Council hopefuls differ on tax breaks
Columbus city officials hailed the property tax incentive deal for new housing at Easton as a job creator and a win for one of the city’s struggling neighborhoods.
But it has put similar incentives in the crosshairs for the candidates attempting to unseat three incumbent City Council members.
Easton’s developers received a 10-year, 100 percent property tax abatement worth about $68 million on new housing in the mixed-use development anchored by a retail center. In exchange, developers agreed to pay the
city about $5.75 million that could be used for programs in Linden.
The council approved the deal in three pieces, starting in February.
The council approves every economic-development deal in the city. Sometimes, the city refunds income taxes collected from employees to the company. In other agreements, the city tells property owners that they don’t have to pay their property taxes at all — even the portion owed school districts.
Economic-development deals were worth about $16.5 million in tax dollars for the city in 2016, according to financial disclosures. The city finished 2016 with about $873 million in revenue for its general fund.
City officials and the incumbent council members, all Democrats, say those deals create jobs. A recent study commissioned by Franklin County Auditor Clarence Mingo, a Republican, determined that tax incentives are a small benefit for taxpayers.
“That’s how we get jobs into this community,” Councilman Shannon G. Hardin said. “It didn’t just happen that our city is growing the fastest in our region and in our state in terms of population and our jobs.”
Hardin is joining fellow Democrats Councilman Mitchell J. Brown and Councilwoman Priscilla Tyson in running for re-election. Two other Democrats, Jasmine Ayres and Will Petrik, and two Republicans, Kieran Cartharn and Whitney Smith, also are running. Two other Republicans, Sarah Ries and Josh Jaffe, will appear on the ballot as placeholder candidates. They work for the county GOP and likely would be replaced on the ballot by other candidates if they win in the primary.
The field will be narrowed to six in the primary on Tuesday.
The challengers say they don’t oppose tax breaks, but most said they think the city needs to be smarter about it how it uses them. The city hired a consultant to study how it uses tax incentives.
“Let’s give a tax abatement to a grocery store to be put in a food desert so they have incentive to move there,” said Ayres, a Democrat from the progressive Yes We Can wing of the local party.
Ayres said incentives are going to the wealthy and businesses that already are established in Columbus with connections that wouldn’t be easily uprooted.
But incumbent Democrat Tyson said the city has to use incentives if it is going to attract jobs. Easton’s developers are required to attract 500 permanent nonretail jobs under their agreement, and a Tax Incentive Review Council acts as the watchdog over such deals.
“Right now, when you’re thinking about the competition in the marketplace … this is what’s really key to us continuing to attract and retain jobs in our community,” she said.
Plenty of Columbus businesses are thriving without tax breaks, which disproportionately hurt schools, Smith said. Votes on tax breaks too often happen with little public debate, the Republican said, and the city needs set criteria for providing incentives.
“You have to balance what’s going to help the city grow, what’s ethically and morally right to do, and what’s going to help the neighborhood that needs the most help,” she said.
Brown said he evaluates each incentive deal “on its own individual merit.” As the city’s population grows, those people will need job opportunities as they move to Columbus, the incumbent Democrat said.
“I’m not necessarily open-hearted in favor of tax abatements, but I am willing to take a look at it and how the city is going to benefit from it, not just now but later on down the road,” he said.
Cartharn, a Republican, agreed that each deal must be evaluated individually, but he said the city failed to recognize the costs to Columbus City Schools when it gave Easton a property tax abatement. That deal will cost the district about $46 million, though city projections say the district could make another $70 million over 37 years as the abatements taper off.
“Tax abatements can be a useful economicdevelopment tool. However, they must be evaluated on their costs and benefits,” he said.
Petrik, a Yes-We-Can Democrat, has another word for tax incentives: giveaways. The deals create winners and losers, he said, and often the winners are developers while average taxpayers are left “picking up the tab.”
The city needs to re-evaluate where it is incentivizing developers to build and make sure builders aren’t pricing residents out of their own neighborhoods, he said.
“They’re going to profit regardless of a tax abatement or not,” he said. “We need a voice on city council who doesn’t just fall in line with a threat from a big developer.”