HomeMy WebLinkAboutIR 9826 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9826
To the Mayor and Members of the City Council December 8, 2015
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*a SUBJECT: AMENDMENT TO ECONOMIC DEVELOPMENT PROGRAM
rrn AGREEMENT WITH GE MANUFACTURING SOLUTIONS, LLC
On February 19, 2013, the City Council approved an Economic Development Program
Agreement (Agreement) with GE Manufacturing Solutions, LLC, an affiliate of GE Transportation
(GE) for the completion of a locomotive manufacturing facility located at 16201 Three Wide Drive
and a mining equipment manufacturing facility located at 16202 Three Wide Drive (M&C G-
17815). The Agreement with GE (City Secretary Contract No. 44816) provides for ten annual
economic development grant payments equal to 55 percent of the City's taxes on the incremental
values (since January 1, 2012) of the real and business personal property investment on the sites
of GE's new locomotive and mining manufacturing facilities. The Agreement provides that if in
any year during the term of the Agreement, GE exceeds certain employment requirements, GE
may be able to receive increased grant payments that would equal up to 85 percent of the City's
taxes on the incremental values of the real and business personal property.
GE has requested an amendment to the Agreement to extend the term by five years and to revise
the employment commitment in order to facilitate an additional investment of $13,575,000 for
improvements at the locomotive facility and to provide additional incentive to allow them to
undertake and complete the construction of the rail test track. Completion of the test track will be
required in order for the proposed amendment to take effect.
The original Agreement states that if GE reaches employment thresholds of 600 and 875 full-time
jobs and also meets commitments pertaining to the utilization of Fort Worth and Fort Worth
Central City residents for those jobs during the term of the Agreement, then GE will be eligible for
bonus grant payments of, respectively, a maximum aggregate of 70 percent of incremental taxes
and a maximum of 85 percent of incremental taxes. Under the terms of the existing Agreement,
GE must meet all three employment commitments (base number of employees, Fort Worth
residents and Central City residents) in order to receive bonus grant payments.
Under the proposed Amendment, GE would be eligible to receive bonus grant payments based
solely on meeting the minimum number of additional overall jobs. Per proposed Amendment No.
1, GE will no longer be required to meet the remaining two employment commitments (Fort Worth
residents and Central City residents) to be eligible to receive the bonus grant
payments. However, the Fort Worth and Central City Commitments will remain in place for
purposes of calculation of the eligible annual grant amount to be received.
All other terms and conditions outlined in the Agreement will remain the same and Staff
recommends approval of the proposed amendment that will be placed on the City Council
meeting agenda for December 15, 2015.
David Cooke
City Manager
ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS