Collaborative Economic Expansion Zones Establishment
In 1993, the Ohio General Assembly established Joint Economic Development Districts (JEDDs), allowing local communities to collaborate and stimulate economic growth. Since then, the legislature has revised the law twice – in 2014 and 2016 – and H.B. 110 instated further changes in 2021, applicable solely to JEDDs created through the general process, not the restricted types (specified in ORC 715.70 and 715.71).
A JEDD agreement unites townships, cities, and villages to address economic development, revenue shortages, growth concerns, and annexation pressures. Through joint efforts, JEDDs can foster job creation, generate revenue, and improve community welfare. Variable JEDD contractual agreements serve as vital economic development tools for local communities.
What is a JEDD?
JEDDs are special territorial districts—initiated by contractual agreements between municipal corporations and townships—aimed at fostering economic development, job creation, and enhancing community welfare. Usually, these objectives are achieved through income tax levies within the district, which can be shared among the parties and used for improved services, new facilities, or enhanced infrastructure, as outlined in the agreement.
How is a JEDD Formed?
JEDD Timeline
A township and a municipal corporation form a JEDD by negotiating a JEDD contract and adopting the contract's terms through local legislation. The contract must include:
Activity
- Contribution types from each party for district development and operation.
- Provisions for sharing tax revenue and costs.
- An economic development plan detailing the schedule for service, facility, or infrastructure provision.
- Appointment procedures for the board of directors, including powers, duties, and functions assignments.
- Grants to the board of directors to levy an income tax, if necessary.
- Annexation restrictions on unincorporated territory within the district.
- Property designation as a community entertainment district, if desired.
H.B. 110 updates in ORC 715.72 F8 (a-c) specify that property owners within half a mile of the proposed JEDD territory can opt out if their property is serviced by a non-contracting municipal corporation. The new bill also requires the contracting entities to:
30 days (minimum)
- alert non-contracting municipal corporations within half a mile or obligated to service the proposed JEDD territory;
- disclose utility infrastructure details, a cost estimate for providing utility services, timelines, and funding analysis demonstrating that the infrastructure will be constructed within five years.
Discussion, negotiation, legislation preparation, and meetings with city, village, and township entities. Must also provide notice to non-contracting municipal corporations within 1⁄2 mile of the proposed JEDD or will be obligated to provide water or sewer services to all or part of the proposed JEDD.
Both parties must hold a public hearing before adopting the contract, and all parties must make the following documents available for public inspection:
- A copy of the JEDD contract, including the economic development plan.
- A map and description of the district area.
- A collection schedule for authorized income taxes, if applicable.
30 days (minimum)
The contracting parties also need to distribute petitions seeking approval for JEDD creation, with a requirement that petitions signed by a majority of property and business owners support the JEDD creation. Once the public comment period elapses and petitions are received, each contracting entity can adopt legislation approving the contract and create the JEDD. Within 10 days following legislation adoption, notice of JEDD creation should be given to property and business owners within the district who did not sign the petition.
Public hearing notice after draft legislation is created
How is a JEDD Governed?
The JEDD is governed by an independent board of directors detailed in the JEDD contract, according to ORC 715.72. Typically, the board consists of five parties with staggered four-year terms:
15 days (minimum)
- Representatives from each municipal corporation involved.
- Representatives from each participating township.
- Business owners within the JEDD.
- Employees working within the JEDD.
- County representatives (if any), otherwise chosen by the other board members.
Communities review input from public hearings and amend legislation, if needed
The JEDD board's powers are delineated in the JEDD contract, adhering to the limitations set forth in ORC 715.72. Generally, JEDDs possess the following powers:
- To levy an income tax within the JEDD at a rate matching the highest rate levied by a contracting municipality, setting aside funds for long-term JEDD maintenance.
- To determine zoning and land use regulations, building codes, public improvements, and other regulatory matters.
- To control annexation of unincorporated territory within the JEDD.
- To restrict property tax abatements and other tax incentives within the JEDD.
- To create JEDDs in mixed-use areas with both residents and businesses.
- To create community entertainment districts within a JEDD.
30 days
What are the Advantages of a JEDD for a Township, City, or Village?
The JEDD becomes law 30 days after legislation is passed by municipality and formally adopted by the township
Township Advantages
- Increased revenue through income and property taxes on previously vacant or undeveloped land.
- Annexation prohibition for three years with cooperative agreements established.
- Enhanced revenue for providing additional services to residents at no additional cost.
- Infrastructure extension to previously unserved parcels.
- Framework for cooperating with municipalities to foster development opportunities.
105 days (total)
City or Village Advantages
JEDD is submitted to the Ohio Development Services Agency
- Increased income tax revenues.
- Typical increase in new utility customers, yielding additional revenue.
- Cooperative framework to solve development issues and foster growth opportunities.
The Joint Economic Development District serves as a creative, localized tool that enables municipalities and townships to collaborate outside municipal boundaries to achieve greater economic growth. By working together, the partners can collaborate to embark on development initiatives, enhance infrastructure, and improve public services without annexation. Ultimately, the JEDD improves residents' economic outlook and provides enhanced services for the community as a whole.
A JEDD can serve as a crucial financial tool in the industry and business sectors, as it helps stimulate economic growth and job creation. By fostering joint efforts among townships, cities, and villages, JEDDs generate revenue that can be used for improved services, facilities, or infrastructure in the district though income tax levies.
Through the establishment of a special board of directors, JEDDs are governed independently, with each board member representing a different party involved: municipal corporations, townships, business owners, employees, and county representatives (if applicable). This board possesses significant powers, such as levying an income tax, determining zoning and land use regulations, and controlling annexation of unincorporated territory, all aimed at promoting economic growth and development.
