HomeMy WebLinkAboutResolution - 5197 - Notice Of Intent - Grinnell Flow Control - Tax Abatement Agreement - 05/23/1996RESOLUTION No. 5197
May 23, 1996
Item #44
RESOLUTION
WHEREAS, the City Council has determined to give notice of its intent to enter into a
Tax Abatement Agreement with Grinnell Flow Control; and
WHEREAS, V.T.C.A., Tax Code, Section 312.2041 requires notice of the intent of 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 THEREFORE:
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 City
Council to enter into a Tax Abatement Agreement with Grinnel Flow Control, said notice to be ;
given to the presiding officers of each governing body of each taxing unit having jurisdiction in
assessing taxes on property located in City of Lubbock, Lubbock County, Texas, and further
described as follows:
2401 N.E. LOOP 289
LOT 1, ALLEN INDUSTRIAL PARK ADDITION
CITY OF LUBBOCK, LUBBOCK COUNTY, TEXAS;
OGLED AS,TO CONTENT:
oel Beesinger, -t im Dirxtor of
'Business Development
APPROVED AS TO FORM:
ald G. VandKer, Mst Assistant City
Attorney
DGV Js/GFC-TA.RES
ccdocs/May 1€1, 1996
NOTICE OF INTENT OF THE CITY COUNCIL
OF THE CITY OF LUBBOCK TO ENTER INTO AN
AGREEMENT TO ABATE TAXES ON REAL PROPERTY
IMPROVEMENTS AND TANGIBLE PROPERTY LOCATED
IN LOT 1, ALLEN INDUSTRIAL PARK ADDITION,
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 Grinnell flow Control to abate taxes on improvements to property and
tangible property located within an enterprise zone created by Ordinance No. 9591 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 Grinnell Flow
Control for tax abatement, a copy of said Agreement is attached to this Notice as Exhibit `°A" 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 23rd day
of May , 1996, at 10:00 o'clock a in.
DGV:js/GFC-NOI.DOC
ccdocs/May 10, 1996
Exhibit "A"
AGREEMENT
STATE OF TEXAS §
COUNTY OF LUBBOCK §
This Agreement made this day of , 1996, by and
between the City of Lubbock, Texas, a home rule municipality of the State of Texas
(hereinafter called "City") and Grinnell Flow Control, a Division of Grinnell Corporation,
(hereinafter called "Company"),
WITNESSETH:
WHEREAS, City did receive from Company on the l Oth day of May, 1996, an
application for tax abatement for the expansion of the existing manufacturing facility
located at 2401 N.E. Loop 289, which is further described as Allen Industrial Park, Lot 1,
City of Lubbock, Lubbock County Texas; and
WHEREAS, upon review of the above application it was determined that the
facilities will be located in the North Enterprise Zone designated by the City in Ordinance
No. 9591 covering the above described property; and
WHEREAS, the Guidelines and Criteria for Tax Abatement within the jurisdictions
of the taxing units of Lubbock County was heretofore adopted by Resolution No. 4973 of
the City Council of the City of Lubbock; 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 of the criteria and guidelines as set forth
in the Guidelines and Criteria governing Tax Abatement within the taxing units of
Lubbock County, said guidelines having been adopted by Resolution No. 4973 of the City
on September 28, 1995, and
WHEREAS, the City did thereafter pass Ordinance No. 9591 creating an enter-
prise zone for commercial and industrial tax abatement, said zone including Allen
Industrial Park, Lot 1, City of Lubbock, Lubbock County, Texas; and
WHEREAS, V.A.T.C., Tax Code, Sec. 312.2011 provides that 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 expansion of an existing facility; and
WHEREAS, V.A.T.C., Tax Code, Sec. 312.002 specifically states that such a pur-
pose is to be included in the guidelines for tax abatement and to be eligible for such treat-
ment; and
WHEREAS, Section fV of the Guidelines and Criteria for Tax Abatement within
the jurisdictions of the taxing units of Lubbock County adopted by the City Council by
Resolution No. 4973 does recognize expansion of existing facilities as being eligible for
tax abatement status; and
WHEREAS, the City Council does hereby find that all of the Guidelines and Cri-
teria established for Tax Abatement within the City of Lubbock, as adopted by Resolution
No. 4973, have been met by Company, and
�J
WHEREAS, Company does intend to expand an existing manufacturing facility;
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
WHEREAS, the City Council finds that entering into this Agreement to abate
taxes on the property described in Exhibit "A" will create new jobs within the City and
enhance economic development within the enterprise zone;
AGREEMENT -- Grinnell Flow Control 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. Term. This Agreement shall remain in force and effect for a period
of five (5) years from the date of its execution 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, as defined in
Section H. of the Guidelines and Criteria Governing Tax Abatement For All Taxing Units
Contained Within Lubbock County, which is the subject of this Agreement, shall be 1996,
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(5) of the Guidelines and Criteria for Tax Abatement within the
jurisdictions of the taxing units of Lubbock County and heretofore adopted by the City
Council by Resolution No. 4973 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 Section 4 above, the following properties:
(a) All proposed new improvements to be placed by Company upon Allen
Industrial Park, Lot 1, City of Lubbock, Lubbock County, Texas; which
AGREEMENT — Grimell Flow Control PAGE 3
proposed improvements are set forth in a plat of the above tract of land,
attached hereto as Exhibit "A" and made a part hereof.
(b) All eligible tangible personal property placed in or upon the property set
forth in Exhibit "A". Ineligible property is outlined in Section IV(5) of the
Guidelines and Criteria Governing Tax Abatement For All Taxing Units
Contained Within Lubbock County.
(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 Qualification. It is hereby found by the City that Com -
parry will expend funds in excess of the funds necessary to qualify for tax abatement by
expanding an existing facility, as defined in Section H of the Guidelines and Criteria
Governing Tax Abatement For All Taxing Units Contained Within Lubbock County, and
further that the Company will create new jobs in excess of the percentage required for tax
abatement, all as set forth in Section IV(9)(b) of the Guidelines and Criteria for Tax
Abatement adopted by the City through Resolution No. 4973.
SECTION 8. Value of Improvements. Company intends to expend approximately
one hundred fifty thousand ($150,000) dollars in building related structural improvements,
as outlined in Exhibit "A", and one million seven hundred and eighty-three thousand
($1,783,000) in equipment to be located within the enterprise zone created by Ordinance
No. 9591.
SECTION 9. Creation of New Jobs. Company agrees within twelve (12) months
from the date of execution of this Agreement that it will create fifty (50) full-time
equivalent new jobs within the Company plant located within Allen Industrial Park, Lot 1,
AGREEMENT — Grinnell Flow Control PAGE 4
City of Lubbock, Lubbock County, Texas; and use its best efforts to maintain a minimum
of two hundred thirty (230) jobs during the term of this Agreement.
SECTION 10. 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 reasonably inspect the
property to insure that the improvements are being made in accordance with the terms and
conditions of Company's application for tax abatement and this Agreement.
SECTION 11. Portion of Tax Abated. City agrees, during the term of this
Agreement, to abate 100 percent of taxes on eligible property.
SECTION 12, Commencement Date. This Agreement shall commence upon the
date of its execution, which date is hereinafter set forth, and shall expire five (5) years
after such date.
SECTION 13. T= of r vem . The Company proposes to modernize and
expand an existing manufacturing facility as described in Exhibit "A". The Company
further states that the proposed improvements to the property above mentioned shall
commence on the 13th day of May, 1996, and shall be completed within approximately six
(6) 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 14. 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.
SECTION 15. Limitation on Use. Company agrees to limit the use of the prop-
erty 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 prop -
AGREEMENT -- Grinnell Flow Control PAGE 5
erty to uses consistent with the general purpose of encouraging development of the enter-
prise zone during the term of this agreement.
SECTION 16. 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 Com-
pany as set forth in Exhibit `B", attached hereto and made a part hereof for all purposes.
SECTION 17. 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 18. Compliance. The City may cancel or modify this Agreement if the
Company fails to comply with the 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
City Manager
P.O. Box 2000
Lubbock, Texas 79457
GRINNEL FLOW CONTROL
James R. Coleman
2401 N.E. Loop 289
Lubbock, Texas 79403
AGREEMENT — Grinnell Flow Control PAGE 6
SECTION 20. 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
GRINNELL FLOW CONTROL
Plant Manager
ATTEST:
day of '199—.
CITY OF LUBBOCK
A Municipal Corporation
DAVID R. LANGSTON,.
MAYOR
ATTEST:
Secretary Betty Johnson,
City Secretary
PR VE S TO CONTENT:
Joel Beesinger
Interim Director of Business Development
OVER AS O FORM:
1
Vandiver
Assistant City Attorney
1R/CB:Grinne1.doc
May 9. 1995
AGREEMENT -- Grinnell Flow Control PAGE 7
05r09i96 !3:38 FAX GR1SNE LL •-- CITY OF LUBBOCK 2002
EXHIBIT "A"
APPLICATION FOR TAX ABATEMENT IN LUBBOCK COUNTY
(a) The mam during facility in Milwaukee, Wisconsin wM be closed and a large portion
of egWpment and inventory will be moved to LubbocJi� Texas. Production of the
additional product wM commence once building rearrangements and improvements have
been made, equipment is placed in the Lubbock Plant and people fired to begin the
incremetnl operations.
(b) A listin of the improvements for which abateme= is being requested is attachod as
schedWe 1.
(c) The improvements to real property, as shown on schedule 1, are as follow:
Budding r+tmrangesnemr for whin , compressed air and
other f$cility upgrades to accommodate adcitional equip -
meat and moving of existing e3quipment. S100,000
Rearraagen3eW of staff office facilities to make room far
additional people and computer egrrilr vmf- $50,000
(d) See amadied
(e) See atracbed
(f) The proposed start elate for the mWroveme= is May 13, 1996 and wffl.be completed
by December 31, 1996.
(g) The improvements to be undertaken are for the expansion of the mamirfart ring
operations in order to be able to increase our production capacity and additional people
neje d.s.
(h) The additional value of the additions to the real property are expected to be $150,000.
(i) The assessed value of the real property for the base yvar(1995) is $121,483.
()j erected new employment will consist of 50 people in direct production posmons
including support groups
06109 06 1i=48 FAX CRINNELL — CITI OF LUBBOCK 2003
Schedule 1
CNG equipment S 250,000
Av400 computer 3 3.3,000
Slat equipment s 1.500.000
BwWmg roarmngcmard $ 100,000
amcae marntaeffwn i
TaW AbWWm*nt "u«dad $1,933,000
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EXHIBIT "B"
SECTION YQ. Recapture:
In the event that any type of facility, (as defined in Section 11. Subparagraphs 5, 6, 7, S, 10,
11, 12. 13, 17, 19) is completed and begins producing goods or services, but subsequently
discontinues producing goods or services for any reason, excepting fire, explosion, 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 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 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 whom 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 or natural
disaster or other event beyond the control of applicant or owner. In the event the 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 events beyond the control of the
applicant or owner, then such applicant or owner shall have a period of one ygg 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 and 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 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 one year time period, hereinabove mentioned
shall commence upon written notification from the Affected Jurisdiction to the applicant or
owner.
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, 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 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 Affected Jurisdiction to whom application for tax abatement was
directed determines that the applicant or owner is in default of any of the terms or conditions
contained in the Tax Abatement Agreement, then in such event 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.
4. 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 event the
Tax Abatement Agreement shall terminate and all abatement of tastes 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 Iater 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, 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.
The date of termination as that terra 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 form the Affected Jurisdiction, failing in which, the
abatement remains terminated and the abated taxes must be paid.
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 the 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 33.01 will apply.
Guidelines and Criteria Governing Tax Abatement For
AU Taxing Units Contained within Lubbock County
Page 2