LORAIN — An incoming business along Broadway in downtown Lorain was granted a tax abatement Tuesday by City Council.
Council voted unanimously to approve the 12-year, 100 percent abatement on the renovation of 383 Broadway, the former Cleveland Trust Bank building, but concerns were raised about the length of time for the tax break.
Councilman Joe Koziura, D-at large, said while the Lorain school board approved a 15-year abatement for the $4 million project last month, because the building is undergoing a renovation and isn’t new construction, city rules only allow for a 12-year break on the new value of the property.
But Councilman Dennis Flores, D-2nd Ward, said he wanted to be able to get the building’s owner — Jovic 2 LLC, owned by Lorain developer Vic Nardini — the full 15 years.
“Typically a business coming downtown, normally the abatement is 15 years so I don’t know why we wouldn’t comply with the 15-year abatement as opposed to the 12,” he said. “I would like to keep it at 15 years.”
Mayor Chase Ritenauer said 15-year abatements being offered to renovation projects, such as the upcoming renovation of the Broadway Building at East Erie Avenue and Broadway into a 55-room hotel, in the downtown corridor had been made in error.
“We ran into the same issue with the Broadway Building and that one is actually 12 years and there’s a (tax increment financing agreement) on top of that,” he said. “That’s 12 years because it’s a renovation. Twelve is the appropriate number. I believe it’s in an ordinance or a consent decree.”
Law Director Pat Riley said he thought the heart of the debate is what constitutes new construction versus a remodel, something that wasn’t outlined in the city’s ordinances.
Flores argued the building had new windows and Nardini was talking about putting a deck on the back of it.
“That’s new construction,” he said. “There’s time to look at this further. He’s not planning on opening until 2020. This is a new business downtown and I’d like to get them the 15-year tax abatement.”
Flores said since the abatement legislation was marked as an emergency on the agenda, Council could afford to send it to a committee meeting to discuss further in order to get a 15-year abatement.
“This program is an incentivizing program so you’re not supposed to do substantial construction or remodeling prior to getting it because it’s the abatement that’s supposed to be the incentive to do it,” he said. “Suggesting that the abatement be granted at a point in time after construction is completed it would be contrary to law.”
Safety-Service Director Dan Given said he spoke with Nardini earlier in the day Monday and he also disagreed with Flores.
“It’s an emergency,” he said. “They’re begging us to get inspectors over there. There’s a lot that needs to be done in a short amount of time before the winter season sets in. We need to deal with this and I agree that based upon our previous practices, this is a remodel, not new construction. While we want to help everyone that’s helping our town, we have to standardize the practice.”
Councilwoman Mary Springowski, D-at large, said she understood what Flores was trying to do but she felt it was “imperative” to get the ball rolling on the abatement.
“With all of the focus on the Broadway Building, we want to complement and enhance what’s happening on Broadway,” she said. “I don’t think there’s any fundamental new construction going on and a deck would be an enhancement. I think we need to move forward as quickly as possible.”
Springowski said she wanted people to remember that Ford was denied an abatement before the plant closed on the west side because work had already been started and completed before the request was made.
“Let us learn from our past and not be condemned to repeat it,” she said.
Flores was the lone vote against the motion to amend the abatement but later voted with the rest of the Council to approve the tax break.