Licking County commissioners say they are concerned about funding a road project in Pataskala when the potential return on their investment could be jeopardized through a referendum.

Licking County commissioners say they are concerned about funding a road project in Pataskala when the potential return on their investment could be jeopardized through a referendum.

"We've already spent a substantial amount of money on the project, and hopefully, we can move forward," commissioner Mark Van Buren said. "I'm disappointed some of these agreements are not signed. But my biggest concern is this referendum. If it's filed, how do we come out in the election?"

Commissioners have been working with Pataskala officials to use $3.4-million in state funding and build a 14,400-foot road through 525 acres east of Mink Road and south of Broad Street. Howard and Rosemary Emswiler own most of the land. The road would open the empty land for development and connect it to the Etna Corporate Parkway to the south.

Licking County commissioners have agreed to front the rest of the money needed -- beyond the grant amount -- to build the portion of the road south of Refugee Road; to pay engineering costs (which could reach an estimated $750,000); and to pay for the cost of mitigating wetlands on the site. By state law, if wetlands are destroyed in construction, they must be replaced elsewhere.

Commissioners agreed to front the money on the condition that the project generates enough revenue to pay the county back in full.

Money could be returned to the county through two revenue streams: a joint economic-development district (JEDD), which would allow Newark to collect an income tax on businesses in the district for the city of Pataskala, which does not currently collect an income tax; and a tax-increment-financing (TIF) district, which would collect any new property-tax revenue from developments in the district and redirect it into a TIF fund to pay back infrastructure debt.

It's the TIF that's come into question since Pataskala resident Mike Fox is working to file a referendum against an amendment to the TIF agreement that Pataskala City Council approved Sept. 15. Council already had passed a 30-year, 100-percent nonschool TIF on the property, including revenue sharing with ProLogis, a development company that since has withdrawn from the project. The amendment approved last week removed ProLogis' name and the company's agreement to give both Southwest Licking Local and Licking Heights school districts $500,000 each.

Pataskala Mayor Steve Butcher said school officials agree the project is a good one, but because both struggle with their own funding issues, each district is leery of losing half-a-million dollars.

Attorney Connie Klema, who is representing the Emswilers, said she's worked with the county to propose alternate funding sources for the schools that could be obtained through a tax-abatement agreement. She said the agreement could include a dollar amount per acre that would be paid to the schools when the land is sold for development.

Jerry Brems, director of the Licking County Planning Department, said the options being sent to the schools Sept. 19 would allow them to receive different amounts per acre, depending on what type of tax abatements are approved for the property. County officials have suggested passing a 100-percent, 15-year tax abatement on the property. Such an abatement would not require companies that develop there to pay 100 percent of their real property taxes for the first 15 years.

Brems said the options sent to each district offers less money per acre for lower abatements, such as a 10-year, 100-percent abatement.

Abatements could be offered on land placed within a community reinvestment area (CRA), and the CRA would have to be approved by school boards.

The Southwest Licking and Licking Heights school boards are expected to hold a joint meeting at 7 p.m. Monday, Sept. 22, at the SWL school board office, 927-A South St., Pataskala, specifically to discuss the CRA/TIF agreement for the Pataskala Corporate Park.

The referendum on the TIF amendment could overturn the amendment but not the original agreement. But county officials are not sure if the original TIF agreement, with ProLogis' name and funding for the schools, could be valid now that ProLogis no longer is part of the project.

Fox said he's not against development, but he is concerned about tax revenues being diverted in the TIF and lost revenue through abatements.

"I want to see tax relief, but if it's 30 years before that relief, that doesn't make sense," Fox said, referring to the TIF.

Even if Fox gathers enough signatures to place the referendum on the ballot, voters would not see the issue until November 2009. That's why Van Buren hesitated last week to approve more funding for the project.

Commissioner Doug Smith said Pataskala officials should be able to understand the county's reluctance to put any more money forward until some of the issues raised in the past few weeks are addressed.

Smith also reminded the group that no matter what agreements are put in place, future negotiations on revenue could be required, depending on the circumstances of the site development.

"The schools need to know that there are variables and there will be some give and take," Smith said.

Despite their concerns, both Van Buren and Smith agreed to spend more money on the project for engineers to determine the best route for the road, considering the wetlands in the area.

Commissioner Tim Bubb was absent.