TIF District Creates Revenue Stream for Jackson Township
JACKSON TOWNSHIP, Ohio – New development in Jackson Township such as the recently opened Truck World Plaza on Bailey Road now provides a revenue stream to fund infrastructure improvements in the township.
Following the lead of Jackson Township trustees earlier this week, the Mahoning County Board of Commissioners yesterday approved a tax increment financing – or TIF – district for the township.
Under the TIF, 50% of new real property taxes that projects generate will be split according to the formula for the county, township and schools, said Commissioner David Ditzler.
“The other 50% goes into the TIF and is used for infrastructure and for roads and for different projects that directly lead up to the corridor of the new development,” he continued. “That generates new monies for Jackson Township that the [county] engineer and trustees can work with.”
In addition to the Truck World plaza, the TIF fund will realize revenue from the new Ohio Utilities Protection Services headquarters and an expansion by FedEx Ground in the township. The TIF is expected to generate just more than $80,000 annually over the 10-year term, officials said.
The county has similar TIF districts in place for the Hollywood Gaming at Mahoning Valley Race Course racino in Austintown and the Inn at Poland Way in Poland.
Improvements identified for the township under the TIF district include upgrades to major corridors such as Bailey Road and Mahoning Avenue as well as roads that serve Youngstown Commerce Park.
Conversations about the possibility of a TIF in the township started several years ago, said Sarah Lown, public finance manager for the Northeast Ohio Development and Finance Authority. The development authority, a division of the Western Reserve Port Authority, manages the county enterprise zone program.
“Jackson Township was conferring a lot of abatements on new businesses but not realizing any direct benefit,” Lown said. “It came to the point where in their general fund they couldn’t pay for the roads and the sewer needs of their citizens, so we devised this strategy as a way to make Jackson Township whole again with infrastructure.”
The arrangement “promotes economic development on one side and it helps the township roads and sewers and so forth on the other side,” she said.
“And it doesn’t come at a significant cost to school districts and the general fund. The schools are the most important tool for economic development because that creates talent.”
Under the enterprise zone agreements the township approved iearlier, businesses typically received a 60% abatement on real property taxes for 10 to 15 years, meaning that the remaining 40% is divided among the various entities, said Jackson Township Trustee Tom Frost.
“Now all the new businesses will be paying 100% tax and 50% will be going into the TIF fund,” Frost said. “So in essence, all the other entities that would receive tax money are actually getting more for this in new tax money, and the remaining 50% of the TIF is coming back and staying where it belongs in Jackson Township.”
Having an infrastructure funding stream will help attract businesses to the industrial park, Frost added. “The roads are pretty deplorable there,” he said.
“We’re in the hotbed of the county with our location so businesses are coming here because of our location. I don’t think they were coming here necessarily because of tax abatements,” he said.
County and township officials said they looked to the successful racino TIF in Austintown as an example of what to do in Jackson. The roughly $6 million that TIF is generating is being leveraged to pay for some $20 million in infrastructure improvements.
“This money isn’t going to fix everything,” Mahoning County Engineer Pat Ginnetti said. “It’s a step in the right direction. It’s certainly not enough money to fix all the infrastructure, and the TIF is designated to a specific area so the grant monies can’t be used anywhere we want. That’s one thing to keep in mind.”
Pictured: Truck World in Jackson Township.
Copyright 2017 The Business Journal, Youngstown, Ohio.
Published by The Business Journal, Youngstown, Ohio.
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