Shalersville Township and the City of Streetsboro have worked out an economic agreement that will prevent any possibility the township could be annexed.
It’s called the Shalersville-Streetsboro Joint Economic Development District (JEDD), and city and township leaders are all on board.
So is Portage County’s board of commissioners, which June 9 approved the JEDD and a tax abatement agreement with SFG Geis Shalersville, the arm of Streetsboro’s Geis Companies that owns some 470 acres just north of the Ohio Turnpike near the Shalersville interchange.
The 50-year agreement automatically renews for 25-year periods, provided all parties agree. It also takes the possibility of annexation completely off the table.
“The whole point of using the JEDD is so the township doesn’t get annexed. We have no desire to annex them, and they have no desire to be annexed by us,” Streetsboro Economic Director Patrick O’Malia said. “What the JEDD does is it effectively makes it almost impossible for us to annex them.”
JEDDs are unique to Ohio. They are agreements between two parties, in this case a city and township, that share benefits and responsibilities of development projects. JEDDs impose a tax on the area, with profits flowing to both parties. Tax Abatement Agreements apply when a government agrees to forgo revenue in return for a promise of economic development or other benefit.
The land, located along Beck Road at state Route 44 and Infirmary Road in Shalersville Township, is currently zoned light industrial. It is within a mile of the Shalersville Ohio Turnpike interchange.
The JEDD states Geis’s intention to erect 10 buildings totaling 7,345,000 square feet on the Shalersville site, transforming 77 acres of farmland into The Turnpike Commerce Center, a major industrial hub. According to the Project Development Agreement, one building alone will total just over 1 million square feet.
Geis estimates the development to cost approximately $70,836,810, according to the PDA. Construction is to begin by July 1 and must be “substantially complete on or about December 31, 2023,” the PDA states.
Under the terms of the PDA, Geis will hold no tax responsibility for increases in assessed value associated with developing the land for 15 years. The agreement is contingent on Geis creating 375 new full-time, permanent jobs by December 2026, adding about $15 million annually to Geis’s payroll or to those of its tenants.
“Townships don’t collect income tax,” O’Malia explained. “They make most of their money on property tax. And what a JEDD does is it allows us to come in as a city and say, ‘We’ll extend our power as a city to allow you to collect an income tax within this defined area,’ and then you work out a split. The trustees now have a new source of revenue for some areas that the Geis Companies have bought right off the turnpike.”
Shalersville trustees could not be reached for comment.
The JEDD agreement states the Geis Companies’ eventual goal of providing more than 2,600 jobs with an eventual annual $2.14 million payroll. Under the terms of the proposed agreement, Shalersville will reap 65% of gross income tax receipts while Streetsboro rakes in 35%.
Should Geis wish to develop more of the property and seek additional tax abatements for doing so, the company will be expected to join the JEDD, O’Malia said.
“You want a property tax credit? The only way the township makes money is property tax, so if you want us to give up property tax, you have to compensate us in another fashion, and that’s joining the JEDD so we can levy an income tax there,” he said.