Sheila McLaughlin reports:
In what could be a first in Ohio, shoppers at the proposed $300-million Liberty Center mega-retail project in Butler County are expected to pay a half-percent more for purchases to help fund roads, sewers and other public improvements at the development.
Liberty Township officials approved the creation of a community authority Tuesday night that would collect the additional fee, with the intention of approving the increase later.
Officials for the township and Columbus-based developer Steiner + Associates call it a user fee, but patrons of retail stores and restaurants at Liberty Center, can look at it this way:
It’s like paying 6.75 percent in sales tax compared to 6.25 percent to shop anywhere else in Butler County, which has the lowest sales tax in Greater Cincinnati’s four-county region and is among four counties with the lowest sales tax in Ohio.
Caroline McKinney, the township’s economic development director, said assessments to tenants and shoppers have always been part of the financing plan proposed by Steiner + Associates. The half-percent fee for shoppers has not been mentioned publicly until now.
Liberty Center is set to break ground this fall at Interstate 75 and Liberty Way, and open in 2015. A 200,000-square-foot flagship Dillard’s store and Cobb Theatres‘ CineBistro have already signed on.
Trustee Christine Matacic said she was aware Liberty Center patrons could be charged a user fee, but she didn’t know specifics until this week.
“We knew the possibilities, but this is coming from the developer. The developer initiates this. Until the developer initiates it we don’t have all the information,” she said Wednesday.
The township approved up to $5 million in infrastructure financing and Butler County commissioners have promised up to $30 million toward the infrastructure once a master development agreement is signed. McKinney said the agreement is expected to be signed within two weeks.
Steiner officials said the project required $56 million in public infrastructure financing.
The county and township are providing 70 percent of it through tax increment financing. Assessments generated by the Liberty Community Authority (LCA) will provide the remaining 30 percent. If assessments don’t pay back the bonds that will be issued for LCA’s end of the financing, Steiner is responsible for the payments, county officials said.
Creating the LCA still must be approved by county commissioners before a board is appointed and the half-percent fee and other funding mechanisms are authorized. Steiner also intends to charge tenants at Liberty Center special assessments to generate money.
Ohio law has allowed the creation and operation of community authorities since 1991, with New Albany establishing the first to finance construction of a middle school, fire station, performing arts center, roads and sewers.
Julie Wagner Feasel, vice president of communications for the Ohio Chamber of Commerce, said officials there believe Liberty Center is the first time a community authority was created for a commercial project. They are often used for residential development, she said.
Ohio doesn’t track community authorities but Todd Walker, spokesman for the Ohio Development Services Agency, said they exist across the state. Ohio isn’t unique in using them, he said. Other states have similar funding tools by a different name, he said.
But Steiner sought changes in the law to allow the the community authority for Liberty Center.
A bill sponsored by Sen. Bill Coley, R-Liberty Township, expanded the law last year to allow projects under 1,000 acres to set up a New Community Authority as a funding mechanism for infrastructure around the development. Before then, at 100 acres, the Steiner development wouldn’t have been eligible.
The arrangement establishes a way for Steiner to fund a portion of the infrastructure with user fees from tenants, shoppers or essentially any legal means possible once the community authority is set up.
At the same time it keeps the government’s contributions down.
Steiner officials had pitched the idea for the community authority after reviving the 1.1-million-square-foot mixed use project in 2011. They had proposed the development years earlier, but put it on hold in 2008 when the economy tanked.
Commissioner Don Dixon said he doesn’t think the additional fee on shoppers will keep people away from Liberty Center.
“It’s a service fee, but it’s voluntary. It’s not used very often, but it’s not something you have to pay,” Dixon said. “It’s like when you go on vacation. You can stay at the Dollar Inn or you want to to stay at The Ritz. It all depends on what your appetite is.”