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Home My WebLink AboutResolution - 2007-R0535 - Give Notice Of Intent To Enter Into Tax Abatement Agreement- Molinos Anahuac Inc - 11/20/2007Resolution No. 2007-80535 November 20, 2007 Item No. 5.16 RESOLUTION WHEREAS, the City Council has determined to give notice of its intent to enter into a Tax Abatement Agreement with Molinos Anahuac, Inc.; 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 Molinos Anahuac, Inc., said notice to be given to the presiding officers of each governing body of each taxing unit having jurisdiction in assessing taxes on 301 Insurance Street, which is further described as Tract A, Railport Addition to the City of Lubbock, Lubbock County, Texas. Passed by the City Council this 20th day of ATTEST: R becca rza, City Secretary APPR VE A TO CONTENT: Rob ison, A s}stant City Manager Development Services APPROVED AS TO FORM: Linda L. Chamales, Senior Attorney Office Practice Section November 2007. GILBREATH, MAYOR PRO TEM Resolution No. 2007-RO535 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 301 INSURANCE WHICH IS FURTHER DESCRIBED AS TRACT A, RAILPORT ADDITION TO THE CITY OF LUBBOCK, LUBBOCK COUNTY, TEXAS Notice is hereby given that the City Council of the City of Lubbock intends to enter into an Agreement with Molinos Anahuac, Inc to abate taxes on improvements to real property located within the reinvestment zone created by Ordinance No. 2006- 00108 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 Molinos Anahuac, Inc. 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 6th day of December 2007, at approximately 9:30 o'clock a.m. Exhibit "A-1" AGREEMENT STATE OF TEXAS § COUNTY OF LUBBOCK § This Agreement made this day of between the City of Lubbock, Texas, a home rule (hereinafter called "City"), and Molinos Anahuac, Inc WITNESSETH: Resolution No. 2007-80535 , 2007, by and municipality of the State of Texas . (hereinafter called "Company"); WHEREAS, City did receive from Company on the 2nd day of May, 2007 an application for tax abatement for improvements to real property and tangible personal property at 301 Insurance Street, Tract A, Railport Addition to the City of Lubbock, Lubbock County, Texas which is further described in Exhibit "A"; and WHEREAS, upon review of the above application it was determined that the facility and real property is located in the Reinvestment Zone designated by the City in Ordinance No. 2006-000108 covering the above described property; and WHEREAS, the Guidelines and Criteria Governing Tax Abatement For Industrial Projects in the City of Lubbock was heretofore adopted by Resolution No. 2007-80514 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 did comply with all the requirements set forth in V.T.C.A.,. Tax Code, Section 312.201; and WHEREAS, the City did comply 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, said guidelines having been adopted by Resolution. No. 2007-RO514 of the City on November 8, 2007; and WHEREAS, the City did pass Ordinance No. 2006-00108 creating a reinvestment zone for commercial and industrial tax abatement, said zone including the area which is described in the attached Exhibit "A"; and WHEREAS, the application received by City from Company is an application for the construction of a new facility; and AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 1 WHEREAS, V.A.T.C., Tax Code, See. 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 adopted by the City Council by Resolution No. 2007-R0514, does recognize construction of a new facility 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. 2007-RO514 have been 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 Company do hereby agree as follows: SECTION 1. Term. This Agreement shall remain in force and effect for a period of five (5) years from January 1 of the tax year after the required improvements are substantially completed 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 this 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 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(6) of the Guidelines and Criteria Governing Tax Abatement for Industrial Projects in the City of Lubbock and heretofore adopted by the City Council by Resolution No. 2007-RO514 is incorporated by reference herein as if fully set out in this Agreement and fully describes the property ineligible for tax abatement. AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 2 SECTION 6. Exemption from Tax. The City covenants and agrees to exempt from taxation, in accordance with Section 4 above, the following properties: (a) Al proposed new improvements to be placed upon the property which is described in Exhibit "A". (b) All eligible tangible personal property, owned by Company, placed in or upon the property set forth in Exhibit "A", which does not include any equipment and personal property owned by Company and already located in a existing facility. (c) It is further understood that all items affixed to the new 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 subparagraph (a) above set forth. SECTION 7. Economic Qualifications. Company agrees to expend funds necessary to qualify for tax abatement by constructing a new facility, as set forth in Section IV(3)(a) 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 Company's application, Exhibit "C" and incorporated herein as if fully set forth. SECTION 8 Job Creation Qualifications. It is hereby found by the City that Company will create and retain 12 new full-time permanent positions within one year of completion of improvements. A description of the number and location of all proposed jobs is attached in Company application, Exhibit "C" and incorporated herein as if fully set forth. SECTION 9. 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, Company will expend one million ($1,000,000) for the construction of a new facility and one million six hundred fifty eight thousand ($1,65$,000) on new equipment to be located within the reinvestment zone created by Ordinance No. 2006-00108. SECTION 10. City Access to Property. Company covenants and agrees that +City shall have access to the property, which are 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 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. AGREEMENT - MOLINOS ANAHUAC, INC. PAGE 3 Year 1: 100% Year 2: $0% Year 3: 60% Year 4: 40% Year 5: 20% SECTION 12. Commencement Date. This Agreement shall commence January 1 of the tax year after the required improvements are substantially completed and shall expire five (5) years after such date. SECTION 13. Type of Improvements. Company proposes to construct a new facility as described in Exhibit "C". Company further states that the proposed improvements to the property above mentioned shall commence on the 6`day of August, 2007, and shall be completed within approximately five (5) months from said date. 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. Company shall provide a copy of the certificate of occupancy or other proof of completion within ten days of completion of improvements. SECTION 14. Limitation on Use. Company 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 15. Recapture. 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 for Tax Abatement adopted by Resolution No. 2007-80514 of the City Council of the City of Lubbock. SECTION 16. Certification. Company 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 17. Compliance. The City may cancel or modify this Agreement if Company fails to comply with the Agreement. AGREEMENT — MOLINOS ANAHUAC, INC. PAGE 4 SECTION 18. Notices. Notices required to be given by this Agreement shall be mailed, certified mail return receipt requested, to the following addresses: CITY OF LUBBOCK MOLINOS ANAHUAC, INC. Assistant City Manager Sergio Rascon Development Services Attn: Rodolfo Mata P.O. Box 2000 1112 Montana Lubbock, Texas 79457 El Paso, TX 79902 Phone: 915.613.0780 Fax: 915.351.4494 AGREEMENT — MOL,INOS ANAHUAC, INC. PAGE 5 SECTION 19. 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. EXECUTED this MOLINOS ANAHUAC, INC SERGIO RASCON ATTEST: DRAFT ONLY -- DO NOT EXECUTE day of ..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 AS TO FORM: Linda L. Chamales, Senior Attorney Office Practice Section AGREEMENT - MOLINOS ANAHUAC, INC. ?AGE 6 Resolution No. 2007-RO535 E\hlba A O U hQ hU 1� 4 LEGEN❑ I ' Ow - 0 -"" W E. k saaxa am Lutb.*. Teves 7940, r y hveWw J DA l,* C V4ah Fargoerner I .L I@p09-I". %, Fb. LerbWA.T6Ra679401 CT , O,k&mCemadx, CrdywA-C.WrLA6.I. Lb. 3309101.1 She. 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