Ohio Senate expected to end joint economic zone creation
5/21/2014COLUMBUS — The window for local governments to band together to create Joint Economic Development Zones is about to close under a bill cleared for a full Senate vote today.
The Senate Finance Committee on Tuesday unanimously approved House Bill 289 to prohibit the creation of JEDZs, arguing that some have enveloped firms in zones with the sole purpose of imposing a municipal income tax on workers there.
At the urging of the city of Toledo, the bill was amended last week to save existing JEDZs such as the ones the city has with Maumee, Monclova Township, Rossford, Oregon, Perrysburg, Berkey, and Northwood and allow for their renewals as long as the district’s geography and tax rates don’t change.
But it’s left out townships that aren’t already well on the way to a November vote on proposed development zones.
Sponsored by Rep. Kirk Schuring (R., Canton), the bill would prohibit the creation of JEDZs as of the end of 2014. The zones are created by local governments to spur development and share income tax revenue collected in the zone.
Cities still could join with other cities, villages, or townships to create new Joint Economic Development Districts, but they will be harder to create and require greater buy-in of businesses.
Cities also could pursue Municipal Utility Districts in which utilities are extended to primarily vacant land to spur economic development that would then be taxed. Townships could not participate in utility districts.
Springfield Township and Holland hope to be on the November ballot with a proposed JEDZ encompassing the business district around a planned $18 million McCord Road railroad crossing underpass project. The bill would require them to temporarily stop their march for the ballot to create a council that would have to approve the plan before advertising public hearings.
State Sen. Randy Gardner (R., Bowling Green), a committee member, said this should provide enough time for the Springfield-Holland JEDZ to qualify for the ballot before the window closes.
“At least now those local governments that already have cooperative agreements can continue those into the future,” Mr. Gardner said. “No.2, it makes clear that private-sector businesses have a new voice in JEDZ law in 2014. I haven’t talked to anybody who defends the current JEDZ law in Ohio.“
The law would kill Springfield Township’s plans for a JEDZ with Toledo around a proposed Dorr Street interchange with I-475.
“We wish state legislators would have taken their time to look at fixing current legislation instead of completing eliminating this,” said Andy Glenn, chairman of the township trustees.