(a) Purpose. The purpose of this section is to encourage the location of new retail, service, amusement and residential rental businesses in the "Downtown Revitalization District," the boundaries for the district being I-70 north, Wheeling Creek to the south and east, and the Ohio River to the west. The goal of the Downtown Wheeling Economic Development Advisory Board Task Force focused primarily upon job creation, mixed use of properties, including downtown living, and increased foot traffic in downtown. This section of the Business and Taxation Code is reflective of the Task Force recommendations made to the governing body and is intended to provide an incentive for new businesses in particular categories with a tax credit.
(b) Business Enhancement – Tax Credit Definitions. When used in this section:
(1) Retail, service, amusement or residential rental “Taxpayer” means any person liable for tax under this article exercising any of the following privileges taxable under Section 787.03
(c)(e)(f)(g) and are exempted in accord with State Law wherein they are taxed thereunder. Video lottery terminals and the proceeds made thereon are not subject to the tax credit as a form of “amusement or entertainment” and are taxed in accord and as permitted by state law.
(2) “New business” means any new retail, service, amusement and business involving residential rental property (with the residential rental property actually located in the downtown district), which physically locates its principal place of business within the Downtown Revitalization District of the City within specified and designated areas of the City, defined in this article, either by purchase of real property or by virtue of a rental agreement or lease and whose gross receipts are subject to the City’s business and occupation tax, and is not currently paying such tax. No entity which has conducted business within the limits of the district currently or in the past, and which changes its name or changes its business structure, shall be considered as a new business under this section, unless extenuating circumstances exist and unless prior written approval has been given by the Finance Director. Additionally, the acquisition and continued operation of an existing commercial entity by another entity subject to the business and occupation tax of the City, whether such acquisition be by purchase or lease, shall not be considered a “new business” under the terms of this section.
(3) “Existing Business” means any business described above in #2 that currently exists in the district as of the date this ordinance becomes effective.
(4) “Downtown Revitalization District” for the purpose of this article includes any business located in the area described as follows:
Boundaries for the district being I-70 to the north, Wheeling Creek to the south and east, and the Ohio River to the West. A map showing the district is available at the Finance Department along with the tax credit application.
(5) “Residential Development Business Taxpayer” for the purposes of this Article includes residential rental property as described in #2 above and includes such properties within the district developed for residential rental use.
(c) Amount of Credit Allowed. Any new retail, service, amusement or residential development business taxpayer as defined above in this section of the ordinance and locates such business to the Downtown Revitalization District which, after the adoption of this section, is eligible for the exemption set forth in the present section shall make application to the City Finance Director of Wheeling each fiscal year, on or before July 1. Any existing retail, service, amusement or residential development business taxpayer as defined above in this section of the ordinance and currently located in the Downtown Revitalization District which, after the adoption of this section, is eligible for the exemption set forth in the present section shall make application to the City Finance Director of Wheeling each fiscal year, on or before July 1. To obtain the benefit of the exemption set forth herein and the City Finance Director shall have full authority and discretion to grant or deny an application made pursuant to the provisions of this section. If the Finance Director grants the application, for the first year the new business exists it shall be entitled to a one hundred percent (100%) exemption from Business and Occupation Tax and existing businesses shall be entitled to a fifty percent (50%) exemption; for the second year in business it shall be eligible for one hundred percent (100%) exemption from Business and Occupation Tax and existing businesses shall be entitled to a fifty percent (50%) exemption; for the third year in business it shall be eligible for a one hundred percent (100%) exemption from business an Occupation Tax and existing businesses shall be entitled to a fifty percent (50%) exemption; and subject to the reduced amount of fifty percent (50%) of Business and Occupation Tax for the fourth year and thereafter. The new business as defined in particular within this section shall be eligible for a Tax credit against the Tax liability due on the gross income generated by the business. This Tax credit shall apply only to income taxable under sections: Section 787.03(b)(e)(f)(g). The Tax credit may be available for a period of three years from the date of application. From the fourth and following years a fifty percent (50%) exemption, the reduced amount, shall apply. The following Tax credit shall apply:
Year 1 | Year 2 | Year 3 | Year 4 and After | |
New Businesses | 100% | 100% | 100% | 50% |
Existing Businesses | 50% | 50% | 50% | 50% |
(d) Administration of Tax Credit Program.
(1) The administration of Section 787.53 – Downtown Business District Enhancement Tax Credit Program is vested in, and shall be exercised by the Director of Finance who, in connection therewith, shall prescribe all necessary forms.
(2) The Director of Finance may prescribe necessary rules, regulations and procedures that are in conformity with Section 787.53 for administration of the Business Enhancement provisions.
(3) The Director of Finance may conduct an annual audit of each business approved for a Tax credit to determine the continued eligibility of the business and to certify that job levels created under these ordinance provisions are sustained for the required period.
(4) All businesses requesting a Tax credit and those granted a Tax credit hereunder shall agree to make all their financial records available for inspection and audit by the City and shall provide copies of all annual audited financial statements and tax returns.
(5) The amount of any approved Tax credit shall be reviewed annually by the Director of Finance to determine continued eligibility of the business for the credit. The procedure for verification of information will be developed as needed by the Director of Finance.
(6) All businesses approved for a Tax credit hereunder must still file a quarterly B&O Tax return and report gross income to the City and abide by all local, state and federal laws pertaining to such business and licensure.
(7) The amount of any Tax credit allowable begins with the taxable year in which the taxpayer placed the new business into use within this City and continues thereafter.
(e) Restrictions Upon the Tax Credit Including Default and Repayment .
(1) It is the intent of the present Business and Occupation Tax incentive that a business, person, corporation, associated entity or other entity shall only be allowed the Business and Occupation Tax Incentive once and the termination of any business and subsequent opening thereof under another name shall not be deemed to be an entity that is eligible to receive the present Business and Occupation Tax Incentive.
(2) In cases where there may be multiple business use including use as a component part of a new qualifying business of a taxpayer together with some other business or occupation not qualifying under this section, the appropriate amount of Business and Occupational Taxes owed and those subject to the Downtown Business District Enhancement Tax Credit shall be apportioned between such business and occupations and the proportion shall be allocated to such qualifying business as decided by the City of Wheeling Finance Director upon a review of the taxpayer’s application shall receive the appropriate credit.
(3) The nature of the business shall also be considered when evaluating an application for the Business and Occupation Tax Incentive. Businesses that require extraordinary uses of City services or are otherwise unduly burdensome on the City services may be disqualified to receive the Business and Occupation Tax Incentive based on the nature of the business, such as businesses that involve the use of hazardous material, hazardous activities or deal with other activities that require an unusually high demand of fire or police services.
(4) The applying taxpayer must demonstrate to the Finance Director’s satisfaction that the business will have a reasonable capability of enduring for at least six years, which would encompass the three years of credit and three years thereafter as a minimum time period when reduced fees and taxes shall be collected.
(5) No application for a Tax credit will be considered and no credit will be otherwise granted to any existing business who, at the time application is made, is delinquent in the payment of any City business and occupation taxes, license fees, fire service fees or any other fees owed the City of Wheeling.
(6) Once a business is granted a Tax credit under this article to any person, corporation or any principals or members or any business they (or it) would not be allowed another Tax credit nor will such property which had previously been designated property so used to qualify for the Tax credit provided by this section thereafter be again available as a new business location. This is meant to be a “one-time” offer for persons, entities and locations.
(7) In no case will a tax credit be granted to any person who conducts business activity from their residence.
(8) If during any taxable year property with respect to which tax credit has been allowed is disposed of or ceased to be used in a business of a taxpayer in this district, or if the taxpayer ceases operation of such business before expiration of the period of the credit, then the unused portion of such credit shall be forfeited for the taxable year in which such event occurs and all applicable ensuing taxable years. In addition, the taxpayer/Tax obligor shall reimburse the City for the total amount of Business and Occupation Tax that was subject to the Business and Occupation Tax Incentive.
(f) On an annual basis at the request of City Council’s Finance Committee and the Finance Director may be required to submit a summary report to Council on applications for Tax credits which were approved and the amount of Tax credits granted to businesses.
(g) Any business, even those not included in the definitions of this section, voluntarily entering the City of Wheeling by annexation, including by minor boundary adjustment, shall also qualify for the Tax Incentive contained in this section provided that providing the tax incentive would not place an undue hardship on the resources of the City of Wheeling as adjudged by the members of City Council.
(Ord. 13225. Passed 6-6-06.)