Gov. Mike DeWine signed into law the budget bill which establishes the Ohio’s state budget for the next two years (July 1, 2021-June 20, 2023). The budget creates several new programs and modifies existing programs that could provide significant financial support to real estate development projects.
New and Existing Programs for Real Estate Development
New Program: Brownfield Remediation Program
The budget establishes a new Brownfield Remediation program and allocates $350M for the remediation of brownfield sites in the state. Each of Ohio’s 88 counties will have $1M reserved for projects. The remaining $262M will be awarded on a first-come, first-served basis according to pending guidelines by the Ohio Department of Development. Applications should be available toward the end of December 2021. Grant awards are up to 75% of total project costs.
New Program: Building Demolition and Site Revitalization Program
The budget creates the Building and Site Revitalization Program and allocates $150M for the demolition of commercial and residential buildings and revitalization of surrounding properties on sites that are not brownfields. Similar to the Brownfield Remediation Program, the grant awards are up to 75% of project costs and will be awarded on a first-come, first-served basis according to pending guidelines. Each of Ohio’s 88 counties will have $500K reserved for projects.
Existing Program Change: Rural Industrial Park Loan Program
The budget expands the geographic eligibility of projects for the Rural Industrial Park Loan Program that provides forgivable loans up to $2.5M for the development of industrial parks. The budget now allows any Ohio county that is not designated as part of a Metropolitan Statistical Area to be eligible to participate in the program. Forty-eight counties are now eligible for the program.
Existing Program Change: Ohio Opportunity Zone Tax Credit Program
The budget authorizes $50M for this biennium and also increases the maximum opportunity zone (OZ) tax credit per taxpayer from $1M to $2M.
New Program: Ohio Megaproject Program
Ohio has created a new program that enhances three existing economic development programs to be more competitive when courting projects with large capital investment or payroll commitments. Megaprojects are those that either will make at least $1B in fixed asset investment or create at least $75M in annual payroll. Projects that meet these requirements are now eligible to receive a job creation tax credit for up to 30 years. Current term limits are 15 years. The program also extends the maximum term for property tax abatements under the Community Reinvestment Area program and Enterprise Zone Program from 15 to 30 years.
Most new programs require the release of program and application guidelines from the Ohio Department of Development. KJK will continue to monitor changes to the application process.
For more information, contact Jon Pinney at jjp@kjk.com or 216.736.7260, or reach out to any of our Real Estate professionals.