The full Cincinnati City Council Wednesday evening approved the framework for a new tax abatement agreement with Cincinnati Public Schools.
The proposal would let the city offer property tax abatements to commercial real estate developers. In exchange, those developers would have to make payments in lieu of taxes (PILOT) to CPS for 33% of the abated property value.
One slight change from what a committee approved Tuesday: The city manager can now negotiate the term of the new agreement for between five and seven years. A committee had approved a five year plan.
The new plan would still include an annual audit. But that review would not change the PILOT rate for the term of the agreement.
Council members David Mann, Chris Seelbach, P.G. Sittenfeld, Christopher Smitherman, Jeff Pastor and Wendell Young voted in favor of the plan. Greg Landsman, Amy Murray and Tamaya Dennard were opposed. Landsman and Murray both said they preferred holding the term to five years.
"That after a few years of doing the audit together, getting into the weeds on the math together, we will be in a better place in five years," Landsman said.
Vice Mayor Smitherman supported the plan, but he was willing to let the agreement run for 10 years.
"I think having these discussions in five years, or really in four years, or three years is just not healthy, and so I really prefer the 10 years," he said.
A 10-year agreement also had the support of Mayor John Cranley. He said that would give more certainty to commercial developers.
A 1999 abatement agreement between the city and CPS expired on Dec 31. That plan had developers making PILOTs of 25-27%. Plus the city was making an annual $5 million payment to the district. That payment is not included in the new proposed agreement.
The city and the school board would decide how the annual audits would be conducted, and who would be involved in the process.
The school board is expected to consider the abatement issue Monday.