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HomeMy WebLinkAboutResolution - 2007-R0239 - Approve LEDA Bylaw Amendments - 06/14/2007Resolution No. 2007-RO239 June 14, 2007 Item No. 5.23 RESOLUTION BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK: THAT the Amendments to the Bylaws of Lubbock Economic Development Alliance, Inc. dated January 22, 2007 are hereby approved by the City Council of the City of Lubbock. Said Amendments to the Bylaws are attached hereto and incorporated in this Resolution as if fully set forth herein and shall be included in the minutes of the Council. Passed by the City Council this 14th day of June, 2007. DAVID A. MILLIKR, MAYOR ATTEST: Garza, City S APPR VE AS O CONTENT: Robon, Assis anity Manager, Development Services APPROVED AS TO FORM:: Linda L. Chamales, Senior Attorney Office Practice Section City Att.: Linda Res-LEDA Bylaws amendment 2007 May 30, 2007 Resolution No. 2007-RO239 RESOLUTION TO AMEND BY-LAWS OF LUBBOCK ECONOMIC DEVELOPMENT ALLIANCE, INC. Since the inception of LUBBOCK ECONOMIC DEVELOPMENT ALLIANCE, INC. ("LEDA"), its primary governing statue, Tex. Rev. C. Stat., Article 5190.6 (the "Act") has continued to undergo significant changes and amendments with almost every legislative session. Such statutory modifications have caused the LEDA Board of Directors to review its By -Laws to maintain compliance with its corporate purposes as mandated by the Act. It is the determination of the LEDA Board of Directors that Article VIII and Article IX of the By -Laws of LEDA should be amended to provide more flexibility and, thereby, provide for the expanded purpose of the Act as stated in recent amendments. A strict construction of Article VIII and Article IX of the By -Laws could lead to the mistaken conclusion that LEDA can only provide direct incentives to participant corporations for the creation of new jobs, which is not the spirit or intent of the Act or the purposes for which LEDA was formed. Specifically, Article VIII states: "ARTICLE VIII RECAPTURE OF INCENTIVES PROVIDED Each entity, which is financially assisted in any manner by the Corporation, shall provide to the Corporation the number ofjobs to be created, the capital investment to be made in the City and the time period in which the entity agrees to maintain that number ofjobs and the capital investment in the City. The Corporation, before agreeing to provide any financial assistance to an entity, shall require the entity to execute a contract whereby the entity shall pay back to the Corporation all or part of the financial assistance expended by the Corporation, if the number of jobs agreed to, the amount of capital investment and the time period for maintaining the jobs and capital investment are not satisfied" Specifically, Article IX states: "ARTICLE IX SPECIFIC TERMS OF AGREEMENTS An agreement made under these Bylaws between the Corporation and another entity must: describe all proposed improvements on the property in question; b. list the number of jobs to be created by the entity; RESOLUTION TO AMEND BY-LAWS Page 1 C. provide access to and authorize inspection of the property by employees of the Corporation and the Board of Directors, or their agents or designees, to ensure compliance with the terms of the agreement; d. the uses of the property in question shall be consistent with the general purpose of encouraging development or redevelopment; e. provide for recapturing all or part of any financial incentives as a result of the agreement if the recipient of the funds fails to employ the number of employees, or fails to make the improvements as provided by the agreement; f. contain each term agreed to by the recipient of the funds and the Corporation; g. require the recipient of the funds to certify annually to the Board of Directors and the Corporation that the recipient of the funds is in compliance with each applicable term of the agreement; and h. provide that the Corporation may cancel or modify the agreement if the recipient of the funds fails to comply with the agreement." The Act, as amended, has redefined the term "project" to require the support of Section 4A development corporations to incent projects that result in the "creation and retention of primary jobs." (Tex. H.B. 2912, 78°i Leg. R.S. (2003).) Not all "projects" contain this requirement. The Act further specifically allows funding for land, buildings, equipment, facilities, expenditures, targeted infrastructure, and improvements that are for the creation or retention of primary jobs as determined by the Board of Directors and found to be required or suitable for the development, retention, or expansion of specified projects. (Tex. S. B. 252, 79`x' Leg. R. S. 2005).) In particular, job training classes, certain infrastructure improvements, and career centers need not be conditioned upon the creation or retention of primary jobs. With the advent of Lubbock Business Park and Lubbock Rail Port, as well as expected and continued amendments to the Act, LEDA's Board of Directors has unanimously approved the following amendments to Article VIII and Article IX of the By -Laws and by this Resolution seeks the approval of the City of Lubbock as follows: BE IT RESOLVED that Article VIII of the By -Laws shall be and is hereby amended to read as follows: RESOLUTION TO AMEND BY-LAWS Page 2 "ARTICLE VIII RECAPTURE OF INCENTIVES PROVIDED Where applicable and in compliance and in conformity with the Development Corporation Act of 1979, as amended (the "Act"), each recipient of financial assistance or costs advanced or paid toward a recipient's project shall provide the Corporation with representations as to the purpose for which incentives are requested and projections regarding the creation or retention of primaryjobs as defined in the Act. The manner and method of recapture or repayment by recipient as to any unfulfilled representation regarding the project or creation or retention of primary jobs or other representation remaining unfulfilled due to termination or abandonment of the project shall also be specifically set forth when required by the Act." BE IT RESOLVED that Article IX of the By -Laws shall be and is hereby amended to read as follows: "ARTICLE IX SPECIFIC TERMS OF AGREEMENTS Where applicable and in compliance and in conformity with the Development Corporation Act of 1979, as amended (the "Act"), the Corporation shall require each recipient of any financial incentives from the Corporation to enter into a written contract or Performance Agreement or other arrangement sufficient to insure that the funds advanced are used for the intended and authorized purposes in furtherance of a permissible Section 4A project. Any such contract, Performance Agreement, or other arrangement must, at a minimum, contain the provisions as required by the terms of the Act as of the date of execution." The two foregoing Resolutions were unanimously approved by the Lubbock Economic Development Alliance, Inc.'s Board of Directors at its monthly meeting held on January 22, 2007. 1"_M11,4J1 LI y �' Sig ed: D�aKaAfdeTs on, Chairman Signed: Gary C'Lawrence LEDA President and CEO RESOLUTION TO AMEND BY-LAWS Page 3 ATTEST: Original attested by Susan Snead. Gary Lawrence, CEO and President, has attested this docu ent as a result of Susan Snead's resignation as CFO of Lubbock Economic Development APIMca.Inc. Gary C. Vawrence The foregoing amendments to Article VIII and Article IX of the By -Laws of Lubbock Economic Development Alliance, Inc., were approved by the Lubbock City Council at its meeting held on June 14, 2007 David MilKer Mayor of Lubbock ATTEST: ecca Garza Secretary RESOLUTION TO AMEND BY-LAWS Page 4