Chapter 122:29-1 | Transformational Mixed Use Development Tax Credit

Rule 122:29-1-01 | Definitions.

• Effective: July 5, 2021
• Promulgated Under: 119.03

Terms not otherwise defined in this rule have the meaning given to them in section 122.09 of the Revised Code.

(A) "Authority" means the tax credit authority created pursuant to division (M) of section 122.17 of the Revised Code.

(B) "Amendment" means any allowed modification to the project, as described in an approved application including changes in property owners, timeline for completion, and changes in financing.

(C) "Connected buildings" means two or more buildings that either share a common wall or are connected by an enclosed passage, including a skyway, walkway, atrium, or vestibule.

(D) "Contiguous parcels" means two or more parcels that are adjacent, meaning each parcel sharing a common boundary with at least one of the other parcels, or that would be adjacent but for a right-of-way separating the two or more parcels.

(E) "Director" means the director of the development services agency of the state of Ohio or its successor.

(F) "Eligible expenditures" means development costs as defined by section 122.09 of the Revised Code and identified in the application materials, which are associated with the portion of the project that is certified by the authority and do not include expenditures incurred for other phases of the transformational mixed use development. Eligible expenditures include architectural or engineering fees paid or incurred in connection with the project. Except for architectural and engineering fees paid or incurred in connection with the project, only expenses incurred after the date of application are eligible expenditures.

(G) "Major city" means a municipal corporation that has a population greater than one hundred thousand as identified by the most recent population estimates by the U.S. census bureau.

(H) "Major factor" means the tax credits are essential in the decision to begin the project or the project would not be completed without receipt of the tax credits.

(I) "Project" means only the portion of the transformational mixed use development submitted by the applicant for certification of tax credits or portion of the transformational mixed use development certified by the authority. A "project" may include one or more phases of a transformational mixed use development and may have one or more property owners.

(J) "Property owner" has the same meaning as owner as defined in division (A)(2) of section 122.09 of the Revised Code. An entity that has fully owned subsidiaries that are property owners in a project or exerts common control over multiple property owners in a project may elect to apply as the property owner for purposes of the tax credit.

(K) "Surrounding area" means, for a project located within ten miles of a major city determined by starting from the corporate boundary of the major city and extending out ten miles from that boundary, the area encompassed within a perimeter starting from the transformational mixed use development boundary and extending one-half mile out from that boundary. For a project not located within ten miles of a major city, surrounding area means the area encompassed within a perimeter starting from the transformational mixed used development boundary and extending two miles out from that boundary.

(L) "Structured parking" means a parking structure either connected to or independent from a building with two or more levels or floors. This structure may be above-ground or underground.

(M) "Viable financial plan" means a complete sources and uses of funding for the proposed project, including anticipated development costs and architectural or engineering fees for that project.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-02 | Eligibility.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) An eligible applicant may be a property owner at the time the application is submitted and the project is certified by the tax credit authority, or an insurance company that contributes capital to be used in the project, as defined in division (A) of section 122.09 of the Revised Code. If there are multiple property owners within a project, only the property owners included in an application are eligible applicants and only the portions of a project associated with an eligible applicant or insurance company contributing capital are included for consideration as part of a project.

(B) The project is either a transformational mixed use development or one or more phased portions of a transformational mixed use development as defined in division (A)(3) of section 122.09 of the Revised Code. If applying for more than one phase, each phase is to be either contiguous to one another or contiguous to a previously developed portion of the transformational mixed use development, so long as the previously developed phase and the project phases in the application are developed in continuous chronological order.

(C) Both (1) the tax credit is a major factor in the completion of the project and (2) the project will not be completed unless the applicant receives the tax credit, each as demonstrated by the applicant to the authority through evidence acceptable to the authority.

(D) The project integrates a combination of:

(1) Any two or more of retail, office, residential, recreation, and other similar mixed uses; or

(2) Structured parking and any two or more of retail, office, residential, recreation, and other similar mixed uses.

(E) The project has in place or has obtained commitments for a minimum of fifty-one per cent of the estimated development costs attributable to the project. Commitments may include, but are not limited to, public financing awards, dedicated service payments, commitments letters or conditional commitment letters from financial institutions, or evidence of available equity.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-03 | Application and Certification.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) The director will provide the form of application for certification of a transformational mixed use development and preliminary approval of a tax credit, developed in consultation with the authority, on its website prior to the opening of each application period.

(1) The authority and the director will develop scoring criteria, scoring instruments, and materials for use by the director in reviewing applications under the program. The scoring criteria, instruments and materials are to be consistent with the factors set forth in section 122.09 of the Revised Code.

(2) The application will include instructions and minimum requirements to satisfy the criteria of the development plan set forth in division (B) of section 122.09 of the Revised Code and other criteria as may be requested by the director and the authority in order to evaluate the potential impact of the transformational mixed use development.

(3) The director will use the scoring criteria and procedures specified in the application to review and recommend projects for certification to the authority.

(B) An application for a project may be submitted by a single property owner or multiple property owners within the project. If an application contains multiple property owners, each property owner is to be a party to the application and the applicants will include a description of the allocation of tax credits among the multiple property owners.

(C) Applications are to be submitted to the director by the deadline published on the program website and specified in the application for each application period. No late applications will be accepted by the director for any reason other than impossibility due to state network error. No additional or supplemental materials will be accepted after the application deadline, unless requested by the director or the authority.

(D) The director will preliminarily evaluate applications for completeness and meeting minimum requirements set forth in the application instructions. Applications missing required information or that do not otherwise satisfy the criteria in the application instructions will be rejected and will not be evaluated by the director nor scored for ranking or recommendation to the authority. The director will provide the applicant notice in writing that its application is incomplete. Submission of an incomplete application does not disqualify a project from reapplying in a future fiscal year or round.

(E) Applications that meet the minimum requirements will be evaluated and scored by the director. Upon completion of evaluation and scoring, the director will rank applications and recommend projects to the authority for approval and certification. The authority may choose to conduct interviews by means of a special meeting, held in accordance with paragraph (D) of rule 122:7-1-02 of the Administrative Code. Projects not approved and certified for a tax credit by the authority in any application period may reapply in future application periods.

(F) The authority will approve and certify recommended applications in accordance with division (C) of section 122.09 of the Revised Code.

(1) For projects that are approved and certified, the authority will issue the statement required by division (C)(2) of section 122.09 of the Revised Code in writing to the applicant.

(2) For projects that meet the minimum requirements and are evaluated but not approved and certified by the authority, the authority will provide the applicant notice in writing in accordance with division (C)(4) of section 122.09 of the Revised Code. The applicant may revise and resubmit its project application for consideration in future rounds.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-04 | Agreements and Amendments.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) Following approval and certification of an application in order to be eligible to receive a credit, all applicants will enter into a grant agreement with the authority setting forth the terms and conditions, in accordance with section 122.09 of the Revised Code and Chapter 122-9 of the Administrative Code. Any applicant identified in the application who does not execute the agreement is not eligible for receiving the approved and certified tax credit.

(B) The agreement will incorporate the development plan and application materials and will set the potential total amount of tax credit and proportion of the total tax credit allocated to each property owner, if more than one property owner is included in the application as approved and certified by the authority.

(C) The agreement may be amended prior to the completion date to reflect changes in property owners, the timeline for completion, or changes in financing. The authority will not consider any requests to amend the scope of the project or end uses as described in the development plan and application materials.

Last updated September 17, 2024 at 10:44 AM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-05 | Transformational Mixed Use Development Tax Credit.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) The tax credit certificate will be in the form determined by the director and as approved by the director of insurance.

(B) The amount of the tax credit certificate is to be as calculated by the authority under either division (H) or (I) of section 122.09 of the Revised Code, as applicable.

(C) In determining the increase in tax collections under division (G) of section 122.09 of the Revised Code for a calculation under division (H) of section 122.09 of the Revised Code, the authority, with the information provided by the tax commissioner and applicable municipal tax administrators will consider the following taxes, levies, and charges, as each may be recognized by the tax commissioner and municipal tax administrators from the project and within the surrounding area:

(1) Those collected under Chapter 718. of the Revised Code;

(2) Those collected under Chapter 5705. of the Revised Code;

(3) Those collected under Chapter 5739. of the Revised Code, including section 5739.09;

(4) Those collected under Chapter 5741. of the Revised Code; and

(5) Those collected under Chapter 5747. of the Revised Code.

Increase in tax collections also includes any amounts collected by a municipal or county tax administrator within the surrounding area by an alternative method than the preceding named chapters of the Revised Code such as tax increment financing agreements, payments in lieu of taxes, and new community authority development charges.

(D) Any collection of taxes that have been abated by action of the local jurisdiction or county are not to be included by the authority in the computation of the increase in tax collections.

(E) The property owner may request the alternative method of computing the value of tax credit certificates under division (I) of section 122.09 of the Revised Code on the request form made available by the director, which will outline the necessary information for the tax credit authority to make a determination on such request.

(1) In its request for the alternative method of computing the value of tax credit certificates, the property owner will identify at least one third party to be engaged by the authority at the expense of the property owner who is competent to reasonably confirm the expected increase in tax collections.

(2) Upon notification by the authority to the property owner that the third party identified is acceptable or its selection of a third party if more than one is identified, the property owner may engage the selected third party on behalf of the authority and, upon completion, present the third party report to the authority.

(3) The third party report as provided to the authority confirming the expected increase in tax collections for the alternative method of computing the value of tax credit certificates is public record under section 149.43 of the Revised Code except as may be otherwise exempt.

(F) Pursuant to division (K) of section 122.09 of the Revised Code, the aggregate value of all tax credit certificates issued for the project may not exceed (1) ten per cent of the actual development costs of the project or (2) the sum of all estimated credit amounts preliminarily approved by the tax credit authority in connection with the project. In any event, no more than forty million dollars in tax credits may be issued for the same transformational mixed use development.

(G) The tax credit may be sold or transferred, in whole or in part, by the property owner under division (E) of section 122.09 of the Revised Code. The property owner will notify the authority of the transfer and will provide the information on the form determined and provided by the director.

(H) A sale of property or sale of an interest in real property by a property owner may include the right to the amount of tax credit held by such property owner and is not a sale or transfer of the credit for purposes of division (E) of section 122.09 of the Revised Code.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-06 | Reporting.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) Start of construction report. Within twelve months of the date a project is certified by the authority, the property owner will provide the director with a start of construction report that includes the following:

(1) An updated schedule for the progression and completion of the project;

(2) Documentation sufficient to demonstrate that construction of the project has begun;

(3) Any additional information requested by the director.

(B) Construction progress report. Annually, after the start of construction report in paragraph (A) of this rule, until the project is completed or as may be requested by the director, the property owner will provide the director a construction progress report detailing the status of the project, including percentage of the project completed, costs remaining, schedule updates, and any other information requested by the director.

(C) Completion report.

Within ninety calendar days after the completion of the project, the applicant is to certify to the authority that each portion of the project is complete substantially as set forth in the application in a completion report in a format acceptable to the authority. The completion report will include the following:

(1) A report from a third party certified public accountant detailing the actual development costs attributable to the project in a form and manner determined by the director; and

(2) Any other items as may be requested by the director or the authority.

(D) In connection with the tax credits and reports under this rule, including the CPA report, the applicant will establish and maintain records for a period beginning from the project approval and certification through the date that is four years from the later of recission of eligibility, the project completion date, or the issuance of the last tax credit certificate. Such records include, but are not limited to, records documenting the information and data contained in the application, project expenditures and all reports submitted in support of the project. The applicant is to make such records available for review and verification by the director, authority, tax commissioner, local tax administrator or director of insurance or appropriate staff of the director, the authority, the tax commissioner, the local tax administrator or director of insurance, as well as other appropriate state agencies. In the event it is determined by the director or the authority that an applicant has submitted reports or other information containing erroneous information or data not supported by records established and maintained under this rule, the director may, after providing notice, require the applicant to submit revised and accurate reports.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-07 | Rescission of Tax Credit Certification.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) If the owner does not timely provide the start of construction report as required by paragraph (A) of rule 122:29-1-06 of the Administrative Code, the authority will provide notice to the owner of such failure and the authority is to rescind certification of the project at its next schedule meeting.

(B) In addition to paragraph (A) of this rule, the tax credit authority may rescind the tax credit certification if:

(1) The owner fails to timely provide a construction progress report and does not cure such failure within thirty days of written notice from the director;

(2) The authority reasonably determines, based on the construction progress report and recommendation from the director, that the project has failed to make sufficient progress towards completion in consideration of the schedule provided by the owner;

(3) The authority reasonably determines that the owner has abandoned the project of the owner informs the authority it has abandoned the project; or

(4) The owner or applicant is found by the authority to have provided false information to the director, the authority or any other entity of the state of Ohio in any way connected to the approval and certification of the project or determination of any amount of tax credit to the owner or applicant under Chapter 122. of the Revised Code.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026

Rule 122:29-1-08 | Fees.

• Effective: July 5, 2021
• Promulgated Under: 119.03

(A) Application fee. A non-refundable application fee of twenty-five hundred dollars is due at the time of application submission. Any submitted application that does not include an application fee payment is ineligible for consideration by the authority.

(B) Fees submitted for an application submission will be credited by the director to the tax incentives operating fund created under section 122.174 of the Revised Code and will be used by the director to administer section 122.09 of the Revised Code.

Last updated July 6, 2021 at 1:29 PM

Supplemental Information

Authorized By: 122.09(O)
Amplifies: 122.09
Five Year Review Date: 7/5/2026