Tax and Payment Timeline

Community Reinvestment Area (CRA)

A CRA lets cities exempt the value of new construction from property taxes to attract investment. The exemption applies to the building value, not the land, and lasts up to 15 years.

Tax Increment Financing (TIF)

A TIF doesn't remove taxes — it redirects them. When new buildings raise a property's value, the owner pays service payments in lieu of taxes equal to what the property-tax bill would have been. Those payments go into a TIF Fund that the City controls, and can be used for public infrastructure (roads, water, sewer, storm drainage, etc.) or, under Ohio law, to reimburse the developer for eligible public-infrastructure costs.

In 1994, Ohio changed its CRA law to limit exemptions and require school-board approval.

Piqua's CRA #3, established in 1992, predates that change. Under the old statute:

• It can grant a 100% exemption for 15 years on all new building value.
• It does not require school-board consent.
• It can be paired with a TIF, but the CRA takes priority under R.C. 5709.911, so the TIF does not begin until the CRA ends.
• This combination allows 15 years of tax exemption followed by 15 years of TIF, extending the incentive period to 30 years.

Highlights

• Each building completed under the project is fully exempt from property taxes for 15 years.
• The TIF exists legally but is "subordinate to any real property tax abatement … provided under R.C. Chapter 3735, including … the CRA Exemption." (TIF Ordinance §1)
• Within 90 days of the agreement, the company deposits up to $75 million into a jointly controlled escrow account for design and construction of public infrastructure:

  "Within ninety (90) days of execution … the Parties shall establish an escrow account … Customer shall deposit funds into the Escrow Account for the estimated design and construction costs." (Water & Wastewater Addendum 1)

• The City draws from this escrow to pay contractors. No bonds or borrowing are issued.
• The Development Agreement PILOT begins:

  "In tax years 1 through 5 … seven hundred and thirty-five thousand dollars ($735,000) per Building that satisfies the PILOT Building Trigger." (§4.3(A)(i))

  These are per-building annual payments to the City's General Fund.
• The company also begins direct payments to the Piqua City Schools and Upper Valley Career Center:

  "It is the intention … to pay to the Piqua City School District and Upper Valley Career Center … compensation payments … in the amount of the taxes that would have been payable … but for this Commission's authorization of this Ordinance." (Ordinance O-18-25)

  These are made directly by the company, not by the City or the TIF.
• The City also begins earning normal utility-service revenue once connections are active.

Highlights

• The CRA's 100% exemption continues; the TIF still cannot collect payments.
• The developer's escrow funds continue to pay for infrastructure.
• The City begins certifying the total cost of those projects so they can be reimbursed later from TIF revenues.
• The company's PILOT payment schedule steps up:

  "In tax years 6 through 20 … the greater of $735,000 per Building or $1,470,000 aggregate, plus CPI (not to exceed 3%) and $1.80 per square foot for any Building over 350,000 square feet." (§4.3(A)(ii))

• The schools continue receiving their separate direct payments.

Highlights

• When the CRA exemption expires after Year 15, the TIF takes effect for the remaining 15 years.
• The company begins paying service payments in lieu of taxes equal to the full property-tax amount that would otherwise be due:

  "Each service payment … will be charged and collected in the same manner and in the same amount as the real property taxes that would have been charged … if this Commission had not authorized the TIF Exemption." (TIF Agreement §2)

• Those payments are collected by the county treasurer and placed in the City's TIF Fund.
• The City must use them according to §5 of the TIF Agreement:

  "The City shall use the Service Payments … (i) up to fifty percent (50%) to reimburse the Company for the cost … of the Public Infrastructure Improvements … and (ii) up to fifty percent (50%) … for City public infrastructure improvements."

• The City reimburses the developer until its certified costs (up to about $75 million) are repaid. The other half stays in the TIF Fund for public projects.
• The company continues paying the school-compensation amounts directly; none of the TIF revenue goes to schools.
• The Development-Agreement PILOT continues through Year 20, then reverts to $735,000 per building (§4.3(A)(iii)).