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HomeMy WebLinkAboutResolution 1678 ~ R~luti®n N0. _~i /,~ WHEREAS, the City of Fort Worth has elected to become eligible to participate in tax abatement under Chapter 312 of the Texas Tax Code; and WHEREAS, the City of Fort Worth has established guidelines and criteria for tax abatement to qualified commercial/industrial projects (the "Policy Statement"}, which Policy Statement was adopted on August 1, 1989, and amended on June 26, 1990; and WHEREAS, on October 9, 1990, the City Council adopted CP-150 (Revised) recommending specific amendments to the Tax Abatement Policy. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF FORT WORTH, TEXAS: SECTION I. THAT the City of Fort Worth hereby amends and restates the Policy Statement for tax abatement to qualified commercial/industrial projects in its entirety as set forth on Exhibit "A", which Exhibit "A" is incorporated herein as if copied in its entirety, and is approved. ~. SECTION II. THAT the Policy Statement, as amended and restated CITY OF FORT iA/ORT~ herein, shall govern all subsequent tax abatement agreements for commercial/industrial projects. SECTION III.. THAT this resolution shall take effect from and after its final date of adoption, and it is accordingly so ordered. Adopted by the City Council of the City of Fort Worth, Texas this /(e~ day of October, A.D., 1990. Bob Bolen Mayor ATTEST: APPROVED BY CITY COUNCIL City Secretary I~P\PROVED AS TO FORM: OCT 16 1990 ,I City Attorney •' ^ - city soczetaxy of the City of Pon WoM, Texnx EXHIBIT "A" • POLICY STATEMENT TAX ABATEMENT FOR COMMERCIAL/INDUSTRIAL PROJECTS CITY OF FORT WORTH I. General Purpose and Objectives Certain types of business investment show high promise of creating new jobs, new income and positive spillover effects beneficial to the City. Therefore, the City of Fort Worth will give consideration, on a case-by-case basis, to providing tax abatement according to state law to the owners of real property for projects which stimulate economic growth and diversification in the City of Fort Worth, Texas. New, as well as expanding and modernizing facilities and structures, will be considered. Evaluation of a tax abatement request will be based on the information provided in the tax abatement application. However, the City of Fort Worth is under no obligation to provide tax abatement to any applicant. Priority consideration will be given to projects located in the enterprise zones and those projects which result in a development with little or no additional cost to the City and/or result in 1,000 or more new jobs. II. Definitions "Abatement" means the full or partial exemption from ad valorem taxes of eligible properties in a reinvestment zone designated a~ such by the City of Fort Worth for economic development purposes. "Modernization" means the replacement and upgrading of existing facilities which increases production, updates technology, or substantially lowers the cost of operation and extends the economic life of the facility. "Reinvestment Zone" is an area designated as such by the City of Fort Worth in accordance with the Texas Property Redevelopment and Tax Abatement Act, Sections 312.001 through 312.209, Tax Code. III. Criteria A. Tax abatement may be granted for a development project, excluding land, which has a minimum capital investment of $10 million, OR 2. $500,000 if the business commits to hiring residents from an eligible "inner city" area for full-time, permanent positions. A map of the eligible areas can • be obtained from the Office of Economic Development; however, the "inner city" is defined as a census tract having at least two of the following four criteria: -1- (1) Unemployment rate greater than 1.5 times the state • rate. (2) 20$ or more poverty. (3) Low income (70$ or more of the household have income at or below 80$ of the city median). (4) Population loss equal to or greater than 20$. A project of less than $500,000, which is located in the inner city areas, may be eligible for consideration if the City Council determines it is in the best interest of the City. S. The state law prohibits tax abatement of existing tax base. Abatement can be considered only for the increase in valuation above the existing valuation of a particular property and for a maximum term of 10 years. The amount and terms of the abatement will be determined by factors such as the costs to the City, the project's increased valuation to the tax base, and the number and types of new jobs and new or expanding local businesses resulting from the project. C. The "Application for Tax Abatement" form must be completed and submitted to the City Manager outlining the following: 1. project specifications, 2. costs and benefits to the City, 3. employment impact in the City and the region, 4. fiscal impact, 5. community impact, 6. projected construction dollars to be spent on the project with a percentage of such dollars that would be awarded to Fort Worth contractors and subcontactors, and 7. projected total annual supplier and professional service contracts in terms of dollars, and the projected percentages of each such category that will be awarded to Fort Worth companies and entities, during the abatement period. A Fort Worth company is one which has a principal office within the city limits of Fort Worth. It is the policy of the City of Fort Worth to encourage the use of disadvantaged business enterprises in contracting opportunities. IV. Procedural Guidelines Any person, partnership, organization, corporation or other en- tity desiring that the City of Fort Worth consider providing tax abatement to encourage location, expansion and/or modernization of operations within the city limits of Fort Worth shall be • required to comply with the following procedural guidelines. Nothing within these guidelines shall imply or suggest that Fort Worth is under any obligation to provide tax abatement in any amount or value to any applicant. -2- • • ~3 • Preliminary Applicaton_Steps A. Applicant shall submit an "Application For Tax Abatement" and shall address all criteria questions outlined in Section III above. The application shall include financial and other information deemed appropriate for evaluating the financial capacity and other factors of the applicant. B. Applicant shall prepare a survey map showing the precise location of the property, all roadways within five hundred (500) feet of the site, all existing land uses and zoning within five hundred (500) feet of the site and the kind, number and location of all proposed improvements. C. City may request applicant to provide substantiation of the economic feasibility of the overall project to assist in determining the long term benefit to the City. D. A complete legal description of the property and tax certificate verifying that no taxes are past due on the applicant's property shall be provided. E. Applicant shall complete all forms and information detailed in items A through D above and submit them to the City Manager, City of Fort Worth, 1000 Throckmorton, Fort Worth, Texas 76102. Application Review. Steps F. All information be reviewed for information may G. The application departments for information may in the application package detailed above will completeness and accuracy. Additional be requested as needed. may be distributed to the appropriate City internal review and comments. Additional be requested as needed. H. Copies of the complete application package and staff comments will be provided to the City Council. The City Manager's Office will make a recommendation as to whether or not it is in the City's and the other taxing authorities' best interest to offer tax abatement to a particular applicant. Consideration of the Application I. The City Council will consider conducted pursuant to the Open Redevelopment and Tax Abatement may be requested as needed. the application at meetings Meetings Act and the Property Act. Additional information J. The City Council shall consider a resolution calling a public hearing to consider establishment of a reinvestment zone. -3- K. The City Council shall hold the public hearing and determine . whether the creation of the reinvestment zone would contribute to the retention or expansion of primary employment or would attract major investment in the zone and would contribute to the economic development of the City. • L. The City Council shall consider adoption of an ordinance designating the area described in the legal description of the proposed project as a commercial/industrial reinvestment zone for tax abatement. Consideration of the Tax Abatement Agreement M. The City Council may consider adoption of a resolution which approves the terms and conditions of an agreement between the City and the applicant, and governs the provision of the tax abatement. At minimum, the agreement shall include the following: 1. General description of the project; 2. Amount of the tax abatement and percent of value to be abated each yea r 3. Duration of the abatement; 4. Type, number, location and timetable of planned improvements; 5. Proposed use of the facility; ~'. 6. Number of jobs to be created or retained and a percentage of employment in Fort Worth; 7. Any specific terms and conditions to be met by the applicant; and 8. Reporting information. N. Any tax abatement granted a project will become effective on January 1 of the year following the issuance of a Certificate of Occupancy (CO} for the new facilities unless otherwise specified in the tax abatement agreement. The total acreage of the project shall be assessed at 100 percent market valuation upon execution of the abatement agreement, unless otherwise addressed in the tax abatement agreement. V. Recapture If a project is not completed as specified in the tax abatement agreement, the City has the right to cancel the abatement agreement and abated taxes shall become due to the City and other affected taxing units as provided by law. If any of the provisions • contained in the tax abatement agreement, i.e., employment, amount of investment, etc., are not met, the City shall have the right to reduce or cancel the abatement agreement. If a project granted a tax abatement ceases to operate or is no longer in conformance with • the tax abatement agreement, the agreement shall not be in effect for the period of time during which the project is not operating or is not in conformance. -4- VI. Inspection and Financial Verification • The City of Fort Worth reserves the right to verify the applicant's credit worthiness prior to granting a tax abatement and to review the financial condition of the project during the term of • the abatement. The City of Fort Worth also reserves the right for a representative to inspect the facilities of the applicant during the term of the abatement and to verify the information provided in the tax abatement agreement. Provisions to this effect shall be incorporated into the agreement. VII. Evaluation Upon completion of construction of the facilities, the City Manager's Office shall annually (or such other times deemed appropriate by the City) evaluate each facility receiving abatement to insure compliance with the agreement and report possible violations of the agreement to all affected taxing units. Any individual or entity receiving tax abatement shall agree to provide information to the City of Fort Worth on a form provided by the City of Fort Worth for the evaluation. Any individual or entity which receives a tax abatement from the City of Fort Worth shall provide information requested by the City including, but not limited to, the following: •' (A} The number of dollar amounts of all construction contracts and subcontracts awarded on the job, specifying which companies are Fort Worth entities. (To be provided quarterly.) (B) The total number of employees of the company, their total salaries, the number of employees who reside in Fort Worth and their gross salaries. These jobs shall be reported in job classifications appropriate to the employees. (To be provided annually.} (C) The gross dollars spent on supplier and professional service contracts, broken down to demonstrate the amounts by contract awarded and performed by Fort Worth indivi- duals and entities. (To be provided semi-annually.) (D) The dollar amount of contracts awarded to Disadvantaged Business Enterprises (DBE). (To be provided annually.) (E) If the dollars or percentages do not equal the original or City Council approved modified projections, the party receiving the abatement shall state the explanation for the failure to meet the projection, together with a recommended course of rectification. lJ -5- It is the policy of the City of Fort Worth that, an agreed upon • percentage of the employees of companies receiving an abatement shall reside in Fort Worth. At the end of each City fiscal year, the company receiving the abatement shall submit a certified list of employees with their addresses to the City Council. If the • percentage is below that agreed upon for the prior year, the abatement may be lowered for the next year on a pro rata basis. A separate calculation shall occur yearly. VIII. Effect Of Sale, Assignment Or Lease Of Property No tax abatement rights may be sold. Tax abatement rights cannot be 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 as to the property sold, assigned or leased. 10/9/90 • • -6- APPLICATION FOR TAX ABATEMENT CITY OF FORT WORTH, TEXAS 1. Property Owner: • Company or Project Name: Mailing Address: Telephone Number: ( ) Company representative to be contacted: Name and title: Mailing Address: Telephone Number: ( ) 2. Project Description and Location: ~.. 3. Brief Description of Activities to be Performed at This Location. Include a Description of Products and/or Services: 4. Date Projected for Occupancy of Project/Initiation of Operations: 5. Eligibility Criteria (Attach statement describing how project • meets tax abatement policy criteria): C~ • APPLICATION FOR TAX ABATEMENT 6. Em~lovment.Imvact A. Construction Employment Estimates: Start: Month/Year / Completion Date: Number of Construction Jobs: Estimated Construction Payroll: $ Percentage of Construction Dollars to lie Spent With Fort Worth Based Contractors or Sub-Contractors k Estimate of Contract Dollars to DBE (Disadvantaged Business Enterprises) $ B. Permanent Employment Estimates: Current Employment at This Location (If Applicable): Estimated Number of New Jobs Created by This Project and • Estimated Percentage of Permanent Full-Time Jobs to be Held by Fort Worth Residents*: At Start/Opening: New Hires Transfers In Year Percentage ~ 5 Years After Opening: New Hires Transfers In Year Percentage $ 10 Years After Opening: New Hires Transfers In Year Percentage $ C. Estimated Annual Payroll - Permanent Employment: Existing Jobs (If Applicable): $ New Jobs $ in Year • Total Annual Payroll $ in Year *Each application will be reviewed on its merits. However, absent . extraordinary circumstances, a minimum of 25~ of the employees shall be Fort Worth residents. Company shall report annually and a prorata reduction of the abatement shall occur if the percentage is not met. Page 2 of 5 APPLICATION FOR TAX ABATEMENT D. Types of Jobs/Job Titles 7. Project Impact. A. Existing Value (per Tarrant Appraisal District): 1. Land $ 2. Improvements $ 3. Personal Property $ B. Estimated Total Cost of Project: Page 3 of 5 1. Site Development $ • 2. Structures $ 3. Personal Property $ C. Estimated revenue per year for first five years subject to sales tax. 1. First Year $ 2. Second Year $ 3. Third Year $ 4. Fourth Year $ 5. Fifth Year $ 8. Describe Any Off-Site Infrastructure Requirements: Water: • Sanitary Sewer: C~ • APPLICATION FOR TAX ABATEMENT Page 4 of 5 Streets: Storm Sewer: Other: 9. Is Property Zoned Appropriately? Yes No Current Zoning • Required Zoning 10. Is Property Platted? Yes No Will Replatting be Necessary? Yes No 11. Impact on Local Business (When Project is Fully Operational): A. Annual value of total supplier and services contracts: 'B. Annual value of supplier and services contracts for Fort Worth businesses: S C. Annual value of contract dollars to DBE: . 12. Describe any other direct benefits to the City of Fort Worth as a result of this project (e.g., sales tax revenue). APPLICATION FOR TAX ABATEMENT Page 5 of 5 13. Environmental Impacts, If any, created by the project: 14. Justification for Tax Abatement Request (Attach documentation to substantiate and more fully describe the justification for this request. Include the amount of the abatement requested and show how it will contribute to the financial viability of the project.) 15. Financial Information - Attach a copy of the latest audited financial statements or, in the case of a new project, a business plan. The application for tax abatement is submitted with the acknowledgment that additional certified financial information may be required. It is further understood and acknowledged that the City Council of the City of Fort Worth encourages the use of local consultants, construction firms and suppliers (with special emphasis given to disadvantaged business enterprises) and that, if approved, the final abatement agreement will require use of local firms when possible in conjunction with this project. Authorized Signature • Date