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Ordinance 051-14RECORD OF ORDINANCES Form No.30043 Passed . 20 AN ORDINANCE DECLARING THE IMPROVEMENT TO CERTAIN PARCELS OF REAL PROPERTY IN THE CITY'S BRIDGE STREET DISTRICT TO BE A PUBLIC PURPOSE AND EXEMPT FROM TAXATION; PROVIDING FOR THE COLLECTION AND DEPOSIT OF SERVICE PAYMENTS AND SPECIFYING THE PURPOSES FOR WHICH THOSE SERVICE PAYMENTS MAY BE EXPENDED; SPECIFYING THE PUBLIC INFRASTRUCTURE IMPROVEMENTS DIRECTLY BENEFITING THE PARCELS; AND AUTHORIZING COMPENSATION PAYMENTS TO THE DUBLIN CITY SCHOOL DISTRICT AND THE TOLLES CAREER AND TECHNICAL CENTER WHEREAS, the City has prepared a strategy for comprehensive development within an area of the City known as the Bridge Street District (which area is referred to herein as the "District") and has endeavored to work collaboratively with public entities, including the Dublin City School District ( " Dublin School District") and the Tolles Career and Technical Center ( " Tolles Career Center"), and private entities to plan for and facilitate the development of the District; and WHEREAS, the City's strategy for development within the District is primarily focused on creating a new, more urban core for the City, including a dynamic mix of commercial and residential development types generally not currently available within the City; and WHEREAS, the City, Vrable Land Holding Dublin LLC and Tuller Henderson LLC have heretofore executed a Development and Tax Increment Financing Agreement dated June 25, 2013 which generally provides for the construction of project which will include skilled nursing facility uses, assisted living uses and office uses, and the construction of various public infrastructure improvements (the "Vrable Development"); and WHEREAS, to facilitate development throughout the District, including but not limited to the Vrable Development, and pay the associated costs of infrastructure improvements and related incentives, this Council has determined pursuant to Ohio Revised Code ( "ORC") Sections 5709.40, 5709.42 and 5709.43 (collectively, the "TIF Statutes ") to declare the improvement to certain parcels of real property located within the City to be a public purpose and exempt from taxation, require the owner of each parcel to make service payments in lieu of taxes, provide for the distribution of an applicable portion of such service payments to the Dublin School District and Tolles Career Center, establish a municipal public improvement tax increment equivalent fund for the deposit of the those service payments, and specify public infrastructure improvements made, to be made or in the process of being made that directly benefit, or that once made will directly benefit, those parcels; and WHEREAS, the Board of Education of the Dublin School District has heretofore adopted a resolution on April 14, 2014 waiving the provision of certain notices, approving the tax exemption of the Improvements (as defined in Section 3), authorizing an agreement (which has heretofore been executed) between the City and the Dublin School District providing for the remission of certain payments to the Dublin School District (the "Dublin School District Agreement") and making other findings with respect to the tax exemption; and WHEREAS, the Board of Education of the Tolles Career Center has heretofore adopted a resolution on June a l. % 2014 waiving the provision of certain notices, approving the tax exemption of the Improvements, authorizing an agreement (which has heretofore been executed) between the City and the Tolles Career Center providing for the remission of certain payments to the Tolles Career Center (the "Tolles Career Center Agreement") and making other findings with respect to the tax exemption; and NOyV, THEREFORE, BE IT ORDAINED by the Council of the City of Dublin, State of Ohio, of the elected members concurring, that: ton Legal Blank, Inc. 51 -14 Ordinance No. Section 1. Parcels The parcels of real property subject to the exemption granted by this Ordinance are identified and depicted in EXHIBIT A attached hereto (each, as currently or subsequently configured, individually, a "Parcer' and collectively, the "Parcels'). RECORD OF ORDINANCES Dayton Legal Blank, Inc. Form No. 30043 Ordinance No. 51 -14 Passed Page 2 .20 Section 2. Public Infrastructure Improvements This Council hereby designates the public infrastructure improvements described in EXHIBIT B attached hereto (the "Public Infrastructure Improvements ") and any other public infrastructure improvements hereafter designated by ordinance as public infrastructure improvements made, to be made or in the process of being made by the City that directly benefit, or that once made will directly benefit, the Parcels. Section 3. Exemption This Council hereby finds and determines that 100% of the increase in assessed value of each Parcel subsequent to the effective date of this Ordinance (which increase in assessed value is hereinafter referred to as the "Improvement" as defined in Ohio Revised Code Section 5709.40(A)) is hereby declared to be a public purpose and shall be exempt from taxation in accordance with Ohio Revised Code Section 5709.40(B) for a period commencing on the date an Improvement attributable to a new structure on that Parcel first appears on the tax list and duplicate were it not for the exemption granted in this Ordinance and ending on the earlier of (a) thirty (30) years after such commencement or (b) the date on which the City can no longer require service payments in lieu of taxes, all in accordance with the requirements of the TIF Statutes. Section 4. Service Payments As provided in Ohio Revised Code Section 5709.42, the owner of each Parcel is hereby required to and shall make service payments in lieu of taxes with respect to the Improvement allocable thereto to the Treasurer of Franklin County, Ohio (the "County Treasurer") on or before the final dates for payment of real property taxes. The service payments in lieu of taxes shall be charged and collected in the same manner and in the same amount as the real property taxes that would have been charged and collected against that Improvement if it were not exempt from taxation pursuant to Section 3, including any penalties and interest (collectively, the "Service Payments "). The Service Payments, and any other payments with respect to each Improvement that are received by the County Treasurer in connection with the reduction required by Ohio Revised Code Sections 319.302, 321.24, 323.152 and 323.156, as the same may be amended from time to time, or any successor provisions thereto as the same may be amended from time to time (the "Property Tax Rollback Payments "), shall be allocated and distributed in accordance with Section 6. Section 5. TIF Fund This Council hereby establishes, pursuant to and in accordance with the provisions of Ohio Revised Code Section 5709.43, the Vrable Municipal Public Improvement Tax Increment Equivalent Fund (the "TIF Fund"). The TIF Fund shall be maintained in the custody of the City and shall receive all distributions to be made to the City pursuant to Section 6. Those Service Payments and Property Tax Rollback Payments received by the City with respect to the Improvement of each Parcel and so deposited pursuant to Ohio Revised Code Section 5709.42 shall be used solely for the purposes authorized in the TIF Statutes or this Ordinance. The TIF Fund shall remain in existence so long as such Service Payments and Property Tax Rollback Payments are collected and used for the aforesaid purposes, after which time the TIF Fund shall be dissolved and any incidental surplus funds remaining therein transferred to the City's General Fund, all in accordance with Ohio Revised Code Section 5709.43. Section 6. Distributions Pursuant to the TIF Statutes, the County Treasurer is requested to distribute the Service Payments and Property Tax Rollback Payments to the City for further deposit into the TIF Fund for (a) remission, on a pro rata basis, to the Dublin School District in accordance with the Dublin School District Agreement and the Tolles Career Center in accordance with the Tolles Career Center Agreement, (b) payment of costs of the Public Infrastructure Improvements, including, without limitation, debt charges on any securities of the City issued to pay costs of those Public Infrastructure Improvements and (c) any other lawful purpose. Section 7. Further Authorizations This Council hereby authorizes and directs the City Manager, the Director of Finance, the Director of Law, the Director of Development, the Clerk of Council or other appropriate officers of the City to make such arrangements as are necessary and proper for collection of the Service Payments and Property Tax Rollback Payments. This Council further hereby authorizes and directs the City Manager, the Director of Finance, the Director of Law, the Director of Development, the Clerk of Council or other appropriate officers of the City to prepare and sign all agreements and instruments and to take any other actions as may be appropriate to implement this Ordinance. RECORD OF ORDINANCES Legal Blank, Inc. Form No. 30043 Passed Page 3 . 20 Ordinance No. 51 -14 Section 8. Tax Incentive Review Council The City's Tax Incentive Review Council will review annually all exemptions from real property taxation granted by this Ordinance in accordance with the requirements of Ohio Revised Code Section 5709.85. Section 9. Reports Pursuant to Ohio Revised Code Section 5709.40(1), the Director of Development is hereby directed to deliver a copy of this Ordinance to the Director of the Ohio Development Services Agency within 15 days after its effective date. Further, and on or before March 31 of each year that the exemption set forth in this Ordinance remains in effect, the Director of Development or other authorized officer of the City shall prepare and submit to the Director of the Ohio Development Services Agency the status report required under Ohio Revised Code Section 5709.40(1). Section 10. Open Meetings 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 any of 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, all in compliance with the law including Ohio Revised Code Section 121.22. Section 11. Effective Date This Ordinance shall be in full force and effect on the earliest date permitted by law. Signed: �1 t�Mayor - Presi ' g Officer Attest: Clerk of Council Passed: 1 2014 Effective: , 2014 EXHIBIT A PARCELS The shaded area on the following map specifically identifies and depicts the Parcels and constitutes part of this EXHIBIT A. The Tax ID Numbers for certain Parcels are included on the following page for reference only and do not limit the Parcels subject to this Ordinance. A -1 1w Lu Lu ill II av 0 188 376 1 1 Feet N E CITY OF DUBLIN Vrable TIF Parcel 273-012446 EXHIBIT A MINIM r �7OFe r r W-1 "r I 41.1 v a ii M3 i r n 13 t � n W j � '"W*w Gomm FUL RD 1w - wo o , Lim AN Lu ui --j —9 P-- , J;S H J . Vrable TIF Parcel 273-012446 EXHIBIT A MINIM r �7OFe r r W-1 "r I 41.1 v a ii M3 i r n 13 t � n W j � '"W*w Gomm FUL RD 1w - wo o , Lim TAX ID NUMBERS A -2 EXHIBIT B PUBLIC INFRASTRUCTURE IMPROVEMENTS The Public Infrastructure Improvements include the following improvements and all related costs of those improvements (including, but not limited to, those costs listed in Section 133.15(B) of the Ohio Revised Code): • Construction of roadways and other infrastructure improvements within the Bridge Street District, including those improvements indicated in the City of Dublin Thoroughfare Plan. Examples include but are not limited to the following: o Construction of John Shields Parkway from Riverside Drive to Village Parkway, o Construction of a roadway connecting Dale Drive and Tuller Ridge Drive, o Improvements to Tuller Road from Riverside Drive to Tuller Ridge Drive, o Improvements to Riverside Drive between Tuller Road and SR 161, o Improvements to Tuller Ridge Drive, o Improvements to Dale Drive, o Improvements to the Riverside Drive / Tuller Road intersection, o Construction of a roundabout at the intersection of US 33/Riverside Drive /SR 161, and o Construction of a roadway connecting Dale Drive to Village Parkway, • Improvements to accommodate on- street parking throughout the Bridge Street District, • Construction of the Scioto River pedestrian bridge, • Improvements to the existing Bridge Street vehicular bridge, • Replacement of the existing Bridge Street vehicular bridge, • Construction of a new vehicular bridge across the Scioto River, • The construction of public parking (including acquisition of interests in real property and related design), • Aesthetic improvements to roadways within the TIF area, M . • Constructing of civic facilities including but not limited to a public library, arts facility, and municipal government facility, • Land acquisition for public purpose, • Construction of public parks and open space plazas, and each together with constructing and installing curbs and gutters, turn lanes, bridges or tunnels, any pumping mechanisms required for a tunnel or other items as necessary, retaining walls, railing, the installation of any necessary traffic signal(s), public utilities which include water mains, sanitary sewer, and storm sewers, stormwater improvements, burial of utility lines, gas, electric and communications service facilities (including fiber optics), street lighting and signs, business signage restoration or improvements, landscaping, and any other related costs, sidewalks, bikeways, preparation of environmental documents, preliminary engineering, design, right -of -way plans and any related costs, right -of -way acquisition, erosion and sediment control measures, grading and other related work, survey work, soil engineering and construction staking, and all other necessary costs and improvements, each together with all other necessary appurtenances thereto, which improvements will benefit the Parcels. MN Office of the City Manager 5200 Emerald Parkway • Dublin, OH 43017 -1090 City of Dublin Phone: 614 - 410 -4400 • Fax: 614 - 410 -4490 To: Members of Dublin City Council From: Marsha I. Grigsby, City Manager v&4�- Date: June 5, 2014 Initiated By: Angel L. Mumma, Director of Finance Memo Re: Ordinance No. 51 -14 - An Ordinance Establishing a Tax Increment Financing District ( Vrable) Summary On June 10, 2013, City Council approved Ordinance No. 39 -13 authorizing the execution of a development and tax increment financing (TIF) agreement (Agreement) with Vrable Land Holding Dublin LLC (Developer). That agreement provided for the development of the 6.34 +/- acre property located at the southwest corner of Tuller Road and Tuller Ridge Drive with skilled nursing, assisted living and office uses (the Project). The Agreement required the Developer to donate certain real property for new roads and set forth the responsibilities of each party for the construction of certain roads and utilities. Key points of the Agreement provided for the following: The donation of the property necessary to construct the proposed John Shields Parkway from Tuller Ridge Drive to the realigned Riverside Drive and for the proposed Mooney Street from Tuller Road to the new John Shields Parkway, to the City by the Developer at no cost. Status: The property was donated as a result of the final development plan approval and recorded plat. City will construct, at its expense, the new John Shields Parkway in two phases. The first phase, from Tuller Ridge Road on the east to a point along the eastern edge of the planned Mooney Street, must be completed by the time the Developer receives a certificate of occupancy for the Project. The second phase, from the terminus of the first phase on the east to the realigned Riverside Drive on the west, must be completed by December 31, 2018. Status: Detailed design has been completed; the construction contract is currently out for bid with the bid opening scheduled for June 17, 2014 and Council awarding of the contract at the July 1 meeting. ■ The Developer will construct, at its expense, Mooney Street in the future, contemporaneously with the development of the property between the proposed Mooney Street and Riverside Drive. Additionally, the developer is required to construct the necessary waterline and extend the necessary laterals to the existing sanitary sewer. Memo re. Ordinance No. 51 -14 — An Ordinance Establishing a Tax Increment Financing District (Vrable) June 5, 2014 Page 2of2 Status: The Developer is constructing the water lines and sewer extensions in conjunction with the construction of the Project. The Agreement also provides that the City shall undertake a tax increment financing pursuant to the TIF Statute to facilitate the construction of the public improvements, as defined within the TIF Ordinance. Ordinance No. 51 -14 proposes the establishment of the Vrable TIF. This TIF will be the first to be created within the defined area of the Bridge Street District Cooperative Agreement between the Dublin City School District (DCS) and the City. As a reminder, the Cooperative Agreement permits the City to authorize various tax incentives, including TIFs, within the BSD that provide for the following (for each incentive authorized): • Years 1— 15 — DCS agrees to forego 100% of the applicable real estate taxes in respect of the improvements to any particular parcel within the applicable tax incentive district. • Years 16 — 30 — DCS will receive 10% of what it would have received if the applicable tax incentive district had not been in place. Additionally, as part of the Cooperative Agreement, DCS waived any right to receive notification of the passage of any Ordinance or legislation authorizing the real property tax exemptions. For purposes of projecting potential service payments, staff has estimated that the value of the private improvements will be approximately $14 million (which was established within the Agreement as the basis for minimum service payments to be made for a period of time). Based on the current milla4e it is estimated the TIF will generate approximately $491,250 annually in years 1— 15 and $458,800 annually in years 16 — 30. These service payments will provide funding for public infrastructure improvements included in the Description of Public Infrastructure Improvements, Exhibit C to the Ordinance. These improvements not only incorporate the construction of John Shields Parkway, as part of this specific Agreement, but also other Bridge Street District infrastructure improvements. As you are aware, other governmental jurisdictions are impacted by the establishment of TIF districts and the resulting deferral of property tax revenue. In Franklin County, several agencies have operating levies. For those agencies, the Vrable TIF will result in the following estimated annual property tax deferrals: • Children's Services $24,443 • ADAMH 10,780 • MRDD 34,300 • Metro Parks 3,675 • Zoo 3,653 • Office on Aging (Senior Options) 6,370 • Library 13,720 It is important to keep in mind how these dollars compare to the overall tax revenue collected by these agencies. The total assessed valuation for all of the City's established TIF districts within Franklin County is $489 million, which is less than two percent of Franklin County's total assessed valuation (per the Franklin County 2012 CAFR). Recommendation Staff recommends that Ordinance No. 51 -14 be adopted by City Council at its second reading/ public hearing on June 23, 2014.