HomeMy WebLinkAboutContract 47341-A1 CITY SECRETARYd I�
CONTRACT N0...T-
AMENDMENT NO. 1 TO
CITY SECRETARY CONTRACT NO. 47341
TAX ABATEMENT AGREEMENT
WITH AMERICAN AIRLINES, INC. AND DALLAS FORT WORTH
INTERNATIONAL AIRPORT BOARD
This AMENDMENT NO. I TO CITY SECRETARY CONTRACT NO.
47341 ("Amendment") is made and entered into by and between the CITY OF FORT
WORTH (the "City"), a home rule municipality organized under the laws of the State of
Texas, AMERICAN AIRLINES, INC. ("Company"), a Delaware corporation, and
DALLAS FORT WORTH INTERNATIONAL AIRPORT BOARD ("Board").
RECITALS
The City and Company hereby agree that the following statements are true and
correct and constitute the basis upon which the City and Company have entered into this
Amendment:
A. The City and Company previously entered into a Tax Abatement
Agreement (City Secretary Contract No. 47341) (the "Tax Abatement Agreement")
concerning the construction of a new headquarters facility for the Company (the
"Project") on land leased from the Board.
B. The Tax Abatement Agreement, at Exhibit"A" attached thereto, contained
a description of the land on which the Project was anticipated to be constructed. On
November 10, 2015, prior to execution of the Tax Abatement Agreement, the City
Council adopted Ordinance No. 21968-11-2015, designating this land as Tax Abatement
Reinvestment Zone No. 91, City of Fort Worth, Texas (the "Initial Zone").
C. In further detailed planning for the Project, the Company desires to
develop the Project as multiple buildings, which would require the Project to extend
beyond the land described in Exhibit A to include additional adjacent land also leased
from the Board. In order to be in a position to grant the tax abatement as incentive for
the Project, as intended by the City and Company under the Tax Abatement Agreement,
the land on which the Project will be constructed but that was not included as part of the
Initial Zone must be located in a reinvestment zone. Accordingly, on June 6, 2017 the
City Council adopted Ordinance No. 22745-06-2017 as Tax Abatement Reinvestm
Zone No. 91A, City of Fort Worth, d Zone"). 3 4 5 6 7 ,9 9 89
OFFICIAL RECORDoil
Page l CITU'$lCRUMM �01k' 0
Amendment No. 1 to CSC No.47341N '�'� Q� V
Tax Abatement Agreement between City of Po WT',Amencan Airlines, nc.,and Dallas/Fort Worth In44 nationl G 0
Airport Board
D. Chapter 312, Texas Tax Code only allows the City to abate real property
taxes on the incremental increase in the value of the real property over its value in the
year in which it was designated as a reinvestment zone (which is frequently referred to as
the "base year" of the reinvestment zone). Because the base year of the Initial Zone is
2015, which is the year in which the Initial Zone was designated, and the base year of the
Expanded Zone is 2017, which is the year in which the Expanded Zone was designated, it
is necessary to amend the Tax Abatement Agreement so that the calculation of the
Abatement thereunder reflects the fact that the real property portion of the Abatement
must account for two different base years.
E. Section 5.2.9 of the Tax Abatement Agreement also caps the Abatement
available thereunder to a 150% increase in the taxable value of the real and personal
property that is subject to the Abatement. Because the Project will now be spread among
a number of buildings, the original estimated cost of the Project is anticipated to exceed
original estimates. Accordingly, the parties wish to amend the Tax Abatement
Agreement to increase this cap to a 250% increase in the taxable value of the real and
personal property that is subject to the Abatement.
NOW, THEREFORE, in consideration of recitals and the mutual benefits and
promises contained in the Agreement and this Amendment and for other good and
valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the
City, Company and Board agree as follows:
AGREEMENT
1. Recital C. is amended to read as follows:
C. On November 10, 2015 the City Council adopted Ordinance No.
21968-11-2015 establishing Tax Abatement Reinvestment Zone No. 91,
City of Fort Worth, Texas (the "Initial Zone"). On June 6, 2017 the City
Council adopted Ordinance No. 22745-06-2017 establishing Tax
Abatement Reinvestment Zone No. 91A, City of Fort Worth, Texas (the
"Expanded Zone").
2. Recital F is amended to read as follows:
F. Company leases approximately 124.04 acres of property more
specifically described (as Tract 1 and Tract 2) in Exhibit "A" (the
"Land"), The Land is located within the boundaries of Dallas/Fort Worth
International Airport, and is subject to a lease between the Board and
Company. Tract 1 consists of 97.012 acres of land and is located within
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Amendment No. 1 to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
the Initial Zone. Tract 2 consists of 27.028 acres of land and is located
within the Expanded Zone. Tract 2 and the Expanded Zone are part of a
larger parcel of land for which there is a single tax account. Company
wishes to construct a new corporate headquarters facility on the Land
consisting of not less than 900,000 square feet of floor area in office and
complimentary and associated uses (the "Required Improvements")
along with ancillary improvements and facilities, which may include such
improvements as dining facilities, conferencing facilities, recreational
amenities or similar types of improvements supporting the corporate
headquarters facility (the "Ancillary Improvements"). Exhibit "A" is
attached hereto and hereby made a part of this Agreement for all purposes.
2. The property description and map attached to the Agreement as Exhibit "A" are
hereby replaced with the property description and map attached to this Amendment as
Exhibit"A".
3. The definition of "Base Year Value" at Section 2 of the Agreement is hereby
amended to read as follows:
Base Year Value means a) as to Tract 1 of the Land, the sum of
any taxable value of Tract 1 of the Land, the improvements on Tract 1 of
the Land, the leasehold in Tract 1 of the Land and improvements on Tract
1 of the Land, and the Taxable Tangible Personal Property located on
Tract 1 of the Land for tax year 2015, which sum is agreed to be Five
Million, Three Hundred Forty-one Thousand, One Hundred Eighty-seven
Dollars ($5,341,187.00), and b) as to Tract 2 of the Land, the sum of any
taxable value of Tract 2 of the Land, improvements on Tract 2 of the
Land, the leasehold in Tract 2 of the Land and improvements on Tract 2 of
the Land, and Taxable Tangible Personal Property located on Tract 2 of
the Land for tax year 2017. In order to calculate the real property Base
Year Value of Tract 2 of the Land, which is part of a larger single tax
account, for tax year 2017, the City and Company agree to divide the
taxable appraised value for all real property covered under such tax
account, which includes Tract 2, and to multiply that value by a fraction,
the numerator of which is 27.028 (the acreage of Tract 2 only) and the
denominator of which is 124.04 (the acreage of all real property covered
under the tax account, including Tract 2). The taxable appraised value for
tax year 2017 for all real property covered under the tax account that
includes Tract 2 is $3,114,719.00. Accordingly the Base Year Value of
Tract 2 of the Land is agreed to be $678,690.00 [(27.028/124.04) x
$3,114.719].
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Amendment No. I to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
4. Section 5.2.9 of the Agreement is hereby amended to read as follows:
5.2.9. Abatement Limitation.
Notwithstanding anything to the contrary herein, the Abatement
hereunder will be based on the combined increase in the taxable value of
the Leasehold Interest (compared to the taxable value of the prior
possessory interests) and the taxable appraised value, if any, of the Land
and any improvements thereon over the combined Base Year Value of
Tract 1 and Tract 2 of the Land and on the increase in the value of Taxable
Tangible Personal Property installed on the Land, up to a maximum
combined increase of Eight Hundred Seventy-five Million Dollars
($875;000,000.00). In other words, if the combined increase in the taxable
appraised value of the Leasehold Interest (compared to the taxable value
of the prior possessory interests); the taxable appraised value, if any, of the
Land and any improvements thereon; and (iii) the taxable appraised value
of the Taxable Tangible Personal Property for the Commencement Tax
Year is more than $875,000,000.00 over their combined Base Year
Values, the Abatement hereunder will be applied only to the first
($875,000,000.00) in value, and Company will be required to pay full
taxes on any remaining taxable value. For example, if the combined
increase in the taxable appraised value of the Leasehold Interest
(compared to the value of the prior possessory interests); the taxable
appraised value, if any, of the Land and any improvements thereon; and
the taxable appraised value of the Taxable Tangible Personal Property for
the Commencement Tax Year is $950,000,000.00 in excess of their
combined Base Year Values, Company's Abatement would be applied as
if the increase in combined value had been only been $875,000,000.00 and
Company would pay full taxes on the $75,000,000.00 difference over that
cap.
5. All capitalized terms used but not defined in this Amendment shall have the
meanings ascribed to them in the Agreement.
6. Consistent with Section 1. of the Agreement, the Board joins this Amendment as
a party solely to memorialize that (i) the Board has leased the Land to Company on terms
and conditions substantially in accordance with the Lease attached to the Agreement as
Exhibit "D" and (ii) the Board consents to construction of the Required Improvements
and Ancillary Improvements solely in accordance with the Lease. The City and
Company agree that neither the Agreement nor this Amendment impose any kind of
financial or other obligation or liability on the Board or the City of Dallas, and that
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Amendment No. 1 to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
neither the Board nor the City of Dallas are responsible for performance of any of the
obligations set forth in this Agreement.
7. This Amendment contains the entire agreement between the parties with respect
to the matters set forth herein. All provisions of the Agreement that are not specifically
amended by this Amendment shall remain in full force and effect.
EXECUTED as of the last date indicated below:
[SIGNATURES IMMEDIATELY FOLLOW ON NEXT FOUR (4) PAGES]
Page 5
Amendment No. I to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
CITY OF FORT WORTH:
By:
Jesus J. Chapa
Assistant CityManager
Date:
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, on this day personally appeared Jesus J.
Chapa, Assistant City Manager of the CITY OF FORT WORTH, a municipality
organized under the laws of the State of Texas, known to me to be the person and officer
whose name is subscribed to the foregoing instrument, and acknowledged to me that the
same was the act of the CITY OF FORT WORTH, that he was duly authorized to
perform the and that he executed the same as the act of the CITY OF FORT WORTH for
the purposes and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this A&4ay of
2017.
S
Not y Public in and for t:n;` kARiA S.sAvcHEz
X-qw
State of Texas , .`A ;`;
�: My Notary ID#2256490
l� ���9,�y cy — aF:�""' Expires December 19,2021
Notary's Printed Name
Page 6
Amendment No. 1 to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
CITY CONTRACT COMPLIANCE MANAGER:
By signing below, I hereby acknowledge that I
am the person responsible for the monitoring
and administration of this contract, including
ensuring all performance and reporting
requirements:
By:
— 4z;��
Name of City Employee:
Title: Djeegor'
APPROVED AS TO FORM AND LEGALITY:
By:
Peter Vaky
Deputy City Attorney
M&C: G-19018 06-06-2017
Form 1295 Cert.No.: 2 0 1 7-2 219`f 7
A bye OX
ORT...
Mary J. _ a6 lr. Co Secretary
.1E)CP,S
OFFICIAL RECORD
CITY SECRETARY
Page 7
FT. WORTH,TX
Amendment No. 1 to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
AMERICAN AIRLINES, INC.,
a Delaware corporation:
By:
Name: iifrlflttiy Skipworth
Title: Vice President-A'nport Affairs&Facilities
Date: ' 1[ t
STATE OF TEXAS §
COUNTY OF TARRANT §
B FORE ME,the undersigned' authority. ,onppthis day personally appeared"�lm
,y� ftM Dft of AMERICAN AIRLINES,
INC., known to me to be the person whose name is subscribed to the foregoing instrument,
and acknowledged to me that s/he executed the same for the purposes and consideration
therein expressed, in the capacity therein stated and as the act and deed of AMERICAN
AIRLINES,INC.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 1W day of
12017.
Notary Public in Ad for w Brittany Carter
,w
the State of z a4 """fic'
Irate oC'Ir%u•
` e Expires. 10-17-2018
l
Notary's Print Name
Page 8
Amendment No. 1 to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
DALLAS FORT WORTH AIRPORT BOARD:
By:
99n42
John C. Terrell
Vice President, Commercial Development
Date: /a - - oZ0 i 7
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, on this day personally appeared John C.
Terrell, Vice President of Commercial Development of the DALLAS FORT WORTH
AIRPORT BOARD, whose name is subscribed to the foregoing instrument, and
acknowledged to me that the same was the act of the DALLAS FORT WORTH
AIRPORT BOARD,that he was duly authorized to perform the and that s/he executed the
same as the act of the DALLAS FORT WORTH AIRPORT BOARD for the purposes
and consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 1 st day of December,
2017.
-1"otary Public in and f r the State of Texas
� pVP�G MONICA MCCOMBS
•P 9
s Notary Public, State of Texas
=�°• 'P� Comm.Expires 06-07-2021
Notary ID 12943357-6
APPROVED AS TO FORM AND LEGALITY:
Pa 1 Tomme, Legal Counsel
Page 9
Amendment No. 1 to CSC No.47341
Tax Abatement Agreement between City of Fort Worth,American Airlines,Inc.,and Dallas/Fort Worth International
Airport Board
CERTIFICATE OF INTERESTED PARTIES
FORM 1295
1 of 2
Complete Nos.1-4 and 6 if there are intere<: _ OFFICE USE ONLY
Complete Nos. 2,3,5,and 6 if there are no interested parties. CERTIFICATION OF FILING
1 Name of business entity filing form,and the city,state and country of the business entity's place Certificate Number:
of business. 2017-291947
American Airlines, Inc.
Fort Worth,TX United States Date Filed:
2 Name of governmental entity or state agency that is a party to the contract for which the form is 12/07/2017
being filed.
City of Fort Worth Date Acknowledged:
3 Provide the identification number used by the governmental entity or state agency to track or identify the contract,and provide a
description of the services,goods,or other property to be provided under the contract.
M&C G-19018
Tax Abatement Agreement Amendment
Nature of interest
4
Name of Interested Party City,State,Country(place of business) (check applicable)
Controlling Intermediary
Dornic, Myron Dallas,TX United States X
Jackson Walker L.L.P. Dallas,TX United States X
Dyer Jeff Fort Worth,TX United States X
Pitchford,Joseph Dallas,TX United States X
Cresent Real Estate Development LLC Dallas,TX United States X
Skipworth,Tim Fort Worth,TX United States X
Kerr, Derek Fort Worth,TX United States X
Isom,Jr,, Robert Fort Worth,TX United States X
Johnson, Steve Fort Worth,TX United States X
Parker, Douglas Fort Worth,TX United States X
American Airlines Group Inc. Fort Worth,TX United States X
Forms provided by Texas Ethics Commission www.ethics.state.tx.us Version V1.0.3337
CERTIFICATE OF INTERESTED PARTIES
FORM 1295
'M
Complete Nos.1-4 and 6 if there are interested , _s. OFFICE USE ONLY
Complete Nos.1,2,3,5,and 6 if there are no interested parties. CERTIFICATION OF FILING
1 Name of business entity filing form,and the city,state and country of the business entity's place Certificate Number:
of business. 2017-291947
American Airlines, Inc.
Fort Worth,TX United States Date Filed:
2 Name of governmental entity or state agency that is a party to the contract for which the form is 12/07/2017
being filed.
City of Fort Worth Date Acknowledged:
3 Provide the identification number used by the governmental entity or state agency to track or identify the contract,and provide a
description of the services,goods,or other property to be provided under the contract.
M&C G-19018
Tax Abatement Agreement Amendment
Nature of interest
4
Name of Interested Party City,State,Country(place of business) (check applicable)
Controlling T Intermediary
5 Check only if there is NO Interested Party. ❑
6 AFFIDAVIT I swear,or affirm,under penalty of perjury,that the above disclosu rue and correct.
CAROL IAEGER
Notary Public.State of Texas
1.•. .:%-
Comm.Expires 11,17-2019
Notary ID 130443281 _
Signature of authorized agent of contracting business entity
AFFIX NOTARY STAMP SEAL ABOVE f
Sworn to and subscribed before me,by the said KeJ.-('-,eA4\ LL %(ANN 1e4-14 ,this the +4A day of'be—c.-L'r"e e
20_M ,to certify which,witness my hand and seal of office.
Q-0� Cx-t2o L. Ye9 es- Ex-e-c, )�ssl-,
Signature of officer administering oath Printed name of officer administering oath Tide of officer administering oath
Porms provided by Ethics Commission wvAv.ethics.state.tx.us Version V1.0.3337