Introduction | Summary | Master Plan Document | Annual Reports | Implementation Strategies
2004 Master Plan Annual Report
Economy
2004 Annual Report | Land Use | Economy | Community Appearance | Community Facilities & Services | Housing | Transportation | Implementation
Click here to view/download a pdf version of the Economy section.
Economy Meeting Summary
From Meeting Dated Tuesday, March 8, 2005
In Attendance
- Cathe Armstrong (Finance Department), Moderator
- Teri Kennedy (Finance Department), Recorder
- Chad Gibson (Development Department), Emma Bramley, Patty Dalton, Jeff Nelson, Gerald Smith (City Manager’s Office), Robin Sowry (City Attorney’s Office)
Goal
Emphasize high quality jobs and businesses, collaborative partnerships, and enhancement of the local tax base, while respecting the residential character of the community and creating a stronger and more diverse economy.
Executive Summary
The goals of the Economy section are the foundation for the Master Plan’s overall success. Assuring the City’s fiscal health over the long term is key to assuring the continuance of quality services and the health and vitality of the community. The Master Plan has identified enhanced income tax revenues, brought about primarily through redevelopment of the City’s commercial districts, as the main contributor to Upper Arlington’s long-term financial stability.
The objectives of retaining and expanding existing businesses, as well as attracting new corporate citizens, continue as City priorities. Regular economic development staff meetings bring together expertise from various departments to consider and help facilitate new projects as they are brought forward.
The cumulative effect from projects that qualified for and have received City incentives is beginning to pay dividends. For example, from 1999–2004, the net fiscal benefit to the City from approximately 30 projects to receive incentives exceeded $900,000.
These and other projects also demonstrate that Upper Arlington remains an attractive location for a niche market of office users, such as small medical and professional entities. With a below-average office vacancy rate compared to the region, as new developments occur, such as those at Riverside Drive/Henderson Road, they are in demand.
Immediately following Master Plan adoption, the framework for requiring and encouraging redevelopment in the Study Areas was put in place, primarily through the Unified Development Ordinance. Realizing this desired change however, is dependent on factors outside the City’s control – desires of the private property owners and market forces – and may not occur for many years or decades if at all. If such opportunities for significant redevelopment do occur, City participation at some level may also be required in the form of incentives or necessary infrastructure improvements.
The City does not have the resources to support redevelopment in all the commercial districts, therefore some exercise to prioritize how the City might allocate project incentives is recommended in the near future.
Several recent projects brought forward by commercial property owners, both formally and informally, show a desire to keep their sites current and viable within the market, but a lack of desire for substantial change through redevelopment. As such projects are brought forward, leadership must struggle with allowing properties to make aesthetic adjustments that will prolong their longevity or to deny proposed changes in the hopes that more significant redevelopment will occur sooner. In essence, the band-aid approach may ultimately be more costly than one substantial redevelopment.
Staff intends to conduct a survey of existing businesses in 2005 to better understand the successes and challenges facing Upper Arlington’s corporate citizens, and equally importantly, to strengthen relations and ultimately support retention and expansion efforts.
The City recently obtained a current-day snapshot of market conditions and realistic expectations for the City’s commercial districts, provided through the Boulevard Strategies Report “Market Analysis for Retail and Office Uses.” Staff intends to review the potential fiscal benefits to the City, assuming projections from this report were to be realized, for use as a comparison to the scenarios outlined by the Master Plan document and to emphasize the flexibility allowed by Master Plan goals.
The City’s physical realities also serve as challenges to economic development activities. Upper Arlington is land-locked and fully developed. Compared to cities of a similar size, Upper Arlington’s commercial-to-population ratio is worse than its parkland-to-population ratio. Likewise, there are few opportunities for annexing adjacent areas that would prove fiscally beneficial over the long term, as was the case with the recent annexation of a commercial portion of Lane Avenue.
These factors emphasize the importance of increasing density within the existing commercial districts to maximize their revenue generating potential for the City.
Other efforts continue to secure necessary revenues without the need to seek property tax increases. They include a focus on expanding grants to support projects, seeking alternative forms of revenue enhancement, monitoring cost recovery practices where appropriate, and participation in lobbying efforts to effect change in how State and Federal funds are distributed to support reinvestment versus new investment.
Several Economy objectives and strategies are considered completed or ongoing as part of routine City business. They have been marked as such and will only contain update information in future reports as projects or items of note occur. Likewise, Staff recommends several strategies be combined with others or deleted if they represent a duplication of efforts. These recommended changes are listed in the Economy strategy table at the end of this section.
Objective Highlights
Objective 1. Enhance the City’s revenue sources.
As part of the regular course of business, the City has several processes in place to estimate and monitor its fiscal needs, culminating in the presentation of a biennial budget to City Council, mid-year progress reviews, and a mid-budget review towards the end of year one in order to make any necessary amendments to the second year.
While the framework is in place to facilitate the redevelopment of commercial districts in a way that enhances City revenue sources, progress made in this area is always dependent on market forces and plans of the property owners and/or prospective developers. Likewise, the City’s lack of available land and competition with other suburbs will also continue to challenge the City as it works to expand the tax base.
The creation and use of economic development tools, such as tax increment financing, are proving successful. For example, from 1999–2004, the net fiscal benefit to the City from approximately 30 projects to receive incentives exceeded $900,000.
Despite this good news, the City’s overall income tax revenue in 2004 stayed flat, indicating that without recent successes in attracting new medical and office developments to Upper Arlington, the City would have witnessed a noticeable decline in revenues (most likely a result of the national economic downturn).
Continuing a trend in recent years, 2004 was a record year for the issuance of building permits, another indicator of successes in the economic development arena and the community’s confidence in Upper Arlington’s future.
A challenge to enhancing revenues through business development is finding the right balance with other Master Plan objectives, such as preserving the community’s residential nature. In recent months, various private projects have been brought forward requesting zoning changes on sites adjacent to residential areas, a trend that is likely to continue considering the makeup of the community. A retreat of City Council, Staff, the Board of Zoning & Planning and the Community Improvement Corporation will provide an opportunity for revisiting some primary Master Plan goals and how best to facilitate community discussion on such projects while seeking the best end result for the community as a whole.
To help the City place a greater focus on seeking and securing alternate funding sources, such as grant and loan programs, Staff intends to review ways to tie such efforts to the budget process. It is hoped that by identifying upcoming projects that might qualify for grant monies up to two years ahead of time, the City will meet with greater success in securing such funds.
While much work has already been done to raise awareness of the issues faced by aging first-tier suburbs such as Upper Arlington, it is hoped expanded participation by members of the Central Ohio First Suburbs Consortium and related lobbying efforts can begin to effect change – with more programs created to support reinvestment versus new development.
A subcontractor income tax program was implemented and is conducted as part of routine City business. However, typical revenue generation from this program is minimal.
As part of efforts to expand cost recovery practices, in mid-2004 the City’s Fire Division began its Emergency Medical Services (EMS) Transport Billing Program, taking advantage of existing Medicare, Medicaid and private insurance dollars set aside to support emergency medical runs. Annually, it is anticipated this program will generate in excess of $450,000. These funds are being set aside to support future emergency/medical equipment and facility needs.
Objective 2. Retain and expand existing businesses.
The framework is in place to help retain and expand existing businesses through the City’s economic development activities, with some notable successes achieved in recent months. However, with existing limited space availability and faced with increasing competition by other communities, some companies have chosen to leave Upper Arlington to meet their growth needs.
In the coming year, Staff intends to establish a means for surveying the community’s businesses to obtain information on their successes, technological needs, challenges, experiences working with the City, etc. It is hoped this effort, combined with an expansion in outreach activities, will help the City better understand how it can help businesses succeed and grow within Upper Arlington.
Staff intends to investigate options for establishing a home-business permit process or other program to track home offices. This could involve a partnership with the Upper Arlington Area Chamber of Commerce to support home-based businesses while, concurrently, improving the City’s understanding of this growing trend.
Consideration of the City’s role in providing or facilitating the provision of state-of-the-art technology continues. It is hoped the pending business survey will provide insight on technologies currently used by businesses and what they would like to have available to them, to help the City better determine current and future needs. Staff also intends to monitor efforts by other pioneer communities before any proposals would come before City Council.
Staff recommends removing Economy 2e from this section and incorporating it into an Implementation objective that addresses public relations activities.
Objective 3. Attract new corporate citizens to the City.
Economic development activities to attract new corporate citizens are primarily undertaken through word-of-mouth and networking on a local/regional level, efforts that are proving successful and cost effective.
The challenges remain limited office space availability that can be promoted to prospective businesses, and competition with other communities.
Staff recommends streamlining this Objective (see Economy Objective 3 in the table at the end of this section).
Objective 4. Expand the amount of office space in the City.
The framework is in place to facilitate the expansion of office space, but progress is contingent upon available space and/or land, market forces, and the plans of private property owners and developers.
Staff believes the pursuit of developing a high-tech business incubator is not a good use of resources at this time and therefore, recommends Economy 4c be put on hold for reconsideration at a future date.
Objective 5. Promote live/work units in redevelopment areas.
The Unified Development Ordinance has laid the framework to support future development of live/work units, however local developers do not presently embrace this concept. Staff recommends City Council discussion to determine the best way forward with this objective.
Objective 6. Partner with regional, state and national economic development organizations to promote the City.
Much of the work of this objective is conducted as routine City business practices.
Emphasis is placed on local and regional opportunities since the low level of return experienced at a national level does not justify the necessary cost and effort.
Objective 7. Establish a net fiscal benchmark to measure the success of plan implementation.
Within the Master Plan document is a broad review of fiscal benefits based on a specific scenario of plan implementation within the Study Areas. This was intended as an example of what could be achieved given a certain set of circumstances, not what must happen for the Master Plan to be considered successful.
The City has a current snapshot of market conditions and realistic expectations for the City’s commercial districts, provided through the recent Boulevard Strategies Report “Market Analysis for Retail and Office Uses,” provided December 2004. In the coming months, Staff intends to prepare another review of potential fiscal benefits to the City, assuming projections from this report were to be realized.
Staff tracks and reports annually on the net fiscal benefits to the City arising from development projects that have received incentives as part of the regular course of business. As already discussed in Objective 1, the cumulative effects of these projects are resulting in a significant boost to City revenues.
Just as available funding can be a roadblock to implementing other Master Plan objectives, such as fast-tracking infrastructure repairs, it also stands as a potential hindrance to successfully redeveloping the Study Areas. The City has a limited amount of funding available to support incentives, therefore Staff recommends further review of this situation to consider how best to prioritize projects, to include the following considerations:
- What level of incentives can the City realistically support – for both short and long term scenarios?
- How should the City prioritize projects?
- Should incentive “hotspots” be identified?
- Revisiting the current incentive programs to ensure they are an efficient use of City resources, while maximizing the long-term fiscal benefit.
Objective 8. Establish alternative revenue sources.
Staff continues to explore alternative revenue options, with several recent key initiatives arising:
- Introduction of the EMS Transport Billing Program summer 2004 is successfully producing funds to support future fire and emergency services, facilities and equipment needs.
- Bed tax legislation will be before City Council in the near future, preparing the City for future hotel development that may occur in any of the City’s commercial districts.
- Options for implementing utility right-of-way user fees are currently being explored by Staff.
The use of assessments such as the existing residential streetlight program, have not proven a successful means for moving project implementation forward. City Council and Staff will be reviewing options for expanding sidewalks in the community in 2005, but it is anticipated funding will continue to be a primary roadblock to realizing this goal.
Economy 8d had previously not been interpreted pertinent to property values recorded by the Franklin County Auditor’s Office, therefore consideration of proactive steps to ensure accurate value assessments are yet to be taken. While the Development Department reports new building permit values to Franklin County each month, it is not currently known how quickly records are updated, with appropriate taxing levels assigned. In the coming year, Staff intends to revisit this strategy to determine the best way forward in preparation for the next significant property assessment process by Franklin County.
Economy
Strategy Responsibilities / Recommended Amendments
Objective 1. Enhance the City’s revenue sources.
a. Adopting a program to estimate fiscal needs (i.e., capital, operations, maintenance, and replacement) and monitoring progress.
| Finance, City Council |
Immediate and Ongoing / Routine |
b. Expanding the City’s personal income tax base by facilitating redevelopment of commercial areas per the Study Area Plans.
| Economic Development, City Council, Board of Zoning & Planning, Community Improvement Corporation |
Ongoing
|
| c. Creating opportunities for office development that emphasizes high-paying jobs.[Includes Land Use 2b which is being removed]
| Economic Development,, City Council, Board of Zoning & Planning, City Attorney, Community Improvement Corporation |
Ongoing
|
d. Continuing to maximize state and federal grant and loan programs.
| City Manager, Development, Finance, Economic Development, Community Improvement Corporation
| Ongoing
|
e. Using tax increment financing (TIF) to fund infrastructure improvements in redevelopment areas.
| Economic Development, Community Improvement Corporation
| Ongoing
|
f. Monitoring cost recovery programs for City services.
| Assistant City Manager, City Council Finance
| Ongoing
|
g. Capturing income tax from construction sub-contractors.
| Finance, City Attorney, Development
| Immediate / Ongoing / Routine
|
Objective 2. Retain and expand existing businesses.
a. Implementing the retention and expansion (R&E) plan for business retention and expansion.
| Economic Development, City Council, Development, Community Improvement Corporation
| Ongoing / Routine
|
| b. Utilizing economic and zoning incentives packages to target existing businesses.[Includes Land Use 3c which is to be removed]
| Economic Development, City Council, Development, City Attorney, Community Improvement Corporation
| Immediate / Ongoing
|
c. Facilitating the development of new office space to accommodate growing businesses.
| Economic Development, City Council, Board of Planning & Zoning, City Manager, Community Improvement Corporation
| Immediate / Ongoing
|
d. Encouraging rehabilitation or redevelopment of existing office space.
| Economic Development, City Council, Board of Planning & Zoning, City Manager, Community Improvement Corporation
| Ongoing
|
e. Promoting the City as a good place to conduct business.
| Community Affairs, Economic Development, Chamber of Commerce, Community Improvement Corporation
| Ongoing / Routine
|
f. Continuing the business ombudsman function in City government through the economic director.
| Economic Development
| Ongoing / Routine
|
g. Continuing to encourage home-based businesses.
| Economic Development, City Council, Board of Zoning & Planning, all City departments, Community Improvement Corporation, Chamber of Commerce
| Ongoing
|
h. Facilitating a fiber optic network and other state-of-the-art technology.
| Information Technology, City Council, Economic Development, Community Improvement Corporation
| Immediate and Short Term / Pending further research and direction
|
Objective 3. Attract new corporate citizens to the City.
| a. Promoting aggressively the City as a great location for corporate offices, OSU research spin-offs, medical professionals, and entrepreneurs.CHANGE TO: Promoting the City’s existing and new office developments to appropriate target audiences, including medical professionals, OSU research spin-offs, corporate executives, and entrepreneurs.(Includes 4d which is being removed)
| Economic Development, City Council, Development, Community Improvement Corporation, Chamber of Commerce
| Ongoing / Routine
|
b. Marketing the City concurrent with facilitating new office development under Strategy 3.
| Economic Development, Chamber of Commerce, Community Improvement Corporation
| Ongoing / Combine with 3a Remove
|
c. Marketing the City to corporate executives currently living in Upper Arlington.
| Economic Development, Community Improvement Corporation
| Immediate and Short Term / Ongoing Routine
|
Objective 4. Expand the amount of office space in the City.
a. Adopting and implementing Study Area Plans.
| Economic Development,City Council, Development, Community Improvement Corporation
| Immediate and Short Term / Adoption complete Implementation ongoing
|
b. Adopting an economic and zoning incentives package targeting office development.Includes Land Use 3c, which will be removed.
| Economic Development, City Council, Community Improvement Corporation, Chamber of Commerce
| Immediate and Short Term / Ongoing
|
c. Facilitating the development of a high-tech business incubator.
| Economic Development, City Council, City Attorney, Chamber of Commerce, Community Improvement Corporation
| Immediate and Short Term / On Hold
|
d. Working with The Ohio State University to attract growing companies to the City.
| Economic Development, City Council, City Manager, Community Improvement Corporation, Chamber of Commerce
| Immediate and Short Term / Combine with 3a Remove
|
Objective 5. Promote live/work units in redevelopment areas.
a. Working with a developer to produce live/work units.
| Economic Development, Development, Community Improvement Corporation
| Short Term / Ongoing
|
b. Adopting an economic and zoning incentives package targeting live/work units.
| Development, City Council, Board of Zoning & Planning, Economic Development, Community Improvement Corporation
| Immediate and Short Term / Further direction required
|
Objective 6. Partner with regional, state and national economic development organizations to promote the City.
a. Maintaining involvement with regional development organizations.
| Economic Development, City Manager, Development, Community Improvement Corporation
| Ongoing / Routine
|
b. Maintaining involvement with the Ohio Department of Development.
| Economic Development, City Manager, Development, Community Improvement Corporation
| Ongoing / Routine
|
c. Continuing to promote the City at regional and national development conferences.CHANGE TO: Continuing to promote the City at local and regional development conferences.
| Economic Development, City Council, City Manager, Development, Community Improvement Corporation
| Ongoing / Routine
|
Objective 7. Establish a net fiscal benchmark to measure the success of plan implementation.
a. Forecasting net fiscal projections by redevelopment area as plans are implemented over time.
| Finance, Economic Development, Community Improvement Corporation
| Ongoing
|
b. Monitoring net fiscal results relative to forecasts and initiating reports.
| Finance, Economic Development, Development
| Ongoing
|
Objective 8. Establish alternative revenue sources.
a. Re-evaluating how the City uses property tax millage.
| Finance, City Council
| Immediate and Short Term / On Hold Until Needed
|
b. Evaluating income tax as an alternative to enhance revenue.
| Finance, City Council
| Immediate and Short Term / On Hold Until Needed
|
c. Targeting millage increase proposals to infrastructure projects.
| Finance, City Council, Development, Public Services
| Short Term, Mid Term, and Long Term / On Hold Until Needed
|
d. Establishing a property assessment-monitoring program.CHANGE TO: Establishing a property value assessment-monitoring program.
| Development, City Council, Finance
| Short Term, Mid Term, and Long Term / Ongoing
|
e. Exploring non-traditional revenue sources.
| Finance, City Council, City Attorney
| Short Term / Ongoing
|
City Manager's Office
City of Upper Arlington
3600 Tremont Road
Upper Arlington, OH 43221
Phone: 614-583-5040
Fax: 614-457-6620
www.ua-ohio.net
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