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HomeMy WebLinkAboutResolution - 2007-R0363 - Give Notice Of Intent - Enter Tax Abatement Agreement - Essential Home Health - 08/09/2007Resolution No. 2007-RO363 August 9, 2007 Item No. 5.6 RESOLUTION WHEREAS, the City Council has detcrmined to give notice of its intent to enter into a Tax Abatement Agreement with Essential Home Health.; 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 Essential Home Health, said notice to be given to the presiding officers of each governing body of each taxing unit having jurisdiction in assessing taxes on 2501 Baylor, which is further described as Hinson Block 35 Lot 6 and 7, Lubbock County, Texas. Passed by the City Council this 9th day of August 2007. DAVID A AILLER, MAYOR ATTEST: 'Rebecca G rza, City Secretary CONTENT: k Robison, Amity Manager Development Services APPROVED AS TO FORM: Linda L. Chamales, Senior Attorney Office Practice Section Resolution No. 2007-R0363 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 LOCATED AT 2501 BAYLOR WHICH IS FURTHER DESCRIBED AS HINSON BLOCK 35 LOT 6 AND 7, LUBBOCK COUNTY, TEXAS Notice is hereby given that the City Council of the City of Lubbock intends to enter into an Agreement with Essential Home Health 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 Essential Home Health for tax abatement, a draft copy of said Agreement is attached to this notice as Exhibit "A-1" 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 23 d day of August, 2007, at approximately 9:30 o'clock a.m. Resolution No. 2007-RO363 EXHIBIT A-1 AGREEMENT STATE OF TEXAS § COUNTY OF LUBBOCK This Agreement made this day of , 2007, by and between the City of Lubbock, Texas, a home rule municipality of the State of Texas (hereinafter called "City") and Raul and Josie Alvarado dba Essential Horne Health. (hereinafter called "Company"); WITNESSETH: WHEREAS, City did receive from Company on the 21" day of February, 2007, an application for commercial tax abatement for the construction of a new facility at 2501 Baylor , which is further described as Hinson Block 35 Lot 6 and 7, Lubbock County, Texas (attached as Exhibit "A"). WHEREAS, upon review of the above application, it was determined that facilities would be located in the Lubbock 2000 North Enterprise Zone designated by City in its Ordinance No. 2000-00032; and WHEREAS, the Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones in the City of Lubbock were heretofore adopted by Resolution No. 2005-80420 of the City Council of the City of Lubbock, a copy of which 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 312.2011; and WHEREAS, the City did comply with all of the criteria and guidelines for creation of an enterprise zone as set forth in Chapter 2303, Subchapter C of the Texas Enterprise Zone Act, Texas Government Code, having adopted Ordinance No. 2000-00032 of the City on June 8, 2000, which ordinance includes 2501 Baylor. WHEREAS, V.A.T.C., Tax Code, Sec. 312.2011 provides 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 construction of a new 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 Commercial Projects in Designated Enterprise Zones adopted by the City Council by Resolution No. 2005-110420, does recognize construction of a new facility as being eligible for commercial tax abatement status; 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. 2005-RO420 and attached as Exhibit "B" have been met by Company; and WHEREAS, Company does intend to construct a new facility; and WHEREAS, the location of the existing facility and surrounding real property, which are to be the subject matter of the Agreement, are attached hereto as Exhibit "A", and made a part of this Agreement for all purposes; and WHEREAS, the City Council finds that entering into this Agreement to abate taxes on the property described in Exhibit "A" will promote high quality commercial development in the City, and enhance economic development within the designated Enterprise Zone; and AGREEMENT — ESSENTIAL HOME HEALTH 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. Recitations. The parties agree that the recitations above in this agreement are true and correct and shall be incorporated into this Agreement. SECTION 2. Term. This Agreement shall remain in force and effect for a period of five (5) years from the date of its commencement as set forth in Section 12, and shall expire and be of no further force and effect after said date. SECTION 3. Base Year. The base year applicable to real property, which is the subject of the Agreement, shall be 2007, and the assessed value of the real property shall be the assessed value applicable to such property for said year. SECTION 4. 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 5. 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 6. 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 attached as Exhibit B, is property ineligible for tax abatement. SECTION 7. Exemption from Tax. The City covenants and agrees to exempt from taxation, in accordance with Section 5 above, the following properties: AGREEMENT - ESSENTIAL HOME HEALTH Page 3 (a) All proposed new construction located at 2501 Baylor, Hinson Block 35 Lots 6 and 7, Lubbock County, Texas, which is further described in Exhibit "All (b) All eligible tangible personal property placed in or upon the property set forth in Exhibit "A", except for any equipment and personal property currently owned by the company and located in the existing facility. (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 Section 11 of this Agreement. SECTION 8. Economic Qualification. Company agrees to expend funds necessary to qualify for tax abatement by constructing a new facility, as set forth in Section IV(9)(a) of the Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones 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 Company's Application, Exhibit "C" and incorporated herein as if fully set forth. SECTION 9. Valuc of Improvements. Company agrees to expend two hundred and fifty thousand dollars ($250,000) in constructing a new facility to be located within the Enterprise Zone created by Ordinance No. 2000-00032. SECTION 10. Electricity 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. SECTION 11. City Access to Property. 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 AGREEMENT - ESSENTIAL HOME HEALTH Page 4 to insure that the improvements are being made in accordance with the terms and conditions of Company's application for commercial tax abatement, attached as Exhibit "C", and this Agreement. SECTION 12. Portion of Tax Abated. City agrees, during the term of this Agreement, to abate taxes on eligible property according to the following schedule: Year l: 100% Year 2: 80% Year 3: 60% Year 4: 40% Year 5: 20% SECTION 13. Commencement Date. This Agreement shall commence upon the January 1 st following the substantial completion of construction and shall expire five (5) years after such date. Company shall provide certification of completion in writing both to the City and to the Lubbock Central Appraisal District within ten (10) days of completion of the project. SECTION 14. Type of Improvements. The Company proposes to construct a new facility as described in Exhibit "C". The Company further states that the proposed improvements to the property above mentioned shall commence on the 28th day of June, 2007, and shall be completed within approximately seven (7) months from said date. The 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. SECTION 15. 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 by January 31, 2008. SECTION 16. Limitation on Use. Company agrees to limit the use of the property set forth in Exhibit "A" to the proposed commercial uses and to limit the uses of the AGREEMENT - ESSENTIAL HOME HEALTH Page 5 property to uses consistent with the general purpose of encouraging development of the designated Enterprise Zone during the term of this Agreement. SECTION 17. 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 Company pursuant to law and as set forth in Guidelines and Criteria Governing Tax Abatement for Commercial Projects in Designated Enterprise Zones adopted by Resolution No. 2405-RO420 of the City Council of the City of Lubbock. (Exhibit B). SECTION 18. Certification. The Company agrees to certify annually to the governing body of each taxing unit that the owner is in compliance with the terms of the Agreement. SECTION 19. Compliance. The City may cancel or modify this Agreement upon sixty (60) days written notice, as set forth in Section VII of Exhibit B, if the Company fails to comply with any of the terms of this 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 ESSENTIAL HOME HEALTH Assistant City Manager, Raul and Josie Alvarado Development Services 6106 Elkhart Avenue Lubbock, TX 79452 Lubbock, TX 79424 SECTION 20. 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. AGREEMENT — ESSENTIAL HOME HEALTH Page 6 EXECUTED this day of ESSENTIAL HOME HEALTH RAUL ALVARADO JOSIE ALVARADO DRAFT ONLY -- DO NOT EXECUTE 2007. CITY OF LUBBOCK A Municipal Corporation DAVID A MILLER, MAYOR ATTEST: Rebecca Garza City Secretary APPROVED AS TO CONTENT: Rob Allison, Assistant City Manager Development Services APPROVED A5 TO FORM: Linda Chamales, Senior Attorney Office Practice Section Page 7