The city got the ball rolling to incorporate the entire proposed $300 million Liberty Town Center into an existing joint tax district.

A public hearing was held Tuesday night that started the process to incorporate several residential properties within the borders of a joint economic development district with Middletown, Liberty Twp. and Mason. The district, or JEDD, is only in on a commercial- or industrial-zoned parcel and designed to collect income taxes on employees of businesses within the zone.

Until recently, state law didn’t allow residential properties to be included, even though income taxes would not be collected, said Caroline McKinney, Liberty Twp. economic development director.

About 25 percent of the 100-acre proposed shopping and entertainment center will be moved into the JEDD following public hearings in Mason and Liberty Twp. in the coming weeks and a vote by the communities’ respective governing boards.

“The action is to clean up the boundaries,” said McKinney. “It’s certainly critical to the JEDD to do this now.”

The JEDD collects 1.5 percent of any employee’s earnings within the 685 acres district that’s around the Liberty Way Interchange and the intersection of Cincinnati-Dayton and Yankee Roads. Steiner & Associates officials are planning to open Liberty Town Square in 2015 near Interstate 75 in Liberty Twp., and ground breaking is anticipated for this coming spring.

Steiner officials have said about 4,500 permanent jobs would be created, and 3,000 construction jobs will be created while this development is being built.

The interchange, which opened a few years ago, provided an access point to I-75 to hundreds of acres of undeveloped land.

“It’s important that government be responsive to business,” said Middletown City Manager Judy Gilleland. “As such, all three entities are working hard to pave the way for this important regional development.”

Middletown and Liberty Twp. officials said exactly how much money would be generated for the governments’ coffers is not known. But the project is said to be bigger than two other Steiner developments — The Greene in Dayton and Easton Town Center in Columbus.

Officials said only when the types of businesses and jobs are known will an idea of how much income tax will be collected.

Liberty Twp. collects 83 percent of the net revenues as the JEDD is currently shaped, while Middletown receives 2 percent and Mason receives 15 percent. Middletown is the tax collecting authority for the JEDD, and for that service receives 5 percent of the gross income tax revenues.

Thus far in 2012, Liberty Twp. has collected $531,900, and more than $2.7 million since the JEDD was formed in October 2006.

Middletown collects about $50,000 a year, and has collected $200,000 since the JEDD was formed. Mason officials were not available.

The development was first proposed in 2008, but was delayed because of the economic downturn. It was reintroduced in 2011. The project is proposed to be a mix of retail, entertainment, dining and housing. Steiner officials have not named any tenants, but have said there will be major anchor tenants.