NAPOLEON — A tax increment financing (TIF) ordinance, concerning improvements and future development at Oakwood Avenue and American Road in Napoleon, was discussed by Napoleon city manager Joel Mazur via Zoom at the Napoleon Area Board of Education meeting Wednesday.

In addition, Napoleon Area City Schools treasurer Michael Bostelman discussed steps the board needed to take to finalize the Clairmont Avenue project.

Mazur discussed a $1.5 million investment for Oakwood Avenue (north of U.S. 24) and American Road, which will increase safety, improve traffic flow, make additional property available for development, and increase tax revenue, with construction beginning as early as 2021.

This investment is in connection with the Love’s Travel Stop project underway on American Road. Although that project is taking place on property located in the Liberty Center School District, Mazur explained future development at Oakwood Avenue would take place in the Napoleon Area City School District.

“This is another important project in the works right now for Napoleon,” said Mazur. “If you haven’t heard me say it before, I will say this, economic development is a long game. You try to position yourself to attract more business, housing, whatever the case, and this is an opportunity to make an investment into a part of the community that’s primed for additional development.

“It’s unique because this is the first time the city would be able to establish a TIF district, but not only that, it will encompass two different school districts which is unusual,” added Mazur. “We’ve had conversations with both school districts, and the Maumee Valley Planning Commission, since they have been working directly with Love’s. This district would utilize TIF funds and grant funds to complete American Road, and Oakwood Avenue down to Freedom Drive.”

Mazur shared that $300,000 of grant funds have been secured for the project, while the remaining $1.2 million would come from a state infrastructure band (SIB) loan, based on approval by the school districts of a TIF structured in a manner similar to other roadwork projects in northwest Ohio. The TIF funds generated would then be used to pay down the debt service.

The city will assume the risk of insufficient TIF revenue, with no risk to the school districts, however, there will not be as much potential upside for the districts. Currently the undeveloped parcels included in the TIF area are generating less than $50,000 in annual tax revenue for the schools.

The school districts will receive 25% of what they otherwise would receive in increased property taxes from the TIF area, until enough revenues are received by the TIF district to pay off the debt service for the project. Once the debt is paid, the parties will reconvene to discuss future terms. Although the TIF agreement is for 30 years, Mazur is confident it won’t last anywhere near that term.

“Our biggest concern as a district was the life of the agreement of 30 years, which is a very long time,” stated Bostelman. “To Joel’s credit, we came up within the agreement that once the debt is paid off, we can sit down and determine where we’re at and how this fits in. I know we don’t know how quickly it will be paid off, but we’ve been told that with the TIF revenues, it won’t be anywhere near 30 years. That’s what got us on board as a district.”

Said Mazur: “We estimate that it will take about 10 years for the debt to be paid off through the TIF revenues. There’s no penalty for early repayment, so it’s a pretty favorable situation for us (the city) and for the school districts.”

The board passed the agreement to execute the school district compensation agreement with the city concerning the TIF ordinance, while also providing related authorizations.

Later in the meeting Bostelman discussed a resolution before the board authorizing the purchase of a bank letter of credit in the amount of $275,000, in connection with the Clairmont Avenue property dedication.

“This is to finalize the dedication of Clairmont Avenue to the city,” began Bostelman. “Mr. Mazur reached out to us and said there is a city ordinance that says we need a bank line of credit to guarantee that if something happens to the entire road, there is something in place to fix it. The chances of something happening to the entire road are slim, but with tremendous thanks to the Henry County Bank, we’ve opened a line of credit should something happen.

“Now to finalize the dedication, we need to present the city with a letter stating the line of credit is in place,” added Bostelman.

The resolution to purchase a bank letter of credit from the Henry County Bank, in the approximate amount of $275,000, was approved by the board.

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