HomeMy WebLinkAboutResolution 2077A Resolution 3U AUL .� It26
RESOLUTION NO
WHEREAS, the enhancement of the tax base and the local economy will benefit the
citizens of the City of Fort Worth, Texas; and
WHEREAS, the Texas Legislature has enacted laws regarding tax abatement which
permit the cities of the State of Texas to participate in such programs as a direct means of
assisting in the retention and expansion of primary employment and/or to facilitate mayor
investment to the City which would be a benefit to the property taxpayers, and citizens of the
City of Fort Worth and would contribute to the economic development of the City of Fort
Worth, and
WHEREAS, the City of Fort Worth desires to promote the construction and/or
rehabilitation of housing in certain areas of the City through the provision of certain economic
development incentives; and
WHEREAS, the Texas Property Redevelopment and Tax Abatement Act, Tax Code,
Sections 312.001 through 312.209 as amended, allows cities to establish local guidelines and
criteria for tax abatement agreements which are a prerequisite for designation of reinvestment
zones; and
WHEREAS, the establishment of specific criteria, guidelines and procedures are
necessary to effectively and fairly administer the provision of economic development
incentives; and
WHEREAS, State Law requires the establishment of guidelines and criteria governing
tax abatement agreements,
NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF FORT WORTH, TEXAS
SECTION 1 THAT the City of Fort Worth elects to become eligible to participate in
residential property tax abatement.
SECTION 2. THAT the City of Fort Worth hereby establishes a Policy Statement on
Tax Abatement For Qualifying Residential Projects- City of Fort Worth,
attached hereto as Exhibit A, which Exhibit A is incorporated herein as
if copied in its entirety and is approved, and which document contains
and establishes guidelines, criteria, and procedures governing property
tax abatement agreements for residential development projects.
CITY OF FORT WORTH
SECTION 3 THAT the guidelines and criteria established with the Policy Statement
on Tax Abatement For Qualifying Residential Projects- City of Fort
Worth shall expressly govern all subsequent residential property tax
abatement agreements, as required by State law
SECTION 4 THAT this resolution shall take effect from and after its final date of
passage, and it is accordingly so ordered.
PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH,
TEXAS, this 18th day of July A.D 1995
Mayor
ATTEST
A�4� &a&e4- i
City Secretary
APPROVED AS TO FORM AND LEGALITY
City Attorney
APPROVED
CITY COUNG1
3u L 1s iS
city o rw
CITY OF FORT WORTH
Exhibit A
POLICY STATEMENT
TAX ABATEMENT FOR QUALIFYING
RESIDENTIAL PROJECTS -
CITY OF FORT WORTH
I General Purpose and Objectives
The City of Fort Worth is committed to the promotion of high quality residential development
in all parts of the City and improvement in the quality of life for its citizens. The City of
Fort Worth will, on a case -by -case basis, give consideration to the granting of property tax
incentives to eligible residential development projects. It is the policy of the City of Fort
Worth that consideration of eligible projects will be provided in accordance with the
guidelines and criteria outlined in this document.
Texas law authorizes the City of Fort Worth to grant tax abatement on the value added to a
particular property by a specific residential development project which meets the economic
goals and objectives of the City As mandated by state law this policy applies to the owners
of real property Since this policy is designed to encourage the development of projects
which would not be feasible in the absence of tax abatement, it is the policy of the City of
Fort Worth that no tax abatement shall be granted for residential development projects that,
• prior to execution of the tax abatement agreement, have applied for a building permit from
the City's Department of Development.
Nothing herein shall imply or suggest that the City of Fort Worth is under any obligation to
provide incentives to any applicant.
II DEFINITIONS
Abatement" means the full or partial exemption from ad valorem taxes on eligible properties
for an amount of up to 100% of the increase in appraised value (as reflected on the certified
tax roll of the appropriate county appraisal district) resulting from improvements begun after
the execution of the tax abatement agreement for a period of up to ten years. Eligible
properties must be located in a reinvestment zone.
'Reinvestment Zone" is an area designated as such by the City of Fort Worth or State of
Texas in accordance with the Texas Property Redevelopment and Tax Abatement Act,
Sections 312.001 through 312.209 of the Tax Code
'Residential Development Project" is a development project which proposes to construct or
renovate multi family residential living units on property that is (or meets the requirements to
be) zoned C R 'C" 'D" 'D -HRl 'D -HR2 or 'H" as defined by the City of Fort Worth
Zoning Ordinance.
is 'Fort Worth Company" is a business which has a principal office located within the city limits
of Fort Worth.
'Minority Business Enterprise (MBE) and Women Business Enterprise (WBE)" is a minority
or women owned business that has received certification as either a MBE or WBE by either
49 the North Texas Regional Certification Agency (NTRCA) or the Texas Department of
Transportation (TxDOT), Highway Division.
III ELIGIBILITY CRITERIA
Improvements eligible for tax abatement are those which will take place after the
agreement is executed. No abatement shall be granted for residential development
projects that, prior to execution of the tax abatement agreement, have applied for a
building permit from the City's Department of Development.
A residential development project is eligible to apply for property tax abatement if*
The project is located in any of the following census tracts. 1002.02, 1010 1011 1016,
1017 1018, 1025 1033 1035 1036 01 1037 01 1038, 1040 (see Map- Attachment
A') AND
2. A. The protect will construct or renovate no less than 50 residential living units of
which no less than 20% shall be affordable to persons with incomes at or below
80% of median family income; OR
B The project has a minimum capital investment of $5 million (excluding acquisition
costs for land and any existing improvements)
• IV ABATEMENT GUIDELINES
A. State law prohibits abatement of taxes levied on inventory supplies or the existing tax
base. The amount and terms of the abatement will be determined by factors established
in the final agreement (such as the costs to the City the project's increase in the value
of the tax base, the number and types of living units, and utilization of Fort Worth
companies as well as MBEs and WBEs for project construction and operational
contracts)
B Unless otherwise specified in the agreement, the amount of the taxes to be abated shall
in no event exceed the value of the investment (as specified in the application)
multiplied by the City's tax rate in effect for the year in which the calculation is made.
C. In certain cases, the City may consider a tax abatement application from the owner of
real property who serves as a landlord or lessor for a residential development project
which meets the eligibility criteria of this section.
D For an eligible residential development project to be considered for tax abatement, the
Application for Tax Abatement" form must be completed and submitted to the Office
of Economic Development.
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E. An application fee must accompany the application. The fee is calculated at the lesser
of (i) 1% of the project investment, or (ii) $15 000
• If construction on the project is begun on the site specified in the application within a
one (1) year period from the application submittal date (with or without a tax
abatement), this fee shall be credited to any permit, impact, inspection or any other
lawful fee required by the City of Fort Worth. If the project is not constructed on the
site specified in the application or if construction takes place at the specified site more
than one (1) year after the application submittal date, the application fee shall not be
refunded or otherwise credited.
F If requested, the applicant must provide evidence that there are no delinquent property
taxes due on the property on which the development project is to occur
G The applicant must provide evidence to substantiate and justify the tax abatement
request including (but not limited to) an analysis demonstrating the tax abatement is
necessary for the financial viability of the project.
H. The tax abatement agreement shall limit the uses of property consistent with the general
purpose of encouraging development or redevelopment of the zone during the period
that property tax exemptions are in effect.
V PROCEDURAL STEPS
. Each request for property tax abatement shall be processed according to the following
procedural guidelines.
•
A. Applicant must complete and submit a City of Fort Worth Application For Tax
Abatement" form (with required attachments) and pay the appropriate application fee.
B The City Manager's Office will. (1) review the application for accuracy and
completeness, (2) certify that the project meets the criteria detailed in Section III, and
(3) present the application to the City Council s Expanding Economic Opportunities
Committee
C. The City Council s Expanding Economic Opportunities Committee will consider the
application at an open meeting. The Committee may-
(1) Approve the application. Staff will then incorporate the application into a tax
abatement agreement which will be sent to the City Council with the Committee s
recommendation to approve the agreement; or
(2) Request modifications to the application. City Management will discuss the
suggested modifications with the applicant and then, if the requested modifications
are made, resubmit the modified application to the Committee for consideration,
or
61
(3) Deny the application. The applicant may appeal the Committee s finding by
requesting the City Council to (a) disregard the Committee s finding and (b)
• instruct city staff to incorporate the application into a tax abatement agreement for
future consideration by the City Council.
D. The City Council retains sole authority to approve or deny any tax abatement
agreement and is under no obligation to approve any tax abatement application or
tax abatement agreement. The City of Fort Worth is under no obligation to
provide tax abatement in any amount or value to any applicant.
E. All tax abatements approved by the City Council will become effective on January 1 of
the year following the year in which a Certificate of Occupancy (CO) is issued for the
qualifying residential development project (unless otherwise specified in the tax
abatement agreement) Unless otherwise specified in the agreement, taxes levied during
the construction of the project shall be due and payable.
VI RECAPTURE
If the terms of the tax abatement agreement are not met, the City has the right to cancel or
amend the abatement agreement. In the event of cancellation, the recapture of abated taxes
shall be limited only to the year(s) in which the default occurred.
VII. INSPECTION AND FINANCIAL VERIFICATION
• The terms of the agreement shall include the City of Fort Worth s right to (1) review and
verify the applicant's financial statements in each year during the life of the agreement prior
to granting a tax abatement in any given year (2) conduct an on site inspection of the project
in each year during the life of the abatement to verify compliance with the terms of the tax
abatement agreement.
VIII EVALUATION
Upon completion of construction of the facilities, the City shall no less than annually evaluate
each project receiving abatement to insure compliance with the terms of the agreement. Any
incidents of non - compliance will be reported to all affected taxing units.
On or before March 31st of every year during the life of the agreement, any individual
or entity receiving a tax abatement from the City of Fort Worth shall provide
information and documentation which details the property owner's compliance with the
terms of the respective agreement and shall certify that the owner is in compliance with
each applicable term of the agreement. Failure to report this information and to
provide the required certification by the above deadline shall result in any taxes abated
in the prior year being due and payable.
IX. EFFECT OF SALE, ASSIGNMENT OR LEASE OF PROPERTY
No tax abatement rights may be sold, assigned or leased unless otherwise specified in the tax
• abatement agreement. Any sale, assignment or lease of the property which is not permitted in
the tax abatement agreement results in a forfeiture of all tax abatement rights on the property
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