HomeMy Public PortalAboutResolution No. 116-99 08-24-1999 RESOLUTION NO. 116-99
A RESOLUTION APPROVING THE FINAL TAX
ABATEMENT AGREEMENT BY AND BETWEEN THE CITY
OF RICHLAND HILLS, TEXAS, AND ALPHA NATIONAL
TECHNOLOGY SERVICES, INC., AND AUTHORIZING
EXECUTION OF SAME BY THE MAYOR OF THE CITY OF
RICHLAND HILLS.
WHEREAS, the City Council of the City of Richland Hills, Texas, has heretofore adopted
guidelines and criteria for potential tax abatements within the City of Richland Hills; and
WHEREAS, the Richland Hills City Council has held a public hearing on the creation of
Richland Hills Reinvestment Zone Number l; and
WHEREAS, proper notice of such public hearing was published in a newspaper of general
circulation in the City at least seven (7) days before the date of said public hearing, as required by
law; and
WHEREAS, written notice of the public hearing was delivered to the presiding officer of
each other taxing unit with jurisdiction over the property contained in Reinvestment Zone Number
1, at least seven (7) days prior to the public hearing thereon; and
WHEREAS, based on the information available to it, together with input received at such
public hearing, the City Council of the City of Richland Hills, Texas, created Richland Hills
Reinvestment Zone Number 1 on the property described in the ordinance creating such reinvestment
zone; and
WHEREAS, written notice of the City's intent to enter into the attached Tax Abatement
Agreement, along with a copy of said Agreement, was delivered to the presiding officer of each other
taxing unit with jurisdiction over said property at least seven (7) days prior to the date of this
Resolution, as required by law; and
WHEREAS, the Richland Hills City Council finds and determines that the terms of the tax
abatement agreement with A1phaNational Technology Services, Inc. and the property subject to the
agreement meet the guidelines and criteria for tax abatements currently in force within the City.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF RICHLAND HILLS, TEXAS:
I.
That the attached tax abatement agreement between the City of Richland Hills and Alpha
National Technology Services, Inc., and the property subject to such agreement meet the guidelines
and criteria for tax abatements in force within the City of Richland Hills, Texas; and
RESOLUTION NO. PAGE 1
BE IT FURTHER RESOLVED that the final tax abatement agreement between the City
of Richland Hills and Alpha National Technology Services, Inc. be and the same is hereby approved
by the City Council of the City of Richland Hills, Texas, and that the Mayor of said city is hereby
authorized to execute said tax abatement agreement on behalf of the City of Richland Hills, Texas.
PASSED AND APP~(~V~D by the City Council of the City of Richland Hills, Texas, by
a vote of 4 ayes, o ~'~~j~i~ abstentions this 24 day of August ~ 1999.
G?
.
~ ~ ~ C. F. K~ lley, Mayor
.i9. ~
.
ATTEST: , ~ •
Terri W' is, City Secretary
G:\Docs\R\RHills\Resolutions\Tax Abate.Agree. Ord
RESOLUTION NO. 116-99 PAGE 2
THE STATE OF TEXAS §
COUNTY OF TEXAS §
TAX ABATEMENT AGREEMENT
This Agreement is entered into by and between the City of Richland Hills, Texas, a home rule
municipality located in Tarrant County, Texas, acting by and through C. F. Kelley, its duly elected
Mayor, hereinafter referred to as CITY, and Alpha National Technology Services, Inc., duly acting
by and through W. Brian Hostin, its Chief Financial Officer, hereinafter referred to as OWNER.
WITNESSETH:
WHEREAS, on the 24~day of August , 1999, the City Council of the City
of Richland Hills, Texas, passed ordinance No. g65-A~ establishing an area as a reinvestment
zone pursuant to Chapter 312 of the Texas Tax Code; and
WHEREAS, in accordance with the Property Redevelopment and Tax Abatement Act,
codified in Chapter 312 of the Texas Tax Code, the City has adopted the Guidelines and Criteria for
the Economic Development Incentives Program (the "POLICY STATEMENT"); and
WHEREAS, the POLICY STATEMENT constitutes appropriate guidelines and criteria
governing tax abatement agreements to be entered into by the CITY as contemplated by Chapter 312
of the Tax Code, ("CODE"); and
WHEREAS, the CITY has adopted a Resolution stating that it elects to be eligible to
participate in tax abatement; and
WHEREAS, the Premises as hereinafter defined are wholly located within the reinvestment
zone established by Ordinance No. 865-99 ;and
WHEREAS, in order to maintain and or enhance the commercial and economic and
employment base of the City of Richland Hills to the long term interest and benefit of the CITY in
accordance with Ordinance No. 865-99 and Chapter 312 of the CODE; and
WHEREAS, the contemplated use of the PREMISES, as hereinafter defined, the
contemplated improvements to the PREMISES in the amount set forth in this Agreement and the
other terms hereof are consistent with encouraging development in accordance with the purposes and
intent of the POLICY STATEMENT, and all applicable law.
NOW, THEREFORE, the parties hereto do mutually agree as follows:
A.
DEFINITIONS
TAX ABATEMENT AGREEMENT PAGE 1
1. The property, which is the subject of this Agreement, is that property described in
• Exhibit "A" attached hereto and made a part hereof, and shall be hereinafter referred to as
PREMISES.
2. The improvements to be constructed include warehouse and office space to be erected
on or affixed to the premises, and any modification to existing buildings, and tangible personal
property (except inventory or supplies) installed on the premises, which shall be collectively referred
to hereinafter as the IMPROVEMENTS. The kind, number and location of all proposed
IMPROVEMENTS are more specifically described in Exhibit "B attached hereto and made a part
of this Agreement for all purposes.
B.
DUTIES OF OWNER
1. The OWNER shall substantially complete construction of the initial phase of the
IMPROVEMENTS on the PREMISES at an initial expenditure of not less than two million, eight
hundred thousand dollars ($2,800,000) on or about , 2000; provided that
OWNER shall have such additional time to complete the initial phase of the IMPROVEMENTS as
may be required if OWNER is diligently pursuing completion of the initial phase of the
IMPROVEMENTS in the event of "force majeure", of if in the sole opinion of the CITY the
OWNER has made substantial progress toward completion of the initial phase of the
IMPROVEMENTS. For this purpose, "force majeure" shall mean any contingency or cause beyond
the reasonable control of OWNER including, without limitation, act of God or the public enemy,
• war, riot, civil commotion, insurrection, governmental or de facto governmental action (unless
caused by acts or omissions of OWNER), fire, explosion or flood, and strikes. The date of
substantial completion of the IMPROVEMENTS shall be defined as the date a Certificate of
Occupancy is issued for the initial phase of the IMPROVEMENTS by the CITY.
2 The OWNER agrees and covenants that it will diligently and faithfully in a good and
workmanlike manner pursue the completion of the IMPROVEMENTS as a good and valuable
consideration of this Agreement. OWNER further covenants and agrees that all construction of the
IMPROVEMENTS will be accordance with all applicable state and local laws and regulations or
valid waiver thereof. In further consideration, OWNER shall thereafter, from the date a Certificate
of Occupancy is issued until the expiration of this Agreement, continuously operate, maintain and
occupy the PREMISES as manufacturing and office headquarters.
3. The OWNER further agrees that the CITY and its agents and employees, shall have
reasonable right of access to the PREMISES to inspect the IMPROVEMENTS in order to insure that
the construction of the IMPROVEMENTS are in accordance with this Agreement and all applicable
state and local laws and regulations or valid waiver thereof; and subject to OWNER's reasonable
security requirements, the continuing right to inspect the PREMISES to insure that the PREMISES
are thereafter maintained, operated and occupied in accordance with this Agreement.
4. The PREMISES shall at all times be used in a manner that is consistent with the
. general purpose of encouraging development within the reinvestment zone. Both parties agree that
the use of the premises for manufacturing and office space, in accordance with this Agreement. is
consistent with such purpose.
TAX ABATEMENT AGREEMENT PAGE 2
5. Prior to October 151 of each year this Agreement is in effect, OWNER shall certify to
• the governing body of the CITY that OWNER is in compliance with applicable terms of this
Agreement.
C.
ABATEMENT ALLOWED
1. Subject to the terms and conditions of this Agreement, and subject to the rights of
holders of any outstanding bonds of the CITY, a portion of ad valorem real property taxes from the
PREMISES otherwise owed to the CITY shall be abated. Said abatement shall be as set forth below
on the taxes assessed upon the value of the IMPROVEMENTS in the year of abatement, but only
on the amount that the value of the IMPROVEMENTS exceeds the value of said IMPROVEMENTS
in the year in which this Agreement is executed, in accordance with the terms of this Agreement and
all applicable state and local regulations or a valid waiver thereof; provided that the OWNER shall
have the right to protest and/or contest any assessment of the PREMISES and said abatement shall
be applied to the amount of taxes finally determined to be due as a result of any protest and/or
contest. In accordance with these terms, the abatement granted shall be as follows, with "year one"
beginning January 1, 2000:
yew Percent of Value of IMPROVEMENTS
Exempted from Taxation
1 35%
• 2 35%
3 35%
4 35%
5 35%
6 35%
7 35%
g 35%
9 35%
10 35%
2. The abatement set forth in paragraph (1) is contingent upon OWNER employing a
minimum of forty-five (45) new full-time employees for the improvements within twelve months
from date of the issuance of a Certificate of Occupancy, and maintaining that many employees for
the remainder of the term of the Agreement. Each year OWNER fails to employ a minimum of 45
new employees, the Percent of Value of Improvements exempted from taxation shall be 20%. "Full
time employees" shall include all personnel working a scheduled work week of 40 hours.
3. In additional consideration of OWNER's promises and representations made herein,
CITY has approved the relocation of a sewer line to facilitate such new development, at an
appropriated cost of $25,760.00. If OWNER defaults under this Agreement as provided herein, this
$25,760.00 shall be subject to recapture along with any abated tax revenues, or by itself if no tax
. revenues have been abated at time of default, under the provisions hereinafter stated.
D.
BREACH AND RECAPTURE
TAX ABATEMENT AGREEMENT PAGE 3
1. In the event that (1) the IMPROVEMENTS for which an abatement has been granted
• are not substantially completed in accordance with this Agreement; or (2) OWNER fails to occupy
the IMPROVEMENTS for the PURPOSES required by this Agreement; or (3) OWNER breaches
any of the terms or conditions of this Agreement, then OWNER shall be in default under this
Agreement. In the event that the OWNER defaults in its performance of (1), (2) or (3) above, then
the CITY shall give the OWNER written notice of such default and if the OWNER has not cured
such default, or obtained a waiver thereof from the appropriate authority, within thirty (30) days of
said written notice, and the OWNER does not commence to cure such default within said thirty day
period and thereafter diligently proceed with its efforts to cure the same, this Agreement may be
terminated or modified by the CITY. Notice shall be in writing as provided below. If the CITY
terminates this Agreement for default, OWNER shall pay to the CITY all taxes which otherwise
would have been paid to the CITY without the benefit of abatement (but without the addition of
penalty; interest will be charged at the statutory rate for delinquent taxes as determined by Section
33.01 of the CODE), together with the $25,760.00 in sewer relocation costs, within sixty days after
the expiration of the above mentioned applicable cure period. After sixty days, if said taxes and
other amounts owed remain unpaid by the OWNER, the penalties and interest will accrue as
provided by law. The Agreement may be terminated by the mutual consent of the parties in the same
manner that the agreement was approved and executed. If the IMPROVEMENTS have not been
completed at the time of the termination, the CITY shall recapture any property tax revenue lost as
a result of the Agreement, together with the sewer line relocation costs described herein.
2. It is expressly agreed and acknowledged between the parties to the Agreement that
nothing in this agreement shal be deemed or construed to affect the ability of the CITY to place a lien
• for taxes against the property as established by Section 32.01 of the CODE. Such lien shall secure
the payment of all taxes abated and subject to recapture under this Agreement. Any such lien may
be fuly enforced pursuant to the provisions of the CODE. For purposes of this subsection, "property"
refers to the PREMISES and all IMPROVEMENTS described herein.
E.
GENERAL PROVISIONS
1. Notices required to be given to any party to this Agreement shall be given personally
or by certified mail, return receipt requested, postage prepaid, addressed to the party at its address
set forth below, and, if given by mail, shall be deemed delivered as of the date deposited in the
United States mail:
For CITY by notice to:
City of Richland Hills
Attention: C. F. Kelley, Mayor
3200 Diana Drive
Richland Hills, Texas 76118
For OWNER by notice to:
• W. Brian Hostin
2501 E. Loop 820 N.
Fort Worth, Texas 76118
TAX ABATEMENT AGREEMENT PAGE 4
• Any party may change the address to which notices are to be sent by giving the other parties
written notice in the manner provided in this paragraph.
2. OWNER in performing its obligations under this Agreement is acting independently,
and the CITY assumes no responsibilities or liabilities to third parties in connection with the
PREMISES or IMPROVEMENTS. OWNER agrees to indemnify, defend, and hold harmless the
CITY, its officers, agents, employees, and volunteers in both their public and private capacities, from
and against claims, suits, demands, losses, damages, causes of action, and liability of every kind,
including, but not limited to, expense of litigation or settlement, court costs, and attorneys fees which
may arise due to any death or injury to a person or the loss of, loss of use of, or damage to property,
arising out of or occurring as a consequence of the performance of this Agreement, save and except
for the actual negligence of the City, its officers, agents or employees.
3. It is the belief of both parties that the PREMISES do not include any property that is
owned or leased by a member of the city council or by a member of the Richland Hills Planning and
Zoning Commission or any other board or commission of the CITY having responsibility for
approval of this Agreement. The parties recognize and understand that any property so owned is
excluded by law from property tax abatement.
4. The terms and conditions of this Agreement are binding upon the successors and
assigns of all parties hereto. This Agreement cannot be assigned by OWNER unless written
permission is first granted by the CITY, which permission shall be at the sole discretion of the CITY;
• provided, however, that upon written notice to the CITY, OWNER may assign its right under this
Agreement to a wholly owned subsidiary.
5. This Agreement was authorized by Resolution of the City Council at its council
meeting on the 24th day of August , 1999, authorizing the Mayor to execute
the Agreement on behalf of the CITY.
6. This Agreement was entered into by
pursuant to authority granted by its Board of Directors, whereby
was authorized to execute this Agreement on behalf of
7. This Agreement shall be effective on the latest date that one of the parties sign below.
CITY OF RICHLAND HILLS ALPHA NATIONAL TECHNOLOGY
SERVICES, INC.
By: By:
C. F. Kelley, Mayor W. Brian Hostin, Chief Financial Officer
SIGNED this day of , 1999 SIGNED this day of , 1999
•
A:\Tax Abatement Agreement.wpd
08/16/99
TAX ABATEMENT AGREEMENT PAGE 5
' ~xN~t3~r A
AYPLTCATION F'OR TAX ABATEMEYf
OR ECONOMiC~DE„VELO~ME~ Mi~~TIVE
• i..tnx Not vo~~
A1DDa11ational lecbnolo~ Services, Inc.
l . Property Ownu:
Mailing Address: 2501 B. Loop 820 !1. _ - ~ -
Pb=t vortb. TX 16118
2. Property Ownu's
R~pT~untative~ Je Alezande*
!viailing Address
Tort yorth, S7C 76102
3. property Address: _,~~•-~.~.~:on of ~H lA~ ? Y~~le~t Yes in Picblane Hills
Lots 1, 2, 5 t b, Block 6, !lidwa~ Plaos lddit_on
?arrant Cotmty . ~
• Property 1.~a11~escr~ption' Cit! of Ricb].and bills •
(Provide atucbment if by meta and bounds)
(Iu~ludo Map(s), if requited)
4. 7escription of Project•
above reterenoed alts for the Al at'_oaal ne+t bee •
Coat ct ~atrvction is eatiaated at : 2.8 aiilion dollars.
AlpbaNationsl is a national on sits serrioe o lion vith oftlcts
in Glifornia llosids and 211inoie. 'h'e aenix t t:~rs
aanitora, personal Co~ryvtei~a, te~ineis, laytope, taxes sad
assorted office eQaiDaent. This location vill ee~ to ~5 le
rith ~
•
1
S. If requesting incentive. describe incentive, reason for requesting incentive, snd the
• impact on the project if incentives are not ~rsnted.
_ 1. 50g abateaeat of real estate tasee over a ten dear period.
2. Ressoval of sever line that divides paropertl+ rbich nalces it
lei seibls t0 build On cutri+enti~. vitbout incentives we will
nay to nse~.~j«• o~ north that ie_ lets exflalsive and_
la ready !or const:vction ritbout i~rovesenta.
6. Date projccccd for occupatioe of project~iaitiation of opcntioc~s:
Jul 1 2000
7. Other information applicable to this project and ot~et qualifying factors
ye Q;~.~« «o ewQloY an additional 15 n.aflle Yitbin the ftrst
yQar of opn?stion.
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