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Realtor designs finance strategy | News, Sports, Jobs – Warren Tribune Chronicle

LIBERTY — At a time with soaring construction costs and limited supplies, a local developer wants to take advantage of a special public financing method that he said will create a constructive public-private partnership and increase housing stock and the property tax base in Liberty.

Real estate developer Jason Altobelli asked township trustees at a meeting earlier this month to consider negotiating a tax increment financing agreement to fund public infrastructure in the Kline’s Farm development off Belmont Avenue.

A portion of the property was developed about 25 years ago and is a well-received development with about 230 households, Altobelli said.

Now, the developers are in the process of designing an extension of the development. The area is poised to grow with five larger estate lots, 40 homes in the Potter’s Circle area and 10 acres to accommodate 36 to 40 units, he said.

“This is a successful, great spot. People love it. It is laid out well and designed professionally,” he said.

Altobelli said he does not yet know how much the development extension will cost to build or how much it will cost to build the public infrastructure it will require, such as roads, water service, sewage service and sidewalks.

“We are waiting on an engineer’s estimate,” Altobelli said.

Once that figure is known, Altobelli said he hopes Liberty trustees will consider entering into a TIF to help defray some of the costs to develop the extension.

A TIF is considered an economic development tool by the state of Ohio, which allows the agreements. In a TIF, a community agrees to forgo a certain percentage of property taxes for improvements on a new development, in exchange for receiving negotiated payments in lieu of taxes, typically for 10 years, to fund the public infrastructure part of the development.

A tax lien is created, and county treasurers continue to collect the taxes from the property owners. The tax collected on the value of the property before the improvements are made continues to be distributed as before, but the tax on the value of the new improvements goes into a fund to pay for the infrastructure.

The trustees had numerous questions for Altobelli and did not seem sold on the idea. If an agreement is reached, it would have to be qualified by the state to be enacted.

Altobelli said typically developers that enter TIFs ask a community for a bond to pay for the infrastructure up front, but that is not what he is seeking.

Altobelli said the developers will pay for the infrastructure up front and make payments in lieu of taxes to the township and toward the bill for the cost of the public infrastructure.

“This is not a handout,” he said. “It is a way to stabilize costs for the long term.”

TIFs are an “economic development tool in the Ohio Revised Code that allows for projects to move forward in a financially helpful way for everyone,” Altobelli said.

Inflation is up about 30 percent and consumers are wary of large price tags right now, so keeping housing costs capped will make it easier to build and sell property, he said.

A TIF is not a tax abatement, he said, and will generate new income for the township. If the development can’t afford to move forward, neither the developer nor the township will benefit from increased value on the land, Altobelli told trustees.

Eventually, the TIF will come to an end, and the full tax amount will be collected the traditional way.

Trustee Arnie Clebone expressed concern for other township property taxpayers and that the deal would help the developer pay himself back for his initial investment.

Someone else still has to pay those taxes, Clebone said.

With a TIF, adding new property owners to the township rolls would lessen the tax burden on the levies property owners already are paying, Clebone said. But without a TIF, those property owners who don’t live in the area will continue to shoulder the tax burden and won’t see the benefit of seeing their tax burden reduced because there are more to pay the approved millage.

Clebone said the TIFs also present an “unfair advantage” to the company over competitors; he said “the market” ought to dictate success of the development.

Altobelli said the payments will help upkeep the infrastructure and help other property owners in the area to develop with more ease. He said he is looking for other partners and hopes to have more discussions with trustees in the new year.

Trumbull County has had three TIFs, Nicholas Coggins, assistant director of the Trumbull County Planning Commission, said.

In Braceville, a 10-year, 60 percent TIF was created in 2002 for the Holiday Inn Express at the Interstate 80 interchange on state Route 5.

In Champion, a 20-year TIF was created for ORIX Warren Venture to build 4,400 feet of road on Research Parkway NW.

In 2019, a 30-year TIF was created for Warren’s downtown business district.

“Any improvements or increased taxes to the area goes to a fund to help with public infrastructure improvements or upgrades in the central business district,” Coggins said.

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