In the case of Alliance v. Marlington Local School Dist. Bd. of Edn., 2019-Ohio-1188, an Ohio appellate court held that the failure of a city to execute a community reinvestment area (“CRA”) agreement with a proper party did not excuse the city from abiding by all applicable CRA statutes.
In this case, a city entered into an agreement with a school board in which the school board granted the city the right to enter into CRA agreements without the notice and consent of the school board – which is normally required by CRA statutes – in exchange for the school board receiving a portion of the income tax revenues that the city gained as a result of CRA agreements. Pursuant to its agreement with the school board, the city entered into a CRA agreement with a local business.
The local business ultimately breached its CRA agreement with the city and, as a result, the city sued to recover damages. During the litigation process, the city discovered that it entered into a CRA agreement with the wrong business entity. The city attempted to use this oversight to have the damages distributed in a manner other than that set forth in the CRA statutes.
The school board filed a lawsuit to force the city to distribute the damages in accordance with the CRA statutes. The Ohio appellate court agreed with the school board and prohibited the city from “tak[ing] advantage of its failure to enter into a CRA agreement with the proper party” in distributing damages. Alliance at ¶ 33. Accordingly, the Ohio appellate court held that damages from the breach of contract dispute must be distributed in accordance with the CRA statutes.
To read this case, click here.
Authors: Matthew John Markling and the McGown & Markling Team.
Note: This blog entry does not constitute – nor does it contain – legal advice. Legal jurisprudence is like the always changing Midwestern weather. As a result, this single blog entry cannot substitute for consultation with a McGown & Markling attorney. If legal advice is needed with respect to a specific factual situation, please feel free to contact a McGown & Markling attorney.