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HomeMy WebLinkAboutResolution - 4779 - Agreement - Aycock Freight Inc - Tax Abatement - 03_23_1995Resolution No. 4779 March 23, 1995 Item #12 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Mayor of the City of Lubbock BE and is hereby authorized and directed to execute for and on behalf of the City of Lubbock Guidelines and Criteria governing tax abatement for commercial projects in designated enterprise zones in the City of Lubbock, attached herewith, by and between the City of Lubbock and Aycock Freight, Inc. and any associated documents, which shall be spread upon the minutes of the Council and as spread upon the minutes of this Council shall constitute and be a part of this Resolution as if fully copied herein in detail. Passed by the City Council this ATTEST: &tt" LCL)iL Betty A • -t*City Secretary 23rd day of March 1995. APPROV TO CONTENT: Ao4 Ell' , Director of Business Relations/ Eco mic Development TO FORM: DMald G. Vandiver, Fi Assistant City Attorney DGV: dp\G\ccdocs\TAXAB TAF.Res February Z, 1995 Resolution No. 4779 March 23, 1995 Item #12 AGREEMENT STATE OF TEXAS § COUNTY OF LUBBOCK § This Agreement made this 23rd day of March 1995, by and between the City of Lubbock, Texas, a home rule municipality of the State of Texas (hereinafter called "City") and Aycock Freight, Inc. (hereinafter called "Company"); WITNESSETH: WHEREAS, City did receive from Company on the 14th day of December, 1994, an application for tax abatement for construction of Company's facilities located within Lot 5, Block 11, Burlington Industrial Addition No. 2, to the City of Lubbock; and WHEREAS, upon review of the above application, it was determined that facilities would be located in the South Enterprise Zone designated by City in its Ordinance No. 9591; and WHEREAS, the Guidelines and Criteria Governing Tax Abatement for Commer- cial Projects in Designated Enterprise Zones in the City of Lubbock was heretofore adopted by Resolution No. 4287 of the City Council of the City of Lubbock; and WBFREAS, the City did comply with all the requirements set forth in V.T.C.A., Tax Code, Section 312.2011; and WHEREAS, the City did comply with all of the criteria and guidelines for creation of an enterprise zone as set forth in V.A.C.S., Section 8, Article 5190.7, having adopted Ordinance No. 9591 of the City on February 18, 1993, which ordinance includes Lot 5, Block 11, Burlington Industrial Addition No. 2, to the City of Lubbock; and WHEREAS, the application received by City from Company is an application for the construction of a new Company facility; and WHEREAS, the location of the constructed 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 WHEREAS, Section IV of the Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones adopted by the City Council by Resolution No. 9591 does recognize construction of new facilities as being eligible for commercial tax abatement status; and WHEREAS, Section IV (9)(d) provides for variance of the Guidelines and Crite- ria Governing Abatement for Commercial Projects in Designated Enterprise Zones by the affirmative vote of three -fourths of the governing body of an affective jurisdiction; and WHEREAS, the application does not meet the specific standards of Section IV(9)(b)(1) in that the new facility does not qualify as a totally new business operation; and WHEREAS, the City Council does hereby find that all of the Guidelines and Cri- teria established for Commercial Tax Abatement within the Enterprise Zones of the City of Lubbock, as adopted by Resolution No. 4287, have otherwise been met by Company; and WHEREAS, the City Council finds that variance of the requirements of Section fV (9)(b)(1) and entering into this Agreement to abate taxes on the property described in Exhibit "A" will contribute to the retention of existing jobs and the creation of new jobs within the affected jurisdiction, and enhance economic development within the designated Enterprise Zone; WHEREAS, variance of the requirement that the facility be a totally new business operation is hereby granted; PAGE 2 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 two (2) years from the date of its execution, 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 the Agreement, shall be 1995, 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. SECTION 5. Property Ineligible for Tax Abatement. The property described and set forth in Section IV(5) of the Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones, and heretofore adopted by the City Council by Resolution No. 4287, and incorporated by reference herein as if fully set out in this Agreement is 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 improvements to be placed upon Lot 5, Block 11, Burlington Industrial Addition No. 2, to the City of Lubbock, which proposed improvements are set forth in a plat of the above tract of land, attached hereto as Exhibit "A", and made a part hereof. PAGE 3 (b) All eligible tangible personal property placed in or upon the property set forth in Exhibit "A". (c) It is further understood that all items affixed to the 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 subpara- graph (a) above set forth. SECTION 7. Economic Qgalification. It is hereby found by the City that Com- pany will expend funds necessary to qualify for tax abatement by constructing a new facil- ity, and further that the Company will create new jobs in excess of the number required for tax abatement, all as set forth in Section IV(9)(2) of the Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones in the City of Lubbock adopted by the City through Resolution No. 4287. SECTION 8. Value of Improvements. Company intends to expend approxi- mately three hundred and seventy-five thousand dollars in building related structural improvements to be located within the Enterprise Zone created by Ordinance No. 9591. SECTION 9. Creation of New Jobs. Company agrees within twelve (12) months from the date of execution of this Agreement that it will create three (3) to four (4) new jobs within the Company facility located within Lot 5, Block 11, Burlington Industrial Addition No. 2, to the City of Lubbock, and use its best efforts to maintain a minimum of ten (10) new jobs during the term of this Agreement. SECTION 10. City Access to Proaertv. Company covenants and agrees that City shall have access to the property, which is the subject matter of this Agreement, during normal business hours, and that municipal employees shall be able to inspect the property to insure that the improvements are being made in accordance with the terms and condi- tions of Company's application for commercial tax abatement and this Agreement. SECTION 11. Portion of Tax Abated. City agrees, during the term of this Agreement, to abate one hundred (100) percent of taxes on eligible property. PAGE 4 SECTION 12. Commencement Date. This Agreement shall commence upon the date of its execution, which date is hereinafter set forth, and shall expire two (2) years after such date. SECTION 13. Type of Improvements. The Company proposes to construct a new freight terminal as described in Exhibit "A". The Company further states that the proposed improvements to the property above mentioned shall commence on the 15th day of December, 1994, and shall be completed within approximately 120 days from said date. The Company may request an extension of the above date from City in the event circum- stances beyond the control of Company necessitates additional time for completion of such improvements, and such consent shall not unreasonably be withheld. 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 prop- erty set forth in Exhibit "A" to commercial 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 designated Enterprise Zone during the term of this Agreement. SECTION 16. Recapture. The 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 Com- pany as set forth in Exhibit 'B", attached hereto and made a part hereof for all purposes. SECTION 17. Notices. Notices required to be given by this Agreement shall be mailed, certified mail return receipt requested, to the following addresses: PAGE 5 CITY OF LUBBOCK AYCOCK FREIGHT, INC. City Manager Gary Aycock P.O. Box 2000 500 E. 50th Street Lubbock, TX 79457 Lubbock, TX 79403 SECTION 18. Effective Date. Notwithstanding anything contained herein to the contrary, this Agreement shall not be effective until such time as it shall be finally passed and approved. EXECUTED this 23rd day of March , 199 5 . AYCOCK FREIGHT, INC. A Texas Corporation ATTEST: ATTEST: Secretary RE/sdh/aycock-2.doc January 30, 1995 PAGE 6 Betty M. Johns n, City Secretary ;APPR70TO CONTENT: d 's, Director of Business Development APPROVED AS TO FORM: Y a�Shor., ttorney EXHIBIT "A" FACILITY DESCRIPTION (a) We will be building a new freight terminal with approximate ly 6000 square feet of warehouse space and approximately 1200 square feet of office space. This facility will be totally dock: high consist of 15 deck doers and will be compcised of metal fabrication. The 3 acres that this facility will be built on will be completely enclosed with a 6 foot high chain link fence and will be paved with 2 inches of asphalt paving for truck and trailer parking. (b) Refer to paragraph (a) (c) Refer to paragraph (a) (d) Site plan attached (a) None (f) Construction should begin around the midd.le of December with completion of the project 4 to 5 months later. (g) The proposed improvements are for the construction of a new facility to be built on an undeveloped piece of real estate. (h) The proposed improvements should add approximately $375,(.-)00.0(:) of additional value to the Real Property. (i) (.j) Our company as it exist currently employees 6 full time employees. We expect with the completion of our new facility our business will increase and most assuredly new .jobs should be created. It is hard to predict exactly how many new .jabs will be created but with this new facility coupled with the upcoming deregulation of Texas our opportunities for growth should in- crease significantly. We should easily be able to add 3 to 4 new employees before the end of the 1995 calender year. Dear members of the commission, our family has been involved in the trucking industry of Lubbock, Texas for the past 35 years. We are currently operating three different trucking operations in the city of Lubbock of which we are working out of leased facili- ties. It would be considerably less expensive for us to continue to rent or to purchase an elder existing facilty and attempt to renovate. However, the availabilty of dock: high buildings that could be converted for use as a freight terminal, in Lubbock are very rare. Therefore, we are willing to take a financial risk: that will only benefit the property tax base of Lubbock for many years to came. I would only hope that You will realize this benefit and through this tax abatement lend us some ecorr_�mic aid to begin this venture. 1 (DL n7 (TYP) 94'-6" 1 LIV Zf­ 7 SPACES 0 9 1-0 14'- 0" 1 - - 63,- 0, 95.70- T.O.C. 95.61, 0. C. 95. 13' O.C. 1-95. 94. - - - - - - - - - - - - - - - - - - - - J 05 Ile' Z 1, \PK F99--9 cc� it - 142,-B, 2'I 4� EL Ic, 4 9CS (T YP.) 'I- B.O.C. • 22 4'- 4'-0. 9L 0 T. 0.- 95, 3: 2 [�5 5 TYP.) 1.� Q ill IT- YP.) a tv :It EXHIBIT "A" LUBBOCK CENTRAL APPRAISAL DISTRICT TAX CERTIFICATE FOR: SERVICE PAGE 2 OF INFORMATION BELOW THIS LINE IS NOT CERTIFIED TAX YEAR: 1994 TAXING UNIT TAX JBBOCK ISD 286.74 JBBOCK CITY 124.42 WATER DIST 1.63 HOSP DIST 20.41 JBBOCK COUNTY 33.28 JRRENT YEAR .TOTALS 466.48 KEY NUMBER: 01485048. PAYMENT INTEREST PENALTY HER YEAR TOTALS JMMARY TOTALS COURT COSTS (** SUBJECT TO CHANGE �*) FILING FEE NET TOTAL DUE DECEMBER ********************* JANUARY 466.48 FEBRUARY TOTAL DUE 286.7 324.4. 1 .6_ 20.41 33.2F 466.4F 466.48 499.13 f ' EXHIBIT "A" LUBBOCK -N-" ZAL APPRAISAL DISTRICT -RTIFICATE FOR: SERVICE PAGE 1 OF t_Lr CTING TAXES Fr-R: t_UBBOCK ISD HP WATER DIST LUBBOCK COUNTY n"JF REQUESTED: 94/12/01 USt' NUMBER: +'ATF OF TEXAS PROPERTY OWNER R 3 R RENTALS 4206 LnCUST AVE LUBBOCK TX 79404-354( BLM 13 SEC-6 AB 456 TR 11 LUBSOCK CITY LC HOSP DIST CERTIFICATE NO.: 63869 TITLE COMPANY NO.: 40 COUNTY OF LUBBOCK ACCT NUMBER: AC14006-90456-00230-0+ KEY NUMBER: 01485048 LOCATION ADDRESS AC: 8.09 IHE UNDERSIGNED AUTHORITY HAS CAREFULLY EXAMINED THE TAX RECORDS OF THIS OFFICE WITP'REFERENCE TO DELINQUENT TAXES AND FINDS THE FOLLOWING TAXES, PENALTIES. .1ND INTEREST ARE DUE AS OF -DATE ISSUED. TAX TAX INTEREST PENALTY TOTE'' YFAR AMOUNT AMOUNT AMOUNT DUf. fOT t. ** NO OTHER DELINQUENT TAX OUTSTANDING ** GIVEN �NDER MY HAND AND SEAL Ur OFFICE AT LUBBOCK, TEXAS THIS THE -� DAY A BYDAVID V. KIMBROUGH DEPUTY TAX COLLECTOR LUBBOCK CENTRAL APPRAISAL DISTRI T EXHIBIT "A" 1994 —� Tax Amount —. $466.48 PAYABLE c"NTRAL APPRAISAL DISTRICTUPON F3ECE!Pr TAX STATEMENT -UBBCCK . 1994 ra'" become P"Kntly ceacnat mt 0a mouent FEHRUARY 1, 1995 BLK B SEC 6 AB 456 TR 11 AC: 8.09 a" LW ax Rate Unit axes Valuation DescEption Total Value LUBBOCK LSD 1.47500 286.74 ASSESSED VALUE 19,440 LUBBOCK CITY a .64000 124.42 LAND VALUE 19,440 HP WATER DIST .00840 1.63 SCHOOL VALUE 1 19,440 LC HOSP DIST .10499 20.41 CITY VALUE I 19,440 LUBBOCK COUNTY .17117 33.28 WATER DIST VALUE 19,440 HOSPITAL DIST VALUE { 19,440 1 k COUNTY VALUE 19,440 � f { LOC: GEO: AC14006-90456-00230-000 KEY: 148SO48 a R 6 R RENTALS f j 4206 LOCUST AVE LUBBOCK TX 79404-3540 1its III 11111110111011111111111111i111I oil I111III IaII } e I ICTE `'•? :cul ?v dales a;,. .5 ;2rr2rt 'err7tcs i :ecucnon a ycur murtV 3x -ale rar" i 9 fiR 3 .17117' _ ?Suits Ic our .;unr: a.,es xrn �3 3A YOUR MORTGAGE COMPANY MAY PAY TAXES DUE. IF THIS PROPERTY IS MORTGAGED, PLEASE CONSULT MORTGAGEE BEFORE REMITTING TAXES. LOC. / LEGAL/NOTE DESCRIPTION GEO: AC14006-90456-00230-000 KEY: 1485048 BLK B SEC 6 AB 4S6 TR 11 AC: 8.09 R & R RENTALS 4206 LOCUST AVE LUBBOCK TX 79404-3540 PHONE: (806) 762-5000 EXT. 400 TAX AMOUNT: $466.48 —;C— — PLEASE AETURN 940000046648014850482 EXHIBIT 'B' SECTION VII. Recapture: 1. In the event that any type of facility, (as defined in Sec- tion I, Subparagraphs 5, 6, 7, 8, 10, 11, 12, 13, 17, 18) is completed and begins producing goods or services, but subse- quently discontinues producing goods or services for any reason, excepting fire, explosion or other casualty or acci- dent or natural disaster or other event beyond the reason- able control of applicant or owner for a period of 180 days during the term of a tax abatement agreement, then in such event the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. The burden shall be upon the applicant or owner to prove to the satisfaction of the Affected Juris- diction to whom the application for tax abatement was directed that the discontinuance of producing goods or ser- vices was as a result of fire, explosion, or other casualty or accident or natural disaster or other even beyond the control of applicant or owner. In the event the applicant or owner meets this burden, and the Affected Jurisdiction is satisfied that the discontinuance of the production of goods or services was the result of events beyond the control of the applicant or owner, then such applicant or owner shall have a period of one year in which to resume the production of goods and services. In the event that the applicant or owner fails to resume the production of goods or services within one year, then the Tax Abatement Agreement shall ter- minate and the Abatement of all taxes shall likewise termi- nate. Taxes abated during the calendar year in which termi- nation takes place shall be payable to each Affected Juris- diction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. The one year time period, hereinabove mentioned, shall commence upon written notifica- tion from the Affected Jurisdiction to the applicant or owner. 2. In the event that the applicant or owner has entered into a tax abatement agreement to make improvements to a facility of any type described in Section 1 above, but fails to undertake or complete such improvements, then in such event the Affected Jurisdiction to whom the application for tax abatement was directed shall give the applicant or owner sixty (60) days notice of such failure. The applicant or owner shall demonstrate to the satisfaction of the Affected Jurisdiction, above mentioned, that the applicant or owner has commenced to cure such failure within the sixty (60) days above mentioned. In the event that the applicant or owner fails to demonstrate that he is taking affirmative action to cure his failure, then in such event the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination takes place shall be payable to each Affected Jurisdiction by no later than Jan- uary 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. 3. In the event that the Affected Jurisdiction to whom applica- tion for tax abatement was directed determines that the applicant or owner is in default of any of the terms or con- ditions contained in the Tax Abatement Agreement, then in such event the Affected Jurisdiction shall give the appli- cant or owner sixty (60) days written notice to cure such default. In the event such default is not cured to the sat- isfaction of the Affected Jurisdiction within the sixty (60) days notice period, then the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise termi- nate. Taxes abated during the calendar year in which termi- nation takes place shall be payable to each Affected Juris- diction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. 4. In the event that the applicant or owner allows ad valorem taxes on property ineligible for tax abatement owed to any Affected Jurisdiction, to become delinquent and fails to timely and properly follow the legal procedures for their protest or contest, then in such event the Tax Abatement Agreement shall terminate and all abatement of taxes shall likewise terminate. Taxes abated during the calendar year in which termination, under this subparagraph, takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termination shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones Exhibit ne• PAGE 2 5. In the event that the applicant or owner, who has executed a tax abatement agreement with any Affected Jurisdiction, relocates the business, for which tax abatement has been granted, to a location outside of the designated reinvest- ment zone, then in such event, the Tax Abatement Agreement shall terminate after sixty (60) days written notice by the Affected Jurisdiction to the Owner/Applicant. Taxes abated during the calendar year in which termination, under this subparagraph takes place shall be payable to each Affected Jurisdiction by no later than January 31st of the following year. Taxes abated in years prior to the year of termina- tion shall be payable to each Affected Jurisdiction within sixty (60) days of the date of termination. 6. The date of termination as that term is used in this Subsec- tion VIII shall, in every instance, be the 60th day after the day the Affected Jurisdiction sends notice of default, in the mail to the address shown in the Tax Abatement Agree- ment to the Applicant or Owner. Should the default be cured by the Owner or Applicant within the sixty (60) day notice period, the Owner/Applicant shall be responsible for so advising the Affected Jurisdiction and obtaining a release from the notice of default from the Affected Jurisdiction, failing in which, the abatement remains terminated and the abated taxes must be paid. 7. In every case of termination set forth in Subparagraphs 1, 2, 3, 4 and 5 above, the Affected Jurisdiction to which the application for tax abatement was directed shall determine whether default has occurred by Owner (Applicant) in the terms and conditions of the Tax Abatement Agreement and shall so notify all other Affected Jurisdictions. Termina- tion of the Tax Abatement Agreement by the Affected Juris- diction to which the application for tax abatement was directed shall constitute simultaneous termination of all Tax Abatement Agreements of all other Affected Jurisdic- tions. S. In the event that a tax abatement agreement is terminated for any reason whatsoever, and taxes are not paid within the time period herein specified, then in such event, the provi- sions of V.T.C.A., Tax Code, Section 33.01 will apply. Guidelines and Criteria Governing Tax Abatement for Comercial Projects in Designated Enterprise Zones Exhibit •n" PAGE 3