Bd. of Educ. of the Loveland City Sch. Dist. v. Bd. of Trs. of Symmes Twp.
111 N.E.3d 833
Ohio Ct. App.2018Background
- In 1991 Symmes Township created a Tax Increment Financing (TIF) project (STIF) providing 100% tax exemption for specified property and authorizing PILOT (payments in lieu of taxes) into a tax-increment-equivalent fund to pay public-improvement debt.
- In 1993 the township issued notes and entered service agreements obligating property owners to make PILOT payments; agreements were to expire by Dec. 31, 2010, or upon final debt retirement.
- In 2003 the township adopted resolutions amending the STIF: it expanded eligible public improvements and refunded outstanding special-revenue notes with general-obligation bonds, changing security from the PILOT fund to the township’s full faith-and-credit.
- Loveland City School District sued in 2016 seeking declaratory relief, mandamus, injunctions and money, alleging the 2003 refunding effectively retired the TIF debt and that subsequent expenditures from the PILOT fund were improper.
- The trial court granted summary judgment for Symmes Township, holding Loveland’s claims were barred by the six-year statute of limitations; the school board appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Applicable statute of limitations | Ten-year catchall (R.C. 2305.14) or two-year political-subdivision statute | Six-year statute for liabilities created by statute (R.C. 2305.07); R.C. 2744 (two-year) governs torts, not equitable TIF claims | R.C. 2305.07 (six years) applies because the claims are statutory TIF claims tied to statutes authorizing TIFs; R.C. 2744 does not apply |
| Accrual date of cause of action | Each improper expenditure in later years gave rise to a new cause; delayed-damage or continuous-violation tolling applies | Cause accrued in 2003 when the STIF was amended/refunded; later acts were effects, not new discrete violations | Accrual occurred in 2003; continuous-violation and delayed-damage doctrines do not save the claim |
| Applicability of former R.C. 5715.27(F) (special statutory remedy) | School board’s remedy is not limited by that provision | Township: special statutory proceeding is exclusive remedy to challenge exemptions | Former R.C. 5715.27(F) does not govern TIF challenges created under R.C. 5709.73; it is not the exclusive remedy here |
| Discovery rule / tolling | School district did not and could not know debt was retired until 2014 public-records production; discovery rule should delay accrual | School board had notice (public resolutions, TIRC meetings) as early as 2003–2004 and should have inquired | Discovery rule inapplicable or at least school board had constructive/actual notice by 2004; suit filed in 2016 is time-barred |
Key Cases Cited
- Princeton City School Dist. v. Zaino, 94 Ohio St.3d 66 (Ohio 2002) (explains TIF mechanism and statutory framework)
- State ex rel. Doner v. Zody, 130 Ohio St.3d 446 (Ohio 2011) (continuous-trespass/continuing-violation doctrine where defendant’s ongoing control tolled limitations)
- Painesville Mini Storage, Inc. v. Painesville, 124 Ohio St.3d 504 (Ohio 2010) (continuous-violation doctrine does not toll where later effects merely continue from one discrete act)
- Flagstar Bank v. Airline Union’s Mtge. Co., 128 Ohio St.3d 529 (Ohio 2011) (general rule on accrual and delayed-damage doctrine)
- State ex rel. Taft v. Court of Common Pleas of Franklin Cty., 63 Ohio St.3d 190 (Ohio 1992) (special statutory procedures can preclude declaratory relief where statute provides exclusive remedy)
- Temple v. Wean United, Inc., 50 Ohio St.2d 317 (Ohio 1977) (summary-judgment standard; no genuine issue of material fact)