HomeMy WebLinkAboutResolution - 2006-R0556 - Tax Abatement Agreement - Semmaterials LP. - 11_21_2006Resolution No. 2006-R0556
November 21, 2006
Item No. 5.10
RESOLUTION
WHEREAS, the City Council has determined to give notice of its intent to enter into a
Tax Abatement Agreement with SemMaterials, LP.; and
WHEREAS, V.T.C.A. Tax Code Section 312.2041 requires notice of intent of the City
Council to be given to the presiding officer of the governing body of each taxing unit in which
the property to be subject to the Tax Abatement Agreement is located; NOW
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the City Secretary give notice as set forth in Exhibit "A" of the intention of the:
City Council to enter into a Tax Abatement Agreement with SemMaterials, LP., said notice to.
be given to the presiding officers of each governing body of each taxing unit having
jurisdiction in assessing taxes on the properties which are described in Exhibit "A-1".
Passed by the City Council this 21st day of November 2006.
DAVID A. VULLER, MAYOR
ATTEST:
Re ecca Garza, City Secretary
APPR V A TO CONTENT:
t4
Rob Apson, Assistant City Manager
Development Services
APPROVED AS TO FORM:
Linda L. Chamales, Senior Attorney
Office Practice Section
Resolution No. 2006—RO556
EXHIBIT "A"
NOTICE OF INTENT OF THE CITY COUNCIL
OF THE CITY OF LUBBOCK TO ENTER INTO AN
AGREEMENT TO ABATE TAXES ON REAL PROPERTY
IMPROVEMENTS AS DESCRIBED IN EXHIBIT "A-1"
Notice is hereby given that the City Council of the City of Lubbock intends to
enter into an Agreement with SemMaterials, LP. to abate taxes on improvements to real
property located within the Lubbock 2000 North Enterprise Zone created by Ordinance
No. 2000-00032 and covering all of the subject property.
Notice is further given that the City Council of the City of Lubbock will
consider authorizing the Mayor of the City to execute a contract between the City and
SemMaterials, LP. for tax abatement, a draft copy of said Agreement is attached to this
notice as Exhibit "A-2" and made a part hereof for all purposes.
Notice is further given that the City Council will consider this matter at its
meeting held in the City Council Chamber, City Hall, 1625 13th Street, City of
Lubbock, on the 7"' day of December, 2006, at approximately 9.30 o'clock a.m.
Resolution No. 2006-RO556
Exhibit "A-1"
Legal Descriptions of Property
Following are the legal descriptions of the parcels included in the tax abatement.
Parcel 1 and 2
Legal description of land:
TRACT 1:
All that portion of Tract 2, Marnels Industrial Additional to the City of Lubbock,
Lubbock County, Texas, according to the Map, Plat, and/or Dedication Deed thereof,
recorded in Volume 950, Page 403, Deed Records of Lubbock County, Texas, being
further described as follows:
BEGINNING at a %" iron rod (set) at the Northeast corner of said Tract 2, which bears
South 2683.1 feet and West 32.1 feet from the Northeast corner of Section 16, Block A,
Lubbock County, Texas;
REVISED
GF # 00-5376
THENCE South, along the East line of said Tract 2, a distance of 500.00 feet;
THENCE West a distance of 185.8 feet to a 3/" iron rod;
THENCE South a distance of 236.00 feet;
THENCE West a distance of 0.42 feet;
THENCE South a distance of 224.8 feet to a'/z" iron rod flush with a building wall;
THENCE South 19' West a distance of 135.17 feet to a ''/2" iron rod in the west line of
said Tract II;
THENCE North, along the West line of said Tract 2, a distance of 1088.40 feet to a'/"
iron rod at the Northwest corner of said Tract 2;
THENCE East, along the North line of said Tract 2, a distance of 230.00 feet to the
POINT OF BEGINNING.
TRACT II:
All that strip of land located on both sides of the common line between Sections 15 and
16, Block A, Lubbock County, Texas bounded by the East by a line parallel with and
47.9 feet East of said Section line, and on the West by a line parallel with and 32.1 feet
West of said Section line, being further described as follows:
Exhibit "A-1"
Legal Descriptions of Property
BEGINNING at a'/4" rod which bears South 2683.1 feet and East 47.9 feet from the
Northeast corner of Section 16 and the Northwest corner of Section 15, Block A,
Lubbock County, Texas;
THENCE South a distance of 500.00 feet to a 3/4" rod;
THENCE West a distance of 80.00 feet to a point in the West line of Tract 2, Marnel's
Industrial Addition to the City of Lubbock, Lubbock County, Texas;
THENCE North, along the East line of said Tract 2, a distance of 500.00 feet to the
Northeast corner of said Tract 2;
THENCE East a distance of 80.00 feet to the POINT OF BEGINNING.
TRACT III:
A 30.00 foot wide strip of land lying contiguous to and westerly of Lot 2, Tract 3 of
Marvels Industrial Addition to the City of Lubbock, as established by Certificate of
Dedication recorded February 7, 1966 in Volume 1072, Pages 560 et seq., Deed Records
of Lubbock County, Texas, situated in the E'/2 of Section 16, Block 1, T.T.R.R. Co.
Survey, Lubbock County, Texas, and being a portion of that certain 95.56 acre tract of
land described in Deed from Walker Stanton, et al dated June 20, 1950, recorded in Book
417, Page 36, Deed Records of Lubbock County, Texas, described as follows, to -wit:
COMMENCING at the Southwest comer of said Lot 2, Tract 3 of Mamels Industrial
Addition;
THENCE Northerly along the Westerly boundary of said Lot 2, Tract 3 along a curve to
the left, have a radius of 620.76 feet with long chord bearing North 09°26'27" East,
107.76 feet to the true point of beginning;
THENCE continuing Northerly along said curve and along the Westerly boundary of said
Lot 2, Tract 3 an arc distance of 50.05 feet to a point of tangency;
THENCE North 00°09'30" West, 523.8 feet, more or less, to a point in the South line of
Lot 1, Tract 3 of said Marvels Industrial Addition to the City of Lubbock;
THENCE West along said South line 30.0 feet;
THENCE South 00°09'30" East, 523.8 feet, more or less, to a point 30.0 feet West of the
hereinabove described point of tangency;
THENCE Southerly along a tangential curve to the right having a radius of 590.76 feet,
an arc distance of 47.72 feet;
THENCE Easterly 30.0 feet to the true POINT OF BEGINNING.
Exhibit "A-1"
Legal Descriptions of Property
REVISED
GF # 00-5376
TRACT IV-.
A portion of Tract No. 2, Mamels Industrial Addition to the City of Lubbock, Lubbock
County, Texas, according to the map, plat and/or dedication deed thereof recorded in
Volume 950, Page 403, Deed Records of Lubbock County, Texas and that 80 foot wide
tract of land adjacent thereto located in the West Half of Section 15 and the East Half of
Section 16, Block A, Lubbock County, Texas, being further described as follows:
BEGINNING at a point in the East line of Section 16 which bears South a distance of
3,183.I feet from the Northeast corner of Section 16, Block A, Lubbock County, Texas;
THENCE West, Parallel to the North line of Section 16, at 32.1 feet pass the East line of
Tract No. 2, Mamels Industrial Addition, continuing for a total distance of 217.9 feet to a
'/2" iron rod with cap found at the Northwest corner of this tract;
THENCE South, parallel to the East line of Section 16, a distance of 219.85 feet to a'/2"
iron rod with cap set for the Southwest corner of this tract;
THENCE East, parallel to the North line of Section 16, a distance of 265.8 feet to a '/2"
iron rod with cap set for the Southeast corner of this tract;
THENCE North, parallel to the East line of Section 16, a distance of 219.85 feet to a 3/4"
iron rod found for the Northeast corner of this tract;
THENCE West, parallel to the North line of Section 15, a distance of 47.9 feet to the
POINT OF BEGINNING.
Parcel 3
Marvels Industrial, south part of tract two (2), and strip on east side
Parcel 4
1619 Marshall Street: Lot 2, Tract 3, Marvels Industrial Addition, 4.57 acres, City of
Lubbock, Lubbock County, Texas, as shown by the official plat thereof, recorded in
Volume 1072, Page 560, of the Lubbock County Deed Records.
Resolution No. 2006—RO556
Exhibit "A-1"
Legal Descriptions of Property
Exhibit "A-2"
Resolution No. 2006-R0556
AGREEMENT
STATE OF TEXAS §
COUNTY OF LUBBOCK §
This Agreement made this day of , 2006, by and
between the City of Lubbock, Texas, a home rule municipality of the State of Texas
(hereinafter called "City"), and SemMaterials, LP (hereinafter called "Company");
WITNESSETH:
WHEREAS, City did receive from Company on the 181h day of September, 2006
an application for tax abatement for improvements to real property and tangible personal
property at 1611 Marshall Street, 1101 Avenue P, and 1619 Marshall, which is further
described in Exhibit "A"; and
WHEREAS, upon review of the above application it was determined that the
facility and real property is located in the Lubbock 2000 North Enterprise Zone
designated by the City in Ordinance No. 2000-00032 covering the above described
property; and
WHEREAS, the Guidelines and Criteria Governing Tax Abatement For Selected
Taxing Units Contained Within Lubbock County was heretofore adopted by Resolution
No. 2005-RO421 of the City Council of the City of Lubbock. A copy of the Guidelines
and Criteria Governing Tax Abatement for Selected Taxing Units Within Lubbock
County is attached as Exhibit "B" and incorporated herein as if fully set forth; and
WHEREAS, the City did comply with all the requirements set forth in V.T.C.A.,
Tax Code, Section 312.201; and
WHEREAS, the City did comply with all the criteria and guidelines as set forth in
the Guidelines and Criteria Governing Tax Abatement for Selected Taxing Units
Contained Within Lubbock County, said guidelines having been adopted by Resolution
No. 2005-RO421 of the City on September 8, 2005; and
WHEREAS, the City did pass Ordinance No. 2000-00032 creating the Lubbock
2000 North Enterprise Zone for commercial and industrial tax abatement, said zone
including the area which is described in the attached Exhibit "A"; and
AGREEMENT - SEMMATERIALS, LP. PAGE 1
WHEREAS, V.A.T.C., Tax Code, Sec. 312.2011 provides that designation as an
enterprise zone constitutes designation as a reinvestment zone without further action; and
WHEREAS, the application received by City from Company is an application for
the expansion of an existing facility; and
WHEREAS, V.A.T.C., Tax Code, Sec. 312.002 specifically states that such a
purpose is to be included in the guidelines for tax abatement and to be eligible for such
treatment; and
WHEREAS, Section IV of the Guidelines and Criteria governing Tax Abatement
for Selected Taxing Units Contained Within Lubbock County adopted by the City
Council by Resolution No. 2005-R0421, does recognize expansion of an existing facility
as being eligible for tax abatement status; and
WHEREAS, the City Council does hereby find that all of the Guidelines and
Criteria Governing Tax Abatement, as adopted by Resolution No. 2005-RO421 have been
met by Company; and
WHEREAS, the location of the facility and surrounding real property, which are
to be the subject matter of this Agreement, are attached hereto as Exhibit "A" and made a
part of this Agreement for all purposes; and
NOW THEREFORE, for and in consideration of the premises and of the mutual
terms, covenants and conditions herein contained the City and Company do hereby agree
as follows:
SECTION 1. Term. This Agreement shall remain in force and effect for a period
of five (5) years from January 1 of the tax year after the required improvements are
substantially completed and shall expire and be of no further force and effect after said
date.
SECTION 2. Base Year. The base year applicable to real property, which is the
subject of this Agreement, shall be 2006, and the assessed value of the real property shall
be the assessed value applicable to such property for said year.
SECTION 3. Base Year Taxes. The taxes upon the real property shall be paid in
accordance with the assessed value of such property for the base year. Base year taxes
upon the real property are thus not abated.
SECTION 4. Abatement of Increase in Base Year Tax. In accordance with
V.A.T.C., Tax Code, Section 312.204 real property taxes applicable to the real property
subject to this Agreement shall be abated only to the extent said value for any given year
within the term of this Agreement exceeds the base year taxes hereinabove set forth.
AGREEMENT - SEMMATERIALS, LP PAGE 2
SECTION 5. Property Ineligible for Tax Abatement. The property described and
set forth in Section IV(6) of the Guidelines and Criteria Governing Tax Abatement for
selected taxing units contained within Lubbock County and heretofore adopted by the
City Council by Resolution No. 2005-R0421 is incorporated by reference herein as if
fully set out in this Agreement and fully describes the property ineligible for tax
abatement.
SECTION 6. Exemption from Tax. The City covenants and agrees to exempt
from taxation, in accordance with Section 4 above, the following properties:
(a) All proposed new improvements to be placed upon the property which is
described in Exhibit "A".
(b) All eligible tangible personal property, owned by Company, placed in or
upon the property set forth in Exhibit "A", which does not include any
equipment and personal property owned by Company and already located
in the existing facility.
(c) It is further understood that all items affixed to the new improvements
placed upon the real property identified in Exhibit "A", including
machinery and equipment shall be considered part of the real property
improvement and taxes thereon shall be abated in accordance with the
provisions of subparagraph (a) above set forth.
SECTION 7. Economic Qualifications. Company agrees to expend funds
necessary to qualify for tax abatement by expanding an existing facility, as set forth in
Section IV(3)(b) of the Guidelines and Criteria Governing Tax Abatement for selected
taxing units contained within Lubbock County (Exhibit "B") on the property described in
Exhibit "A". A description of the kind, number and location of all proposed
improvements is attached in Company's application, Exhibit "C" and incorporated herein
as if fully set forth.
SECTION 8. Value of Improvements. In accordance with V.A.T.C., Tax Code,
Section 312.204(a), which requires the Owner of the property to make specific
improvements or repairs to the property in order to be eligible for tax abatement,
Company will expend three million six hundred thousand ($3,600,000) for the expansion
of an existing facility and eight million eight hundred thousand ($8,800,000) on new
equipment to be located within the enterprise zone created by Ordinance No. 2000-00032.
SECTION 9. EIectricity Provider. Company agrees to utilize Lubbock Power &
Light (LP&L) for electrical services for the term of the tax abatement. If company
chooses to utilize a different Power Company, this contract shall be terminated.
AGREEMENT - SEMMATERIALS, LP. PAGE 3
SECTION 10. City Access to Property. Company covenants and agrees that City
shall have access to the property, which are the subject matter of this Agreement, upon
reasonable notice and during normal business hours, and that municipal employees shall
be able to inspect the property to insure compliance with the terms and conditions of
Company's application for tax abatement, attached as Exhibit "C", and this Agreement.
SECTION 11. Portion of Tax Abated. City agrees, during the term of this
Agreement, to abate taxes on eligible property according to the following schedule.
Year 1:
100%
Year 2:
80%
Year 3:
60%
Year 4:
40%
Year 5:
20%
SECTION 12. Commencement Date. This Agreement shall commence January 1
of the tax year after the required improvements are substantially completed and shall
expire five (5) years after such date.
SECTION 13. Type of Improvements. Company proposes to expand an existing
facility as described in Exhibit "C". Company further states that the proposed
improvements to the property above mentioned shall commence on the I" day of October,
2006, and shall be completed within approximately seven (7) months from said date.
Company may request an extension of the above date from City in the event
circumstances beyond the control of Company necessitates additional time for completion
of such improvements and such consent shall not unreasonably be withheld. Company
shall provide a copy of the certificate of occupancy or other proof of completion within
ten days of completion of improvements.
SECTION 14. Drawings of Improvements. Company shall furnish City with one
set of as built plans and drawings of the improvements to be made pursuant to the terms
of this Agreement.
SECTION 15. Limitation on Use. Company agrees to limit the use of the
property set forth in Exhibit "A" to commercial and/or industrial uses as those terms are
defined in the zoning ordinances of the City of Lubbock and to limit the uses of the
property to uses consistent with the general purpose of encouraging development of the
enterprise zone during the term of this agreement.
SECTION 16. Recapture. Company agrees to be bound by and comply with all
the terms and provisions for recapture of abated taxes in the event of default by Company
pursuant to law and as set forth in Guidelines and Criteria for Tax Abatement adopted by
Resolution No. 2005-RO421 of the City Council of the City of Lubbock.
AGREEMENT - SEMMATERIALS, LP PAGE 4
SECTION 17. Certification. Company agrees to certify annually in writing to the
governing body of each taxing unit that the owner is in compliance with the terms of the
Agreement.
SECTION 18. Compliance. The City may cancel or modify this Agreement if
Company fails to comply with the Agreement.
SECTION 19. Notices. Notices required to be given by this Agreement shall be
mailed, certified mail return receipt requested, to the following addresses:
CITY OF LUBBOCK
Assistant City Manager
Development Services
P.O. Box 2000
Lubbock, Texas 79457
SEMMATERIALS, LP
Rusty Smallwood
1611 Marshall Street
Lubbock, TX 79403
SECTION 20. Effective Date. Notwithstanding anything contained herein to the
contrary, this Agreement shall not be effective until such time as it has been finally
passed and approved.
EXECUTED this day of , 2006.
SEMMATERIALS, LP. CITY OF LUBBOCK
A Municipal Corporation
ATTEST:
Tax Abatement Agmt-SemMaterials November 9, 2006
DAVID A. MILLER, MAYOR
ATTEST:
Rebecca Garza
City Secretary
APPROVED AS TO CONTENT:
Rob Allison, Assistant City Manager
Development Services
APPROVED AS TO FORM:
Linda L. Chamales, Senior Attorney
AGREEMENT — SEMMATERIALS, LP. PAGE 5