The trustees approved a seven-year 60% property tax abatement for the project, a tax incentive that is rarely used in the largest township in Ohio, according to Community Development Director Aaron Wiegand.
“West Chester offers very few tax abatements, I think that’s important for residents to know,” Wiegand said. “We’re already a low tax environment overall, so we don’t often find the need to offer a ton of incentives for companies.”
Without the abatement the township would collect around $782,124 over the life of the agreement. Tax revenue under the new deal is estimated at $312,851.
The agreement promises an investment of $46 million to $79 million for land acquisition, construction, new equipment and more.
There are now six enterprise zones on the township’s books — a previous abatement for Republic, two for General Electric, Planes Companies and Systecon for a total abatement of $21.2 million over the life of their various agreements for all taxing bodies. The township’s total tax abatement for 2022 was $338,898.
The Lakota Local Schools Board is scheduled to approve the deal Thursday; the company will reimburse the district half the abated taxes, or an estimated $598,935, over the life of the agreement. Butler Tech will be reimbursed $28,371 as part of the deal.
Wiegand said Republic was one of the first companies to move into the township’s industrial area, and the sheer magnitude of the project warrants a tax break.
“Incentives aren’t rewards, but what is a reward is the commitment that Republic Wire has continually made to West Chester over the years,” he said.
The Butler County commissioners are scheduled to approve the Republic Wire enterprise zone on Monday. Commissioner Don Dixon told the Journal-News he’ll gladly approve the deal.
“Something like this with Republic Wire where you can keep 160 jobs, add 40 new jobs, 300,000 square feet, that’s what it’s supposed to do,” Dixon said. “Everybody will ask for it, and not all of them are good. You have to be able to look at the overall picture... This one here is something we should be doing every chance we get, retain jobs, get new jobs, keep that kind of tax base in Butler County, I think it’s a winner.”
Property tax incentive programs have come under fire recently, while Butler County officials have waged a war on the looming 42% property valuation hike. Dixon issued a “call to action” in April after the huge increases were announced, local leaders and state lawmakers held two summits on the issue.
Dixon and Auditor Nancy Nix said during the summits it needs a legislative solution but local jurisdictions must be more circumspect in their use of tax incentives like tax increment financing (TIF) and residential improvement districts (RID).
“We have people granting TIFs and RIDs that are usually for the wrong purpose,” Dixon said during the first meeting. “And what happens is it ends up that the taxpayers are subsidizing the development and everybody else loses until that comes off.”
Nix told the group communities use these vehicles that siphon money away from providing government services, which prompts new levies. She said 20 years ago there were 108 levies — 80 new levies have been approved since 2008 — and now there are a total of 142.
“We’re diluting the tax base, and your regular taxpayers cannot afford when you have all these TIFs and RIDs and abatements,” Nix said.
In response, West Chester Finance Director Ken Keim put together a presentation for Dixon and Nix about the use of TIFs in the township. Since 2005 the three main TIF districts have generated $400.5 million in revenues and the township has spent nearly $303 million on major infrastructure work like the new Union Centre Boulevard diverging diamond interchange at Interstate 75 and a myriad of other projects.
“They’re not seeing what we’re spending it on, they’re seeing all that money coming in without perspective of what we’re spending it on,” Keim said. “Their imagination has gotten them to thinking we’re spending all that money to funnel to developers, I’m showing them look at all the community services that are paid for.”
Nix told the Journal-News after she saw Keim’s presentation, “I think they have done things the right way,” and she is more concerned about the use of RIDs which are becoming more prevalent.
Dixon said in the wake of the summit, talks are starting about the proper use of tax incentives.
“We’ve had enough communication now among the bigger townships that deal with this a lot and we’re kind of are all on the same page,” he said. “We might not agree exactly how it’s supposed to work but at least we have the concept and the outline.”
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