Plain City Council members are treading lightly as they consider whether to approve a special taxing incentive in their village for the first time.
Council members on Monday heard the first reading of an ordinance that would establish a Tax Increment Financing (TIF) agreement for a proposed residential development for seniors, the Hamlet on Darby.
Pleasant Valley Fire District Chief Mark Kidd emphasized that Plain City has never before approved a TIF. He said he fears one approval could start a trend.
“(Approval of this TIF) opens the door to the next, and the next, and the next,” Kidd said to council during the public comments section of the meeting.
According to the Hamlet on Darby TIF agreement, the developer agreed to acquire approximately 9.23 acres off of Fairfield Drive to construct 67 units, including 32 two-bedroom “garden homes” and 35 two-bedroom lofts. At least 80% of the households must have at least one occupant who is 55 years of age or older.
The TIF for the Hamlet on Darby is a non-school, 30-year agreement.
Generally, a TIF allows the increase assessed value of an improvement to real property to be exempt from real property taxation.
The property owner will instead make payments in lieu of taxes – equal to the increase in property taxes generated by the improvement – to the local government. Those funds are directed to a specific TIF fund that is used to pay for infrastructure improvements laid out in the agreement.
The developer will be required to complete the “construction, reconstruction, extension, improving or changing (of) sanitary sewer mains” as well as the creation and extension of multi-use trails, according to the TIF agreement.
While the TIF dollars would generally be diverted to the infrastructure improvements, this specific TIF ensures several entities that would lose funding remain whole.
The village agreed to pay from the TIF fund the Jonathan Alder and Tolles school districts, the Pleasant Valley Fire District and make payments toward the police levy, as if those entities were not exempt from the taxation.
After payments are made to these entities, the developer will be reimbursed for public infrastructure improvements. Any additional dollars leftover will be added to the TIF fund for bikeway and pedestrian infrastructure.
Kidd underlined his appreciation that the developers behind the Hamlet on Darby included a clause that allows funding to continue to go toward his fire department, as well as other entities that would generally miss out due to a TIF.
He said his opposition to residential TIFs is “not a reflection” of this specific application, the Hamlet on Darby “just happens to be the first.”
He said the fire district does not realize income taxes and is “100% property tax driven.”
If property taxes are diverted from the Pleasant Valley Fire District due to a TIF, he said he fears the department will not have the funding to adequately service new residential developments.
“If you start TIF-ing a bunch of properties, we’re still going to have to service that,” he said, adding, “How am I going to keep up with everything that happens?”
Kidd said he understands the benefits of commercial TIFs but urged council to investigate other options for residential developments.
Council member John Rucker shared similar sentiments.
“In general principle, I’m not a fan of residential TIFs,” Rucker said.
He agreed that approving the agreement for the Hamlet on Darby could open the door to other applications, and council should “put a safeguard on this door.”
Council President Michael Terry said he is “not against residential TIFs wholeheartedly,” but feels each application needs to be vetted individually.
Council member Jim Eudaily agreed that officials should be particularly cautious when it comes to approving tax incentives for residential developments. Still, he said the Hamlet on Darby is a “special circumstance,” as he feels the developer will create improvements that benefit the community.
Council heard the first reading of an ordinance to approve the TIF, but a motion to waive the second reading failed.
Council member Frank Reed was the only dissenter in a 4-1 vote, as Council member James Sintz was absent. However, five votes in favor are necessary to waive a second reading.
A second reading and opportunity to vote on the measure will come before council at its next meeting at 6:30 p.m., April 11.
In other business:
– Heard the first reading of an ordinance to execute a Community Reinvestment Area abatement agreement for 101 S. Chillicothe St.
Developers intend to turn the clock tower building into a new location for Moeller Brew Barn, an Ohio-based restaurant and brewery.
If approved, the owners will receive a 100% tax exemption for 12 years. CRA abatements are applied specifically to the property taxes of the assessed valuation of the redeveloped structure that will be constructed under the project.
The application was approved by the Jonathan Alder Board of Education before appearing before council.
Reed requested waiving the second reading of the resolution, but council agreed instead to add the second reading to its next work session at 6:30 p.m., April 6.
– Council unanimously approved motions to appoint Chase Evans and Alexa Tomey to the Marketing and Communications Advisory Committee, and Sonia Walker to the Personnel Board of Appeals.
Evans is a community relations specialist for the City of Hilliard. Tomey is a marketing manager for Jones Lang LaSalle. Both are residents of Plain City.
Walker is the owner of Calig Law Firm. She also serves as a member of the Jonathan Alder Board of Education.