By Sue Kiesewetter
Enquirer contributor

FAIRFIELD - Cincinnati Financial Corp. will begin work in January on a $98 millionexpansion project that will add a third tower - and at least 500 jobs - to its Fairfield campus.

The two-phase project at Fairfield's largest employer starts with building a 700-space underground parking garage that will take some 18 months to complete. The second phase will put a seven-story, 487,000-square-foot tower atop the parking garage, to be open by 2008.

"It's going to be a little larger, but the same design as the other two towers,'' said Norm Settle, CFC senior vice president for administrative services.

The first tower on the 75-acre complex at the corner of South Gilmore and Mack roads opened in December 1985. The second tower was completed in 2000.

The insurance company employs about 2,800 people at its Fairfield headquarters and has a payroll of about $136 million, said Tim Bachman, Fairfield's development services director.

A tax incentive agreement approved last week by the Fairfield Board of Education would abate 100 percent of the company's taxes on the building for 15 years, Bachman said. The agreement goes to city council for approval Sept. 13.

During the first 10 years of the agreement, Cincinnati Financial will pay $200,000 a year to the Fairfield Schools, Bachman said. That increases to $280,000 annually for the last five years.

"This is certainly a fantastic project,'' Bachman said. "Anytime you have somebody willing to invest $98 million in the community - it's a big deal."

By 2008, employment is expected to increase by about 500 in Fairfield, said CFC spokeswoman Joan Shevchik. By the end of 2010, another 500 employees could be added. Those 1,000 employees would increase payroll by about $54 million annually.