Akron City Council approved legislation Monday night to sell the 67-acres of public land to a developer for a deep discount of $600,000, but its potential for growth has the city optimistic. The company buying the land is Akron Romig Road LLC, of Delaware, which plans to build a 600,000-square-foot, $100 million commercial facility that's supposed to create a minimum $30 million in new annual payroll, translating to about 500 new jobs.
But just who is the developer and future tenant, or tenants? Mayor Dan Horrigan and his administration has refused to answer those questions. By a 12-1 vote, the city council approved the sale, without even knowing who the developer is.
WATCH MORE | Lynna Lai continued our coverage of this story on Channel 3 News at 11
A Channel 3 News investigaton found that Akron Romig Road LLC is registered as a business in Delaware, which is known for its business-friendly tax laws, and secrecy rules, where thousands of shell companies go to remain anonymous.
According to Delaware business records, Akron Romig Road LLC's incorporation/formation date is July 16, 2018, filed at 12:43pm. That same day, the Akron city council approved the sale of the property to the company, 7 hours later.
The registered agent for the business is The Corporation Trust Company, which is a registered agent service, located in a non-descript yellow brick building at 1209 N. Orange Street in Wilimington. It also serves as the official address to 285,000 businesses. According to Securities and Exchange Commission filings, some of the country's largest companies like Wal-Mart, Google, and Verizon share the same official address.
So why Delaware? According to corporate tax attorneys whom we spoke to, the state has been called the "on-shore Panama" for being a tax haven for companies. A so-called "Delaware Loophole" allows companies to legally shift earnings from other states to Delaware, where they are not taxed on income generated outside of the state.
The loophole only applies to state taxes, not local, so Ohio could potentially lose tax revenue generated by a company "headquartered" in Delaware. In fact, according to a report from The New York Times, other states lost more than 9-billion dollars in lost taxes in the last decade, because of the Delaware Loophole.
Our findings did not sit well with councilman who cast the lone dissenting vote on the sale of the Rolling Acres property to an anonymous buyer.
"We are all being kept in the dark," said Ward 10 Councilman Zack Milkovich. "Not even council[members] who voted for the sale know who the developer is," he said.
"This is not the way the government should work. Everything should be out in the open, especially when it's the people's land," said Milkovich.
Because of the size of the proposed facility, there has been speculation that Amazon could build a fulfillment center. In North Randall, Amazon chose the site of the former Randall Park Mall as its fulfillment center, and Amazon chose the former Chrysler facility to build a distribution center in Twinsburg.
READ MORE I Businesses add staff, hours in anticipation of Amazon's new fulfillment center in North Randall
Twinsburg Mayor Ted Yates told Channel 3 that in his city's experience with Amazon, the online giant did not act secretively.
"They wanted to be low-key, for sure, but I wouldn't describe them as secretive" said Yates. When asked if Amazon handled its business dealings with the city through a registered agent, Yates said, "No."