City changes tax exemption measure

NORWALK — Norwalk's city council voted to alter the city's new Community Reinvestment Area (CRA) but did not move to restructure the Enterprise Zone Agreement guidelines. A CRA is an economic development tool that provides real property tax exemptions for property owners who renovate existing or construct new buildings, according to the Ohio Department of Development. Meanwhile, Norwalk's Enterprise Zone encompasses all land within the city limits and offers tax incentives to encourage capital investment, job creation and retention by applicable businesses, according to the Huron County Growth Partnership. The approved Norwalk CRA gives tax abatements for residential construction of 75 percent for 10 years and commercial properties will receive an abatement of up to 75 percent for up to 10 years. The CRA was passed by the council with a 6-1 vote in June. Norwalk Mayor Dave Light introduced legislation at the July 8 council meeting to amend the current CRA. According to Light, the CRA contained language that an application for tax breaks must be submitted before new construction or remodeling begins. Under the current rules, work cannot begin before the CRA agreement has been approved by the city. This change now allows residents to apply for CRA grants if the project was started prior to passage of the CRA. The council modified and expanded the footprint of the CRA to encompass the entirety of Norwalk at its June 17 meeting. At a council meeting hosted Tuesday, council members agreed to move forward with those proposed CRA changes. Enterprise Zone changes tabled A change to the city's Enterprise Zone guidelines was also on the table during the meeting. Council members were voting to change the "assistance available" portion of the guidelines at the behest of Light. Light's proposal would make the "assistance available" guidelines clearer, making it easier for potential applicants to understand the process. "To keep the city competitive in more of a global market, we decided to upgrade (the guidelines)," Light said. The changes proposed would allow an "exceptional case" to be eligible to receive tax incentives "in excess of the current 75% abatement and allow extension of the current 10 years to a maximum of 15 years. Currently, an "exceptional case" requires the project to create "50 jobs" to be eligible for bigger tax cuts. This rule would be changed to "the establishment of a new business or the expansion of an existing business which, in the opinion of the negotiating committee, due to the type or location of the enterprise or the number of new jobs and new payroll proposed to be created, warrants the city offering an abatement in excess of the 75 percent and or 10 years in duration, provided that the terms of any abatement shall not exceed 15 years," if passed, according to O'Hara. The ordinance would also "clean up some of the language" concerning school board approval. "Whatever the Ohio Revised Code says, that's what we will follow," O'Hara said. When the vote was taken at Tuesday's meeting to waive a second reading of the legislation, council member Drew Burge voted "no" with the other 5 members voting "yes." Under the rules of the council, it requires six "yes" votes to waive a second reading, meaning the legislation did not pass at Tuesday's meeting but can be attempted at a later meeting.