Jankowski v. Monclova-Maumee-Toledo Joint Economic Development Zone Board of Directors

185 Ohio App. 3d 568 · Ohio Court of Appeals · 2010

Facts

Monclova Township, Maumee, and Toledo formed a Joint Economic Development Zone (JEDZ) and imposed an income tax. Appellants challenged the tax, arguing improper revenue distribution to contracting municipalities, lack of consideration for a service contract with Monclova Township, and the JEDZ contract's failure to specify improvements. The trial court granted summary judgment for the JEDZ, leading to this appeal.

Issue

1. Can JEDZ income tax revenues be distributed to contracting municipalities for general purposes unrelated to the JEDZ? 2. Is a contract between the JEDZ and a township for governmental services valid if the township already has a pre-existing legal duty to provide those services? 3. Is the JEDZ contract valid if it does not explicitly obligate parties to specific improvements but incorporates an economic development plan?

Holding

1. Yes, JEDZ income tax revenues can be distributed to contracting municipalities for general purposes pursuant to the contract. 2. No, the contract between the JEDZ and Monclova Township for governmental services is invalid for lack of consideration because the township had a pre-existing legal duty to provide those services. 3. Yes, the JEDZ contract is valid as its preamble and incorporated economic development plan, detailing specific improvement projects, satisfy statutory requirements.

Rule

R.C. 715.691(H) permits JEDZ income tax revenues to be used for the purposes of the zone and for the purposes of the contracting municipal corporations pursuant to the contract. Performance of a legal duty owed to a promisor, which is neither doubtful nor subject to honest dispute, is not valid consideration for a contract. A JEDZ contract satisfies R.C. 715.691's requirement for sharing costs of improvements if it incorporates an economic development plan detailing specific projects.

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