2018-90 Resolution - Laserfiche WebLink

Home Browse Search

Section 6. Limitation on the use of Tax Abatements; Allowable Incentives; Uniform training incentives. (a) Real Estate Tax Abatements. The MUD Parties agree that for any business relocating between Cleveland and City, there shall be a limit on any new industrial or commercial real estate tax abatement to a term not to exceed 10 years. The abatement shall not exceed 75 percent. (b) Income Tax Abatements. The MUD Parties agree that they shall not provide any income tax abatement to any businesses relocating between Cleveland and City. (c) Allowable Incentives. Notwithstanding the provisions of subsections (a) and (b) of this Section 6, the MUD Parties may continue to offer incentives including, but not limited to, the discounted sale of property, low-interest loans, and tax increment financing as provided for in R.C. §§5709.40 and 5709.41. The limitations provided in subsections (a) and (b) of this Section 6 shall not apply to business relocation from outside of the territorial boundaries of the District as defined in Section 3 above. Section 7. Income Tax Sharing for Moves Within the District. (a) The MUD Parties agree that if any business with an annual gross payroll of more than $500,000 relocates from one MUD Party (the "Losing MUD Party") to another MUD Party (the "Gaining MUD Party'), the Losing MUD Party shall be entitled to receive from the Gaining MUD Party, for a period of 5 years, 50 percent of future income tax revenue based upon payroll in existence immediately prior to the relocation. The Gaining MUD Party's 50 percent share shall be calculated based upon the Gaining MUD Party's employment -based tax rate as may be amended from time to time, minus the percentage that may be earmarked for a city's school district pursuant to city ordinance. The Gaining MUD Party's 5 year income tax sharing obligation for any business that relocates during the term of this Agreement is a continuing obligation that shall survive the termination of this Agreement. (b) The 5 year tax sharing obligation may be earlier terminated or reduced if the Losing MUD Party "backfills" space at the same payroll value with a similar business, as follows: (i) the business that moved jobs adds equivalent new payroll anywhere in the Losing MUD Party's jurisdiction, this new payroll shall qualify as "backfill" for purposes of this Section 7; and (ii) if the moving business replaces part of the vacated space with new jobs and payroll, the aggregate employment -based income tax paid to the Losing MUD Party will be deducted from this tax sharing obligation. Upon becoming aware that "backfilling" has occurred, the Losing MUD Party shall provide the Gaining MUD Party with written notice within 30 days as provided for in Section 20. For example, if new employees are hired anywhere in Cleveland by the relocated employer, the employment -based income tax from those employees that is paid to Cleveland shall reduce the amount to be paid by City to Cleveland in an amount equal to the employment -based income tax paid by or on behalf of those employees. For purposes of the above example, "new" Cleveland employees are permanent employees who are hired due to the creation of new positions within Cleveland versus new or existing