The city of Marysville and its largest employer, the Scotts Miracle-Gro Co., have negotiated an agreement that will lead to a multi-million-dollar expansion project.

The city of Marysville and its largest employer, the Scotts Miracle-Gro Co., have negotiated an agreement that will lead to a multi-million-dollar expansion project.

City administrator Jillian Froment announced Thursday night that the city and Scotts had agreed to terms on an economic development agreement that will lead to the retention or creation of nearly 200 jobs.

Scotts plans to build a 40,000-square-foot manufacturing/processing facility and a 20,000-square-foot office facility on its Marysville campus.

Established in Marysville in 1866, Scotts Miracle-Gro is the largest producer of horticultural products in the world. In addition to its Scottslawn Drive headquarters and campus, the company recently re-opened the original O.M. Scotts store in Marysville's historic uptown business district.

Scotts has worked the last several months to address a shortage in company office space that could have resulted in more than 150 jobs being relocated to another central Ohio city, Froment said.

"Instead, Scotts worked closely with the city to find alternatives that would retain these positions in Marysville. This week Scotts met with city officials to announce they will build a 20,000-square-foot facility that would provide additional office space and meeting rooms on their campus, thus ensuring the 150 jobs will remain in Marysville," she said.

On Thursday, July 9, Marysville City Council will hold a public hearing on a pair of resolutions related to the project.

Froment said Eric Phillips, Union County's economic development director, was approached by Scotts representatives about two weeks ago regarding the possible expansion of the company's manufacturing facilities in Marysville.

She said the additional manufacturing facility would be used to process coir, the outer husk of coconuts, which is used in Scotts E-Z seed as the delivery medium.

"Scotts E-Z seed has seen such success in this retail period, they literally can't keep it on the shelves," Froment said.

To meet demand, Scotts will build a 40,000-square-foot facility valued at $6.2-million and purchase new machinery and equipment valued at approximately $16.8-million.

The company plans to have the new facility in operation by early 2010, Froment said. The facility will create 33 full-time permanent jobs and 39 part-time seasonal positions for at total of 53 full-time equivalent jobs.

"This will result in approximately $3-million of new annual payroll," she said. "The facility will also ensure the retention of 15 permanent jobs already located in the city of Marysville."

Froment said the decision to build the manufacturing/processing facility was another sign of Scotts' commitment to the community.

"There were competing business concerns that had to be weighed," she said. "For example, the coconut husk is imported from Sierra Leone. There were several areas of the United States that were considered by Scotts for the simple reason that the cost associated with bringing the raw material from Africa to Ohio is far greater than other areas of the country."

By utilizing the county's Economic Development Incentive Policy and working closely with Scotts and the state of Ohio, city officials were able to create a scenario that made Marysville the preferred location.

As part of that scenario, the city is asking council to approve an enterprise zone agreement between Marysville and Scotts. Without that agreement, Froment said the city and Union County would not realize the job creation and investment and increase to the tax base.

Froment said the agreement has been reviewed by the Union County-Marysville Tax Incentive Review Council, which recommended it to city council.

The agreement calls for a 10-year, 75-percent real property tax abatement, valued at $6.2-million, for the construction of the manufacturing facility.

A commitment also is being sought from the Ohio Department of Development for a state-funded economic development incentive package.

Froment said the agreement also provides for a hiring preference for residents in the city of Marysville enterprise zone.

An enterprise zone tax revenue sharing agreement between the city of Marysville and the Marysville Exempted Village School District also is included in the agreement.

That agreement ensures that no single entity bears the brunt of the impact of an economic development incentive.

"This agreement provides a method for equalizing the tax collections by both the school district and the city from this project, thereby equalizing the benefit and the impact to both entities," Froment said.

The project is projected to create approximately $60,000 in tax revenue per year, for a 10-year total of more than $620,000. Of that total, the city and school district would each receive approximately $30,000 a year, for a 10-year total of $300,000.

City council President John Gore, the city's representative on the tax incentive review council, said Mayor Chris Schmenk, a Scotts employee, did not participate in any portion of the discussions for the project.

jdonahue@thisweeknews.com