeotdrewingvav Neyall need to beio placewben lFe buJding ee
penlld
• IX[npaoai
ab
beco a ged IQ me common moWest tla Wil be Winning UWlhisdava
Mc Atlah We cauat IQ Tim Themmian should be rsslaml to
• Add 1 0R Nu ming mciian In Emwld P ream Wilding
Wml .
• tl1I na "iffic Win lane eco building's Weui to ag vmre.
a letion o(a wW at Me west b ull na main deNmeto oMe
new
location, T i left Ium g anm length a boiling 40 g fyi
• the
• installation bm as and a tme hould be 400 fm
En M of e It u m me t IO (ct On wa@mshvWJnvcrvay.
Extend NeRbm lane IW s of wwourn Parkw a�dnvewo y.
• o a
two mi t War me s. Also ollM1
NhnuM luau of Enemas an Pam Read Pwt image to no lude
two engaged! tam Imm'. o Imould be Ymlion al City POST ei In emle nun
boW lanx. no good wd be it nomie minlwmg Mewemmm but no be implemmlN with
the up a i
wy on of Wsl Boas it nwd w 4 the wuan ltli ng is 8slilN
xupmay.
o Theweaemehueddmeway nee tha hipalwi n nne i a lane and Nrte
o ulWwW mn
Ix (uueddie "alN left, one SM1rM left vW eight. add omdalicaletl rigM1l) .
Public amid lighting and wvarappouncei may exist at me new bmtion ofthe main
mtrnscedng: DoWlsurveyworkshouldbepafm wN titus wnwbathss be
=via
Ord 5201 Cardinal Health Ec Dev. Agreement
8 -020]
Page 16 of 19
.. Mny 200
W. Mmk Mann
Pas 2m2 HnIW Wnl Campua
Poge 2o(R
ry
un vrolix4n' o Pte pmyseE hour mmrcetimbmvecn me builtliogmayimpmt Wa eai9ing
ec Yma�ole load ioedtlai i n g ieueewi veld tobe w iawl(m review.
e Tne City passed upEVetl cadercyanlivg eocmazhmwu wpu6lic emenls lot year.
re Eawmml Emmecb m ain merit willMnttmNboutline hotlines m
re$pavi i
J u Nev impwvemen¢in it iseaeemenl . This ugmcml
rcquireea $Iql fce. Av mampleepeemenlu elWChad.
+ ThC ei¢plaulwm nwm +Itt M emayNC
Pmiu m unaeP Ublloe &,g J Jm
noMea$tcunrerofNe pmpenY. ue 6m F
orths'e manaiag amtGNinal
Pleu
pre(ertW la keep Wev Paltuacpans. emiew lhiacomedvilN
- The NOM Hetk InNan Kw is u FEMA- mudie]avmm in Nlsma Thc Ilavaway,
m dus such plw Iw e Fli ith ou t Food Central and St i on the Plmts. m wok
iC Nia mre will beitrcomplim,cc with out FIOOC Central and gloimwCterMmagCmenl
rcguloucn$aM wJl rryuiten Spaial FlmdHazardAw OcveluPmem Pemiil utM
aWmissioC afa S]Ill ice.
n,es r anJ Spmnw8enbmmrn P wiu nxd wmaY Oweurrtm sbrmwbv
Mnnegem[m SheathsCOn iJar mtedon cegulmiene.
+ fe, Site plan shows proposed summit in me limited rcaebv'righw6way oft -]ID. If NU is
nwtlN, amitof way PmmiI man Ne Ohio Desmond ofTmsporcu n x111 be rumored
- ThcaJWas forlM1ie silo ucwrtmly OS]5 EmsWtl Parkway. Plux coo diazu wiN Kneum
Yoho. PE if you dome this to change.
We apprtciwe being oble w pmvWe a preWtinary review no Wia pmoo. Additional
comments may ouur during the review cfine cut site pW and mnmm[tion drawings.
Plwee to us know if you bare any Fusi om.
Sincerely.
Bvbrta A. Con PE
Idonnnne hhems Etw6lopmem
Anazhmmt
Cc Mucalm Grigsby. Biscommi'manNOWmy City MUUger
Pau111unmenmin, PE. mother of EngiaannsCiq bulrushes
sem -EIIm Within P6, Engimmnng Manor -T epoltom
f(nnin Yorks, PE. Coil bouncer
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
8 -02 -07
Page 17 of 19
MEMO — EXHIBIT 2
The City and Cardinal Health, Inc. previously entered into tax increment financing and economic
development agreements on June 30, 1995, September 20, 1999 and November 5, 2003. This economic
development agreement, if passed, will terminate and replace the existing 2003 Agreement. The
incentives provided for in the attached Economic Development are outlined in the following:
1. Incentive Payment. The City agrees to extend the incentive payment schedule outlined in its
existing 2003 Economic Development Agreement beyond 2013 until such a time Cardinal
Health receives a total of $7.5 million in incentive payments as agreed upon in 2003. Certain
annual target withholdings are still required to be met in the new Agreement and will
continue to increase at a rate of 2.5% per year beyond 2013.
2. Incentive Payment Annual Cap. In the new Agreement, the City agrees to raise the "cap" of
the annual incentive payment provided from $750,000 to $850,000 for the years 2008, 2009
and 2010 to be collected in 2009, 2010 and 2011. The cap on annual incentive payments for
2011 and beyond will return to $750,000 consistent with the 2003 Agreement.
3. West Campus Facility. Cardinal Health, as part of this discussion, has expressed its intention
to construct 250,000 square feet of office space (Phase 1) on its west campus. This new facility
will add significant value to the McKitrick TIE District. In the 2003 Agreement, the City
agreed to pay Cardinal Health $350,000 upon "substantial completion" of this new facility.
"Substantial completion" is now defined in the new Agreement as issuance of an occupancy
permit. Cardinal Health intends to begin construction of the new facility no later than
December 31, 2007 and will complete construction of the facility no later than December 31,
2009. Should Cardinal Health not complete the building by December 31, 2009, the 2003
Agreement shall be reinstated. Any incentive payment by the City of Dublin beyond the 2003
Agreement will be paid to the City by Cardinal Health.
4. Traffic Signals & Turn Lanes. The City agrees to install at its expense the necessary traffic
signals and turn lane modifications associated with 7000 Cardinal Place and as may be
required as a result of the new facility. The City estimates the cost of these improvements to be
$740,000.
5. Road & Associated Utility Improvements on South Campus. The City agrees to construct a
road and associated utilities on Cardinal Health's South Campus land with the intent to create a
'Job ready site." The cost of these improvements is estimated to be $2,775,000. The City
agrees to complete design of these improvements by December 31, 2008. The City agrees to
construct these improvements in a timely manner to coincide with the future construction of
Cardinal Health's South Campus facility. Cardinal Health has not committed to constructing
this facility at this time. These improvements could be constructed by the City prior to Cardinal
Health's decision to construct a South Campus facility in order to implement the City's
thoroughfare plan and/or to positively influence or effect construction of facilities adjacent to
Cardinal Health's South Campus. In all events, the City will include and coordinate the design
of these improvements with Cardinal Health to minimize and /or avoid negative impacts on
Cardinal's plans for its South Campus facility and will obtain Cardinal Health's agreement
prior to making these improvements.
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
8 -02 -07
Page 18 of 19
6. Emerald Parkway Extension. The City desires to construct the remaining portion of Emerald
Parkway from Riverside Drive to approximately Bright Road, thereby completing Emerald
Parkway. Such an improvement would add greatly to the quality of life of Dublin residents, the
Columbus Northwest area and Cardinal Health employees. This improvement will be made
possible by the addition of Cardinal Health's West Campus facility within the existing
McKitrick TIE District. The City has already budgeted for design of the Emerald Parkway
extension in 2007. Currently, the construction of this project is not budgeted. With Cardinal
Health's commitment to construct its West Campus facility, the City commits to complete the
design of the Emerald Parkway extension by April 1, 2008. Dublin City Council will review its
five -year Capital Improvements Program (CIP) later this year. City Council will at that time
determine whether the Emerald Parkway extension will be budgeted for in the 2008 -2012 CIP.
As an additional incentive, the State of Ohio is offering to provide a $900,000 grant for
road and utility improvements. If approved by the State, this grant will be used by the City
to help fund the construction of the final phase of Emerald Parkway.
State of Ohio Land Acquisition Incentive. The State of Ohio is offering to provide a land
acquisition incentive to Cardinal Health. The details of this incentive are still being discussed
and are still subject to State approval. At this time, the State, Cardinal Health and City of
Dublin are working with the new Columbus - Franklin County Finance Authority who may act
as the "land bank" and /or third party to enable the State of Ohio to provide this incentive to
Cardinal Health. The EDA before Council references this incentive. If this arrangement does
not happen with this Authority, it is possible that another Agreement could be brought to
Council to enable the City to fulfill this role. This purchase will enable the State to provide an
additional incentive of $4 million to Cardinal Health.
The financial incentive based on income tax withholdings being offered by the City is substantially the
same as the existing 2003 Agreement. The additional 675 jobs to be added will result in an additional
amount of $786,240 in annual income tax withholdings to the City.
A significant portion of the incentives being offered by the City of Dublin are in the form of capital
improvements. These improvements will be funded mostly, if not entirely, through tax increment
financing dollars generated by the McKitrick TIE district and a South Campus TIE district.
City Council previously authorized the establishment of a TIE district on the 28 -acre South Campus
(Ordinance No. 19 -99); however, we are currently evaluating the benefits of terminating the existing
TIE district and establishing a new TIE district. This will allow the City to include the South Campus
Road and Utility improvements and more importantly provide for the collection of service payments
for a longer period of time. When the current TIE district was established, State law provided that the
term of the TIE district ran for a period of 30 years from the date of passage of the authorizing
legislation. Terminating the existing TIE district will provide for a minimum of eight additional years
that the City will be able to receive service payments.
Ord. 52 -07 Cardinal Health Ec. Dev. Agreement
8 -02 -07
Page 19 of 19
MEMO — EXHIBIT 3
(used for discussion purposes only)
Draft Roadway Connections
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52 -07
AN ORDINANCE AUTHORIZING THE PROVISION OF
CERTAIN INCENTIVES FOR PURPOSES OF
ENCOURAGING THE EXPANSION BY CARDINAL
HEALTH, 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 City Council Resolution No. 07 -94 adopted on June 20, 1994, and the
updated strategy approved by City Council Resolution No. 30 -04 adopted on July 6,
2004, this Council desires to encourage commercial office development and provide for
the retention and creation of employment opportunities within the City; and
WHEREAS, consistent with the Strategy, the City and Cardinal Health, Inc.
( "Cardinal ") have heretofore entered into the tax increment financing and economic
development agreements on June 30, 1995, September 20, 1999 and November 5, 2003
(the Prior Agreements ") wherein the City agreed to provide certain economic
development incentives to induce Cardinal to locate certain of its operations within the
City and expand its workforce; and
WHEREAS, based on the results of Cardinal's most recent examination of workforce
needs, and induced by and in reliance on the economic development incentives to be
provided by the City pursuant to this Ordinance, Cardinal is desirous of further
expanding its workforce within the City by relocating approximately 675 new jobs
from outside the State of Ohio to the City and constructing an approximately 250,000
square foot facility on its west campus within the City (together, the `Expansion ");
and
WHEREAS, the State of Ohio, in cooperation with the Columbus - Franklin County
Financing Authority, intends to provide certain incentives to Cardinal in the form of a
Job Creation Tax Credit and land purchase /lease of Cardinal's land within the City
located south of Interstate I -270 for the purpose of inducing Cardinal's Expansion; and
WHEREAS, this Council has determined to also offer certain economic development
incentives (the "Incentives ") to amend and supplement economic development
incentives set forth in the Prior Agreements, with the terms of such Incentives set forth
in the form of Economic Development Agreement by and between the City and
Cardinal presently on file with the Clerk of Council (the "Economic Development
Agreement"), in order to induce Cardinal to further expand its workforce and facilities
within the City, thereby improving the economic welfare of the people of the State of
Ohio, the Central Ohio region and the City, all as authorized in Article VIII, Section 13
of the Ohio Constitution.
NOW, THEREFORE, BE IT ORDAINED by the Council of the City of Dublin, State
of Ohio, of the elected members concurring, that:
Section 1 . This Council hereby finds and determines that Cardinal's Expansion and the
related Incentives are in furtherance of the Strategy. This Council further finds and
determines that it is necessary and appropriate and in the best interests of the City to
provide the Incentives to Cardinal 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. The Economic Development Agreement, providing for, among other things,
the Incentives in consideration for Cardinal's Expansion, 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
52 -07 Page 2
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 3. 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 may be appropriate to implement this Ordinance.
Section 4 . This Council finds and determines that all formal actions of this Council and
any of its committees concerning and relating to the passage of this Ordinance were
taken in an open meeting of this Council or its committees and that all deliberations of
this Council and any of its committees that resulted in those formal actions were in
meetings open to the public in compliance with the law.
Section 5 . 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: .2007
Effective: 2007
* * * Draft of August 2, 2007 * * *
ECONOMIC DEVELOPMENT AGREEMENT
THIS ECONOMIC DEVELOPMENT AGREEMENT (the `Agreement") is made and entered into
this day of , 2007, 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 CARDINAL HEALTH, INC., an Ohio corporation
with its executive offices located in Dublin, Ohio ( "Cardinal "), under the circumstances
summarized in the following recitals.
RECITALS:
WHEREAS, consistent with its Economic Development Strategy (the "Strategy") approved
by City Council Resolution No. 07 -94 adopted on June 20, 1994, and the updated strategy
approved by City Council Resolution No. 30 -04 adopted on July 6, 2004, the City desires to
encourage commercial office development and provide for the retention and creation of
employment opportunities within the City; and
WHEREAS, consistent with the Strategy, the City and Cardinal have heretofore entered into
the tax increment financing and economic development agreements on June 30, 1995 and
September 20, 1999 (the agreement delivered on September 20, 1999 being referred to herein as
the "1999 Incentive Agreement") wherein the City agreed to provide certain economic
development incentives to induce Cardinal to locate certain of its operations within the City and
expand its workforce; and
WHEREAS, consistent with the Strategy, on November 5, 2003, the City and Cardinal have
heretofore entered into an Economic Development Agreement (the "2003 Incentive Agreement")
wherein the City agreed to provide further incentives to induce Cardinal to further expand its
workforce within the City; and
WHEREAS, based on the results of Cardinal's most recent examination of workforce
needs, and induced by and in reliance on the economic development incentives provided in this
Agreement, Cardinal is desirous of further expanding its workforce within the City and
constructing an approximately 250,000 square foot facility on its West Campus (as defined in the
1999 Incentive Agreement)(the "West Campus Facility "); and
WHEREAS, pursuant to Ordinance No. -07 passed , 2007, the City has
determined to offer economic development incentives described herein to induce Cardinal to
expand its workforce within the City, to create jobs and employment opportunities, to construct the
West Campus Facility and to improve the economic welfare of the people of the State and the City,
all as authorized in Article VIII, Section 13 of the Ohio Constitution; and
WHEREAS, the City and Cardinal have determined to enter into this Agreement to
terminate the 2003 Incentive Agreement and to provide these incentives to induce that expansion
by Cardinal of its operations within the City;
Now THEREFORE, the City and Cardinal covenant, agree and obligate themselves as follows:
Section 1. Termination of 2003 Incentive Agreement; Reinstatement Subject to
reinstatement as provided in this Section 1, the 2003 Incentive Agreement is hereby terminated.
If Cardinal does not achieve Substantial Completion (as defined in Section 3(b)) of the West
Campus Facility by December 31, 2009, this Agreement shall, upon delivery of notice by the City
to Cardinal, terminate and be of no further force and effect (except as to Section 3(n)) and
whereupon, the City and Cardinal agree that the 2003 Incentive Agreement shall be reinstated. Any
payments made by the City to Cardinal pursuant to Section 3(d) that exceed the payments that
would have been made under the 2003 Incentive Agreement shall be repaid by Cardinal to the City
within forty -five (45) days following the termination of this Agreement. Upon reinstatement of the
2003 Incentive Agreement, the City shall calculate any applicable Deficiency Carryforward
Amount pursuant to Section 2(f) of the 2003 Incentive Agreement and any applicable Surplus
Carryforward Amount pursuant to Section 2(g) of the 2003 Incentive Agreement for years in which
payment is made or was to have been made pursuant to Section 3(d) of this Agreement.
Section 2. Cardinal Agreement to Increase Employment and Construct the West
Campus Facilitv Cardinal and the City acknowledge that, on April 30, 2007, the Ohio Tax Credit
Authority (the "Tax Credit Authority) approved an amendment to Cardinal's Tax Credit
Agreement with the Tax Credit Authority in connection with Cardinal's agreement to increase by
six hundred seventy five (675) its creation of full -time jobs in the City. Cardinal and the City agree
that, in consideration of the economic development incentives to be provided by the City herein,
Cardinal will expand its workforce in the City and achieve Substantial Completion (as defined in
Section 3(b)) of the West Campus Facility by December 31, 2009.
Section 3. City Agreement to Provide Incentives
(a) General In consideration for Cardinal's agreement to expand its workforce,
construct the West Campus Facility and to increase the levels of Cardinal employment and
associated payroll within the City, the City agrees to provide economic development incentives to
Cardinal in accordance with this Section.
(b) Payment Related to Prior Workforce Expansion The 1999 Incentive Agreement
provided that the City would make a payment to Cardinal in the amount of $701,300 (the "Final
1999 Incentive Payment") in consideration for Cardinal constructing an additional owner - occupied
building containing at least 120,000 square feet of space. In consideration of Cardinal's leasing of
60,000 square feet of space in the City, the City paid to Cardinal one -half of the Final 1999
Incentive Payment in the amount of $350,650 within forty -five (45) days following the execution of
the 2003 Incentive Agreement. The City and Cardinal agree that in consideration for Cardinal's
construction of the West Campus Facility, the City will pay to Cardinal the remaining one -half of
the Final 1999 Incentive Payment within forty -five (45) days following Substantial Completion of
the West Campus Facility. As used in this Agreement, the term "Substantial Completion" means
the issuance of atemporary certificate of occupancy for the West Campus Facility.
-2-
(c) Withholdings Calculations
(i) Calculation of Actual Withholdings On or before March 15 of each year
from 2008 through the year in which the Maximum Payment Amount (as defined in
Section 3(h)) is reached, the City shall calculate the actual payroll withholding taxes
collected during the then preceding calendar year by the City from all Employees, net of
refunds (the "Actual Withholdings "). For purposes of this Section 3, "Employees" shall
include only those individuals employed by Cardinal working at a location within the City.
(ii) Information Relating to Employees Cardinal agrees that, in accordance with
City Code, the annual payroll reconciliation and related W -2 forms relating to its Employees
will be provided to the City prior to February 28 of each calendar year.
(d) Payments to Cardinal If the Actual Withholdings for the then preceding calendar
year exceed the Target Withholdings for the then preceding calendar year, the City shall, on or
before April 15 of the then current calendar year, pay to Cardinal, solely from nontax revenues, an
amount equal to the product of (i) an amount equal to the Actual Withholdings (net of refunds)
minus the Target Withholdings, multiplied by (ii) the Incentive Factor (as defined below for each
applicable year). The payments provided for in this Section 3 shall be made by the City to Cardinal
by electronic funds transfer or by such other manner as is mutually agreed to by the City and
Cardinal. The Target Withholdings and Incentive Factor for each year are described in the
following table:
Calendar Year
Target Withholdings
Incentive Factor
2007
$3,456,639
38.00%
2008
$3,543,055
38.00%
2009
$3,667,062
38.00%
2010
$3,795,409
36.00%
2011
$3,928,248
36.00%
2012
$4,065,737
36.00%
2013
$4,208,037
34.00%
2014
$4,313,238
34.00%
2015
$4,421,069
34.00%
2016
$4,531,596
34.00%
2017
$4,644,886
34.00%
2018
$4,761,008
34.00%
With respect to the Actual Withholdings collected during calendar year 2019 or any
subsequent calendar year, the Incentive Factor shall be thirty -four percent (34 %). The Target
Withholdings for each such calendar year shall be calculated by multiplying the Target
Withholdings for the previous calendar year by 1.025.
(e) 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
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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 Cardinal 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 3 shall be payable solely from the City's nontax 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 3 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 nontax revenues.
(f) Deficiency Carryforward Amounts If and to the extent the amount of nontax
revenues are insufficient in a particular calendar year for appropriation and payment to Cardinal, the
City will make payment to Cardinal in the amount of nontax revenues available for appropriation
and payment to Cardinal. The difference between the amount required to be paid by the City to
Cardinal pursuant to this Section 3 and the amount actually paid (referred to herein as a "Deficiency
Carryforward Amounts shall be carried forward to the next succeeding calendar year and paid to
Cardinal in addition to any other payment for that succeeding year required by this Section 3. This
Agreement shall not terminate until the City has paid to Cardinal all Deficiency Carryforward
Amounts required to be paid to Cardinal in accordance with this Section 3; provided, however, the
aggregate of all payments to Cardinal pursuant to this Agreement shall not exceed the Maximum
Payment Amount (as defined in Section 3(h)).
(g) Surplus Carryforward Amounts If and to the extent the annual payment as
calculated pursuant to Section 3(d) is greater than the Maximum Annual Payment (as defined in
Section 3(h)), any such amount or portion thereof (referred to herein as a "Surplus Carryforward
Amount') shall be paid by the City to Cardinal in any future calendar year where the annual
payment as calculated pursuant to this Section 3 is less than the Maximum Annual Payment;
provided, however, the aggregate of that annual payment, together with any Surplus Carryforward
Amount and excluding any Deficiency Carryforward Amount paid to Cardinal, does not exceed the
Maximum Annual Payment.
(h) Maximum Economic Development Incentive Pavments In no event shall (i) the
amount of payments made by the City to Cardinal pursuant to this Section 3 in any one calendar
year (excluding any Deficiency Carryforward Amount paid to Cardinal) exceed the Maximum
Annual Payment for that year or (ii) the aggregate amount of payments made by the City to
Cardinal pursuant to the 2003 Incentive Agreement or this Section 3 exceed Seven Million Five
Hundred Thousand Dollars ($7,500,000) (the `Maximum Payment Amount; provided, however,
the limitation on payments as set forth in this subsection shall not include the payment to be made
by the City to Cardinal pursuant to Section 3(b) of this Agreement or Section 2(b) of the 2003
Incentive Agreement. As used herein, the term `Maximum Annual Payment' means, for all years
except the years 2009, 2010 and 2011 (for 2008, 2009 and 2010 Actual Withholdings, respectively),
Seven Hundred Fifty Thousand Dollars ($750;000), and for each of the years 2009, 2010 and 2011
(for 2008, 2009 and 2010 Actual Withholdings, respectively), Eight Hundred Fifty Thousand
Dollars ($850,000).
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(i) Applicable Citv Pavroll Tax Rate For purposes of calculating the Actual
Withholdings in each calendar year under this Section 3, the City's payroll tax rate shall be assumed
to be two percent (2 %).
0) West Campus Facility: Traffic Controls and Further Assurances The City agrees to
install, at its own expense (currently estimated to be $740,000), the traffic improvements described
under the heading "Traffic /Roadway" on Exhibit A attached hereto. The City agrees to coordinate
with Cardinal with respect to the construction of these traffic improvements so as to not
unreasonably interfere with the construction or operation of the West Campus Facility, and agrees to
use its good faith effort to complete these traffic improvements by December 31, 2009. The City
further agrees to cooperate in all reasonable ways with Cardinal and its architects, engineers and
agents to facilitate the commencement of construction of the West Campus Facility.
(k) South Campus Land Bank The City acknowledges that Cardinal intends to enter
into one or more agreements with the Columbus - Franklin County Finance Authority (the `Finance
Authority') and/or the State whereby the Finance Authority will purchase the South Campus (as
defined in the 1999 Incentive Agreement) land from Cardinal upon terms and conditions to be
agreed upon by the Finance Authority and/or the State and Cardinal. The City agrees to reasonably
cooperate with Cardinal, the Finance Authority and the State in connection with this purchase. If
despite the good faith efforts of Cardinal, the Finance Authority, the State and Cardinal are unable
to complete this purchase, the City will proceed in good faith to negotiate with the State and
Cardinal to purchase the South Campus with funds made available by the State, provided Cardinal
will agree, in any purchase agreement with the City for the South Campus, to pay all maintenance
costs, financing costs and taxes for the South Campus and indemnify the City for all costs incurred
by the City during its period of ownership of the South Campus.
(1) South Campus Road and Utility Improvements The City agrees to construct, in
accordance with all then - existing City laws and regulations, road and associated water, sanitary
sewer and storm sewer improvements on the South Campus deemed necessary, in the City's
reasonable discretion, to provide traffic ingress and egress and water, sanitary sewer and storm
sewer services for an office facility of 317,000 square feet with associated parking spaces as
provided under then - existing zoning laws or other then - existing City laws or regulations (the "South
Campus Improvements "). To the extent the City has sufficient interests in real property to do so, the
City will make rights -of -way available to the electric and gas utilities for the extension of those
utilities to the South Campus beyond the current connections to the South Campus on Dublin Road.
The City and Cardinal intend that the road improvements comprising the South Campus
Improvements will generally have an eighty (80) foot right -of -way and consist of a 2/3 road
section (i.e. one lane each direction with a center turn lane), will extend from the western
boundary of the South Campus to Dublin Road, will be located as close as feasible from an
engineering perspective to the southern boundary of the South Campus, and will be situated, to the
extent feasible from an engineering perspective, so as to permit the construction of an office facility
of 317,000 square feet with associated parking spaces as provided under then - existing zoning laws
or other then - existing City laws or regulations. The City will provide Cardinal with the same
notices with respect to zoning or land use matters that affect the South Campus as any owners of
the South Campus. The City agrees to use its best effort to complete the design of the South
Campus Improvements by December 31, 2008. The City shall obtain Cardinal's written approval of
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the design of the South Campus Improvements (not to be unreasonably withheld) prior to the
commencement of the South Campus Improvements. Upon receipt of Cardinal's written approval
of the design plans for the South Campus Improvements, the City shall use its best efforts to
complete construction of the South Campus Improvements no later than the date on which a
temporary certificate of occupancy is issued for an owner - occupied building (whether occupied by
Cardinal or otherwise) on the South Campus containing at least 120,000 square feet of space (the
"South Campus Facility"). The City agrees to coordinate with Cardinal with respect to the
construction of the South Campus Improvements so as to not unreasonably interfere with the
construction or operation of the South Campus Facility and, to the best of the City's ability, uphold
the zoning for the South Campus as provided in Ordinance No. 124 -98 (as amended and approved
July 19, 1999). The cost of the South Campus Improvements is presently estimated to be
$2,775,000, with this cost to be paid by the City. The City and Cardinal agree that (i) the South
Campus Improvements include the Phase I Public Improvements (as defined in the 1999 Incentive
Agreement) and (ii) the provisions of Section 3(a) of the 1999 Incentive Agreement are superseded
by the provisions of this Section. Furthermore, the City and Cardinal agree that, notwithstanding
the provisions contained in the second paragraph of Section 4 of the 1999 Incentive Agreement
regarding the deposit and use of tax increment financing revenues from the South Campus, the City
may use those revenues for any purpose permitted by law and City Ordinance No. 19 -99 or any
successor tax increment financing ordinance applicable to the South Campus, as each may be
amended from time to time.
(m) Emerald Parkway Extension The City agrees to use its best effort to complete, at its
expense, the design work for the remaining portion of Emerald Parkway from Riverside Drive to
approximately Bright Road by April 1, 2008. The City and Cardinal agree that, notwithstanding the
provisions of Section 3(b) of the 1999 Incentive Agreement, the City may elect to construct the
remaining portion of Emerald Parkway prior to the completion of the South Campus Improvements.
(n) TIE Modification Cardinal acknowledges and agrees that the City may, if the City
deems it to be in its best interest, amend or otherwise modify (including by repeal and passage of
new tax increment financing legislation) all or a portion of City Ordinances No. 19 -99 and No. 57-
94 to maximize the length of the tax increment financing exemption applicable to the West Campus
Facility and future developments on the West Campus or South Campus. If necessitated by these
changes, Cardinal agrees to cooperate in the negotiation, execution and recordation of a tax
increment financing agreement and/or tax increment financing declaration for real property it or any
of its affiliates own within the South Campus or West Campus.
Section 4. 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 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
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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:
City of Dublin, Ohio
5800 Shier Rings Road
Dublin, Ohio 43016 -7295
Attention: Economic Development Director
(ii) Cardinal at:
Cardinal Health, Inc.
7000 Cardinal Place
Dublin, Ohio 43017
Attention: Vice President — Corporate Real Estate and
Workplace Services
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 Cardinal in other than his or her
official capacity. No official executing or approving the City's or Cardinal'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
Cardinal and its successors and assigns.
(d) Recitals The City and Cardinal 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 Cardinal.
(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 for more than
one of those counterparts.
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(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 Cardinal, 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) Survival of Representations and Warranties All representations and warranties of
Cardinal and the City in this Agreement shall survive the execution and delivery of this Agreement.
(k) Cardinal's Obligations All obligations of Cardinal under this Agreement may be
satisfied by any combination of Cardinal and entities controlled by or under common control with
Cardinal. For purposes of this Agreement "controlled by," or "under common control with" refers
to the possession, directly or indirectly, of the legal power to direct or cause the direction of the
management and policies of an entity, whether through the exercise of, or the ability to exercise,
voting power or by contract.
(Signature Pages to Follow)
in
IN WITNESS WHEREOF, the City and Cardinal have caused this Agreement to be executed in
their respective names by their duly authorized representatives, all as of the date first written above.
Approved as to Form:
C
CITY OF DUBLIN, OHIO
Printed: Jane Brautigam
Title: Citv Manager
C
Printed: Marsha I. Grigsbv
Title: Director of Finance
Printed: Stephen J. Smith
Title: Director of Law
CARDINAL HEALTH, INC.
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 during the year 2007 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: .2007
Director of Finance
City of Dublin, Ohio
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Exhibit A
West Campus Facilitv Traffic Improvements
The following letter describes the traffic improvements to be constructed in connection
with the West Campus Facility under the heading "Traffic /Roadway ".