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The City of Toledo’s Commercial and Industrial Tax Abatement (“CITA”) Program is designed to spur economic activity and job growth that would not have otherwise occurred in the absence of the incentive. The incentive helps minimize risk by lowering operating expenses of a development project that results in the creation or retention of jobs in Toledo. This program offers up to a 100% exemption on the increased property value resulting from new construction or significant renovations. The abatement period extends up to 12 years for renovations and up to 15 years for new construction. The map below illustrates the RTA zones located throughout the city.

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Eligibility

Commercial and industrial structures qualify for the CITA Program. Smaller multi-family structures with four or less units are directed to the Residential Tax Abatement Program.

The CITA Program supports new construction and the rehabilitation of existing commercial and industrial structures. The minimum cost of improvements for rehabilitation is $5,000. The abatement periods vary, with new construction projects qualifying for up to a 15-year exemption and renovations qualifying for up to a 12-year exemption.

The Lucas County Auditor assesses whether an improvement will increase property tax value and determines the extent of the increase.

Qualification Requirements:

  • The property must be located in the jurisdictional boundaries of the City of Toledo.
  • Applicant must be the owner of the property for which they are applying for the exemption.
  • Applicant must commit to the creation or retention of jobs in the City of Toledo.
  • Property taxes and assessments must be current.
  • Properties must comply with zoning requirements, including overlay and historic district approvals.
  • Projects must obtain the appropriate permits, inspections and occupancy approvals.
  • Projects must have a minimum investment in renovation or construction of $5,000.
  • Construction cannot commence until a Community Reinvestment Area Agreement and, if needed, a School Payment Agreement and ordinance are executed and approved.
  • In some cases, depending on which Community Reinvestment Area the project is located, the abatement must be authorized by an ordinance being adopted by Toledo City Council.
  • According to Ohio Revised Code, projects expected to generate $2,000,000 or more in new payroll, including construction payroll, are required to enter into a School Payment Agreement with the impacted school district.
  • According to Ohio Revised Code, projects receiving a tax abatement more than 75% will require approval by the impacted school board, unless the school board adopts a resolution waiving its rights to approve such exemptions.
  • If your project involves the rehabilitation of a structure of historical or architectural significance, please contact the Department of Economic Development in advance of your submission to confirm the required documentation for your particular project.


Application Process

1. Application Submission

Applicant completes a CITA application and submits it to the Department of Economic Development. The purpose of the application is for the business applicant to describe the project to the community so that it can evaluate the business’s eligibility, identify project issues, and determine whether this project merits a tax exemption. It is noteworthy that the purpose of the CITA Program is to provide real property tax incentives in order to induce economic activity and job growth that would not have otherwise occurred in the absence of the incentive. This means that not every applicant must, or even should, receive a CRA tax exemption. The application is a crucial document, because it is a written certification of what the community can expect to receive should it offer a tax subsidy to the project.

2. Internal Review

The department determines if:

  • There are any eligibility concerns
  • There are any relocation related issues - A relocation occurs when a business moves jobs or assets from one Ohio political subdivision to another. The full definition of relocation and the requirements surrounding CRA relocations can be found in Ohio Administrative Code Section 122:9-1-02.
  • A tax exemption is warranted for the proposed project, and if so, how much exemption is appropriate based on the quantitative (amount of investment, number of jobs created or retained, etc.) and qualitative (catalytic impact of project, type of jobs created, etc.) factors.

3. Agreement Drafted

The department drafts a CRA Agreement in accordance with the relevant sections of the Ohio Revised Code and local enabling legislation.

4. Relocation Notices Sent

If necessary, relocation notices are sent out to the affected communities with the application and draft agreement.

5. School Board Notices Sent

If the project meets certain thresholds, the affected school board(s) are provided notice of the City’s intent to enter into a CRA Agreement and introduced to the applicant to enter into a School Payment Agreement. School Payment Agreements are required to be executed before the City will execute the CRA Agreement with the applicant.

6. Toledo City Council Approval

If the project is located in certain designated CRAs, an ordinance must be adopted by Toledo City Council authorizing the CRA tax exemption.

7. Agreement Executed

The CRA Agreement is executed by the City and all materials are sent to the Lucas County Auditor for final processing.

8. Construction Begins

The applicant may begin construction. If any improvements are made prior to the execution of the CRA agreement, the exemption may be rendered void.


        Post Award

        Abatement terms commence upon assessment by the Lucas County Auditor, lasting for the for a maximum of 12 years for renovation projects and 15 years for new construction projects. If the property owner desires to sell or transfer the property during the term of the incentive, approval must be granted in writing by the City of Toledo. If approved, the new owner will continue to benefit from the abatement.

        Properties must remain current on property taxes, job creation or retention obligations, school payments (if required), comply with zoning regulations, and be free of code violations throughout the abatement period. Annual reviews by the Tax Incentive Review Council and property inspections ensure compliance.


        Questions?

        Please email your questions to Carmen Watkins at carmen.watkins@toledo.oh.gov.