HomeMy WebLinkAboutResolution 3164-02-2005A Resolution
Authorizing Execution of Amendment to
Master Economic Development Agreement with Cabela's Retail, Inc.
WHEREAS, on June 8, 2004 the City Council approved M&C C 20113 authorizing execution
of that certain Master Economic Development Agreement (the `Master Agreement"), effective as of
July 1 2004 with Cabela s Retail, Inc ("Cabela s) and
WHEREAS, the Master Agreement outlines the manner m which tax increment contract
revenue bond financing, tax exemptions and economic development grants from the City (collectively
the `Public Participation ') will be used to support construction by Cabela s of an approximately 200 000
square foot retail development with public exhibition and recreation space (the `Project") and
WHEREAS, the Master Agreement stipulates that the maximum amount of the Public
Participation (the `Public Participation Amount") will be $40 million, net present value, subject to
adjustments as provided by the Master Agreement; and
WHEREAS, the Project has been delayed for a number of months due to a lawsuit filed against
the City surrounding the creation of Tax Increment Reinvestment Zone Number Ten, City of Fort
Worth, Texas, whose revenues will be used to retire tax increment contract revenue bonds issued by the
Lone Star Local Government Corporation m a principal amount not to exceed $32 million, and
WHEREAS, on account of these delays, the cost to Cabela s and the City in attorneys fees plus
the cost to construct the public improvements m accordance with the original timetable is projected to be
an additional $1 685 000• and
WHEREAS, all other parties to the Agreement wish to allow Cabela s and the City to recoup
these increased costs through a bond issuance by the Corporation that is $1 685 000 higher than
originally anticipated (although still not to exceed the $32 million maximum authorized by the Lone Star
Local Government Corporation during its meeting on September 28, 2004), which would necessitate an
amendment to the Master Agreement increasing the Public Participation Amount from $40 million, net
present value, to $41 685 000 net present value;
NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FORT WORTH, TEXAS
1 That the City Manager is hereby authorized to execute an amendment to the Master
Agreement mcreasmg the Public Participation Amount from $40 million, net present value, to
$41 685 000 net present value
2. That all previous Resolutions are hereby expressly repealed to the extent in conflict with
the provisions of this Resolution.
3. That this Resolution shall take effect immediately from and after rts adoption.
AND IT IS SO RESOLVED.
Adopted this 8th day of February 2005
ATTEST
By 1~
Marty Hendrix ,~ APPROVED
City Secretary~~~" ~r~'',l~ CITY COUNCIL
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CERTIFICATE FOR RESOLUTION
THE STATE OF TEXAS
COUNTIES OF TARRANT AND DENTON
CITY OF FORT WORTH
We, the undersigned officers of said City hereby certify as follows.
1 The City Council of said City convened m REGULAR MEETING ON THE 8TH DAY OF
FEBRUARY 2005 at the City Hall, and the roll was called of the duly constituted officers and members
of said City Council, to-wit:
Ralph McCloud,
Jim Lane,
Chuck Silcox,
Becky Haskm,
Donavan Wheatfall,
Clyde Picht,
John Stevenson
Wendy Davis,
Charles Boswell,
Gerald Pruitt,
Jim Keyes,
Marty Hendry,
Mayor Pro Tempore,
Councilmembers,
City Manager
Deputy City Attorney
Director of Finance,
City Secretary
and all of said persons were present, except the following absentees. Mayor Mike Moncrief, thus
constituting a quorum. Whereupon, among other business, the following was transacted at said Meeting:
a written
RESOLUTION AUTHORIZING EXECUTION OF AMENDMENT TO
MASTER ECONOMIC DEVELOPMENT AGREEMENT WITH
CABELA S RETAIL, INC.
was duly introduced for the cons~derat~on of said City Council and read m full. It was then duly moved
and seconded that said Resolution be passed, and, after due discussion, said motion carrying with it the
passage of said Resolution, prevailed and carried by the following vote:
AYES 6
NOES 2
2 That a true, full and correct copy of the aforesaid Resolution passed at the Meeting described
m the above and foregoing paragraph ~s attached to and follows this Certificate; that said Resolution has
been duly recorded m said City Council's minutes of said Meeting; that the above and foregoing
paragraph is a true, full and correct excerpt from said City Council's minutes of said Meeting pertaining to
the passage of said Resolution, that the persons named in the above and foregoing paragraph are the duly
chosen, qualified and acting officers and members of said City Council as md~cated therein, that each of
the officers and members of said City Council was duly and sufficiently notified officially and personally
in advance, of the time, place and purpose of the aforesaid Meeting, and that said Resolution would be
• introduced anal considered for passage at said Meeting, and each of said officers and members consented,
m advance, to the holding of said Meeting for such purpose, and that said Meeting was open to the public
and public nonce of the time, place and purpose of said meeting was gwen, all as required by Chapter
551 Texas Government Code.
rs
551 Texas Government Code
SIGNED AND SEALED the 8th day of February 2005
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City of Fort Worth, Texas
~ Mayor and Council Communication
COUNCIL ACTION Approved As Amended on 2/8/2005 Resolution No 3164-02 2005
DATE Tuesday February 08 2005
LOG NAME 17CABELA REFERENCE NO C-20518
SUBJECT
Authorize Execution of Amendment to Master Economic Development Agreement with Cabela's
Retail Inc
RECOMMENDATION
It is recommended that the City Council authorize the City Manager to execute an amendment to the Master
Economic Development Agreement between the City Tarrant County the Lone Star Local Government
Corporation and Cabela s Retail Inc. in order to accommodate an anticipated increase in the amount of
bonds issued by the Lone Star Local Government Corporation for construction of public improvements
related to the Cabela s development project.
DISCUSSION
On June 8 2004 (M&C C-20113} was approved by the City Council authorizing the City Manager to
execute a Master Economic Development Agreement (the Master Agreement) with Cabela's Retail Inc.
(Cabela's) for construction of a retail facility of approximately 200 000 square feet with publicly
owned exhibition and recreation space near the intersection of IH 35-W and SH 170 (the Project} The
Lone Star Local Government Corporation (LGC) will issue bonds to finance the cost of construction of
certain public improvements related to the Project. Cabela's will purchase all bonds issued by the LGC A
tax increment reinvestment zone or TIF will pay tax increment generated from property in the TIF to retire
the bonds
The City will also pay Cabela's a limited number of economic development grants authorized by Chapter
380 of the Texas Local Government Code (the 380 Grants} The overall amount of the 380 Grants is
anticipated to be the difference between the amount of the aggregate LGC bond issuance plus the value of
tax exemptions granted on publicly-owned property within the Project and an amount which is defined in
the Master Agreement as the 'Public Participation Amount, which currently is $40 000 00 net present
value based on the following projected allocations.
TIF
1 % Sales Tax (380 Grants from City)
Personal Property/Inventory Tax (380 Grants)
Value of Tax Exemptions
Total
$26 315 000
$ 7 820 000
$ 1,285 000
$ 4,580,000
$40 000 000
The Project has been delayed for a number of months due to a lawsuit filed against the City last year
surrounding the creation of the TIF The City prevailed in that action However on account of delays
• caused by that litigation the additional cost to Cabela's in attorneys fees plus the cost to construct the
public improvements in accordance with the original timetable is projected to be approximately $1 5
million It is recommended that this increased cost be recouped by including those costs as part of the
Logname 17CABELA Page 1 of 2
LGC's bond issuance
Upon approval of the recommended amendment, the maximum Public Participation Amount under the
Master Agreement would be $41 685 000 net present value based on the following projected allocations.
TIF
1 °/v Sales Tax (380 Grants from City)
Personal Property/Inventory Tax (380 Grants)
Value of Tax Exemptions
Total
$28 000 000
$ 7 820 000
$ 1,285 000
$ 4,580,000
$41 685 000
Because Cabela s will purchase all bonds issued by the LGC Cabela's and not the City will be at risk if
the TIF has not produced sufficient revenue upon expiration of the TIF in 2025 Therefore the proposed
amendment to the Master Agreement should not have a negative impact on the City
The Cabela's retail project will be located in Council District 2
FISCAL INFORMATION/CERTIFICATION
The Finance Director certifies that this action will require no direct expenditure from City funds in the current
fiscal year
TO Fund/AccountlCenters
FROM FundlAccount/Centers
Submitted for City Manager's Office. by:
Originating Department Head.
Additional Information Contact:
Dale Fisseler (6266)
Tom Higgins (6192)
Peter Vaky (7601)
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Logname 17CABELA Page 2 of 2