Posted: 6:47 p.m. Monday, July 6, 2015
No tax credits
awarded this cycle for Middletown
microbrew
By Ed Richter
Staff Writer
MIDDLETOWN —
A lot of developers were
breathing easier last week after Ohio’s
biennial budget was signed into law last week.
During the last weeks of
the budget process in the Ohio General Assembly, there was a proposal to drop
the historic preservation tax credits from the budget. However, that proposal
was short-lived and escaped any line item vetoes and was put back into the
budget that was signed last week by Ohio Gov. John Kasich.
Had the historic tax
credits been eliminated, it would have resulted in roughly a $1.7 million loss
to the Manchester
Hotel project and about $600,000 from the Snider Building/Brewery project,
said Illinois
developer William Grau, who heads the ownership group redeveloping both
projects.
In a recent email
response to the Journal-News, Grau said, “The State Historic Tax Credits are
imperative to the Manchester Hotel’s redevelopment as a hotel, but we believe
to create a destination, both buildings need to be redeveloped.”
Grau said had the tax
credits been discontinued, “Our plan B is the redevelopment of the Manchester
Hotel as a hotel, at the urging of the city. Our original proposal was to
redevelop the Manchester Hotel as apartments, and if the State Historic Tax
Credits we’re to be eliminated, that option would need to be reconsidered.”
Now that the state
historic tax credit program remains in place for the next two years, Grau said
his group is still on track to submit the historic tax credit application for
the $12.7 million Manchester
project in September as previously announced.
As for the $3.5 million Snider Building
project, the application for historic tax credits that was submitted at the end
of March was ruled ineligible by the Ohio Development Services Agency, which
administers the program.
Penny Martin, a
development services agency spokeswoman, said the Snider application was
ineligible because there was no pre-application meeting held with the State
Historic Preservation Office. She said the project is eligible to apply in the
next round. The application deadline is Sept. 30 and awards for that cycle will
be announced on Dec. 31.
Grau could not be
reached for comment Monday on the past award cycle.
He recently told the
Journal-News that SHPO was reviewing the restoration plans for the Snider Building
provided by Hardlines Design Company.
Grau also said the group
is currently in talks with several existing microbreweries as potential
partners, including Cigar City Brewing located in Tampa, Fla.
Although the projects
have hit a snag in seeking historic preservation tax credits, Grau’s group may
receive some positive financial news tonight.
That is when Middletown
City Council is expected to approve a pair of Community Reinvestment Area tax
abatements for both projects for 100 percent for 12 years.
City officials said the Manchester tax abatement
is valued at approximately $104,000 a year for a total of $1.24 million over
the 12-year abatement period. The city’s portion of the property taxes that
would be abated is estimated to be $9,660 a year or $115,920 over the abatement
period. Announced plans call for The Manchester Inn, which closed four years
ago, to be restored back to an operating 70-room/suite boutique hotel with a
restaurant, conference and meeting space, and additional commercial office
space as well as the historic ballroom event space.
According to city
officials, the tax abatement for the Snider
Building, also known as the Sonshine Building, is valued at $45,000 a year
for a total of $546,00 over the 12-year abatement. The Snider Building
is to be redeveloped as a brewery, taproom, distillery project that would have
a direct relationship with the Manchester Hotel redevelopment.
In 2010, Middletown created a community reinvestment area to use
all reasonable incentive measures to assist and encourage development in the
downtown area of Middletown.
Based on state guidelines, CRA abatements can be used for residential
developments, industrial/commercial developments, or a combination of both.
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