BY AMY HIGGINS
The Cincinnati Enquirer
FAIRFIELD -- Fairfield City Council approved extending a tax break Tuesday to the prospective buyer of the former Mercantile Stores Inc. headquarters.
City officials hope to entice Ohio Casualty Corp. to buy the recently vacated building and relocate as many as 1,000 employees there. Otherwise, some $2.3 million could be owed to Butler County.
Butler County commissioners are expected to make the final decision on extending the tax incentive -- which has four years left -- at their meeting next week.
"This is one of the contingencies that must be remedied for the project to continue," Tim Bachman, Fairfield planning director, told council.
The city needs to fill the building on Seward Road, off Ohio 4. Mercantile employees in 1997 paid the city more than $700,000 annually in earnings taxes. That was about 5.5 percent of Fairfield's earnings tax take.
Mercantile vacated the building after Dillard's Inc. bought the department store company, parent of McAlpin's, and moved the 1,000 Fairfield-based jobs to Arkansas, Dillard's home.
Ohio Casualty spokeswoman Cindy Denney said the insurance company hasn't decided whether to buy the 280,000-square-foot building, much less how many or which employees to put there. Ms. Denney would confirm only that Ohio Casualty is in "active negotiations."
But unless the property tax abatement is extended, the owner of the property -- whoever that is -- could be liable for the $2.3 million in tax breaks received by Mercantile since the tax break was granted in 1991. Butler County commissioners in August told Dillard's it should repay the money.
Ms. Denney confirmed that extending the abatement is a necessary step in Ohio Casualty's negotiations to buy the building. If the purchase happens, Ohio Casualty would invest in excess of $30 million in the project, Mr. Bachman said.
Whether or not it buys the building, Ohio Casualty needs more office space.
The company, with $4 billion in assets, announced last month it would buy Great American Insurance Co.'s commercial-lines business for up to $358 million. That deal would bring 800 new employees -- 435 of whom are in Blue Ash and Cincinnati -- into the Ohio Casualty fold.
