Pinecrest Developers Asking for Tax Break; Orange Residents Petitioning to Limit Village's Ability to Grant Such Deals

By Brenda Cain

ORANGE, Ohio -- Some village residents say they were misled when developers pitched Pinecrest: a high-end retail complex that would draw property tax dollars for schools.

Now that Fairmount Properties of Cleveland are asking for tax increment financing for the development, a group led by former village Mayor John Dubyak and resident Edward Bonk are collecting signatures to place an ordinance on the November ballot that would make it impossible for village officials to offer tax breaks without voter consent. They need 130 signatures.

Bonk calls Fairmount's request for a tax break a "bait and switch" and says Fairmount wants to add apartments to the original plan, meaning the school district could see additional students.

Orange Mayor Kathy Mulcahy called the petition drive "misguided." 

"The village and the schools will still benefit from all of the tax dollars promised in the original campaign," Mulcahey said.

Fairmount wants to use tax-increment financing to divert taxes from increased value on the property to pay for some costs of public improvements, including roads. To grant the tax break, both the village and school district would have to approve the deal.

Orange voters in 2013 approved rezoning 70-plus acres north of Harvard Road and east of Interstate 271 for nearly 300,000 square feet of stores, 40,000 square feet of restaurants and a 580-seat theater. Also in the works is an 80-room hotel and 18,000 square feet of offices. Original plans called for townhouses and other homes -- all for sale -- near the Orange-Woodmere border. A key selling point: Most of the retailers would be new to Northeast Ohio.

Mulcahey said the project, slated to include a restaurant with Bocce bowling when it opens next year, will still bring in the tax dollars promised. In addition, she said developers have committed $5 million to add walking trails.

Bonk calls the conflict between residents and village officials "a moral argument," especially since most of the discussion have taken place behind closed doors.

"I just don't see how giving away public money is a secret," he said.

The meetings have been held in secret because of "competitive information" about retailers who have committed to the project or are still being pursued, Mulcahey said. The village is planning public meetings in a few weeks.

"No public business will be done without a public hearing," she said.

Dubyak said the financing would be a first for the village, and for neighboring communities.

"My concern is about the precedent this would set," said Bonk. "The next guy comes along and asks for the same deal and the next thing you know we are in a downward spiral. "