HomeMy WebLinkAboutResolution - 2014-R0270 - Intent To Enter Tax Abatement Agreement - X-Fab Texas Inc. - 08/14/2014RESOLUTION
WHEREAS, the City Council has determined to give notice of its intent to enter into a
Tax Abatemcnt Agreement with X -Fab 'Texas, Inc.; anal
WHEREAS, V.T.C.A. Tax Code Section 312.2041 requires notice of intent of the. C'I(N
Council to be ,given to the presiding officer of the governing body of each taxing unit in «hick
the property to be subject to the 'Tax Abatement Agreement is located; NOW
13F 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 X -Fab Texas, Inc., said notice to
be given to the presiding officers of each governing body of each taxing unit having
jurisdiction in assessing taxes on the property located at 2301 N. University Avenue, Lubbock,
Lubbock County, Texas which is further described in Exhibit "A -I".
Passed by the City Council on August 14, 2014.
" . IV C. LR'I'SON, MAYOR
ATTEST:
c
Re cc�Garza, ity Secret
�1'1'lt0 V FI) AS TO CONTENT:
Cheryl Brock, Executive Director of Budget
APPROVED AS TO FORM:
Linda L. Chamales
Economic Development Attorney
EXHIBIT "A"
NOTICE OF INTENT OF THE CITY COUNCIL
OF THE CITY OF LUBBOCK TO ENTER INTO AN
AGREEMENT TO ABATE TAXES ON IMPROVEMENTS TO REAL
PROPERTY AND TANGIBLE PERSONAL PROPERTY
LOCATED AT 2301 UNIVERSITY, LUBBOCK, LUBBOCK COUNTY, TEXAS,
FURTHER 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 X -Fab Texas, Inc., to abate taxes on improvements to real
property and tangible personal property located within an Enterprise Zone, EZ/RZ # 44,
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
X -Fab Texas, Inc. 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 IP Street, City of
Lubbock, on the 28`h day of August, 2014, at approximately 5:15 o'clock p.m.
Exhibit "A-1"
BEGINNING at an aluminum disk monument found at the Northeast corner of said Drake
Street on the South line of Block 1, Lubbock State School Addition, an addition to the City of
Lubbock, according to the map, plat and/or dedication deed thereof, recorded in Volume
1143,Page 677, D.R.L.C.T. and also being North 0 deg. 01 min. 09 sec. East - 10.00 feet from
the Northwest corner of Lot 1, Lawson Addition, an addition to the City of Lubbock, according
to the map, plat and/or dedication deed thereof, recorded in Volume 838, Page 211, D.R.L.C.T.
THENCE South 0 deg. 01 min. 09 sec. West, along the East line of said abandoned Drake
Street, at 10.00 feet, passing the Northwest corner of said Lawson Addition, continuing along
the West line of said Lawson Addition, at 60.00 feet, passing the Southeast corner of said
abandoned Drake Street and the most Northerly Northeast corner of said Texas Instruments
Addition, continuing on for a total distance of 139.91 feet to an aluminum disk monument
found for the Southwest corner of said Lawson Addition;
THENCE South 89 deg. 58 min. 01 sec. East, along the North line of said Texas Instruments
Addition and the South line of said Lawson Addition, a distance of 143.27 feet to an aluminum
disk monument found for the most Easterly Northeast corner of said Texas Instruments
Addition and the Southeast corner of said Lawson Addition on the West Right-of-way of
University Avenue (F.M. 1264, variable width R.O.W.);
THENCE South 0 deg. 32 min. 04 sec. East, along the East line of said Texas Instruments
Addition and the West Right-of-way of said University Avenue, a distance of 2422.31 feet to a
1/2 inch iron rod set for corner;
THENCE North 89 deg. 27 min. 56 sec. East, along the East line of said Texas Instruments
Addition and the West Right-of-way of said University Avenue, a distance of 10.00 feet to a '/2
inch iron rod set for corner in the North Right-of-way of Loop 289 at the beginning of a curve
to the right having a radius that bears North 89 deg. 50 min. 33 sec. West, a distance of 215.00
feet;
THENCE Along the North Right-of-way of said Loop 289 and along said curve to the right,
with a chord that bears South 42 deg. 01 min. 23 sec. West - 286.98 feet, through a central
angle of 83 deg. 43 min. 52 sec. and an arc length of 314.20 feet to a concrete Right-of-way
marker found for corner at the end of said curve;
THENCE South 84 deg. 14 min. 24 sec. West, along the North Right-of-way of said Loop 289,
a distance of 833.14 feet to an aluminum disk monument found for corner at the beginning of a
curve to the left having a radius that bears South 05 deg. 45 min. 28 sec. East, a distance of
5879.65 feet;
THENCE Along the North Right-of-way of said Loop 289 and along said curve to the left,
with a chord that bears South 82 deg. 04 min. 50 sec. West - 443.52 feet, through a central
angle of 04 deg. 19 min. 23 sec. and an arc length of 443.63 feet to an aluminum disk
monument found for corner at the end of said curve;
THENCE South 83 deg. 47 min. 51 sec. West, along the North Right-of-way of said Loop 289,
a distance of 766.83 feet to a concrete Right-of-way marker found for corner;
THENCE South 73 deg. 26 min. 45 sec. West, along the North Right-of-way of said Loop 289,
a distance of 266.20 feet to an aluminum disk monument found for corner;
THENCE South 89 deg. 52 min. 26 sec. West, along the North Right-of-way of said Loop 289,
a distance of 599.04 feet to an aluminum disk monument found for the Southwest corner of
said Texas Instruments Addition and the Southeast corner of a called 286.15 acre tract of land
conveyed to the City of Lubbock as described in a deed recorded in Volume 370, Page 55,
D.R.L.C.T.;
THENCE North 0 deg. 00 min. 37 sec. East, along the West line of said Texas Instruments
Addition and the East line of said 286.15 acre tract, a distance of 2318.79 feet to an aluminum
disk monument found for the most Westerly Northwest corner of said Texas Instruments
Addition;
THENCE South 89 deg. 56 min. 05 sec. East, a distance of 100.19 feet to an aluminum disk
monument found for an inside ell corner of said Texas Instruments Addition;
THENCE North 0 deg. 00 min. 05 sec. West, along the West line of said Texas Instruments
Addition and the East line of said 286.15 acre tract, at 706.65 feet, passing the Southwest
corner of the above mentioned abandoned Drake Street and continuing for a total distance of
766.65 feet to an aluminum disk monument found for the most Northerly Northwest corner of
said Texas Instruments Addition and the Northwest corner of said abandoned Drake Street, on
the South line of the above mentioned Block 1, Lubbock State School Addition;
THENCE South 89 deg. 53 min. 30 sec. East, along the North line of said Drake Street and the
South line of Block 1, Lubbock State School Addition, a distance of 2800.50 feet to the POINT
OF BEGINNING and containing 203.377 acres of land.
EXHIBIT "A-2" (DRAFT DOCUMENT)
AGREEMENT
STATE OF TEXAS §
COUNTY OF LUBBOCK §
This Agreement made this day of , 2014, by and
between the City of Lubbock, Texas, a home rule municipality of the State of Texas
(hereinafter called "City"), and X -Fab Texas, Inc. (hereinafter called "X -Fab");
WITNESSETH:
WHEREAS, City received an application from X -Fab dated July 10, 2014 for tax
abatement for improvements to real property located at 2301 N. University Avenue, Lubbock,
Lubbock County, Texas which is further described in Exhibit "A" and for the addition of
tangible personal property improvements (equipment); and
WHEREAS, upon review of the above application it was determined that the facility
and real property is located in the Enterprise Zone, EZ/RZ #44 designated by the City in
Ordinance No. 2013-00108 covering the above described property; and
WHEREAS, the Guidelines and Criteria Governing Tax Abatement For Industrial
Projects in the City of Lubbock was adopted by Resolution No. 2013-RO370 of the City
Council of the City of Lubbock. A copy of the Guidelines and Criteria Governing Tax
Abatement for Industrial Projects in the City of Lubbock is attached as Exhibit "B" and
incorporated herein as if fully set forth; and
WHEREAS, the City complied with all the requirements set forth in V.T.C.A., Tax
Code, Section 312.201; and
WHEREAS, the City complied with all the criteria and guidelines as set forth in the
Guidelines and Criteria Governing Tax Abatement for Industrial Projects in the City of
Lubbock; 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
Industrial Projects in the City of Lubbock recognizes expansion of an existing facility and
addition of personal property 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. 2013-R0370 have been, or will be,
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 X -FAB and do hereby agree as follows:
SECTION 1. Term. This Agreement shall commence January 1 of the tax year after
the required improvements are at least 90 percent complete and shall expire and be of no
further force and effect five (5) years after such date.
SECTION 2. Base Year. The base year applicable to real and personal property, which
is the subject of this Agreement, shall be 2014, and the assessed value of the real and personal
property shall be the assessed value applicable to such property for said year.
SECTION 3. Base Year Taxes. The taxes upon the real and personal 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. Because the real property
described in Exhibit A has been the subject of a previous ten year tax abatement, real property
taxes applicable to the real property subject to this Agreement shall not be abated, even to the
extent the value for any given year within the term of this Agreement exceeds the base year
taxes.
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
Industrial Projects in the City of Lubbock (Exhibit "B") 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 the appropriate Sections above, the following properties:
(a) All eligible tangible personal property (equipment), placed in or upon the
real property set forth in Exhibit "A", which does not include any equipment and
personal property owned by X -Fab and already located in the existing facility.
SECTION 7. Economic Qualifications. X -Fab agrees to expend funds necessary to
qualify for tax abatement by expanding and modernizing the existing facility owned by X -Fab,
as set forth in Section IV(3)(b) of the Guidelines and Criteria Governing Tax Abatement for
Industrial Projects in the City of Lubbock (Exhibit `B") on the property described in Exhibit
"A". A description of the kind, number and location of all proposed improvements is attached
in X-Fab'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, X -Fab will expend approximately two
hundred fifty thousand dollars ($250,000.00) for the expansion of an existing facility owned by
X -Fab and thirteen million, nine hundred sixty-five thousand dollars ($13,965,000.00) on new
equipment to be located on the property described in Exhibit "A" which is within the Enterprise
Zone designated by Ordinance No. 2013-00108.
SECTION 9. Product Distribution. X -Fab will certify to City that 50% or more of their
products are distributed outside of Lubbock County each year with their filing of the
Certification form with the City of Lubbock, as required in Section IV 1(b) of the Guidelines
and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock.
SECTION 10. City Access to Property. X -Fab covenants and agrees that City shall
have access to the property, which is 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 and documents necessary 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. Type of Improvements. X -Fab proposes to modify the existing facility
as described in Exhibit "C". X -Fab further states that the proposed improvements to the
property above mentioned shall commence on September 1, 2014, and shall be completed June
30, 2016. X -Fab may request an extension of the above date from City in the event
circumstances beyond the control of X -Fab necessitate additional time for completion of such
improvements and such consent shall not unreasonably be withheld. X -Fab shall provide proof
of completion within ten days of completion of improvements.
SECTION 13. Limitation on Use. X -Fab 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 14. Recapture. X -Fab 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 in Exhibit `B."
SECTION 15. Certification. X -Fab 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 16. Compliance. The City may cancel or modify this Agreement if X -Fab
fails to comply with the Agreement.
SECTION 17. Notices. Notices required to be given by this Agreement shall be
mailed, certified mail return receipt requested, to the following addresses:
CITY OF LUBBOCK
City Manager
P.O. Box 2000
Lubbock,Texas79457
Phone: (806) 775-2016
X -Fab TEXAS, INC.
Ed Pascasio, CFO
2301 N. University
Lubbock, Texas 79415
Phone: (806) 747-4400
SECTION 18. 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 by the City Council.
EXECUTEDon
X -FAB, TEXAS, INC.
Ed Pascasio, CFO
(DRAFT
2014.
CITY OF LUBBOCK
A Municipal Corporation
GLEN C. ROBERTSON, MAYOR
ATTEST:
Rebecca Garza, City Secretary
Lc citywulmde/Tax Abatement A€ a—X-Fab2014
July 21, 2014
APPROVED AS TO CONTENT:
Cheryl Brock, Executive Director of Budget
APPROVED AS TO FORM:
Linda L. Chamales, Economic
Development Attorney
DRAFT