The Mound Development Corp. and the city of Miamisburg have agreed on a multi-year income tax sharing deal to fund the former Mound site’s economic development.
The agreement – a memorandum of understanding - calls for the city and the MDC to evenly share income tax revenue generated by businesses locating at the 306-acre Mound Advanced Technology Center business park off of Ohio 725, officials said.
The MDC oversees the business park, the site of the former nuclear weapons development site, for economic development.
Under the plan, if a company locating at the park has a $6 million payroll, it would pay $135,000 under the city’s 2.25-percent income tax rate with the MDC and the city getting $67,500 each, said Eric Cluxton, MDC president.
Funds generated from the agreement can be used only for economic development purposes. These include “building renovations, business attraction incentives, tenant improvements and other similar activities designed to result in the location of new businesses or the expansion of existing businesses at the Mound,” the agreement states.
The deal takes effect June 1 and ends June 1, 2018, according to city records.
Despite giving up potential tax revenue, the deal makes sense if the city wants to attract more businesses, said Miamisburg Mayor Dick Church Jr.
“When a business approaches you about coming, you have to deal with them in some fashion,” he said. “It’s just how business is done today … A lot of people have different ideas, but it’s important to bring jobs to the community.”
The MDC derives most of its income through property transactions and lease income, according to a memo by Miamisburg Development Director Chris Fine.
“Because many of the buildings on the site are still vacant or underutilized, the long-term sustainability of the organization will depend on additional revenue to ‘bridge the gap’ until more properties are sold or additional spaces are leased to companies,” according to Fine’s memo.
The agreement will be handled on a case-by-case basis, Cluxton said. It does not apply to the MDC’s 12 existing businesses, which employ 256 workers, he said.