Fairfield Twp. Bd. of Trustees v. Testa

Summary

The Supreme Court of Ohio affirmed the Board of Tax Appeals' decision upholding a house-of-public-worship exemption for property subject to an earlier tax-increment-financing agreement. The court held that R.C. 5709.911 subordinated the TIF exemption and eliminated the obligation to make service payments because the township failed to take statutory steps preserving the TIF exemption's priority. The court also held that the township lacked standing to assert an as-applied constitutional challenge based on impairment of contractual obligations.

Holdings

1. For a TIF exemption approved before the effective date of R.C. 5709.911, the uncodified provisions of Sub.H.B. No. 427 subject the exemption to the limitations in R.C. 5709.911(A), including subordination to another statutory exemption. Because Fairfield Township failed to preserve the TIF exemption's priority, the house-of-public-worship exemption had priority.
2. R.C. 5709.911 bars enforcement of the real covenant requiring service payments because the statute makes the house-of-public-worship exemption controlling and eliminates the service-payment obligation during that exemption.
3. The township lacked standing to challenge R.C. 5709.911 under the Ohio Constitution's contract-impairment prohibition because its injury resulted from its failure to take the statutory steps available to preserve its rights, rather than from unconstitutional operation of the statute.

Questions Presented

1. Whether R.C. 5709.911 and the uncodified provisions of Sub.H.B. No. 427 subordinated the preexisting TIF exemption to the property's later house-of-public-worship exemption.
2. Whether the TIF service-payment covenant remained enforceable notwithstanding the statutory priority of the house-of-public-worship exemption.
3. Whether Fairfield Township had standing to assert an as-applied challenge under the Ohio Constitution's contract-impairment prohibition.

Disposition

affirmed