Q.:  What is a Joint Economic Development District?

A.: A Joint Economic Development District (JEDD) describes the result of an arrangement between a township and a city (or village) that allows them to share the benefits and responsibilities of commercial and industrial development in Ohio.  A JEDD permits a regional approach to economic development.  The statutory purpose for a JEDD is the facilitation of economic development in the state and in the region of the municipality and township that are the contracting parties.  The statewide provisions governing JEDD’s are Sections 715.72 to 715.83 of the Ohio Revised Code.

Q.: How does a JEDD benefit a city?

A.: If a city annexes property, it must provide all the city services to those properties, including expensive police and fire protection, zoning, road development and water and sewer services.  By using a JEDD, the city can obtain a portion of an income tax levied by the JEDD without annexing the property, and without providing all municipal services.  The city benefits because its share of the JEDD income tax revenues can go into its general fund.  The city also benefits by avoiding the animosity that annexation can cause between local governments that should be working together to serve area citizens.

Q.: How does a township benefit from a JEDD?

A.: Normally, a city that is party to a JEDD agrees not to annex property anywhere within the JEDD, or anywhere within the township, for the duration of the JEDD term.  This agreement allows the township to preserve its geographic integrity as a political subdivision while continuing to receive all the real estate taxes from the property.  Also, the township and city share the JEDD income tax revenue, which gives the township access to a new revenue source.  This share of income tax revenue allows the township to continue to provide local services without constantly asking residents for real estate tax increases.

Q.: Must the township and the city be located next to each other in order to form a JEDD?

A.: No.  Property need not be contiguous.  In fact, a JEDD can be formed between a township and a city even if there is another township or city in between the two borders that is not a party to the JEDD.  Property must be zoned and used for commercial or industrial purposes, and cannot contain property that is zoned or used for residential purposes.

Q.: Why would a property owner want to be part of a JEDD?

A.: Many property owners need city services, such as water and sewer, that may not be available in townships.  Through a JEDD, a property owner can access those services without having the property annexed into the city.  Some JEDD’s provide that a certain percentage of the JEDD income tax (say, 20 percent) must be put into a fund to be used only within the JEDD area.  Such funds might be used to extend infrastructure (such as roads, water lines, sewer lines, street lighting, curbs and sidewalks) necessary for industrial and commercial development.

Q.: Can a JEDD benefit residents who are not included in the JEDD?

A.: Yes.  Many JEDD agreements in Ohio allow for residential service areas that are not required to join the JEDD and, therefore, do not pay a JEDD income tax.  Nearby cities generally agree to provide water or sewer services to those residential areas without annexing them.  Often, these services are provided at either the same rates as city residents pay, or at a much lower surcharge than other out-of-city residential users generally pay for water or sewer.  The logic is that, since the city will pass by residential customers when it runs water and sewer lines to the commercial and industrial property covered by a JEDD, the city might as well allow those residential customers access to the city’s water and sewer services.

Q.: Do township and city residents get the opportunity to vote on a JEDD?

A.: It depends.  City residents are not afforded the opportunity to vote on a JEDD. The municipality and the township must approve the JEDD contract.  If the township trustees' approval is not unanimous, the contract must be approved by the township voters at an election in the township.

Q.: Why don’t we see more JEDDs in Lorain County?

A.: The process of creating a JEDD is not easy.  Negotiating and drafting the JEDD contract is often a lengthy process.  Once the contract has been prepared, the petition process is initiated.  Creating a JEDD requires a petition from a majority of the property owners in the JEDD and another petition from a majority of the business owners in the JEDD.  Past animosities, a lack of trust and friction between political jurisdictions may inhibit cooperation among the respective political leaders.