MOUNT VERNON — Mount Vernon City Council on Monday approved a 10-year, 50-percent real property tax exemption for Founders Grove.
Founders Grove is a 156-unit planned neighborhood development on Upper Gilchrist Road.
Lemmon Development plans to build six, 8-unit apartment buildings and 108, 2-, 4-, and 6-unit villas on 34 acres north of The Retreat at Mount Vernon.
Area Development Foundation President Sam Filkins said that when Lemmon started planning the project several years ago, the city’s CRA (Community Reinvestment Area) allowed a 15-year, 89-percent exemption.
Since then, the council has amended the CRA legislation. Lemmon Development moved from a 15-year/80-percent exemption to a 10-year/80-percent exemption, then to the current 10-year/50-percent exemption.
Filkins said the ADF’s mission is to bring smart, good development but not have it cost any more than necessary.
“That’s just what [Lemmon] needs, not more than what they need. And it still is going to create new revenue for the schools in that 10-year period,” he said of the exemption.
Currently, the parcel generates about $1,000 in property tax. At a 50-percent rate, Mount Vernon City School District’s projected share is $148,457 annually for the 10-year term.
After Year 10, MVCS would receive the full amount of around $296,000.
The career center will receive $19,422 for the first 10 years and $37,471 thereafter.
“This is a great example of how an abatement can be used to incentivize growth that wouldn’t have happened otherwise, and it is going to be good for the community in the short and long term,” Filkins said.
“Over a 30-year span, not including any increases for inflation, it’s estimated to benefit the schools over $7 million. And it’s 156 new housing units, which we need.”
New revenue without new costs
The development targets “60 and better” tenants, which Filkins said is good for the schools because it does not create many new students.
“So it’s new revenue without new costs,” he said.
Mayor Matt Starr noted that when Lemmon Development first approached the city, the city did not have an NCA (New Community Authority) in place.
“We were looking at opening up, offering tools and incentives for that. Now that we’ve kind of unkinked that hose, each deal is negotiated through council,” he said.
The NCA benefits the city by generating revenue through a 4-mill assessment levied only on property owners in the new development. Existing property owners do not pay the millage.
The city can use that revenue throughout the city to help pay for new growth, such as for a new police or fire station.
The CRA benefits the developer, making it affordable to build in Mount Vernon.
Lemmon will invest approximately $45.5 million into the Founders Grove project. The abatement will save the developer about $2 million.
“It’s important that you have both of those so that growth pays for growth. … So two different tools, two different purposes for those tools. They work really well together,” Filkins said.
Unlike Liberty Crossing, where two of the four mills will go toward paying off developer bonds, the full four mills from Founders Grove will go to the city.
City acquires land parcels
Council members suspended the third reading and accepted the donation of property from the Knox County Land Reutilization Corp., aka Knox County Land Bank.
Parcel 66-09684.000 is a section of the southbound lane on Coshocton Avenue in front of the Knox Community Hospital’s Urgent Care Center.
Law Director Rob Broeren said that while the city was allowed to put a roadway on the parcel, the parcel is technically privately owned.
Land Bank President Filkins said the property was never transferred to the city, and the owner stopped paying taxes on it.
The property went through the foreclosure process, and the land bank ultimately acquired it.
Council members also suspended the three readings and approved the acquisition of two other parcels within the city.
Parcels 66-09675.004 and 66-09675.001 are part of the private stormwater system that benefits several businesses north of the strip mall where Rural King is located.
The Ohio Environmental Protection Agency requires new development to manage stormwater runoff.
Broeren said once the city takes over the parcels, businesses that develop in the area will sign agreements to pay for that private stormwater system.
“We will go through municipal planning and the utility commission in 2026 to set the rates for those private businesses so that they will pay for the ongoing maintenance, as well as putting money aside for future rehabilitation of the private stormwater utility,” he said.