ORDINANCE NO. 1618 AN ORDINANCE OF THE CITY OF OVIEDO, FLORIDA, ESTABLISHING AN ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION FROM CERTAIN AD VALOREM TAXATION FOR OVIEDO MEDICAL CENTER, LLC, AN AFFILIATE OF HOSPITAL CORPORATION OF AMERICA, INC.; PROVIDING FOR FINDINGS, INTENT AND PURPOSES; PROVIDING FOR THE GRANT OF A GRADUATED AND DECLINING ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION FOR A PERIOD OF FIVE (5) TAX YEARS; PROVIDING FOR CONTINUING PERFORMANCE OBLIGATIONS AND A PERFORMANCE AGREEMENT; PROVIDING FOR REVIEW; PROVIDING FOR IMPLEMENTING ADMINISTRATIVE ACTIONS; PROVIDING FOR CONFLICTS; PROVIDING FOR A SAVINGS PROVISION; PROVIDING FOR SEVERABILITY; PROVIDING FOR NON- CODIFICATION AND CORRECTION OF SCRIVENER'S ERRORS AND PROVIDING FOR AN EFFECTIVE DATE AND EXPIRATION. BE IT ENACTED BY THE CITY COUNCIL OF THE CITY OF OVIEDO, FLORIDA, AS FOLLOWS: SECTION 1. LEGISLATIVE FINDINGS, INTENT AND PURPOSES. (a). The City staff report and City Council agenda memorandum relating to this matter is adopted as legislative findings, intent and purposes as if fully set forth in the provisions of this Ordinance. The definitions set forth in Section 196.012, Florida Statutes, and Section 2-301 of the Code of Ordinances of the City of Oviedo shall be applicable in the enactment, implementation and execution of the provisions of this Ordinance. (b). The City of Oviedo has complied with all requirements and procedures of Florida law in processing and advertising this Ordinance. (c). Article VII, Section 3(c), of the Constitution of the State of Florida 1 and Section 196.1995, Florida Statutes 2, authorizes the City of Oviedo (the "City") to grant 1 Which provides that: Any county or municipality may, for the purpose of its respective tax levy and subject to the provisions of this subsection and general law, grant community and economic development ad valorem tax exemptions to new businesses and expansions of existing businesses, as defined by general law. Such an exemption may be granted only by ordinance of the county or municipality, and only after the electors of the county or municipality voting on such question in a referendum authorize the county or municipality to adopt such ordinances. An exemption so granted shall apply to improvements to real property made by or for the use of a new business and improvements to real property related to the expansion of an existing business and shall also apply to tangible personal property of such new business and tangible personal property related to the expansion of an existing business. The amount or limits of the amount of such exemption shall be specified by general law. The period of time for which such exemption may be granted to a new business or expansion of an existing business shall be determined by general law. The authority to grant such exemption shall expire ten years from the date of approval by the electors of the county or municipality, and may be renewable by referendum as provided by general law.
economic development ad valorem tax exemptions to new businesses and expansions of existing businesses subject to voter approval. On November 6, 2012, the electors of the City of Oviedo approved authorizing such economic development ad valorem tax exemptions at a referendum election, and on September 5, 2013, the City Council enacted Ordinance Number 1575 authorizing the granting of such economic development ad valorem tax exemptions which Ordinance is codified in Sections 2-301 through 2-310 of the Code of Ordinances of the City of Oviedo. Those provisions set forth the guidelines, process and procedures for implementing and administering the City s economic development ad valorem tax exemption program. The City Council hereby finds and determines that any and all constitutional and statutory prerequisites for the economic development ad valorem tax exemption granted by virtue of the enactment of this Ordinance have occurred or been accomplished. (d). Oviedo Medical Center, LLC, an Affiliate Of Hospital Corporation of America, Inc., a Tennessee corporation (hereinafter "Oviedo Medical Center") submitted an application to the City (the "Application") requesting a graduated and declining economic development ad valorem tax exemption of fifty per cent (50%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 1, forty per cent (40%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 2, thirty per cent (30%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 3, twenty per cent (20%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 4, and ten per cent (10%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 5,for a total period of five (5) ad valorem tax years commencing with ad valorem tax year 2016. The Application is attached as Exhibit 1 to this Ordinance and incorporated in the provisions of this Ordinance by reference. (e). In its Application, Oviedo Medical Center stated, among other things, the following: (1). The proposed location of the new business is located within the boundaries of Oviedo at 8300 Red Bug Lake Road within the City Limits of the City. (2). The Company intends to create two hundred and eleven (211) new full-time jobs paying an average annual wage of at least one hundred forty-five per cent (145%) of the County's average annual wage or fifty-eight thousand one hundred and thirty-six dollars ($58,136.00), excluding benefits, but shall be obligated to create at least one hundred and seventy-four (174) of such jobs. 2 Subsection (1) states that [t]he board of county commissioners of any county or the governing authority of any municipality shall call a referendum within its total jurisdiction to determine whether its respective jurisdiction may grant economic development ad valorem tax exemptions under s. 3, Art. VII of the State Constitution.... Page 2 of 6
(3). Oviedo Medical Center will make a capital investment of at least eighty million dollars ($80,000,000.00) in the construction of improvements at the selected location and the purchase of new equipment thereby enhancing the ad valorem tax base of the City. (4). Oviedo Medical Center is one of the nation's leading healthcare providers in the United States. (5). Oviedo Medical Center is committed to local procurement and plans to use local vendors when appropriate in support thereof thereby enhancing economic development within the City. (6). Oviedo Medical Center is committed to environmental sustainability and will apply green technologies to the maximum extent feasible. (f). The Seminole County Property Appraiser completed its review of the Application and submitted its report to the City, dated February 3, 2015. The Property Appraiser's report is attached as Exhibit 2 to this Ordinance and incorporated in the provisions of this Ordinance by reference and concluded the following: (1). The total revenue available to the City for the current ad valorem tax year from ad valorem tax sources is $10,267,965.00 (reported in tax year 2014 as final taxable value). (2). The total revenue lost to the City for the current ad valorem tax year by virtue of economic development ad valorem tax exemptions previously granted under this section is $000.00. (3). The estimate of the revenue which would be lost to the City during the current ad valorem tax year if the economic development ad valorem tax exemption applied for was granted is $169,165.50. (4). A determination that the property listed in the Application meets the definition of an expansion of an existing business has been made. (g). The Application meets all controlling constitutional and statutory requirements as well as the requirements set forth in Sections 2-301 through 2-310 of the Code of Ordinances of the City of Oviedo. (h). The City Council finds that Oviedo Medical Center qualifies as an expansion of an existing business and that granting an economic development ad valorem tax exemption to Oviedo Medical Center to encourage its creation of a new business will promote economic sustainability within the City through the creation of jobs and utilization of local resources. SECTION 2. AWARD OF ECONOMIC DEVELOPMENT AD VALOREM TAX EXEMPTION; CONDITIONS. Page 3 of 6
(a). The City Council hereby grants to Oviedo Medical Center and establishes on behalf of Oviedo Medical Center an economic development ad valorem tax exemption of fifty per cent (50%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 1, forty per cent (40%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 2, thirty per cent (30%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 3, twenty per cent (20%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 4, and ten per cent (10%) of the assessed value of qualifying improvements to real property and qualifying tangible personal property specified in the Application for ad valorem tax year 5, for a total economic development ad valorem tax exemption period of five (5) ad valorem tax years commencing with ad valorem tax year 2016 with all the said real property that is the subject of this economic development ad valorem tax exemption being acquired by Oviedo Medical Center after the effective date of this Ordinance to facilitate the creation of a new business as set forth in Section 1 of this Ordinance. (b). The economic development ad valorem tax exemption for Oviedo Medical Center shall be in effect only for a period of five (5) ad valorem tax years commencing with ad valorem tax year 2016 and running through and including ad valorem tax year 2020 and is conditioned upon Oviedo Medical Center entering into an performance agreement with the City providing that Oviedo Medical Center shall remain in compliance with the terms of the agreement, this Ordinance and the provisions of controlling law during the five (5) ad valorem tax year period of economic development ad valorem tax exemption as aforesaid. The performance agreement shall be in a form that is approved by the City Manager and the City Attorney which shall include, at a minimum, the following provisions: (1). An obligation to construct a facility consisting of a hospital bed tower totaling at least ninety-four thousand and eighty-nine (94,089) square feet which shall include at a minimum forty-eight (48) acute care beds, ten (10) intensive care beds and six (6) labordelivery-recovery-post-natal suites and making a capital investment of at least eighty million dollars ($80,000,000.00) in the construction of improvements at the selected location and the purchase of new equipment thereby enhancing the ad valorem tax base of the City. (2). An obligation to create at least one hundred and seventy-four (174) new full time jobs within the next two (2) ad valorem tax years from the effective date of this Ordinance with the jobs having an average annual salary of at least fifty-eight thousand one hundred and thirty-six dollars ($58,136.00), excluding benefits. (3). An obligation to maintain the newly created positions for at least two (2) full ad valorem tax year years from the date that they were created. (4). An obligation for Oviedo Medical Center to use its best efforts to hire employees residing within the City of Oviedo and to use local suppliers for its goods and Page 4 of 6
services and make every other reasonable effort to enhance economic development within the City. (5). An obligation to provide continuing performance reports and annual filings and certifications as required by the City and the controlling provisions of law. (6). An obligation to protect the City and its investment relative to any potential change in ownership. (7). A provision for revocation by the City should any failure of performance occur which the City determines, in its sole discretion, results in a breach of the performance agreement such that, should Oviedo Medical Center fail to comply with the terms of this Ordinance, the City Council may, in its discretion, revoke the economic development ad valorem tax exemption and recover any taxes exempted pursuant to the procedures set out in controlling law and the performance agreement. (d). The economic development ad valorem tax exemption granted by virtue of the provisions of this Ordinance applies only to Citywide ad valorem taxes levied by the City on the qualifying improvements to real property and qualifying tangible property specified in the Application of Oviedo Medical Center. The economic development ad valorem tax exemption does not apply to taxes levied by any other municipality in which the property of Oviedo Medical Center be located, the Seminole County School District, a municipal services taxing unit, any water management district or any other special taxing district or to taxes levied for the payment of bonds or taxes authorized by a vote of the electors pursuant to Article VII, Section 9 (b) or Section 12 of the Constitution of the State of Florida. No economic development ad valorem tax exemption is granted on the land on which improvements are made by Oviedo Medical Center. SECTION 3. IMPLEMENTING ADMINISTRATIVE ACTIONS. (a). The City Manager, or designee, is hereby authorized and directed to implement the provisions of this Ordinance and to take any and all necessary administrative actions to include, but not be limited to, the adoption of administrative rules. (b). In accordance with Section 2-310 of the Code of Ordinances of the City of Oviedo the decision of the City Council, in its sole discretion, to not grant an economic development ad valorem tax exemption, as set forth in the provisions of this Ordinance, shall not be reviewable by the Seminole County Value Adjustment Board pursuant to Chapter 194, Florida Statutes. SECTION 4. SAVINGS. The prior actions of the City of Oviedo relating to the economic development activities of the City, economic development grants and similar programs, and any and all matters relating thereto are hereby ratified and affirmed. SECTION 5. CONFLICTS. All ordinances or parts of ordinances in conflict with this Ordinance are hereby repealed. Page 5 of 6
SECTION 6. SEVERABILITY. If any section, sentence, phrase, word, or portion of this Ordinance is determined to be invalid, unlawful or unconstitutional, said determination shall not be held to invalidate or impair the validity, force or effect of any other section, sentence, phrase, word, or portion of this Ordinance not otherwise determined to be invalid, unlawful, or unconstitutional. SECTION 7. NON-CODIFICATION; CORRECTION OF SCRIVENER'S ERRORS. (a). The provisions of this Ordinance shall not be made a part of the Code of Ordinances of the City of Oviedo, Florida. (b). In accordance with the provisions of Section 1-14 of the Code of Ordinances of the City of Oviedo, Florida and the City s ongoing codification program; the City Clerk, in conjunction with the City Attorney, may make corrections to the provisions of this Ordinance relative to Scrivener s errors of whatever type or nature and, although this Ordinance is not being codified, the City Clerk shall ensure that this Ordinance is prominently available to all who may desire to obtain a copy of the Ordinance. SECTION 8. EFFECTIVE DATE. This Ordinance shall become effective immediately upon enactment. The economic development ad valorem tax exemption granted by virtue of the provisions of this Ordinance shall take effect commencing with ad valorem tax year 2016. The economic development ad valorem tax exemption granted by virtue of the in the provisions of this Ordinance shall automatically expire on December 31, 2020, and shall no longer be in force and effect thereafter. FIRST READING: February 16, 2015 SECOND READING: PASSED AND ADOPTED THIS day of A.D., 2015. ATTEST: DOMINIC PERSAMPIERE MAYOR of the City of Oviedo, Florida Barbara J. Barbour City Clerk Page 6 of 6