New Albany owes Plain Township an estimated $300,000 from tax-increment-financing (TIF) district revenue it collected.

New Albany owes Plain Township an estimated $300,000 from tax-increment-financing (TIF) district revenue it collected.

"It looks like the amount due to the township for prior years is slightly above $300,000, give or take," New Albany communications director Scott McAfee said. "However, legislation requires that a compensation agreement be in place to make the payment, and there is no agreement in place yet. We're still working through the process of establishing this compensation agreement so we can make the payment."

McAfee said New Albany City Council will have to review a compensation agreement before any payment is made. He said he could not give a timeline on when the payments could be made.

The error was discovered by township fiscal officer John Brandt, who sent the city a letter Jan. 24 requesting revenue owed. For some TIF districts, the city reimburses the township for revenue it would collect if a TIF district were not in place.

City manager Joseph Stefanov reviewed legislation and confirmed an agreement was included in legislation but never completed.

The agreement was to include revenue from TIF districts created when 10 subdivisions were built: Balfour Green, Ealy Crossing, The Enclave, Hawksmoor, Richmond Square, Saunton, Tidewater I and II, Upper Clarenton and Wentworth Crossing.

A TIF is an economic development mechanism available to local governments to finance public infrastructure improvements and, in certain circumstances, residential rehabilitation, according to the Ohio Department of Development. A TIF works by locking in the taxable worth of real property at the value it holds at the time the authorizing legislation was approved.

The TIF districts were created to generate revenue and pay back debt incurred in construction of the Jeanne B. McCoy Community Center for the Arts and the development of a Metro Park in northern Plain Township, Stefanov said.

The McCoy center was built with funding from New Albany, Plain Township and the New Albany-Plain Local School District. The city and township worked together to issue debt so each government did not have to issue debt separately.

The Metro Park, which will be called Rocky Fork Metro Park and is being developed north of Walnut Street and east of Schott Road, is similar in that it is a collaborative project between New Albany, Columbus and Plain Township, all of which have contributed funding or land to the project.