BELLBROOK — In what’s being called a win-win for both sides, Bellbrook-Sugarcreek Schools and Oberer Development Co., are negotiating terms of tax increment financing (TIF) for the former Dille property in Sugarcreek Township.
The property, which was annexed by Centerville several years ago, is reportedly the site for a Costco wholesale store along with other retail and residential buildings. Under a TIF, a municipality or developer can take the project’s projected increase in property tax money that would normally go to a school district and use that for the project for a period of time. Under Ohio law, 75 percent of property tax money can be taken under a TIF for 10 years, leaving the schools with 25 percent.
“They can do that without our approval,” said Bellbrook schools Superintendent Dr. Keith St. Pierre.
However Oberer is willing to give the schools more than 25 percent in exchange for a longer TIF period. The developer needs the extra money to fund the major improvements to the infrastructure, including but not limited to adding lanes Feedwire Road and Wilmington Pike. The TIF needs to go longer than 10 years, but it may not need to go 30 years, which is the limit, according to George Oberer Jr., CEO of Oberer Development.
“We are negotiating where we can extend the number of years and also expand the percentage that the school district can get,” Oberer said. “It’s a win-win for the entire community. They’ll benefit from all the infrastructure improvements.”
St. Pierre said the current negotiations call for the schools to get 55 percent of the commercial property tax from the development. School officials are trying to get 55 percent for Sugarcreek Township as well.
Any amount is better than the current situation. Very little in property tax revenue is going to the schools and it’s at an agricultural rate St. Pierre said.
Oberer said the “conservative” projected figures show the development is going to improve the property value more than $120 million over what it is at now.
And given that Oberer needs more than 10 years’ worth of TIF money, it gives the schools a bargaining chip they didn’t have before, St. Pierre said. Had Oberer needed just a 10-year TIF, there could potentially be no limit to the amount of residential units built.
“We could have just been flooded with students,” St. Pierre said. “The school has been able to say, ‘Hey we don’t want over 1,000 apartments.’ ” The current number is approximately 300, two-bedroom units, which “limits the number of students,” St. Pierre said.
He added that projections indicate the TIF would not need need to go the entire term which means the schools will begin to see added property tax dollars sooner.
“As the monies come in as our financial guys suspect they will, better than what is charted out, we’re requesting the TIF is paid off sooner,” St. Pierre said.
In addition to more property tax money for the schools, there is a windfall expected with regards to sales tax revenue and projected payroll. While Oberer said he is under a confidentiality agreement and is not allowed to specifically mention the name of the major tenant, he did say it has a $9 million per year payroll and will pump between $110-115 million a year in sales into the economy.
Oberer said “that single store” will create nearly 300 jobs with a minimum full-time starting salary of approximately $20 per hour.
St. Pierre said once the money from the development starts coming in, it may reduce the amount needed for the next school tax levy.
The Sugarcreek Board of Education must approve the TIF and as legal language continues to be worked out, approval could happen in May or it may not come until June or later, St. Pierre said.