ANNUAL 20 REPORT 16 I Downtown Cincinnati and The Banks MAYOR John Cranley CITY MANAGER Harry Black DIRECTOR OF COMMUNITY & ECONOMIC DEVELOPMENT Oscar Bedolla 2 COUNCIL MEMBERS Vice Mayor David Mann President Pro Tem Yvette Simpson Kevin Flynn Amy Murray Chris Seelbach P.G. Sittenfeld Christopher Smitherman Charlie Winburn Wendell Young COMMUNITY & ECONOMIC DEVELOPMENT SENIOR STAFF Philip Denning James Flick Daniel Fortinberry Roy Hackworth Monica Hardman Greg Huth Clifton Pendergrass Megan Ryan Bob Schroer Aisha Tzillah CONTENTS MESSAGE FROM THE DIRECTOR 4 MISSION6 ORGANIZATIONAL CHART 7 2016 AT A GLANCE 9 DIRECTOR’S OFFICE 10 CINCY POP SHOP SPOTLIGHT 15 ECONOMIC DEVELOPMENT 17 CINTRIFUSE SPOTLIGHT 23 HOUSING & COMMUNITY DEVELOPMENT 26 PARKING FACILITIES 32 BUSINESS ADMINISTRATION & FISCAL 34 MONITORING & COMPLIANCE 36 POLICY & COMMUNICATIONS 38 CONTACTS40 3 MESSAGE FROM THE DIRECTOR OSCAR BEDOLLA Thank you for the opportunity to provide an update on the successful year the Department of Community and Economic Development (DCED) had in 2016. Building upon the momentum we experienced in 2015, we exceeded our expectations and goals with the help of the leadership of Mayor John Cranley, City Manager Harry Black, City Council, key stakeholders, and the hard work of our team. As a department, we were busy in 2016, facilitating more than $440 million in total investment through 58 projects, which also resulted in the creation of 816 housing units. The City also created 2,347 jobs and retained an additional 1,840 jobs through housing and economic development projects, nearly 1,800 more than 2015. This further cements the notion that we are a City on the Rise. The changes introduced to the organizational structure in 2015 allowed the department to EFFICIENTLY and EFFECTIVELY manage projects and provide transparency to both internal and external stakeholders. Our restructuring through the addition of the Major Projects Division and the Policy and Communications Division, in addition to the expanded role of the Monitoring and Compliance Division, has allowed us to: • Promote the DCED mission and advance policy initiatives. • Increase our ability to facilitate intricate urban development projects. • Create a more robust incentive monitoring system while increasing data oversight. Since this was the inaugural year under the new structure, we determined that our charge should reflect the recent changes. Hence, the team developed a new mission: To facilitate strategic development and services within the Cincinnati community that improve the lives of residents, increase business investment, and revitalize City neighborhoods. 4 MESSAGE FROM THE DIRECTOR This mission represents not only what we do, but also what we are passionate about. It is this passion and dedication that helped drive the success of the department over the past 12 months. The following report will discuss the many successes we had, the projects we helped facilitate, and what we hope to accomplish in 2017. Last year showcased that Cincinnati is a city on the rise on several fronts. We are gaining the attention of outside investors, both foreign and domestic, who are investing in our real estate. We used our incentives strategically to help startups get up and running, assist small and medium sized businesses with expansion, and attract new companies to the city. I am proud to lead a team whose hard work and dedication has contributed to the numerous accolades the City received across the spectrum, such as Christie’s International Real Estate naming the City as a “Top City to Watch in 2017” and Travel + Leisure calling Cincinnati a “Top Place to Visit in 2017.” To continue this rise in 2017, we must continue to be proactive in identifying trends. We must drive innovation to cater to the needs of the new economy. We must be strategic in our development to create vibrant and sustainable neighborhoods and utilize intelligence gained from expanded data collection. Finally, we must be transparent in our process and inclusive of small, minority-owned, and woman-owned businesses. I look forward to the challenges and successes 2017 will bring and leading the Department of Community and Economic Development. Join me as we continue to #WatchCincyRise. Oscar L. Bedolla 5 MISSION Our mission is to facilitate strategic development and services within the Cincinnati community that IMPROVE the lives of residents, INCREASE business investment, & REVITALIZE city neighborhoods. Smale Riverfront Park 6 ORGANIZATIONAL CHART Director’s Office Parking Facilities Major Projects Economic Development Business Administration & Fiscal Housing & Community Development Monitoring & Compliance Policy & Communications 7 52 NEIGHBORHOODS Spring Grove Village Northside e s m da A CBD Riverfront Oakley Hyde Park Mt. Lookout oo ut aln W . E ls Hil Madisonville nw Corryville W t. Lower Price H ill ills tH u aln n West Over lto de End The Pen Rhine East End Se da e at sg ill CUF Mt. en sv Evanston Heights ue m Avondale Auburn Q Hill N. Avondale a bi m m lu ulu Co usc T W. Price Hill E. Price k ar rP yle Sa S Fairm . ount Pleasant Ridge Paddock Hills M Westwood Fa N W En irm . o g. ou od nt s Camp ton Washing Roll Hill W S. es E. Cumminsville tw oo d Millvale Clifton Rose Bond Hill Li Mt. Airy C Winton Hills e ag h art y ned Ken hts Heig College Hill d ell lawn Hartw Mt. Washington Riverside California REVITALIZING COMMUNITIES 8 2016 AT A GLANCE #WatchCincyRise INCENTIVES $447M+ TOTAL INVESTMENT IN CITY PROJECTS INCENTIVES REVIEW 816 HOUSING UNITS CREATED COMPLETED 1,840 2,347 JOBS RETAINED JOBS CREATED $ $ $ 8:1 1,800 181 PRIVATE TO CITY INVESTMENT IN 2016 METER POLES LOWERED TO MEET ADA ACCESSIBILITY HEIGHT REQUIREMENTS BUSINESS RETENTION VISITS (170% increase from 2015) LAUNCH OF 9 DIRECTOR’S OFFICE The Director’s Office oversees the seven The final report measured the City’s divisions that make up our department competitiveness in both the region including Economic Development, and the nation by profiling our major Major Projects, Housing and Community incentive programs against peer cities. It Development, Fiscal and Operations, also made several recommendations on Monitoring and Compliance, Policy and how the City can improve development Communications, and Parking Facilities. efforts, which we began implementing Together, the DCED team is highly immediately. For example, we created a focused and responsive to the needs of more robust process in which we provide constituents and implements policies that detailed information to City Council and are innovative, transparent, and maximize the general public about our investment efficiency. decisions. MAJOR ACCOMPLISHMENTS Looking back on 2016, our department achieved several major accomplishments which include: Incentive Review From July 2015 to June 2016, DCED Capitalizing on development momentum is a key goal of our department. actively collaborated with HR&A, an industry-leading consulting firm whose core mission is to reinvent cities into In addition to making changes to our vibrant urban centers that offer jobs incentive tools, we expanded the role of and sustain a high quality of life for our Monitoring and Compliance Division diverse communities. The result of this to facilitate a more rigorous monitoring collaboration was a comprehensive process that includes surveillance review of the City’s incentive policies. The reviews, and tracking the progress of primary objectives of this review were to commitments made by incentivized evaluate the effectiveness of the City’s businesses. Finally, we formed a Data incentive offerings, assess the processes Integrity Team (DIT), inclusive of by which projects were evaluated, and members of each division and led by identify how the department’s toolkit can a Data Integrity Manager. The DIT is be enhanced to help maximize the City’s tasked with streamlining data collection return on investment. and ensuring accuracy. All of this was done to improve our competitiveness, minimize risk, and maximize return on City investments. 10 10 Development Opportunity Solicitations Monday initiative utilized social media to Capitalizing on development momentum market these opportunities in addition is a key goal of our department. To to our traditional marketing strategies. ensure the City continues to perpetuate This effort drew in both community and growth, we must facilitate a development developer interest as demonstrated by process that is transparent and includes the attendance of more than 80 people community involvement. This past year at the initial informational session. This we did exactly that by releasing a new informational session was designed initiative that identifies development to discuss the opportunities, create opportunities on City-owned land that transparency of information, explain requires, as a part of the process, the the process, and promote inclusion of development community to engage minority-owned and woman-owned residents prior to developer solicitation. businesses on development teams. The goal is to establish a process that is transparent to residents and holds In total, 14 letters of interest were the City accountable for building submitted for the two development projects that reflect the interests of the opportunities. We are currently working community. through the procurement process to screen the RFP responses. Upon completion, we will select preferred We understand the need to build strong partnerships with fastgrowing cities so we can share best practices and leverage relationships to meet our growing needs. applicants who will be advanced through a more rigorous selection process with a preferred developer anticipated to be selected by August 2017. Moving forward, this coordinated release of opportunities is a tactic the department will employ, at least annually, to activate development throughout Cincinnati’s 52 neighborhoods. The inaugural event occurred in 2016 on the Monday after Thanksgiving, commonly referred to as “Cyber Monday.” The event was designed to showcase the release of community development opportunities in the City of Cincinnati. The two development opportunities released were the Shillito’s West building and the Ninth and Plum Streets redevelopment site. Both properties have been underutilized for decades. Our Cyber Economic Development Incentives Consortium As our department continues to identify innovative solutions to grow our local economy, we understand the need to build strong partnerships with fastgrowing cities so we can share best practices and leverage relationships to meet our growing needs. To that end, we recently partnered with the City of Kansas City, Missouri, which is currently in the process of conducting a 11 DIRECTOR’S OFFICE comprehensive historic review of their (cont.) LOOKING AHEAD TO 2017 past use of incentives, like the work we did with HR&A, as noted previously. Building Diversity and Capacity Together, we created an Economic As Cincinnati continues to develop, Development Incentives Consortium to advancing diversity is a priority. By broaden our collective understanding of developing targeted policies and the long-term impacts of these tools and programs to promote diversity, we will accelerate identification of policy and ensure that “a rising tide lifts all boats.” process improvements to the benefit of our communities. To this end, we have created strategic initiatives that provide transparency and To kick off this initiative, we brought build capacity. together economic development professionals from multiple cities to Advancing Diversity in Development discuss steps each has taken to improve The Advancing Diversity in Development economic incentive policies. Participants program provides training and included leaders from: informational seminars to help individuals • Baltimore, Maryland learn about the tools and investment • Atlanta, Georgia resources that are available to them so • Portland, Oregon that they may successfully engage with • St. Louis, Missouri City and City-supported projects of all • New Orleans, Louisiana sizes and types. This program has been • Tulsa, Oklahoma successful in the past, and, looking ahead • Columbus, Ohio to 2017, we will build on this workshop by • Chicago, Illinois hosting additional informational sessions designed to educate minority-owned This ongoing effort will enable us to share and woman-owned businesses about and evaluate best practices on how to use opportunities for project participation and incentives to promote greater economic access to funding. equality, and to benefit lower-income residents and neighborhoods. 12 Aging in Place Through our collective work, we As the city’s population grows and ages, will develop a city that provides the we need to make strategic investments necessary amenities, housing, and now that will allow us to tend to the infrastructure to retain and grow the needs of the population of all our 52 population and allow all residents to age neighborhoods in the future. DCED can in place. help promote those “aging in place” investments in several different ways, Foreign Direct Investment Strategy including changing our community Foreign direct investment (FDI) is an reinvestment area tax incentive language important tool we identified to attract to help shape the types of projects investment while thinking about being built. One example of this is our innovative ways to perpetuate economic grocery incentives policy that encourages development. Given the political new fresh foods markets to open in uncertainty in today’s world, this topic neighborhoods lacking this important has a broad appeal from real estate amenity. Investments like this will ensure developers and legal professionals to that our city residents can live in their investment bankers and policymakers. own community safely, independently, With the recent immigration changes and comfortably regardless of the stage and anticipated amendments to tax and of life. regulatory reform, it is important that we develop strategies that address the The department is actively working on changing political framework. these aging-in-place issues with various partners, including People Working In 2017, we will host a FDI symposium Cooperatively, Cincinnati City Council with leaders from REDI Cincinnati, Member P.G. Sittenfeld’s office, the SelectUSA, Cleveland International Fund, City of Cincinnati Office of Data and KPMG, World Trade Center of Kentucky, Performance and Analytics, and others. and many more. This symposium will Downtown Cincinnati and The Banks 13 DIRECTOR’S OFFICE (cont.) focus on how we can grow our regional Cincinnati Area Geographic Information economy (in turn growing our local System (CAGIS) to create a “Momentum economy) through leveraging FDI to build Map.” This map is expected to launch in infrastructure and real estate projects, spring 2017 and includes activity in all and attracting foreign companies sectors of the Central Business District, to improve our manufacturing and including retail, office, residential, parking, workforce sectors. The information etc. collected from the symposium will serve as the foundation for a robust strategy We will gradually build upon the that outlines the different forms of FDI functionality of this map based on and resources available to help Cincinnati public feedback and input from key court international investment. stakeholders, including expanding the scope to be inclusive of all 52 of Cincinnati’s neighborhoods. Foreign direct investment (FDI) is an important tool we identified to attract investment while thinking about innovative ways to perpetuate economic development. ‘Why I Love Cincinnati!’ To increase the awareness of the many great things happening throughout Cincinnati, DCED is embarking on a video marketing campaign designed to highlight the people and places that make this a great place to live and work. The first is “Why I Love Cincy!” and will be an effort between the department and several local partners where we will Momentum Map ask people to submit videos explaining Downtown Cincinnati is flush with why they love Cincinnati. We will also development activity and has been feature various Cincinnati neighborhoods for some time. Since 2013 alone, our throughout the year in videos that department has helped facilitate $672 showcase the unique charm that flows million in investment in completed throughout the city. projects, with hundreds of millions of dollars more on the horizon. There is so much activity that we wanted to create an interactive tool to showcase this to developers and investors looking to invest in the urban core. Therefore, 14 14 our department began working with SPOTLIGHT CINCY POP SHOP Following the release of the Downtown for eligible merchandising materials, in Retail Action Plan in June 2016, DCED addition to a rent-free retail space during led the charge to bring Cincy Pop Shop, November and December. a pop-up retail program, to Cincinnati’s urban core. Cincy Pop Shop addressed The program received 16 applications a goal of the Action Plan, which is “to from aspiring vendors, as diverse as they catalyze retail offerings that appeal to were eager. A selection committee made the diversity of the Cincinnati market up of five members, including City staff, by providing small and unique business the property manager for the Carew opportunities.” Tower, a small business lender, and a small business owner came together The program was created in partnership to create a process that was inclusive, with Downtown Cincinnati Inc. as a low- collaborative, and fair. Each committee risk opportunity for future Cincinnati member had the opportunity to first business owners to explore the potential complete an evaluation survey based of a brick-and-mortar retail location. solely on the vendor’s application. The applicants were then asked to After searching available spaces in come in and pitch their business to the the Central Business District, the team committee. Applicants were then scored identified Cincinnati’s iconic Carew Tower on predetermined criteria based on the as the site for the inaugural Cincy Pop retail goals from the Downtown Retail Shop program. Partnering with the Carew Action Plan. The scores from the pitch Tower team and building management day were added to the score taken from company Belvedere Corp., three the individual surveys, and eight diverse previously vacant spaces in the building vendors were chosen: were activated for the 2016 holiday • Barcode Glam shopping season. • Chapeau Couture Hats • Davis Cookie Collection LLC Through strategic use of Community • Flying Pig Marathon Development Block Grant funds, the • Green Box Gift Wrapping Winter 2016 Cincy Pop Shop offered • Jenco Brothers’ Candy selected vendors $1,000 in support • Sarah Center • Tronk Design CINCY POP SHOP 2016 15 Although diversity was a goal from the for baking, although at the time she was start of the program, the final number using it to relax during graduate school. surpassed expectations, with six of the When coworkers began paying her to eight selected vendors being woman- make boxes of a dozen cookies, the couple owned businesses, and seven of the capitalized on the opportunity. eight being minority-owned businesses. Fast forward to 2016. Davis Cookie We sat down with two of the vendors to Collection participated in the 12-week talk about their experience. entrepreneurship program at MORTAR, learning the ins and outs of starting a Fernanda Vergara, co-founder of local business and connecting with valuable furniture manufacturer Tronk Design, resources, such as University of Cincinnati rarely does business in Cincinnati and law students who helped them with legal had a lot to say about how the program aspects of running a business. The Cincy helped her business. “It was a no-brainer Pop Shop program gave them the added for us,” relates Fernanda. “We had never perspective of having a store and allowed ventured into retail [space] before, and them to get an idea of how to stock a this was a great learning experience.” brick-and-mortar retail location. Tronk designs and builds contemporary furniture, but mostly online and mostly bring our local story to Cincinnati. Our “We had never ventured into retail [space] before, and this was a great learning experience.” goal is to market to Cincinnati and tell -Fernanda Vergara, our local story, and open retail spaces. co-founder of Tronk Design to customers outside of Cincinnati – that is, until Cincy Pop Shop. “The Pop Shop program enabled us to After this experience, we feel more confident about what we need to do before we do that.” “And it’s a family business,” Miles muses, “We’re both doing it. It really promotes “We learned so much about how to family. We’re creating something for merchandise and sell our product to our family to be able to call our own.” the end user, not the internet,” reflects The Davises’ goal is to pass the business Fernanda. “We had never ventured into down to their children and to become a retail; it was a learning experience.” Cincinnati staple, along with the likes of Graeter’s or Montgomery Inn. For Davis Cookie Collection, it felt good to be able to answer the question, What advice would the Davises give the “Where are you located?” next round of Cincy Pop Shop applicants? “Be ready for that pitch and come with 16 Christina and Miles Davis quickly realized your best. It can really be a game changer in 2014 that Christina had a tasty talent for your business.” ECONOMIC DEVELOPMENT & MAJOR PROJECTS Projects Divisions serve as liaisons BUSINESS EXPANSION AND ATTRACTION PROJECTS between City departments, businesses, In 2016, the Economic Development and the development community. They and Major Projects Divisions helped to are dedicated to cultivating commercial create and retain more than 4,035 jobs development in all of Cincinnati’s 52 and leveraged in excess of $272 million neighborhoods by providing financial, in private investment through economic informational and technical assistance to development projects. This success was businesses seeking to relocate or grow. achieved by attracting new businesses to The staff is adept at helping commercial the City and helping existing companies developers, business owners, real estate expand their operations. The Economic Development and Major brokers, and site selectors navigate the administrative and legislative processes related to their projects. FIGURE 1: ECONOMIC DEVELOPMENT AND MAJOR PROJECTS DIVISION PROJECTS Project Statistics Jobs Created 2,203 Jobs Retained 1,832 Housing Units 205 Private Investment $272.1M City Investment $42.5M Other Public Investment $10.1M Anthem Ribbon Cutting 17 Development projects in our urban core Jet Machine and Path Forward IT get a lot of attention. However, it should (Roselawn) be noted that our department works TechSolve II Business Park, located in tirelessly to help attract and facilitate Roselawn near the southwest corner of investment throughout all of Cincinnati’s Reading Road and Seymour Avenue, was, neighborhoods, such as Lower Price Hill, until recently, a blighted, underutilized Roselawn, West End and Queensgate. shopping center known as Seymour Together with our community partners, Plaza. The City partnered with the Port of the Economic Development and Major Greater Cincinnati Development Authority Projects Divisions helped facilitate more to demolish and remediate the property, than $37 million in development in these making it ready for new construction. four neighborhoods in 2016. Jet Machine broke ground on a Q-Labs (Lower Price Hill) 105,000-square-foot industrial facility Q-Labs, a full-service laboratory servicing on nine acres, the largest undeveloped the food ingredients and flavorings, parcel in the TechSolve II Business cosmetic, pharmaceutical, and health and Park, in September 2016. Construction beauty care industries, will soon begin is expected to cost approximately $5 rehabilitation of two buildings totaling million, and the company will invest a 25,000 square feet and the construction total of $12 million in the project. The new of a new 30,000-square-foot laboratory space will allow the company to create 52 within the Knob Hill City View industrial new, permanent, full-time jobs, and retain park on Radcliff Drive in the Lower Price 118 existing full-time jobs in Cincinnati. Hill neighborhood. This $7.5 million This expansion will also free up space at project will retain 100 full-time permanent one of Jet Machine’s existing buildings jobs and create 47 new jobs. in Bond Hill for an office tenant, Path Forward, to expand and create 150 new jobs and retain 151 existing jobs. 18 Jet Machine ECONOMIC DEVELOPMENT & MAJOR PROJECTS (cont.) Messer Construction (West End) SFA Architects (Queensgate) Messer Construction acquired two SFA, an architecture and engineering firm properties on Cutter Street in the with more than 47 years of experience, is West End to construct a two-story, renovating a warehouse building at 555 50,000-square-foot facility that will house Carr Street in Queensgate. The building the company’s corporate operations. The is 60,000 square feet and located along project broke ground in October 2016 and a prominent gateway into Cincinnati is expected to be completed by the end off the Sixth Street Viaduct. This new of 2017.The roughly $12.8 million project expansion will retain their headquarters will support the retention of 116 jobs, as in Cincinnati and be a major investment well as creation of 40 new jobs. for the Queensgate neighborhood. The total project cost is $4.7 million and the company will commit to increase their employment from 60 full-time permanent employees to 85 full-time permanent employees. Messer Construction 19 PROJECT SPOTLIGHTS Madison Square is being developed by RBM Development LLC. The project Medpace (Madisonville) features office and retail space. There will Economic development activity in also be a Dolce Hotels & Resort Lifestyle Cincinnati also included a major business Collection hotel, which will have 239 expansion project initiated by Medpace, rooms and conference space. All in all, the a clinical research organization for the development could bring $200 million in development of drugs and medical investment to Madisonville. devices. Medpace’s commitment to Madisonville started in 2008 when it 309 Vine Street (Downtown) selected the former NuTone site at the Cincinnati has seen its apartment market corner of Madison and Red Bank roads boom in the Central Business District due for its headquarters, where currently to urbanization. it has 1,150 employees. Now, just eight years later, the company will add another 962 jobs at the new Madison Square development. The new jobs will have an approximate annual salary of $55,000. The addition of these employees will positively affect neighboring businesses and will serve as a catalyst for new business attraction in Madisonville. 20 Cincinnati has seen its apartment market boom in the Central Business District due to urbanization. 309 Vine St There are two primary factors driving in the Central Business District into urbanization. First is the “millennial approximately 300 market rate micro effect.” It has been widely reported that apartments, approximately 400 square Millennials and those in Generation Y are feet each, with 18,000 square feet of retail migrating to urban areas. Second, it is not space and 24,500 square feet of office just the younger generations moving to space. When finished, the $70 million urban areas. Today, more baby boomers project will be the first of its kind in the and retirees are calling downtown home. Cincinnati market. These two populations converging on downtown forces developers to become innovative in their projects. They must ECONOMIC DEVELOPMENT PROGRAMS offer amenities that appeal to both Business Retention and Expansion population segments. Business retention and expansion One such change developers are visits (BRE) are a top priority for the making is the sacrifice of living space for Economic Development and Major entertainment and social common areas. Projects Divisions. Our teams conduct There is no greater example of this in BREs with local companies to continue downtown Cincinnati than the 309 Vine to cultivate relationships and serve the Street development. needs of businesses located in the City. The goals of these are to facilitate greater The Chicago-based developer Village communication and remain connected to Green is currently converting the local businesses. In 2016, 181 BRE visits 348,934-square-foot Union Central were conducted, a 170% increase over the Life Building Annex at 309 Vine Street number completed in 2015. Jos. Berning Printing Brink Brewing Co. Anthem 21 ECONOMIC DEVELOPMENT & MAJOR PROJECTS (cont.) Neighborhood Business District or wayfinding signage to make the Development district more appealing to visitors and The Neighborhood Business District residents. Improvement Program (NBDIP) is a highly versatile program that For the 2017 round of the NBDIP, was created to assist communities we estimate that $750,000 in City in implementing projects that Capital funds will be available to stabilize, maintain, and improve their selected qualifying groups. Final neighborhood business districts. These funding applications are due from projects can come in a variety of forms, neighborhood business district including parking additions, façade development groups on April 21, 2017. improvements, or building renovations. Funding recommendations will then be The program can also provide indirect made in June, with funding becoming benefits by funding streetscapes available in July and August, subject to City Council approval. 22 Smale Riverfront Park SPOTLIGHT CINTRIFUSE INNOVATION ENABLED BY DIGITAL STARTUPS Cintrifuse is the Cintrifuse is a unique institution for epicenter of the Cincinnati in the benefits and capability Cincinnati startup that it offers relative to economic scene, and Cincinnati is development. It is a public-private no stranger to startups. partnership that the City of Cincinnati Two local soap makers invested in through real estate who turned their development of its office space, as well as tiny business into support of its general operating expenses. a consumer goods company that spans the globe; a small door-to-door insurance sales group that now owns and manages nearly $68 billion in assets; a four-person data mining team that recently reanimated an entire block of downtown for its now more than 600 employees – all have a story that is uniquely Cincinnati. “I’m not building a kingdom; I’m building an economy.” -Wendy Lea, Chief Executive Officer, Cintrifuse Cincinnati has a long history of companies like Procter & Gamble, Western & and invested here. The City continues WHAT DOES IT TAKE TO CREATE A THRIVING STARTUP ECOSYSTEM IN CINCINNATI? to see companies like these take root That is the question that drives Cincinnati in Cincinnati, and strategically aligns innovation hub Cintrifuse. With a lexicon resources to better partner with them. that includes Series A, super angel groups, Realizing the value that startups can bring growth hacking, and BigCos, the company to economic growth, the local business has brought life to the Cincinnati startup community and the City of Cincinnati scene that, until recently, had been pressed for an innovative startup reserved for large market coastal cities. Southern Financial Group, and 84.51° that have grown here, stayed here, ecosystem – thus, Cintrifuse was born. 23 There is a bustling energy throughout simply, working with roughly 300 startups the historic Over-the-Rhine building that to link their innovation with investors and you can link to Cintrifuse CEO Wendy corporations. Lea. All over the bright, open space, entrepreneurs are putting innovation However, the work doesn’t end or even to work. Groups and teams from the begin at the front door of their offices. community are also invited to fill coworking spaces throughout the building. “I’m not building a kingdom; I’m building Aptly named Union Hall, 1311 Vine Street is an economy,” Lea explains. Cintrifuse now headquarters for StartupCincy. takes a holistic approach to building the next generation of digital startups, Appointed in October 2014, the nurturing a certain percentage of magnanimous Lea has brought with those through venture capital-backed her a wealth of experience, spanning startups. Lea continues, “Even that sector dozens of countries and numerous influences small to medium business, prominent leadership positions on because these businesses, meaning tech- and innovation-focused boards. bootstrapped, or loaned, businesses, Additionally, she was instrumental in thrive around the ecosystem of a venture- bringing Techstars’ FounderCon 2016 backed startup segment. It’s not just one to Cincinnati. The event brought more or the other – it’s the combination of all than 1,100 startup founders, investors and of them that will lift us up, so you have to others from around the world together to watch all those different segments.” network and share best practices around tech-based innovation. Lea doesn’t see any reason why the next Uber or Amazon couldn’t come out of Cincinnati. She reflects on the city’s Make sure startups are equipped, that culture: “I love the tradition of us, but also they come here, stay here, get customers the desire to bring in some new, vibrant, around here, and get funding. “That’s digital-native next generation. There’s really my day job,” says Cintrifuse CEO a sincere desire for the tradition of this Wendy Lea. community to be cracked open a little bit to let new folks in.” In an ever-changing business climate, Cintrifuse is a dot connector, to put it very 24 Union Hall The region’s higher education institutions she hopes to see more innovation play an important role in bringing this around those sectors, as well as others. new talent to the city, Lea relates. She is With industry strongholds like Kroger, exactly right when she points out that it is Cincinnati Children’s Hospital Medical not only her job, but the City’s job as well Center, Procter & Gamble, and others, to make sure graduates are connected to Cincinnati is a perfect place to give big the right degrees and career paths, e.g., companies access to innovation. digital manufacturing, physical products, cyber security, etc. to thrive in Cincinnati’s Lea emphasizes the importance economy. of Cincinnati’s longstanding larger businesses in the startup ecosystem. Lea also credits Cincinnati’s burgeoning These are the businesses that engage startup scene to “gritty” entrepreneurship, with, invest in, and rely on startups. These and observes the Midwestern qualities are the businesses that started out selling that drive startups to be mindful of bars of soap, and want to give today’s investors’ money and work diligently for startups their own story of growth that is what they earn. uniquely Cincinnati. Looking down the line, Lea sees good What’s next for the startup scene in opportunities in several fields for Cincinnati? The Cintrifuse team won’t rest entrepreneurs looking to make an impact until Union Hall is full and there is a line of in Cincinnati. Given the high level of next generation tech disrupters out the customer service integrated in health door. care, retail, foodservice, and hospitality, Cintrifuse Founding Partners Wall 25 HOUSING & COMMUNITY DEVELOPMENT The Housing and Community center with diverse housing options and Development Division focuses on targeted supportive housing services. and transformative development to provide quality housing options for all In 2016, the Housing and Community Cincinnati residents. Through creativity Development Division created 611 housing and collaboration, our division works units, leveraging approximately $106 to position the city as a thriving urban million in private investment. FIGURE 2: HOUSING DIVISION RELATED PROJECTS Project Statistics Jobs Created 144 Jobs Retained 8 Housing Units Created Private Investment 26 611 $106.2M City Investment $6.5M Other Public Investment $9.7M Sands Senior Apartments HOUSING AND COMMUNITY DEVELOPMENT PROGRAMS The projects were selected based on their ability to make a positive and visible impact within our neighborhoods. The Notice of Funding Availability 265 total units developed represent 43% The Notice of Funding Availability (NOFA) of all the housing units facilitated by the program is the primary procurement Housing and Community Development process for accessing City funding for Division. housing development projects. It funds a full spectrum of quality housing options, To help announce our newest round of and, in doing so, improves housing quality funding for calendar year 2017, the division and affordability. The funding provided by developed an informational webinar, the program is significant in that it is an which gave developers a preview of the open and competitive process that allows upcoming solicitation. The funding that for transparency and aids in how the will be available for 2017 was increased department makes funding decisions. by $2.5 million, bringing the aggregate funding to $6.5 million. Of the additional In 2016, the Housing and Community funding, $2 million was provided to Development Division utilized the $4 support affordable housing projects. million in funding, announced in November 2015, to provide financial assistance NOFA funding breakdown: for 10 housing projects located in eight neighborhoods: Camp Washington, College Hill, Madisonville, Northside, • HOME - $ 1.5 million (affordable) Over-the-Rhine, Roselawn, South • Capital - $2 million (affordable) Cumminsville, and Walnut Hills. These • Capital - $1.5 million (market rate) • CDBG - $1.5 million (affordable and market rate) projects encompassed a mix of market rate and affordable housing developments, Applicants recommended for funding from which included the development of 12 the money available in 2017 will be notified owner-occupied and 253 rental units. in the summer of 2017. Housing 27 HOUSING & COMMUNITY DEVELOPMENT (cont.) CiTiRAMA® American Dream Downpayment Initiative Cincinnati has seen a boom in the rental The American Dream Downpayment housing market. However, the department Initiative (ADDI) program is a down also recognizes the importance of creating payment assistance program designed to homeownership opportunities for city assist first time homebuyers with down residents. payment assistance and/or closing costs up to $5,000. Participating households With this in mind, the Housing and must be at or below 80% of the area Community Development Division median income and must be willing to partnered with the Home Builders purchase a home in one of Cincinnati’s Association of Greater Cincinnati to put 52 neighborhoods. Funds are awarded in together the latest installment of the the form of five-year forgivable loans with CiTiRAMA® program. CiTiRAMA® has been 20% forgiven each year of occupancy. and continues to act as a catalyst for the In 2016, approximately $140,000 was revitalization of urban communities and is awarded to 37 households leveraging $3 a part of the team’s comprehensive plan million in private financing. to increase housing options throughout Cincinnati. The 2016 edition of CiTiRAMA® took place at Gershom Grove in College Hill and featured 36 single family homes by four The main component that drives business attraction is workforce. builders: Brookstone Homes, Drees Homes, Maronda Homes, and Potterhill Homes. Hand Up Home prices ranged from $200,000 to One of the main components that drives $350,000. Of the 36, 23 were sold before business attraction is workforce. To have a the event kicked off in September 2016, well-rounded and experienced workforce, making it the most successful CiTiRAMA® the City must provide job readiness since the program launched in 1996. At programs to cultivate employees who the time of this report, there is only one have the skills that employers are seeking. remaining lot for sale. This training is especially important for those who are struggling to break the cycle of poverty. 28 One such program that our Housing expand the Hand Up initiative to maximize and Community Development Division the benefit it can have on our community. administers is the Hand Up Initiative. Launched in 2015 by Mayor John Cranley, Strategic Partnerships Advancing Hand Up is a comprehensive training Communities (SPARC) program that strives to alleviate the 2016 marks the inaugural year of the burden of joblessness and poverty Housing and Community Development affecting many Cincinnatians. By helping Division’s neighborhood-centric program those who are out of work attain known as Strategic Partnerships employment and move their families Advancing Redevelopment in toward self-sufficiency, the Hand Up Communities (SPARC). This program initiative will improve the economic provides technical assistance to outlook and lead to better outcomes for neighborhood organizations, including the region. but not limited to Community Councils, Community Development Corporations In calendar year 2016, over 360 (CDCs), and Community Housing participants successfully completed Hand Development Organizations. In 2017 DCED Up Initiative programming. Our seven will partner with the CDC Association of Hand Up service providers successfully Greater Cincinnati to administer SPARC. placed 72% of graduates into gainful employment. This initiative runs on a The program’s primary objective is to program year that is facilitated from May leverage the available resources and 1st to April 30th of the following year. the development expertise of City staff Figure 3 below shows the breakdown and the CDC Association to improve the of Hand Up service providers and development capacity and processes participants for the current program year.* of the participating neighborhood organization (PNO). Together, DCED, the The team is continuously seeking CDC Association, and the PNO will be additional providers and opportunities to the spark that ignites a neighborhood to achieve transformative development. FIGURE 3: HAND UP BREAKDOWN* Hand Up Service Providers (May 1, 2016– February 28, 2017) Cincinnati-Hamilton County Community Cincinnati Works Freestore Foodbank IKRON Corporation Action Agency Mercy Neighborhood Eater Seals Ministries Tri-State Urban League Totals Total Enrollments 22 122 84 73 32 11 109 453 Program Completions (Graduates) 21 100 58 45 28 6 59 317 Employments 17 93 27 20 26 4 33 220 *Figure 3 Breakdown of Hand Up service providers and participants for the current program year up to the time this report was finalized. 29 HOUSING & COMMUNITY DEVELOPMENT (cont.) Looking ahead, the 2017 SPARC awardee The Sheakley Center for Youth is anticipated to be announced in early Many young adults are at a high risk of spring. Once the awardee is selected, the experiencing homelessness, especially program will follow a 12-month, three- those who age out of the foster care phase schedule, including: system, have mental and behavioral issues, or are leaving the juvenile • Phase I – Exploration and Inventory of Neighborhood Priorities justice system. The Sheakley Center (two months) for Youth is a creative, adaptive reuse • Phase II - Capacity Building (eight months) • Phase III - Report on Success of of a 64,000-square foot commercial warehouse in Walnut Hills into 39 affordable permanent supportive housing Program and Next Steps apartments for young adults (aged 18- (two months) 24). Developed by the Sheakley Center for Youth Limited Partnership, the project PROJECTS will also contain a youth shelter as well as As a division, the Housing and Community a social service component designed to Development team strives to develop help stabilize at-risk youth experiencing housing opportunities that assist residents homelessness. Total project cost is of all ages and all income levels. A primary approximately $7.5 million and is expected focus is to assist our lower income families to be completed in early 2018. with community resources and affordable housing. The following three projects are examples of how we worked towards that goal. 30 The Sheakley Center for Youth Abington, Race, and Pleasant Apartments Marlowe Court Over-the-Rhine has a long, rich history Marlowe Court is a new construction as a diverse neighborhood. To maintain of 53 senior affordable housing units in this diversity, we must develop affordable College Hill. The project will also include housing options so residents of all income approximately 3,600 square feet of retail levels have quality housing options. and commercial space on the first floor. The senior apartments will contain a mix Therefore, projects like the Abington, of 22 one-bedroom and 31 two-bedroom Race, and Pleasant Apartments are vital to apartments and will be built to LEED maintaining affordable housing options in Silver standards. The project will be 100% the neighborhood. visitable and include a minimum of 5% Americans with Disabilities Act (ADA)- The project is a collaboration between approved and 2% sensory impairment the Cornerstone Corporation for Shared units. The development team consists of Equity and The Model Group, and involves Episcopal Retirement Services (ERS), The the renovation of five historic buildings. Model Group, and College Hill Community The redevelopment of these historic Urban Redevelopment Corporation buildings will reduce blight, create jobs, (CHCURC). The total project cost is and help attract private investment in approximately $11.0 million. Construction the area. This project is also significant in started in July 2016 and is expected to be that eight of the properties are located completed by September 2017. south of Liberty Street, creating a rare opportunity to preserve affordable housing in this portion of Over-the-Rhine. In total, this $13.7 million project will create 50 units of affordable housing totaling approximately 77,000 square feet with 22 of the 50 units designed as accessible. Construction started in November 2016 and is expected to be completed by the end of 2017. The project is part of a larger affordable housing plan in Over-the-Rhine that will preserve historic structures as well as provide more than 300 units of affordable housing in the neighborhood. Marlowe Court Groundbreaking 31 Parking Facilities One unique strength of the Department functionality, provide data that allows of Community and Economic the Parking Facilities team to reduce Development is the inclusion of the downtime of out-of-service meters and Parking Facilities Division. implement predictive enforcement in high traffic areas during peak hours. The Parking Facilities staff is committed to providing high-quality customer Figure 5 outlines the increases in revenue service to ensure the needs of our in FY2016. residents, visitors, and workforce are met. MAJOR ACCOMPLISHMENTS This is done through an entrepreneurial model that uses the latest technologies and data to enhance the user experience Cincy EZPark and develop a parking system that The City of Cincinnati has partnered supports the active and thriving with Conduent (formally Xerox) for Downtown environment of tomorrow. on-street parking services since 2014. After bringing the first iteration of BUDGET AND REVENUE the City’s mobile parking application, The FY2016 operating budget for Parking PassportParking, launched in 2015, Facilities Division was approximately Conduent and Passport delivered a $12.7 million. new Cincy EZPark-branded application to provide more convenient payment The revenue from our parking operations options for customers in Cincinnati. increased, in part, due to our ability to deploy technological upgrades to the In upcoming years, we hope to build City’s parking meters in calendar year real-time parking availability information, 2015 (CY2015). These upgrades have bus schedules, bike share availability and helped to improve overall parking meter passes, and more into the application. FIGURE 5: PARKING FACILITIES DIVISION REVENUE Revenue 32 2015 2016 Year over year Increase (%) $8.7M $10.9M 25% Cincy EZPark is now available at all on- Parking Improvements street smart parking meters. With Cincy In response to parking data and EZPark, smartphone users can: recommendations received from Conduent, the Parking Facilities Division • Purchase parking using a debit or credit card. implemented several improvements to • Get alerts when meter time is about to expire. the City’s parking system. These include redefining parking zones, institution of a • Extend time remotely (up to the maximum allotted time). • View personal parking history. predictive enforcement process, and the changeover of single-space meters to multi-space kiosks. The Cincy EZPark application will carry Looking ahead, we believe DCED’s work current PassportParking users’ account with Conduent will continue to deliver features, profile, and stored credit cards. useful data for more effective service Users will be prompted to sign in using delivery, and will enable Parking Facilities the same credentials (email address or to maintain its focus on data-driven phone number) and pin number. The technology to enhance the parking new application also contains a feature customer experience. that allows merchants to set up and fund accounts to validate parking for On-Street Parking Improvements customers. To make our on-street parking system more accessible, Parking Facilities Looking ahead, with the improvements helped to facilitate the lowering of 1,800 we have made to both the meter poles to meet the American with PassportParking and Cincy EZPark Disabilities Act (ADA) accessibility height applications, we expect pay-by-cell requirements. Additionally, signage parking usage to become the preferred and decals were replaced to provide payment method for on-street parking more information to users and enhance throughout Cincinnati. the aesthetics of our parking systems throughout Cincinnati. Future Site of Fourth and Race Parking Garage and Development Site 33 Business Administration & Fiscal Operations Our Business Administration and Fiscal FY2016 Operating Budget Operations Division focuses on managing DCED’s operating budget for Operations the budgets and fiscal operations of the (human services and monitoring), the department and ensures daily operations Housing and Community Development and human resources support to aid in the Division, the Economic Development department’s vision and goals. Division, and the Major Projects Division is BUDGETS AND PROGRAMS The DCED total budget for fiscal year 2016 (FY2016) was approximately $46 million. FY2016 Parking Facilities Division Budget Parking Facilities is an enterprise fund, meaning that its financial reporting is separate from the rest of the department because a fee is charged for parking services. The FY2016, operating budget for Parking Facilities was approximately $12.7 million. As for the rest of the department, the Business Administration and Fiscal Operations Division managed over $33.3 million in FY2016, including general fund operating, general fund capital, Community Development Block Grant (CDBG) administrative funds, and CDBG program funds. comprised of both general fund operating and CDBG funding. In FY2016, which runs from July 2015 to June 2016, the Department had a general fund budget of approximately $9.5 million. Allocation of these funds was as follows: • 66% - Business Administration and Fiscal Operations Division • 8% - Housing and Community Development Division • 26% - Economic Development Division and Major Projects Division Additionally, DCED received approximately $1.7 million in administrative funding from CDBG. These funds are primarily used to fund staff that administer the HOME Investment Partnerships (HOME), CDBG, Emergency Solutions Grant (ESG), and Housing Opportunities for Persons with AIDS (HOPWA) annual programs and projects, as described in the 2015-2019 City of Cincinnati Consolidated Plan. The Consolidated Plan is approved by the U.S. Department of Housing and Urban Development (HUD) and annually reported by the City. 34 Allocation of the CDBG administrative CY2016 CDBG Programs funds was as follows: In addition to the administrative funds received from CDBG, our department • 65% - Business Administration and Fiscal Operations Division also receives program funding. These • 21% - Housing and Community funds, unlike the others, are distributed Development Division on a calendar year basis. In 2016 we • 14% - Economic Development were awarded approximately $7 million, Division and Major Projects Division which funded 19 different programs administered, either directly or indirectly FY2016 Capital Funding through agency service providers, In FY2016, our department secured capital throughout the department’s various funding to support 26 projects, for new divisions. See Figure 4 below for funding housing development and neighborhood allocation information. business district improvements. In total, DCED was awarded approximately $15.1 million in capital dollars, 24% of which went to housing and 76% to economic development. FIGURE 4: CDBG PROGRAM FUNDS ALLOCATION Division Allocation Programs Supported Monitoring and Compliance 16% • • • • Housing and Community Development Division 65% • • • • Economic Development 19% • Small Business Services • Neighborhood Business District Improvement Program (NDBIP) • Commercial and Industrial Redevelopment Summer Youth Employment Program Mill Creek Restoration Findlay Market Operating Support Vacant Lot Reutilization Affordable Multi-Family Rental Hand Up Initative CoreFour Strategic Housing Program Compliance Assistance Repairs for the Elderly (CARE) • Blueprint for Success • Emergency Mortage Assistance • Fair Housing Services • Housing Repair Services • Operating Support for CDCs • Tenant Representation • Urban Homesteading 35 Monitoring & Compliance Our Monitoring and Compliance Division One pre-existing process that we is charged with tracking and recording improved this past year is the annual community and economic development self-reporting process for both the incentives and programs. They ensure Job Creation Tax Credits (JCTCs) recipients of City support comply with and Commercial Reinvestment Area federal and local regulations, covenants (CRA) incentives. This process requires set out by City agreements, and key recipients to provide updates on their performance indicators developed in compliance by submitting a report coordination with the City of Cincinnati. on jobs created and retained and This process ensures investments made confirming the amount of investment by the Department of Community and in their projects. The improvements we Economic Development have the greatest made include providing the option to impact on the community and maximize complete and submit the annual report the City’s return on investment. forms online. For the recipients, this makes the reporting process faster and MAJOR ACCOMPLISHMENTS more efficient. For us, it reduces data entry (saving staff time) and ensures Implementing the Incentive Review data automatically gets stored into our Report Recommendations database upon its submission. Over the last year, the Monitoring and Compliance Division has taken major Next, to oversee and ensure the accuracy strides to expand the department’s and completeness of the reporting oversight of incentivized businesses information and all other department- based on recommendations made wide data, we created a Data Integrity from our incentive review. These Team (DIT). This team, which is managed changes include building upon our by a Data Integrity Manager, ensures existing framework to make processes data integrity by recommending more efficient, ensuring accuracy and improvements to our data-collection completeness of data, and implementing and reporting systems and regularly a more rigorous monitoring process. reviewing the accuracy and completeness of the data. 36 Lastly, following the incentive review Operating Contract Monitoring Process report, the Monitoring and Compliance Improvement Division began to develop a more DCED began working with the City rigorous monitoring process that Administration to ensure the important includes surveillance reviews. This work performed by general fund process requires division staff to select operating contract recipients supports projects and conduct in-person meetings the mission and goals of the Department. with recipients and visit project sites To this end, we partnered with the Office throughout the lifecycle incentive. of Performance Data Analytics (OPDA) Through surveillance reviews, our staff to implement a process that provides can proactively verify the accuracy of greater transparency in the spending of companies’ self-reported submittals City funds by organizations that have as well as build a better relationship contracts managed by our department. with those individuals making strategic In 2016, this list included the following investments within the City. To date, organizations: African American Chamber 24 surveillance reviews have been of Commerce, CDC Association of completed that have varied by program, Greater Cincinnati, CincyTech, Cintrifuse, neighborhood, and project type. Film Cincinnati (formerly Greater Cincinnati and Northern Kentucky Film Tax Incentive Conversion Commission), MORTAR, Port of Greater The Monitoring and Compliance Cincinnati Development Authority, Division oversaw the conversion of 11 REDI Cincinnati, and the University of Property Investment Reimbursement Cincinnati Economics Center as well as a Agreements to the tax credit method variety of human services contracts. of payment for these incentives in 2016. This conversion is important because it DCED staff worked with each of the eliminated appropriations of general fund organizations to ensure the goals, dollars to reimburse companies based objectives, and scope of services stated in on the incentive they received. Instead, their City agreements reflected the City’s companies now receive a refundable tax and DCED’s mission, and to improve the credit against the company’s tax liability quality of agreed upon key performance without changing the tax incentive indicators. DCED staff will continue to benefit amount. monitor these organizations and their programs through quarterly reports and regular evaluation reviews by OPDA and the City Manager. Through this new process, the City hopes to improve the efficiency and effectiveness of its service delivery through these programs, thus maximizing the benefits of each dollar spent by the City on them. 37 Policy & Communications Whether it is engaging with the and under construction, browser- community, working with the media, responsive design, and additional or producing marketing content and features to better serve those looking to materials, our Policy and Communications partner with us. staff serve as liaisons between the department and internal and external The change was not only effective, but partners, clients, and customers. The grabbed the attention of the greater division is also tasked with managing the economic development community. legislative and policy-related activities of The website was awarded the 2016 the department. International Economic Development Council Silver Award for “General Our website was awarded the 2016 International Economic Development Council Silver Award for “General Purpose Website.” Purpose Website.” DCED’s website will continue to evolve to better serve site selectors, developers, and community members. Webinars Our Policy and Communications Division partnered with both the Housing and Community and Development Division and our Economic Development Division to present a series of webinars designed MAJOR ACCOMPLISHMENTS Improved Communications In our efforts to provide a more effective tool for communication, the department launched a new website design in March 2016. The new www.choosecincy. com is tailor-made, with a user-friendly layout and navigation structure, a page dedicated to projects both completed 38 to provide developers and community members with clear information about programming, incentive offerings, and some of our initiatives. The subject areas included: • 2016 Notice of Funding Availability • Available Incentives • Programs for Small Businesses These videos are available online at www.choosecincy.com. Additional webinars will be offered These videos can be found at in 2017. If there is a subject matter or www.choosecincy.com and feature topic you would like to be covered, we Director Oscar Bedolla, along with: encourage you to contact us at • John Barrett, Chairman, President [email protected]. and CEO of Western & Southern Financial Group “Why Choose Cincinnati?” Marketing Videos As community and economic • Stuart Aitken, CEO of 84.51° development professionals, our • Joe Allen, General Manager of GE team members are some of the chief Global Operations Center at advocates for the City. We constantly the Banks • Mario San Marco, President, Eagle Realty Group work to attract and retain businesses and residents, largely through proactive In 2017, we will continue to look for marketing efforts. creative and innovative communication tools that will showcase the city and One such effort we undertook in 2016 highlight the great activity and people was to work with the downtown business found throughout Cincinnati. community to create two videos answering the question, “Why Choose Cincinnati?” These videos are a powerful tool that speaks directly to the aspects that business executives consider when choosing a location for their companies. Downtown Cincinnati 39 CONTACT Director’s Office 513.352.1948 Economic Development 513.352.2435 Major Projects 513.352.1953 Housing & Community Development 513.352.6119 Business Administration & Fiscal Operations 513.352.6130 Monitoring & Compliance 513.352.3305 Parking Facilities 513.352.4526 Policy & Communications 513.352.6136 40
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