HomeMy WebLinkAboutResolution - 2007-R0514 - Approve Guidelines And Criteria Governing Tax Abatement For Industrial Projects - 11/08/2007Resolution No. 2007-80514
November 8, 2007
Item No. 5.7
RESOLUTION
WHEREAS, in September of 2005, the City of Lubbock approved uniform guidelines
and criteria for tax abatement for industrial projects within the City of Lubbock; and
WHEREAS, state law requires that the guidelines and criteria approved must be re-
adopted every two years, and the City of Lubbock desires to approve new guidelines for
industrial tax abatement; NOW THEREFORE:
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF LUBBOCK:
THAT the City Council of the City of Lubbock hereby approves and adopts "Guidelines
and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock", which
guidelines and criteria are attached as Exhibit "A" and are made a part hereof for all intents and
purposes. These guidelines shall become effective immediately.
Passed by the City Council this 8th day of November, 2007.
/ W.,
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DAVID A. NOLLER, MAYOR
ATTEST:
Reb:cca Garza, City Secretary
APPR VED AS O CONTENT;
cs-t�
Rob Alli n, Assistan City Manager
Development Services
APPROVED AS TO FORM:
Linda Chamales, Senior Attorney
Office Practice Section
Lc: city att/L indalResolutions/Res-Tax AbatementlndustrialGuidelines-2007
Exhibit"A" Resolution No. 2007—RO514
Guidelines and Criteria Governing Tax Abatement For
Industrial Projects In The City of Lubbock
SECTION L General Purpose:
The City of Lubbock is committed to the promotion of high quality development in all parts of the City of
Lubbock, Texas; and to an ongoing improvement in the quality of life for the citizens residing within the
Affected Jurisdiction. The Affected Jurisdiction recognize that these objectives are generally served by
enhancement and expansion of the local economy. The Affected Jurisdiction will, on a case by case basis,
give consideration to providing tax abatement, as authorized by V.T.C.A., Tax Code, Chapter 312, as
stimulation for economic development within the Affected Jurisdiction. It is the policy of the Affected
Jurisdiction that said consideration will be provided in accordance with the guidelines and criteria herein set
forth and in conformity with the Tax Code.
Nothing contained herein shall imply, suggest or be understood to mean THAT the Affected Jurisdiction is
under any obligation to provide tax abatement to any applicant and attention is called to V.T.C.A., Tax
Code, Section 312.002(d). With the above rights reserved all applications for tax abatement will be
considered on a case by case basis.
SECTION 11. Definitions:
As used within these guidelines and criteria, the following words or phrases shall have the following
meaning:
1. Abatement of Taxes: To exempt from ad valorem taxation all or part of the value of certain
Improvements placed on land located in a reinvestment zone designated for economic
development purposes as of the date specified in the Tax Abatement Agreement for a period
of time not to exceed ten (10) years.
2. Affected Jurisdiction: City of Lubbock.
3. Abatement Agreement: (1) A contract between a property owner and an Affected
Jurisdiction for the abatement of taxes on qualified property located within a reinvestment
zone; or, (2) a contract for the abatement of taxes between an Affected Jurisdiction and a
certified air carrier who owns or leases Real Property located within the reinvestment zone or
Personal Property or both as authorized by V.T.C.A., Tax Code, Section 312.204(e)
4. Advanced Technologies: advanced manufacturing which requires higher skills and results in
higher wages and investment.
5. Base Year Value: The assessed value of property eligible for tax abatement as of January 1
preceding the execution of an Abatement Agreement as herein defined.
6. Distribution Center Facility: A building or structure including Tangible Personal Property
used or to be used primarily to receive, store, service or distribute goods or materials.
7. Expansion of Existing Facilities or Structures: The addition of buildings, structures,
machinery or equipment to a Facility.
8. Existing Facility or Structure: A facility as of the date of execution of the Tax Abatement
Agreement, located in or on Real Property eligible for tax abatement.
2007 Industrial Tax Abatement Guidelines
November 8, 2007
9. Facility: The improvements made to Real Property eligible for tax abatement and including
the building or structure erected on such Real Property and/or any Tangible Personal Property
to be located in or on such property.
10. Information and Data Center: Facility used to house computer systems and associated
components, such as telecommunications and storage systems. The main purpose of the
facility is running applications that handle the core business and operational data of
organizations, off-site backups and other informational operations.
It. Improvements to Real Property or Improvements Shall mean the construction, addition to,
structural upgrading of, replacement of, or completion of any facility located upon, or to be
located upon, Real Property, as herein defined, or any Tangible Personal Property placed in or
on said Real Property.
12. Manufacturing Facility: A Facility which is or will be used for the primary purpose of the
production of goods or materials or the processing or change of goods or materials to a
finished product.
13. Medical Services: Facilities such as hospitals, specialty hospitals and other like facilities that
are classified under North American Industrial Classification System Code 622.
14. Modern ization/Renovation of Existing Facilities: The replacement or upgrading of existing
facilities.
15. New Facility: The construction of a Facility on previously undeveloped real property eligible
for tax abatement.
16. New Permanent Job: A new employment position created by a business that has provided
employment to an employee of at least 1,820 hours annually and intended to be an
employment position that exists during the life of the abatement.
17. Other Basic Industry: A Facility other than a distribution center facility, a research facility, a
regional service facility or a manufacturing facility which produces goods or services or which
creates new or expanded job opportunities and services a market of which 50% of revenues
come from outside of Lubbock County, Texas.
18. Owner: The record title owner of Real Property or the legal owner of Tangible Personal
Property. In the case of land leased from an Affected Jurisdiction or buildings leased from a
private party or tax exempt property, the lessee shall be deemed the owner of such leased
property together with all improvements and Tangible Personal Property located thereon.
19. Productive Life: The number of years a Facility is expected to be in service.
20. Real Property: Land on which Improvements are to be made or fixtures placed.
21. Regional Services Facility: A Facility, the primary purpose of which is to service or repair
goods or materials and which creates job opportunities within the Affected Jurisdictions.
22. Reinvestment Zone: Real Property designated as a Reinvestment Zone under the provisions
of V.T.C.A., Tax Code, Section 312.202.
2007 Industrial Tax Abatement Guidelines
November S, 2007
23. Research Facility: A Facility used or to be used primarily for research or experimentation to
improve or develop new goods and/or services or to improve or develop the production
process for such goods and/or services.
24. Tangible Personal Property: Any Personal Property, not otherwise defined herein and which
is necessary for the proper operation of any type of Facility.
SECTION III. Intent of Criteria and Guidelines:
The Intent of the criteria and guidelines, as herein set forth, is to establish the minimum standards which an
applicant for tax abatement must meet in order to be considered for such status by the Affected Jurisdiction.
SECTION IV, Criteria and Guidelines for Tax Abatement:
Any type of Facility will be eligible for tax abatement consideration provided such Facility meets the
following guidelines and criteria:
1. To qualify for Tax Abatement, the company must meetboth of the following criteria:
a) The modernization or expansion of an existing facility of any type as herein defined or
construction of a new facility of any type as herein defined.
b) Producer, manufacturer or distributor of goods and services of which 50 percent or more
are distributed outside of Lubbock County.
2. In addition to the aforementioned, the taxing jurisdiction will consider abatement only if the
company meets one of the following criteria:
a) One of the following target industries:
i) Advanced Technologies and Manufacturing
ii) Value-added Agricultural Production including Food Processing and Machinery
iii) Research and Development
iv) Medical Services (as defined in Section 11 Definitions)
v) Warehouse/Distribution
vi) Corporate Headquarters of a Regional/National Service Center
vii) Information and Data Centers
b) The project is not included as a target industry, but has the potential of generating
additional significant economic development opportunities to Lubbock
3. The company must meet one of the following criteria:
a) The project will add at least $1 million in real property improvements, or $2
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million in new personal property, or 25 new permanent jobs if the
facility is a new company to Lubbock.
b) The project will add at least $500,000 in real property improvements, or $1 million in
new personal property, or 15 new permanent jobs if the facility is an existing company.
4. New or existing facilities,of any type herein defined, located in a reinvestment zone or upon
Real Property eligible for such status will be eligible for consideration for tax abatement status
provided that all other criteria and guidelines are satisfied
5. Improvements to Real Property are eligible for tax abatement status.
6. The following types of Property shall be ineligible for tax abatement status and shall be fully
taxed.
a) Real Property;
b) inventories or supplies;
C) tools;
d) furnishings and other forms of movable personal property;
e) vehicles;
f) aircraft;
g) housing;
h) boats;
i) hotel accommodations;
j) motel accommodations;
k) retail businesses;
1) property owned by the State of Texas or any State agency; and,
m) property owned or leased by a member of the affected Jurisdiction that did not have an
active tax abatement in place before they became a member of the governing body or
commission.
7. In order for a Facility to qualify for abatement, the following conditions must apply:
a) The owner or leaseholder of real property must make eligible improvements to the real
property; and,
b) In the case of lessees, the leaseholder must have a lease commitment of at least five (5)
years.
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2007 industrial Tax Abatement Guidelines
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c) It is recommended that facilities located within the certificated territory of the City's
municipally owned electric utility, Lubbock Power and Light (LP&L) utilize LP&L for
electrical services during the term of the abatement.
In reinvestment zones, the amount and term of abatement shall be determined on a case by
case basis, however, in no event shall taxes be abated for a term in excess of ten (10) years.
The amount of the taxable value of Improvements to be abated and the term of the abatement
shall be determined by the municipality in all cases where the property for which tax
abatement is applied for is within the City limits of the City or by the County of Lubbock in all
cases where the property for which tax abatement is applied for is outside of the City limits of
a municipality, but within the County of Lubbock, except that a reinvestment zone that is a
state enterprise zone is designated for the same period as a state enterprise zone as provided
by Chapter 2303, Government Code. The authority of all other taxing units shall be as set
forth in V.T.C.A., Tax Code, Section 312.206.
In enterprise zones, the governing body of each taxing jurisdiction may execute a written
agreement with the owner of the property. The agreement may, but is not required to, contain
terms that are identical to those contained in the agreement with the municipality, county, or
both, whichever applies, and the only terms for the agreement that may vary are the portion of
the property that is to be exempt from taxation under the agreement and the duration of the
agreement.
9. No property shall be eligible for tax abatement unless such property is located in a
reinvestment zone in accordance with V.T.C.A., Tax Code, Section 312.202 and the tax
abatement application is filed with the taxing jurisdiction before construction begins.
10. Notwithstanding any of the requirements set forth in Section IV Subsection 3, the governing
body of an Affected Jurisdiction upon the affirmative vote of a three-fourths (314) of its
members may vary any of the above requirements when variation is demonstrated by the
applicant for Tax Abatement that variation is in the best interest of the Affected Jurisdiction to
do so and will enhance the economic development of the Affected Jurisdiction. By way of
example only and not by limitation the governing body of an Affected Jurisdiction may
consider the following or similar terms in determining whether a variance shall be granted;
a) That the increase in productivity of the Facility will be substantial and hence directly
benefit the economy.
b) That the increase of goods or services produced by the Facility will be substantial and
directly benefit the economy.
c) That the employment maintained at the Facility will be increased.
d) That the waiver of the requirement will contribute and provide for the retention of
existing jobs within the Affected Jurisdiction.
e) Any other evidence tending to show a direct economic benefit to the Affected
Jurisdiction.
11. Taxability:
a) The portion of the value of improvements to be abated shall be abated in accordance with
the terms and provisions of a Tax Abatement Agreement executed between the Affected
Jurisdiction and the owner of the Real Property and/or Tangible Personal Property,
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9. any combination of these factors;
a) Be predominantly open and, because of obsolete platting, deterioration of
structures or site improvements, or other factors, substantially impair or arrest
the sound growth of the municipality;
b) Be in a federally assisted new community located in a home rule municipality or
in an area immediately adjacent to a federally assisted new community located in
a home rule municipality;
c) Be located entirely in an area that meets the requirements for federal assistance
under Section 1 19 of the Housing and Community Development Act of 1974 (42
U.S.C. Section 5318);
d) Encompass signs, billboards, or other outdoor advertising structures designated
by the governing body of the municipality for relocation, reconstruction, or
removal for the purpose of enhancing the physical environment of the
municipality, which the legislature declaresto be a public purpose; or,
e) Be reasonably likely as a result of the designation to contribute to the retention
or expansion of primary employment or to attract major investment in the zone
that would be a benefit to the property and that would contribute to the economic
development of the municipality.
2. For purposes of this Section, federally assisted new community is a federally assisted area:
a) That has received or will receive assistance in the form of loan guarantees under Title X
of the National Housing Act (12 U.S.C., Section 1749aa et seq); and,
b) A portion of which has received grants under Section 107 (a)(1) of the Housing and
Community Development Act of 1974, as amended.
3. The governing body of a municipality, as required by Section 312.201, or a county, as
required by V.T.C.A., Tax Code, Section 312.401, shall hold a public hearing on the
designation of an area within its jurisdiction as a reinvestment zone. The burden shall be on
the owner of the property sought to be included in the zone or applicant for the creation of the
reinvestment zone to establish the following:
a) That the requirements of Subsection I of this Section have been met.
b) That the improvements sought are feasible and practical.
4. No later than the seventh day before the date set for the above public hearing notice of such
hearing shall be:
a) Published in a newspaper having general circulation in the Affected Jurisdiction.
b) Delivered in writing to the presiding officer of the governing body of each taxing unit that
includes in its boundaries Real Property that is to be included in the reinvestment zone.
5. At the public hearing above described in Subsection 3 above, any interested person is entitled
to speak and present evidence for or against the designation of such reinvestment zone.
2007 Industrial Tax Abatement Guidelines
November 8, 2007
6. At the conclusion of the hearing described in Subparagraph 3 above, the governing body shall
enter its findings as follows:
a) That the applicant or owner has or has not met his burden as hereinabove set forth, and/or,
b) That the improvements sought are or ate not feasible and practical.
c) That the proposed improvements sought will or will not be a benefit to the land to be
included in the reinvestment zone and to the Affected Jurisdiction after the expiration of
an agreement entered into under V.T.C.A., Tax Code, Section 312.204.
7. An application for the creation of a reinvestment zone shall not be granted unless the Affected
Jurisdiction considering such application enters affirmative findings to Subparagraphs a, b,
and c of Subsection 6 above set forth.
8. At the conclusion of the public hearing herein required and upon the affirmative finding of the
governing body as required by Subsection 7 above set forth, the goveming body may
designate a reinvestment zone in accordance with the provisions of V.T.C.A., Tax Code,
Sections 312.201 or 312.401, whichever Section shall be applicable under the premises.
The designation of a reinvestment zone expires five years after the date of the designation and
may be renewed for periods not to exceed five years, except that a reinvestment zone that is a
state enterprise zone is designated for the same period as a state enterprise zone as provided
by Chapter 2303, Government Code. The expiration of the designation does not affect an
existing tax abatement agreement made in accordance with V.T.C.A., Tax Code, Section
312.201 through Section 312.209.
10. Designation of an area as an enterprise zone under the Texas Enterprise Zone Act, Chapter
2303, Subchapter C, Texas Government Code, constitutes designation of the area as a
reinvestment zone under Subchapter B of the Property redevelopment and Tax Abatement
Act without further hearing or other procedural requirements other than those provided by the
Texas Enterprise Zone Act, Chapter 2303, Subchapter C, Texas Government Code.
SECTION VI. Tax Abatement Agreement:
After the creation of a reinvestment zone as hereinabove authorized a Tax Abatement
Agreement may be executed between the owner and any Affected Jurisdiction. A Tax
Abatement Agreement shall:
a) Establish and set forth the Base Year assessed value of the property for which tax
abatement is sought.
b) Provide that the taxes paid on the base year assessed value shall not he abated as a result
of the execution of said Tax Abatement Agreement.
c) Provide that ineligible property as subscribed in Section IV, Subsection 6, hereinabove
shall be fully taxed.
d) Provide for the exemption of Improvements in each year covered by the agreement only
to the extent the value of such Improvements for each such year exceeds the value for the
year in which the agreement is executed.
2007 Industrial Tax Abatement Guidelines
November 8, 2007
e) Fully describe and list the kind, number and location of all of the improvements to be
made in or on the Real Property.
f) Set forth the estimated value of all improvements to be made in or on the Real Property.
g) Clearly provide that tax abatement shall be granted only to the extent:
1. The Improvements to Real Property increase the value of the Real Property for the
year in which the Tax Abatement Agreement is executed; and,
2. That the Tangible Personal Property improvements to Real Property were not located
on the Real Property prior to the execution of the Tax Abatement Agreement.
h) Provide for the portion of the value of the improvements to Real Property of
improvements to be abated. This determination is to be made consistent with the
provisions of Section IV, Subsection b, of these guidelines and criteria as hereinabove set
forth.
i) Provide for the commencement date and the termination date. In no event shall said dates
exceed a period of ten years.
j) Describe the type and proposed use of the improvements to Real Property or
improvements including:
1. The type of facility.
2. Whether the improvements are for anew facility, modernization of a facility, or
expansion of a facility.
3. The nature of the construction, proposed time table of completion, a map or drawings
of the improvements above mentioned.
4. The amount of investment and the commitment for the creation of new jobs.
5. A list containing the kind, number and location of all proposed Improvements.
t. Any other information required by the Affected Jurisdiction.
k) Provide a legal description of the Real Property upon which improvements are to be
made.
1) Provide access to and authorize inspection of the Real Property or improvements by
employees of the Affected Jurisdiction, who have executed a Tax Abatement Agreement
with owner to insure improvements are made according to the specifications and
conditions of the Tax Abatement Agreement.
m) Provide for the limitation of the uses of the Real Property or improvements consistent
with the general purpose of encouraging development or redevelopment of the zone
during the period covered by the Tax Abatement Agreement.
n) Provide the contractual obligations in the event of default by owner, violation of the terms
or conditions by owner, recapturing property tax revenue in the event owner defaults or
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otherwise fails to make improvements as provided in said Tax Abatement Agreement, and
any other provision as may be required or authorized by State Law.
o) Contain each term agreed to by the owner of the property.
p) Require the owner of the property to certify annually to the governing body of each taxing
unit that the owner is in compliance with each applicable term of the agreement.
q) Provide that the governing body of the municipality may cancel or modify the agreement
if the property owner fails to comply with the agreement.
2. Not later than the seventh day before a municipality or the County of Lubbock(as required by
V.T.C.A., Tax Code, Section 312.2041 or Section 312.402) enters into an agreement for tax
abatement under V.T.C.A., Tax Code, Section 312.204, the governing body of a municipality
or a designated officer or employee thereof or the governing body of the county of Lubbock or
a designated officer or employee thereof shall deliver to the presiding officer of the governing
body of each of the taxing units in which the property to be subject to the agreement is
located, a written notice that the municipality or the County of Lubbock as the case may be,
intends to enter into the agreement. The notice must include a copy of the proposed Tax
Abatement Agreement.
3. A notice, as above described in Subparagraph 2, is presumed delivered when placed in the
mail, postage paid and properly addressed to the appropriate presiding officer. A notice
properly addressed and sent by registered or certified mail for which a return receipt is
received by the sender is considered to have been delivered to the addressee.
4. Failure to deliver the notice does not affect the validity of the agreement.
SECTION VII. Application:
Any present owner of taxable property located within an Affected Jurisdiction may apply for
tax abatement by filing an application with the county of Lubbock, when the Real Property or
Tangible Personal Property for which abatement is sought is located within the County of
Lubbock but outside of the City limits of any City or with the appropriate City when the Real
Property or Tangible Personal Property for which abatement is sought is located within the
City limits of a municipality located whollyor partially within Lubbock County.
2. The application shall consist of a completed application form accompanied by:
a) A general description of the improvements to be undertaken.
b) A descriptive list of the improvements for which tax abatement is requested.
c) A list of the kind, number and location of all proposed improvements of the Real Property
Facility or Existing Facility.
d) A map indicating the approximate location of improvements on the Real Property Facility
or Existing Facility together with the location of any or all Existing Facilities located on
the Real Property or Facility.
e) A list of any and all Tangible Personal Property presently existing on the Real Property or
located in an existing facility.
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f) A proposed time schedule for undertaking and completing the proposed improvements.
g) A general description stating whether the proposed improvements are in connection with:
1. the modernization of a facility (of any type herein defined); or,
2. construction of a new facility (of any type herein defined); or,
3. expansion of a facility (of any type herein defined); or,
4, any combination of the above.
h) A statement of the additional value to the Real Property or Facility as a result of the
proposed improvements.
i) A statement of the assessed value of the Real Property, Facility or Existing Facility for the
Base Year.
j) Information concerning the number of new jobs that will be created or information
concerning the number of existing jobs to be retained as result of the improvements
undertaken.
k) Any other information which the Affected Jurisdiction, to which the application has been
directed, deems appropriate for evaluating the financial capacity of the applicant and
compatibility of the proposed improvements with these guidelines and criteria.
1) Information that is provided to an Affected Jurisdiction in connection with an application
or request. for tax abatement and which describes the specific processes or business
activity to be conducted or the equipment or other property to be located on the property
for which tax abatement is sought is confidential and not subject to public disclosure until
the Tax Abatement Agreement is executed. Information in the custody of an Affected
Jurisdiction after the agreement is executed is not confidential. (V.T.C.A., Tax Code,
Section 312.003).
m) The Affected Jurisdiction to whom the application for tax abatement has been directed
shall determine if the property described in said application is within a designated
reinvestment zone. If the Affected Jurisdiction determines that the property described is
not within a current reinvestment zone then they shall so notify the applicant and said
application shall then be considered both as an application for the creation of a
reinvestment zone and a request for tax abatement to be effective after the zone is created.
SECTION VIII. Default Options
1. In the event that the applicant, owner or lessee has entered into a tax abatement agreement to
make improvements as defined in Section IV.2 above, but fails to undertake or complete such
improvements; fails to create all or a portion of the new jabs provided by the Tax Abatement
Agreement; or is in default of any of the terms or conditions contained in the Tax Abatement
Agreement; then in such event the Affected Jurisdiction to whom the application for tax
abatements 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
2007 Industrial Tax Abatement Guidelines
November 8, 2007
within the sixty (60) days above mentioned. In the event the applicant owner, or lessee fails to
demonstrate that he is taking affirmative action to cure his failure, the Affected Jurisdiction
shall have three options:
(a) The Affected Jurisdiction may renegotiate the Agreement with the applicant, owner or
lessee, in which case the current Guidelines and Criteria Governing Tax Abatement for
Commercial Projects in Designated Enterprise Zones shall apply to the new Agreement;
or
(b) The Affected Jurisdiction may determine that good cause exists to cancel the Agreement
and all abatement of taxes shall terminate immediately; or
(c) The Affected Jurisdiction may terminate the Agreement and recapture taxes abated under
Section VIII. Recapture.
In any of the three options in subparagraph I above, the Affected Jurisdiction to which the
application for tax abatement was directed shall determine whether default has occurred by the
applicant, owner or lessee in the terms and conditions of the Tax Abatement Agreement and
shall so notify all other Affected Jurisdictions. Cancellation or termination of the Tax
Abatement Agreement by the Affected Jurisdiction to which the application for tax abatement
was directed shall constitute simultaneous action to all Tax Abatement Agreements of all other
Affected Jurisdictions.
SECTION IX. Recapture
In the event that any type of facility, (as defined in 'Section 11, Subparagraphs 5, 6, 7, 8, 10, 11,
12, 14, 18, 20) is completed and begins producing goods or services, but subsequently
discontinues producing goods or services for any reason, excepting fire, explosion or other
casualty or accident or natural disaster or other event beyond the reasonable control of
applicant or owner for a period of 180 days during the term of a tax abatement agreement,
then in such even 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 Jurisdiction to who the
application for tax abatement was directed that the discontinuance of producing goods or
services was as a result of fire, explosion, or other casualty or accident of natural disaster or
other event beyond the control of applicant or owner. In the event that 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 vents beyond the control of the applicant or
owner, then such applicant or owner shall have a period of one Y.�ar 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
terminate and the Abatement of all 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 31 st 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
notification from the Affected Jurisdiction to the applicant or owner.
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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 or fails to create all or a portion of the number of new jobs
provided by the Tax Abatement Agreement, 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 January 31 st 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.
In the event that the Affected Jurisdiction to whom application for tax abatement was directed
detennines that the applicant or owner is in default of any of the terms or conditions contained
in the Tax Abatement Agreement, then in such even the Affected Jurisdiction, shall give the
applicant or owner sixty (60) days written notice to cure such default. In the event such
default is not cured to the satisfaction 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 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.
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 even 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 31 st 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.
5. In the even 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 reinvestment 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 termination 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 Subsection 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 Agreement 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.
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2007 Industrial Tax Abatement Guidelines
November 8, 2007
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. Termination of the Tax
Abatement Agreement by the Affected Jurisdiction to which the application for tax abatement
was directed shall constitute simultaneous termination of all Tax Abatement Agreements of all
other Affected Jurisdictions.
8. In the event that a tax abatement agreement is terminated for any reason what so ever and
taxes are not paid within the time period herein specified, then in such event, the provisions of
V.T.C.A., Tax Code, Section 33.41 will apply.
SECTION X. Miscellaneous;
1. Any notice required to be given by these criteria or guidelines shall be given in the following
manner:
a) To the owner or applicant: written notice shall be sent to the address appearing on the Tax
Abatement Agreement.
b) To an Affected Jurisdiction: written notice shall be sent to the address appearing on the
Tax Abatement Agreement.
2. The Chief Appraiser of the Lubbock Central Appraisal District shall annually assess the Real
and Personal Property comprising the reinvestment zone. Each year, the applicant or owner
receiving tax abatement shall furnish the chief Appraiser with such information as may be
necessary for the abatement. Once value has been established, the Chief Appraiser shall
notify the Affected Jurisdictions which levy taxes of the amount of assessment.
3. Upon the completion of improvements made to any type of Facility as set forth in Section
VIII, Subparagraph I of these criteria and guidelines a designated employee or employees of
any Affected Jurisdiction having executed a tax abatement agreement with applicant or owner
shall have access to the Facility to insure compliance with the Tax Abatement Agreement.
4. A tax abatement agreement may be assigned to a new owner but only after written consent has
been obtained from all Affected Jurisdictions which have executed such an agreement with the
applicant or owner.
5. These guidelines and criteria are effective upon the date of their adoption by an Affected
Jurisdiction and shall remain in force for two years. At the end of the two year period these
guidelines and criteria may be readopted, modified, amended or rewritten as the conditions
may warrant.
6. Each Affected Jurisdiction shall determine whether or not said Affected Jurisdiction elects to
become eligible to participate in tax abatement. In the even the Affected Jurisdiction elects by
resolution to become eligible to participate in tax abatement, then such Affected Jurisdiction
shall adopt these guidelines and criteria by separate resolution forwarding a copy of both
resolutions to all other Affected Jurisdictions.
7. In the event of a conflict between these guidelines and criteria and V.T.C.A., Tax Code,
Chapter 312, then in such event the Tax Code shall prevail and these guidelines and criteria
interpreted accordingly.
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2007 Industrial Tax Abatement Guidelines
November 8, 2007
8. The guidelines and criteria once adopted by an Affected Jurisdiction may be amended or
repealed by a vote of three-fourths of the members of the governing body of an Affected
Jurisdiction during the two year tam in which these guidelines and criteria are effective.
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