Chapter 122:4-1 | Tax Exemption Application and Criteria

Rule 122:4-1-01 | Enterprise zone characteristics definitions.

• Effective: February 10, 2014
• Promulgated Under: 119.03

(A) As used in division (A)(1)(d) of section 5709.61 of the Revised Code, a prevalence shall mean that at least five per cent of the commercial or industrial structures in the area proposed as an enterprise zone are vacant or demolished, or are vacant and the taxes charged thereon are delinquent.

(1) A retail facility in the area shall be counted as a commercial structure.

(2) A vacant structure is a facility which has fifty-one per cent or more of its total square footage under a roof vacant.

(3) Facilities which are both vacant or demolished, and vacant and tax delinquent, shall only be counted once.

(4) The applicable county or municipal corporation shall certify the accuracy of the criteria set forth in this paragraph, and shall also certify that the creation of the enterprise zone will most likely result in the reduction of vacant and demolished, and vacant and tax delinquent, structure in the area of the county or corporation shall also specify a rationale to explain the basis of the certification.

(5) The applicable county or municipal corporation shall update the criteria set forth in this paragraph every two years to maintain the status of the area as an enterprise zone.

(B) As used in division (A)(1)(g) of section 5709.61 of the Revised Code, documentation must be submitted with the application demonstrating, to the satisfaction of the director of the development services agency, that the structure is vacant or under-utilized or used for a non-intended purpose.

(1) The applicable county or municipal corporation shall specifically identify such structures in the agreement.

(2) Agreement which include structures that were not included in the municipal corporation's, or county's, petition for enterprise zone designation shall be revoked by the director and the tax incentives for that year shall be disallowed unless excepted by division (A)(1)(h) of section 5709.61 of the Revised Code.

(C) As used in division (A)(1)(h) of section 5709.61 of the Revised Code, no averaging of values between or among multiple school districts shall be permitted.

(1) Documentation shall be provided by the applicable county or municipal corporation to demonstrate, to the satisfaction of the director, that the enterprise zone boundary either corresponds do, or does not exceed, the boundary of the eligible school district.

(2) The director shall provide a list of eligible school districts and shall update the list using information supplied by the tax commissioners every two years to any interested party.

(D) As used in division (A)(2) of section 5709.64 of the Revised Code, "new employee" is further defined to mean a full-time employee hired after the enterprise entered an agreement under section 5709.62 or 5709.63 or 5709.632 of the Revised Code and maintained in a non-retail position at the facility as of the last day of the calendar year immediately preceding the year in which the tax incentive qualification certificate application is made.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.61(A)(1)(h), 5709.67(A), 5709.671
Amplifies: 5709.61
Five Year Review Date: 2/10/2019
Prior Effective Dates: 10/16/1994

Rule 122:4-1-02 | Enterprise zone agreement tax exemption fee.

• Effective: February 10, 2014
• Promulgated Under: 119.03

(A) The state's application fee for applications submitted to a municipal corporation or county to enter into an agreement under section 5709.62, 5709.63, or 5709.632 of the Revised Code shall be seven hundred fifty dollars.

(B) Payment shall be in the form of a check or money order made payable to the Ohio development services agency by an enterprise at the time of application and shall be forwarded to the Ohio development services agency with the executed agreement by the municipal corporation or county.

(C) If the application does not result in the approval of the agreement, then the fee shall be refunded to the applicant by the municipal corporation or county. Otherwise, such fee shall be non-refundable.

(D) No more than one fee shall be collected per application.

(E) The director of the development services agency shall notify the tax commissioner to withhold the approval of all tax exemptions pertaining to an agreement which has not met the enterprise zone tax exemption fee requirements set forth in this rule.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.671, 5709.68(C)
Amplifies: 5709.68
Five Year Review Date: 1/4/2024
Prior Effective Dates: 10/16/1994, 7/19/2000

Rule 122:4-1-03 | Municipal corporation enterprise zone designation criteria.

• Effective: February 10, 2014
• Promulgated Under: 119.03

(A) As used in division (A) of section 5709.62 and division (A) of section 5709.632 of the Revised Code, the petition shall be in a form prescribed by the director of the development services agency.

(B) As used in division (C) of section 5709.62 of the Revised Code, "establish" shall mean the creation of a facility which is determined to the satisfaction of the director of the development services agency to entail significant investment in real and/or tangible personal property other than inventory.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.67(A)
Amplifies: 5709.62(A), 5709.632(A)
Five Year Review Date: 1/4/2024

Rule 122:4-1-04 | Seasonal business criteria.

• Effective: February 10, 2014
• Promulgated Under: 119.03

(A) As used in division (A)(3) of section 5709.64 of the Revised Code, seasonal business shall refer to the employment in any industry in which it is customary to operate only during regularly recurring periods of less than twenty-six weeks in any calendar year. The director of the development service agency's determination shall not be effected by the fact that employees engage in nonseasonal activities, if such work constitutes a minor, or incidental, part of the seasonal operations.

Last updated November 5, 2024 at 1:37 PM

Supplemental Information

Authorized By: 5709.64(A)(3), 5709.67(A)
Amplifies: 5709.64(A)(3)
Five Year Review Date: 1/4/2024

Rule 122:4-1-05 | Nonretail position criteria.

• Effective: October 16, 1994
• Promulgated Under: 119.03

(A) As used in section 5709.64 of the Revised Code, a nonretail position shall mean the position of one full-time employee whose principal tasks or duties do not include the effecting of transactions wherein one party is obligated to pay the price and the other party is obligated to provide a service or to transfer title to or possession of the item sold, or who is employed at an establishment other than one used primarily for making retail sales.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: –
Amplifies: –
Five Year Review Date:

Rule 122:4-1-06 | Municipal corporation and county enterprise zone report.

• Effective: February 10, 2014
• Promulgated Under: 119.03

As used in division (A) of section 5709.68 of the Revised Code, the report shall be in a form prescribed by the director of the development services agency.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.67(A)
Amplifies: 5709.68(A)
Five Year Review Date: 1/4/2024
Prior Effective Dates: 10/16/1994

Rule 122:4-1-08 | Tax incentive review council reporting requirements.

• Effective: February 10, 2014
• Promulgated Under: 119.03

Tax incentive review councils shall annually submit a copy of the written recommendations required by division (C)(1) of section 5709.85 of the Revised Code to the director of the development services agency.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.67(A)
Amplifies: 5709.85(C)
Five Year Review Date: 1/4/2024

Rule 122:4-1-09 | Relocation provisions.

• Effective: February 10, 2014
• Promulgated Under: 119.03

(A) "Relocation" is defined as the transfer of employment positions or taxable personal tangible property assets from one Ohio political subdivision to another. This includes the transfer of employment positions or taxable personal tangible property assets from one unincorporated township to another township within the same county.

A project that transfers employment positions from a facility within an Ohio political subdivision to a site within another Ohio jurisdiction where the business has committed to and does backfill or replace all such employment positions during the proposal's hiring period or three years, whichever is shorter, is not considered a relocation. Likewise, a project that transfers taxable personal tangible property assets from a facility within an Ohio political subdivision to a site in another Ohio jurisdiction, but the business has committed to and does install replacement assets of like or greater value and of compatible type is not a relocation.

The transfer of employment positions or taxable personal tangible property assets within the same municipality or unincorporated township area is not a relocation.

(B) A business that relocates all or a portion of its operations from one Ohio jurisdiction to another location without enterprise zone program assistance, then requests such incentives for an unrelated expansion project that does not involve the transfer of additional, current employment positions or taxable assets from another Ohio jurisdiction is not a relocation if the proposal occurs at least one year after the completion of the first unassisted relocation.

(C) Operations of an enterprise which are determined to be "temporary in nature" will not be considered within the meaning of facility as defined in division (C) of section 5709.61 of the Revised Code and will not be subject to the enterprise zone program relocation restrictions. A determination that an operation is "temporary in nature" can be supported by, but is not limited to, the documentation of site control arrangements of recent and short term nature, the forced relocation by acts of God such as tornadoes or fires to a facility obviously inadequate for the enterprise's current and future needs and the use of public warehouse space where the local jurisdiction does not derive an entitlement interest in the value of taxable assets or income tax generated from employees of the enterprise.

(D) Net increase in employment shall be calculated by verifying the total employment of the facilities affected by the proposed project including any such facility in which positions will be transferred from without replacement. This base employment number will be set at the time prior to the agreement. This base will be subtracted from the total employment number at the specified time of the information, for the purposes of the annual report, December thirty-first of the specific year. Employment positions lost to attrition will not be discounted as part of this process. Unless otherwise stated in the enterprise zone agreement, only those employees actually employed by the designated business will be considered. Each employment position will be designated as either full-time permanent, part-time permanent, full-time temporary or part-time temporary.

(E) As used in section 5709.69 of the Revised Code, application for late service by a legislative authority of a municipality or county to an affected municipality or county of a proposed relocation shall be made in writing to the director of the development services agency and shall contain sufficient information for the director to determine whether or not earlier service is not possible or whether the realization of the project is in jeopardy because of the required thirty-day notice period.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.671
Amplifies: 5709.633, 5709.69
Five Year Review Date: 1/4/2024
Prior Effective Dates: 10/5/2000

Rule 122:4-1-10 | Enterprise zone program employee tax credit.

• Effective: February 10, 2014
• Promulgated Under: 119.03

(A) Applicants for the Ohio enterprise zone program's employee tax credit shall provide the name, social security number, employment start date, the county of residence for the twelve months prior to employment and the type of assistance the employee received (temporary assistance for needy families or predecessor) at the time of employment as a result of an enterprise zone agreement for each employee claimed as eligible.

(B) Business shall also provide:

(1) Documentation of a valid enterprise zone agreement for a project occurring in a designated metropolitan statistical area central city or an appalachian county; and

(2) A general information release allowing the director of the development services agency to request confirmation from the tax commissioner and the director of the environmental protection agency clearance that the applicant does not owe any: (a) delinquent state or local taxes; (b) any monies to the state or a state agency for the administration or enforcement of any environmental laws or other state laws; and (c) any other monies to the state, a state agency or a political subdivision of the state that are past due, whether the amounts owned are being contested in a court of law or not. Should it be determined that the applicant owes taxes or payments, the applicant will be notified and given thirty days to cure the deficiency. No employee tax credit certificate will be issued until resolution.

(C) The director of the development services agency shall confirm each eligible employee with the department of human services or its successor prior to issuing the employee tax credit certificate.

Last updated October 25, 2024 at 4:24 PM

Supplemental Information

Authorized By: 5709.66(A)
Amplifies: 5709.66
Five Year Review Date: 2/10/2019
Prior Effective Dates: 10/5/2000