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HomeMy WebLinkAboutIR 9040 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 9040 To the Mayor and Members of the City Council May 5, 2009 �1lTB Page 1 of 2 SUBJECT: Adopt a Resolution Renewing a Neighborhood Empowerment .., Zone Tax Abatement Policy and Adopt Amendments to Neighborhood Empowerment Zone Tax Abatement Policy and Basic Incentives The purpose of this Informal Report is to provide information regarding the Resolution renewing the City's Neighborhood Empowerment Zone (NEZ) Tax Abatement Policy which expires on May 16, 2009 and information pertaining to the proposed amendments to the NEZ Tax Abatement Policy and Basic Incentives authorized by Chapter 378 of the Texas Local Government Code. If the proposed Resolution is approved, the new policy will be effective May 17, 2009 through May 16, 2011, unless amended at an earlier date or repealed by a vote of at least three-fourth (3/4) of the members of the City Council thereby permitting the City to enter into tax abatement agreements as authorized by the Texas Tax Code Chapter 312. The following are staff's five recommended amendments to the NEZ Tax Abatement Policy and Basic Incentives: 1. Current Policy: Only able to abate ad valorem property taxes under the NEZ Tax Abatement Policy by a tax abatement agreement. Proposed: Include ad valorem personal property taxes for municipal tax abatement. This proposed amendment would mirror the City wide Tax Abatement Policy. 2. Current Policy: In order for an Owner/Developer to apply to receive any incentives provided for under the NEZ Tax Abatement Policy and Basic Incentives, an Owner/Developer must meet with the following persons and organizations to discuss the project. 1) the Council Member for the District the Project is located; and 2) the neighborhood associations or community based organizations registered with the City in the NEZ the project is located. Proposed: It is proposed to require the Owner/Developer to notify and discuss the new construction projects with the Council Member for the District where the Project is located. The Owner/Developer is required to notify within 300 feet the registered neighborhood organizations or community based organizations registered with the City. The measurement of the distance between the proposed project and Neighborhood Association or Community Based Organizations shall be along the property line of the street fronts and from front door and in direct line across intersections. 3. Current Policy: The Owner/Developer must apply for the NEZ Tax Abatement and be approved by the City Council before construction or rehabilitation is started. Pro osed: The Owner/Developer must apply for the NEZ Tax Abatement and be approved by the City Council before construction or rehabilitation is started with the exception of grading or demolition activities. 4. Housekeeping Amendments. Reflect the name change of "Housing Department" to "Housing and Economic Development Department", ISSUED BY THE CITY !MANAGER FORT WORTH, TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No, 9040 ` To the Mayor and Members of the City Council May 5, 2009 Page 2 of 2 fir: SUBJECT: Adopt a Resolution Renewing a Neighborhood Empowerment Zone Tax Abatement Policy and Adopt Amendments to Neighborhood Empowerment Zone Tax Abatement Policy and Basic Incentives • Remove reference to Council Committee. • Other housekeeping amendments. Staff recommends proceeding with placing the NEZ Tax Abatement Policy renewal Resolution and amendments adoption on the May 12, 2009, City Council agenda for consideration. If you should have any questions regarding this information please contact Cynthia Garcia, Assistant Director, Housing and Economic Development Department at 817-392-8187. Dale A. Fissele# , mow, City Manager Attachment Proposed NEZ Tax Abatement Policy and Basic Incentives ISSUED BY THE CITY MANAGER FORT WORTH, TEXAS fr CITY OF FORT WORTH rul NEIGHBORHOOD EMPOWERMENT ZONE {NEZ} TAX ABATEMENT POLICY AND BASIC INCENTIVES 1. GENERAL PURPOSE AND OBJECTIVES Chapter 378 of the Texas Local Government Code allows a municipality to create a Neighborhood Empowerment Zone (NEZ) when a "...municipality determines that the creation of the zone would promote: (1) the creation of affordable housing, including manufactured housing, in the zone; (2) an increase in economic development in the zone, (3) an increase in the quality of social services, education, or public safety provided to residents of the zone; or (4) the rehabilitation of affordable housing in the zone." The City, by adopting the following NEZ Tax Abatement Policy and Basic Incentives, will promote affordable housing and economic development in Neighborhood Empowerment Zones. NEZ incentives will not be granted after the NEZ expires as defined in the resolution designating the NEZ. For each NEZ, the City Council may approve additional terms and incentives as permitted by Chapter 378 of the Texas Local Government Code or by City Council resolution. However, any tax abatement awarded before the expiration of a NEZ shall carry its full term according to its tax abatement agreement approved by the`City"Council. As mandated by state law, the property tax abatement under this policy applies to the owners of real property. Nothing in the policy shall be construed as an obligation by the City of Fort Worth to approve any tax abatement application. 11. DEFINITIONS "Abatement or Tax Abatement"means full or partial exemption from City of Fort Worth ad valorem taxes on eligible real aid personal property' located in a NEZ for a secified period on the difference bet tii the amount of increase in the a ora;sed value as reflected on the certified tax roll of the a ro rate count a raisal district` resuitin from i� rove�ents beoun after the execut<on of a written Tax Abatement A regiment and lip tle a raised value of such real.estate prior to execution of a written Tax Abatement A reerent as reflected cn the most on which the Tax Abatement Aareement was executedl Ease Va/ e„is the value of the property, excluding land, as determined by the Tarrant County Appraisal District, during the year rehabilitation occurs. "Building Standards Commission" is the commission created under Sac. 7-77, Article IV, Minimum Building Standards Code of the Fort Worth City Code. _ "Capital Investment" includes only real property improvements such as new facilities and structures, site improvements, facility expansion, and facility modernization, Capital Investment does NOT include land acquisition costs and/or any existing improvements, or personal property (such as machinery, equipment, and/or supplies and inventory). "City of Fart Worth Tax Abatement Policy Statement"means the policy adopted by City Council on February 29, 2000. "Commercialllndustrial Development Project" is a development project which proposes to construct or rehabilitate commercial/industrial facilities on property that is (or meets the requirements to be) zoned commercial; industrial or mixed use as defined by the City of Fort Worth Zoning Ordinance. "Community Facility Development Project""is a development project which proposes to construct or rehabilitate community facilities on property that allows such use as defined by the City of Fort Worth Zoning Ordinance. "Eligible Rehabilitation" includes only physical improvements to real property. Eligible Rehabilitation does NOT include personal property (such as furniture, appliances, equipment, and/or supplies). "Gross Floor Area" is measured by taking the outside dimensions of the building at each floor level, except that portion of the basement used only for utilities or storage; and any areas within w the building used for off-street parking. "Minimum Building Standards Code"is Article IV of the Fort Worth City Code adopted pursuant to Texas Local Government Code, Chapters 54 and 214. "Minority Business Enterprise {MBE}"and "Women Business Enterprise (WBE)"is a minority or woman owned business that has received certification as either a certified MBE or certified WBE by either the North Texas Regional Certification Agency (NTRCA) or the Texas Department of Transportation (TxDot), Highway Division. "Mixed-Use Development Project" is a development project which proposes to construct or rehabilitate mixed-use facilities in which residential uses constitute 20 percent or more of the total gross floor area, and office, eating and entertainment, and/or retail sales and service uses constitute 10 percent or more of the total gross floor area and is on property that is or meets the requirements to be) zoned mixed-use as described by the City of Fort Worth Zoning Ordinance, ";Multi-family Development Project' is a development project which proposes to construct or rehabilitate multi family residential living units on property that is (or meets the requirements to be) zoned multi family or mixed use as defined by the City of Fort Worth Zoning Ordinance, "Prof ct" means a 'Pesidential Project", 'Oo rimer ciallIndus rial Development r rax a €"�" ?'�"om a i rkv F t'_, 'g,,.:,elopment rq"ie.t" 'fvfix..�"',� €�,s�; a�° �eloo pent rroject", 'fir ,.,x �,.r.w�=F.�de faze v,.ra 'a'` Development e.",.� ,. t � .Z 2 "Reinvestment Zone" is an area designated as such by the City of Fart Worth in accordance 3 with the Property Redevelopment and Tax Abatement Act codified in Chapter 312 of the Texas Tax Code, or an area designated as an enterprise zone pursuant to the Texas Enterprise Zone Act, codified in Chapter 2303 of the Texas Government Code. Ill. MUNICIPAL PROPERTY TAX ABATEMENTS A. RESIDENTIAL PROPERTIES LOCATED IN A NEZ- FULL ABATEMENT FOR 5 YEARS I. For residential property purchased before NEZ designation, a homeowner shall be eligible to apply for a tax abatement by meeting the following: a. Property is owner-occupied and the primary residence of the homeowner prior to the final NEZ designation. Homeowner shall provide proof of ownership by a warranty deed, affidavit of heirship, or a probated will, and shall show proof of primary residence by homestead exemption; and b. Property is rehabilitated after NEZ designation and City Council approval of the tax abatement; c. Homeowner must perform Eligible Rehabilitation on the property after NEZ designation equal to or in excess of 30% of the Base Value of the property; and d. Property is not in a tax-delinquent status when the abatement application is submitted. 2. For residential property purchased after NEZ designation, a homeowner shall be r eligible to apply for a tax abatement by meeting the following: a. Property is constructed or rehabilitated after NEZ designation and City Council approval of the tax abatement; b. Property is owner-occupied and is the primary residence of the homeowner. Homeowner shall provide proof of ownership by a warranty deed, affidavit of heirship, or a probated will, and shall show proof of primary residence by homestead exemption; c. For rehabilitated property, Eligible Rehabilitation costs on the property shall be equal to or in excess of 0% of the Base Value of the property. The seller or owner shall provide the City information to support rehabilitation costs; d. Property is not in a tax-delinquent status when the abatement application is submitted; and e, Property is in conformance with the City of Fort Werth Zoning Ordinance. 1 For investor owned single family property, an investor shall be eligible to apply for a tax abatement by meeting the following, a. Property is constructed or rehabilitated after NEZ designation and City Council approval of the tax abatement; b. For rehabilitated property, Eligible Rehabilitation costs on the property shall be equal to or in excess of 30% of the Base Value of the property; c. Property is not in a tax-delinquent status when the abatement application is submittted,, and 3 B. MULTI FAMILY DEVELOPMENT PROJECTS LOCATED IN A NEZ �r 1. 140% Abatement for 5 years. If an applicant applies for a tax abatement agreement with a term of five years or less, this section shall apply. Abatements for multi-family development projects for up to 5 years are subject to City Council approval. The applicant may apply with the Housing and Economic Development Department for such abatement. arr nnrr fro=rm�=nr° ne ra6ro 6-alaf ts �s � �+<sr^Ear6 In order to be eligible for a property tax abatement upon completion, a newly constructed or rehabilitated multi-family development project in a NEZ must satisfy the following: At least twenty percent (20%) of the total units constructed or rehabilitated shall be affordable (as defined by the U. S. Department of Housing and Urban Development) to persons with incomes at or below eighty percent (80%) of area median income based on family size and such units shall be set aside for persons at or below 80% of the median income as defined by the U.S. Department of Housing and Urban Development. City Council may waive or reduce the 20% affordability requirement on a case-by-case basis; and (a) For a multi-family development project constructed after NEZ designation, the project must provide at least five (5) residential living units OR have a minimum Capital Investment of$240,404; or (b) For a rehabilitation project, the property must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property. Such Eligible Rehabilitation costs must come from the rehabilitation of at least five (5) residential living units or a minimum Capital Investment of$200,404. , 1%-140% Abatement of City Ad Valorem taxes up to 14 years If an applicant applies for a tax abatement a reemen with a terra of more than five years, this section shall apply. Abatements for multi-family development projects for up to 10 years are subject to City Council approval. The applicant may apple with the Housing and Economic eveloprne st-Department for such abatement. 4 Years 1 through 5 of the Tax Abatement Agreement Multi-family projects shall be eligible for 100% abatement of City ad valorem taxes for years one through five of the Tax Abatement Agreement upon the satisfaction of the following: At least twenty percent (20%) of the total units constructed or rehabilitated shall be affordable (as defined by the U. S. Department of Housing and Urban Development) to persons with incomes at or below eighty percent (80%) of area median income based on family size and such units shall be set aside for persons at or below 80% of the median income as defined by the U.S. Department of Housing and Urban Development.. City Council may waive or reduce the 20% affordability requirement on a case-by-case basis; and a. For a multi-family development project constructed after NEZ designation, the project must provide at least five (5) -residential living units OR have a minimum Capital Investment of$200,000; or b. For a rehabilitation project, the property must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property. Such Eligible Rehabilitation costs must come from the rehabilitation of at least five (5) residential living units or a minimum Capital Investment of$200,000. Years 6 through 10 of the Tax Abatement Agreement Multi-family projects shall be eligible for a 1%-100% abatement of City ad valorem taxes for years six through ten of the Tax Abatement Agreement upon the satisfaction of the following: a. At least twenty percent (20%) of the total units constructed or rehabilitated shall be affordable (as defined by the U. S. Department of Housing and Urban Development) to persons with incomes at or below eighty percent (€30%) of area median income based on family size and such units shall be set aside for persons at or below 60% of the median income as defined by the U.S. Department of Housing and Urban Development. City Council may waive or reduce the 20% affordability requirement on a case-by-case basis; and 1. For a multi-family development project constructed after NEZ designation, the project must provide at least five (5) residential living units OR have a minimum Capital Investment of$200,000„ or 2> For a rehabilitation project, the property must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30 of the Base Value of the property. Such Eligible Rehabilitation costs must come from the rehabilitation of at least fi ve (5) resident al ;i°ping units or a minimum Capital Investment of$200,000, b. Any other terrns as City Council of the City of Fort north deems appropriate, including, but not limited to; t. utilization of Fort Worth companies for an agreed upon percentage of the total costs for construction contracts: 2, utilization of certified minority and women owned business enterprises for an agreed upon percentage of the total costs for cons ruct.on contracts: 4, com- m--.,t to hire an agreeed upon peercentage of Fort, h rree,s i"I e n t S 5 5. commit to hire an agreed upon percentage of Central City residents 6. landscaping; 7. tenant selection plans; and 8. management plans. C. COMMERCIAL, INDUSTRIAL AND COMMUNITY FACILITIES DEVELOPMENT PROJECTS LOCATED IN A NEZ 1, 100% Abatement of City Ad Valorem taxes for 5 nears If an applicant applies for a tax abatement agreement with a term of five years or less, this section shall apply. Abatements for Commercial, Industrial and Community Facilities Development Projects for up to 5 years are subject to City Council approval. The applicant may apply with the Housing and Economic Development Department for such abatement. In order to be eligible for a property tax abatement, a newly constructed or rehabilitated commercial/industrial and community facilities development project in a NEZ must satisfy the following: a. A commercial, industrial or a community facilities development projectnwt constructed after NEZ designation must have a minimum Capital Investment of $75,000; or b. For a rehabilitation project, it must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property, or$75,000, whichever is greater. 2. 1%-100% Abatement of City Ad Valorem taxes up to 10 years If an applicant applies for a tax abatement agreement with a term of more than five years, this section shall apply. Abatements agreements for a Commercial, Industrial and Community Facilities Development projects for up to 10 years are subject to City Council approval. The applicant may apply with the Dousing and Economic i. ' Development Department for such abatement. z 3 f' sa G-G46 V i Z .. s s. �., Years 1 thr uah 5 of the Tax Abatement Aareem-nt Commercial, Industrial and Community Facilities Development projects shall be eligible for 100% abatement of City ad valorem taxes for the first five years of the Tax Abatement Agreement upon the satisfaction of the following: 6 a. A commercial, industrial or a community facilities development project r constructed after NEZ designation must have a minimum Capital Investment of $75,000; or b. For a rehabilitation project, it must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property, or$75,000, whichever is greater. Years 6 through 10 of the Tau Abatement Agreement Commercial, Industrial and Community Facilities Development projects shall be eligible for 1%-100% abatement of City ad valorem taxes for years six through ten of the Tax Abatement Agreement upon the satisfaction of the following: a. A commercial, industrial or a community facilities development project constructed after NEZ designation must have a minimum Capital Investment of $75,000 and must meet the requirements of subsection {e} below ; or b. For a rehabilitation project, it must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property, or $75,000, whichever is greater and meet the requirements of subsection {c} below. c. Any other terms as City Council of the City of Fort Worth deems appropriate, including, but not limited to: 1. utilization of Fort Worth companies for an agreed upon percentage of the total costs for construction contracts; 2. utilization of certified minority and women owned business enterprises for an agreed upon percentage of the total costs for construction contracts; 3. commit to hire an agreed upon percentage of Fort Worth residents; 4. commit to hire an agreed upon percentage of Central City residents; and 5. landscaping. D. MIXED-USE DEVELOPMENT PROJECTS LOCATED IN A NEZ 1. 100%Abatement of City Ad Valorem taxes for 5 years If an applicant applies for a tau abatement agreement with a terra of five years or less. this section shall apply. Abatements for Mixed-Use Development projects for up to 5 years are subject to City Council approval. The applicant may apply with the dousing and Economic veloprnent Department for such abatement. In order to be eligible for a property tax abatement, upon completion, a newly constructed or rehabilitated nixed-use development project in a NEZ must satisfy the frill ov i g: a- Residentia' uses in the pnojetc Floor Area ofthe pro'ec and 7 b. Office, eating and entertainment, and/or retail sales and service uses in the r project constitute 10 percent or more of the total Gross Floor Area of the project; N: and (1) A mixed-use development project constructed after NEZ designation must have a minimum Capital Investment of$200,000; or (2) For a rehabilitation project, it must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property, or$200,000, whichever is greater. 2. 1%-100% Abatement of City Ad Valorem taxes up to 10 years If an applicant applies for a tax abatement agreement with a term of more than five years, this section shall apply. Abatements agreements for a Mixed Use Development projects for up to 10 years are subject to City Council approval. The applicant may apply with the Housing grad Economic Development Department for such abatement. Years 1 through 5 of the Tax Abatement Agreement Mixed Use Development projects shall be eligible for 10014 abatement of City ad ram valorem taxes for the first five years of the Tax Abatement Agreement upon the ` satisfaction of the following: a. Residential uses in the project constitute 20 percent or more of the total Gross Floor Area of the project; and b. Office, eating and entertainment, and/or retail sales and service uses in the project constitute 10 percent or more of the total Gross Floor Area of the project; and c. A new mixed-use development project constructed after NEZ designation must have a minimum Capital Investment of $200,000; or for a rehabilitation project, it must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Ease Value of the property, or $200,000; whichever is greater. Years 0 throul,,h 10 of the Tax Abatement A rep ent Mixed Use Development projects shall be eligible for 1-100% abatement of City ad valorem taxes for years six through ten of the Tax Abatement Agreement upon the satisfaction of the following: . Residential uses t ect constitute 20 per enmore of the total Gross Floor Area the pro ect 8 b. Office, eating and entertainment, and/or retail sales and service uses in the project constitute 10 percent or more of the total Grass Fluor Area of the project; c. A new mixed-use development project constructed after NEZ designation must have a minimum Capital Investment of $200,000; or for a rehabilitation project, it must be rehabilitated after NEZ designation. Eligible Rehabilitation costs on the property shall be at least 30% of the Base Value of the property, or $200,000, whichever is greater; and d. Any other terms as City Council of the City of Fort Worth deems appropriate, including, but not limited to: 1. utilization of Fort Worth companies for an agreed upon percentage of the total costs for construction contracts; 2. utilization of certified minority and women owned Business enterprises for an agreed upon percentage of the total costs for construction contracts; 3. property inspection; 4. commit to hire an agreed upon,percentage of Fort Worth residents 5. commit to hire an agreed upon percentage of Central City residents 6. landscaping; 7. tenant selection plans; and 8. management plans. E. ABATEMENT GUIDELINES 1. If a NEZ is located in a Tax Increment Financing District, City Council will determine on a case-by-case basis if the tax abatement incentives in Section III will be offered 40 to eligible Projects. Eligible Projects must meet all eligibility requirements specified in Section III. 2. A tax abatement shall not be granted for any development project in which a building permit olicetlon, excluding grading and/or demolition, has been filed with the City's Planning and Develol2ment Department. In addition, the City gill not abate taxes on the value of real or personal property for and period of time prior to the year of execution of a`Tax Abatement Aoreernent with the City. :3. If a Project is located in the Woodhaven Neighborhood Empowerment Zone, in order to be considered "eligible" to apply for a tax abatement under this Policy, the Woodhaven Community Development Corporation and the Woodhaven Neighborhood Association must have submitted a letter of support for the Project to the City of Fort'North In order to be eligible to apply for a tax abatement, the property owner/developer must= at Not be delinquent in paying property taxes for any property owned by the owner/developer, except that an owner/developer may enter into a tax abatement agreement with the city of Fort Worth for a specific Project if: 1. the Project meets NEZ tax abatement criteria, and 20 the applicant is not responsible for the tax delinp n y for the Property, and 3. the applicant tenters sir an agreement to. payoff It under the g under ss-tate law and u, peirrnnfteedl 9 4. the tax abatement shall provide that the agreement shall take effect after the delinquent taxes are paid in full u b. Not have any City of Fort Worth liens filed against any property owned by the applicant property owner/developer. "Liens" include, but are not limited to, weed liens, demolition liens, board-up/open structure liens and paving liens. �-5. Projects to be constructed on property to be purchased under a contract for deed are not eligible for tax abatements. 5, Once a NEZ property owner of a residential property (including multi-family) in the NEZ satisfies the criteria set forth in Sections III.A, E.1. and E.2. and applies for an abatement, a property owner may enter into a tax abatement agreement with the City of Fort Worth. The tax abatement agreement shall automatically terminate if the property subject to the tax abatement agreement is in violation of the City of Fort Worth's Minimum Building Standards Code and the owner is convicted of such violation. =7 A tax abatement granted under the criteria set forth in Section III. can only be granted once for a property in a NEZ for a maximum term of as specified in the agreement. If a property on which tax is being abated is sold, the City 4 ma assign the tax abatement agreement for the remaining term once the new owner submits an application- so long as the new owner complies with all of the terms of the tax abatement agreement. 7—LA property owner/developer of a multifamily development, commercial, industrial, community facilities and mixed-use development project in the NEZ who desires a tax Ed- abatement under Sections III.B, C or D must: ��.�rs a. Satisfy the criteria set forth in Sections 111.13, C or D, as applicable, and Sections III.E.1 E.2; and E3. and b. File an application with the Housing and Economic Development Department, as applicable; and c. The property owner must enter into a tax abatement agreement with the City of Fort Worth. In addition to the other terms of agreement, the tax abatement agreement shall provide that the agreement shall automatically terminate if the owner receives one conviction of a violation of the City of Fort Worth's Minimum Building Standards Code regarding the property subject to the abatement agreement during the term of the tax abatement agreement; and d. If a property in the NEZ on which tax is being abated is sold, the new owner may enter into a tax abatement agreement on the property for the remaining tern. if the terms of the tax abatement agreement are not met, the City Council has the right to once, or amend the abatement agreement, in the event of cancellation, the recapture of abated taxes shall be limited to the year's; in which the default occurred or continued. 15. The terms of the agreement shall include the City of Fort Worth's right to; 1 j 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 yeas conduct an on site insper ion of the Project in each year during the life of the abatement to verify .ph .c � �.. u s tax abatement gre at un ran agreement if the Project contains or will contain a sexually oriented business (4 terminate the agreement, as determined in City's sole discretion, if the Project contains or will contain a liquor store or package store. 44�1l. 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 the City Council. On or before February 1st 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 cancellation of agreement and any taxes abated in the prior year being due and payable. 124. If a property in the NEZ on which tax is being abated is sold, the new owner may enter into a tax abatement agreement on the property for the remaining term. Any sale, assignment or lease of the property which is not permitted in the tax abatement agreement results in automatic cancellation of the agreement and recapture of any taxes abated after the date on which an unspecified assignment occurred. ti F. APPLICATION FEE 1. An application fee of$25.00 for all basic incentives, excluding tax abatements. 2. The application fee for residential tax abatements governed under Section III.A is $100. 3. The application fee for multi-family, commercial, industrial, community facilities and mixed-use development projects governed under Sections III.B,, C. and D., is one- half of one percent (0.5%) of the proposed Project's Capital Investment, with a $200 minimum not to exceed $2,000. The Application Fee shall not be credited or refunded to any party for any reason, M FEE WAIVERS, A, ELIGIBLE RECIPIENTS/PROPERTIES 1, City Council shall determine on a case-by-case basis whether a Proiect that will contain or contains a liquor -store or package store is eligible to apply for a fee %maiver, 2. If a Project is located in the Woodhaven Neighborhood Empowerment Zone, in order to be considered "eligible' to apply for a fee waiver under this Policy, the Woodhaven Community Development Corporation and the Woodhaven Neighborhood Associ'ation must have submiffed a lo r oil support,for the Project to the City af Foo Worth—however, once the NEZ Plan is submitted for the Woodhaven NEZ, this will no longer be required. 1 Projects to be constructed on property to be purchased under a contract for deed are not eligible for development fee waivers. 4. In order for a property owner/developer to be eligible to apply for fee waivers for a Project, the property owner/developer: a, must submit an application to the City; b. must not be delinquent in paying property taxes for any property owned by the owner/developer or applicant; c. must not have any City liens filed against any property owned by the applicant property owner/developer, including but not limited to, weed liens, demolition liens, board-up/open structure liens and paving liens; and d. of a Project that will contain or contains a liquor store, package store or a sexually oriented business has received City Councils determination that the Project is eligible to apply for fee waivers. Approval of the application and waiver of the fees shall not be deemed to be approval of any aspect of the Project. Before construction, the applicant must ensure that the project is located in the correct zoning district. B. DEVELOPMENT FEES Once the Application for NEZ Incentives has been approved and certified by the City, the following fees for services performed by the City of Fort Worth for Projects in the NEZ are waived for new construction projects or rehabilitation projects that expend at least 30% of the Base Value of the property on Eligible Rehabilitation costs: 1. All building permit related fees (including Plans Review and Inspections) 2. Plat application fee (including concept plan, preliminary plat, final plat, short form replat) 3. Board of Adjustment application fee 4. Demolition fee 5. Structure moving fee 0, Community Facilities Agreement (CFA) application fee 7, Zoning application fee 3. Street and utility easement vacation application fee . Ordinance Inspection Fees 10. Consent/Encroachment Agreement Application Fees Other development related fees not specified above will be considered for approval by City Council on a case-cry-case basis. C. IMPACT FEES Single family and mulb-family residential development projects in the NEZ, Automatic 10,0% waiver of wate and wastewater i p c t frees will be p w i -. 2 2. Commercial, industrial, mixed-use, or community facility development projects in the w✓ NEZ, a. Automatic 100% waiver of water and wastewater impact fees up to $55,000 or equivalent to two 6-inch meters for each commercial, industrial, mixed-use or community facility development project. b. If the project requests an impact fee waiver exceeding $55,000 or requesting a waiver for larger and/or more than two 6-inch meter, then City Council approval is required. Applicant may request the additional amount of impact fee waiver through the s4 Planning and Develoornent Department. V. RELEASE GP CITY LIENS A. ELIGIBLE RECIPIENTS/PROPERTIES 1. Project must be located in a NEZ. - . City Council shall determine on a case-by-case basis whether a Project that will contain or contains a liquor store or package store is eligible to apply �_Leceive a b ia,4 . release of City liens. 4 . If a Project is located in the Woodhaven Neighborhood Empowerment Zone, in order to be considered "eligible" to apply for release of city liens under this Policy, the Woodhaven Community Development Corporation and the Woodhaven Neighborhood Association must have submitted a letter of support for the Project to the City of Fort Worth-however, once the NEZ Plan is submitted for the Woodhaven NEZ, this will no longer be required. . Projects to be constructed on property to be purchased under a contract for deed are not eligible for any release of City Liens. 5 In order for a property owner/developer to be eligible to apply for a release of city liens contained in Section V.B., C,, D., and E. for a Project, the property owner/developer: . most submit an application to the City= b. must not be delinquent in paying property taxes for any property owned by the owner/developer; b, must not have been subject to a Building Standards Commission's Order of Demolition where the property was demolished within the last five , years; . must not have any City of Tort worth liens filed against any other properly owned by the applicant property owner/developer. "Liens' includes; but is not limited to, weed l ens, demolition liens: board-up/open structure liens and paving liens, and d, of a Project that contains or will contain: a liquor store, package store or a sexually oriented business has received City Council's determination the Project is eligible to apply receive a release of City, liens. 1 5,6. In order for a Rehabilitation Project to qualify for a release of city liens, the owner/developer must spend Eligible Rehabilitation costs on the Property of at lease 30% of the Base Value of the Property. C 7. Liens shall be released once the Project Improvements have been made to the property. -7 . Any liens filed after the initial certification of the property shall not be released. B. WEED LIENS The following are eligible to apply for release of weed liens: 1. Single unit owners performing rehabilitation on their properties. 2. Builders or developers constructing new homes on vacant lots. 3. Owners performing rehabilitation on multi-family, commercial, industrial, mixed-use, or community facility properties. 4. Developers constructing new multi-family, commercial, industrial, mixed-use or community facility development projects. C. DEMOLITION LIENS Builders or developers developing or rehabilitating a property for a Project are eligible to apply for release of demolition liens for up to $30,000. Releases of demolition liens in excess of$30,000 are subject to City Council approval. D. BOARD-UP/OPEN STRUCTURE LIENS The following are eligible to apply for release of board-up/open structure liens: 1. Single unit owners performing rehabilitation on their properties. 2. Builders or developers constructing new single family homes on vacant lots. 1 Owners performing rehabilitation on multi-family, commercial, industrial; mixed-use, or community facility properties. 4. Developers constructing multi-family, commercial, industrial, mixed-use, or community facility projects. E. PAVING LIENS The following are eligible to apply for release of paving liens:. Single unit owners performing rehabilitation abilitation on their properties. 2 Builders or developers constructing new homes on vacant lots. . Oi neM performing rehabilitation on mutt-farm! . commercial, industrial, mixed-use, or community facility properties. 4. Developers constructing multi-family, commercial, industrial, mixed-use, or community facility projects. i 14 VI, PROCEDURAL STEPS A. APPLICATION SUBMISSION 1, The applicant for NEZ incentives under Sections Ill. IV.; and V. must complete and submit a City of Fort Worth "Application for NEZ Incentives" and pay the appropriate application fee to the - Planning and Development Department, as applicable. 2. The applicant for incentives under Sections III.C.2 and D.2 must also complete and submit a City of Fort Worth "Application for Tax Abatement" and pay the appropriate application fee to the Housing and Economic Development Department . The application fee, review, evaluation and approval will be governed by City of Fort Worth Tax Abatement Policy Statement for Qualifying Development Projects. B. CERTIFICATIONS FOR APPLICATIONS UNDER SECTIONS III. IV, AND V 1. The - Planning and Development Department will review the application for accuracy and_completeness. Once the 44 —_Planning and Development Department determines that the application is complete, the rig- Planning and Development Department will certify the property owner/developer's eligibility to receive tax abatements and/or basic incentives based on the criteria set forth in Section Ill., IV., and V. of this policy; as applicable. Once an applicant's eligibility is certified, the Department will inform appropriate departments administering the incentives. An orientation meeting with City departments and the applicant may be scheduled. The departments include, a. Housing and Economic Development Department: property tax abatement for residential properties and multi-family development projects, release of City liens. b. Housing and Economic Development eoartment 4G-_: property tax abatement for commercial, industrial, community facilities or mixed-use development projects. c. Development Department: development fee waivers. d. Water Department: impact fee waivers. e. Other appropriate departments, if applicable. g � + s 3m`n C. APPLICATION EVI EVALUATION FOR APPLICATIONS Property Tax Abatement for Residential Properties and Multi-family Development Pr oet a. For a completed and certified application for no more than five years of tax abatement smith Council approval, the City tanager shall execute a tax abatement g meft with the ppil� ant, b. For a completed and certified multi-family development project application for more than five years of tax abatement: Ad (1) The Housing and Economic Development Department will evaluate a completed and certified application based on: (a) The project's increase in the value of the tax base. (b) Costs to the City (such as infrastructure participation, etc.). (c) Percent of construction contracts committed to: (i) Fort Worth based firms, and (ii) Minority and Women {awned Business Enterprises (MMIBEs). (d) Other items which the City and the applicant may negotiate. the appliGatie- the Q741,y 99, W t2nne-, e-r+c<r3$irsrn €'",� �'`nsnr�ts§finr� €��+r v d s # C'n^rr�rsir§r�a'� a-�an.!� trsvrsr_s»r$'S°�inr9 §rt ^s�t:ns+r±tr� fin .^nr�tsn�n� � na g r$sa t''nmrrs i$Yar� fnr nnr�e��rz$an*a.::nr r• z (3) Consideration by the City Council 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. c, Effective Date for Approved Agreements All tax abatements approved by the City Council will become eflective on January 1 of the year fallowing the year in which a Certificate of Occupancy (CO) is issued for the qualifying development project (unless otherwise specified in the tax abatement agreement). Unless otherwise specified in the agreement, taxes levied daring the construction of the project shall be due and payable. , Property Tax Abatement for Commercial Industrial; Community Facilities, and Mixed-Use Development Projects a, For a completed and certified application for no more than five years of tax abatement, with Council approval, the City Manager shall execute a tax abatement agreement with the applicant... 1 b. For a completed and certified application for more than five years of tax S a abatement: VII (1) The Housing and Economic Development Department O#€ise-will evaluate a completed and certified application based on: (a) The project's increase in the value of the tax base. (b) Costs to the City (such as infrastructure participation, etc.). (c) Percent of construction contracts committed to: (i) Fort Worth based firms, and (ii) Minority and Women owned Business Enterprises (M/WBEs). (d) Other items which the City and the applicant may negotiate. (2) (a) AppFeve the appliGatieR. Staff will then ;RGGFPGMte the appliGatiGR into a the Feq6le �f ; (3) Consideration by the City Council 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. c. Effective Date for Approved Agreements 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 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. 3. Development Fee Waivers a. For certified applications of development fee waivers that do not require Council approval, the Planning and Development Department will review the certified applicant's application and grant appropriate incentives. 17 b. For certified applications of development fee waivers that require Council approval, City staff will review the certified applicant's application and make ke appropriate recommendations to the City Council, 4. Impact Fee Waiver a. For certified applications of impact fee waivers that do not require Council approval, the Water Department will review the certified applicant's application and grant appropriate incentives. b. For certified applications of impact fee waivers that require Council approval, the Water Department will review the certified applicant's application and make appropriate recommendations to the City Council' 5. Release of City Liens For certified applications of release of City liens; the Housing and Economic Development Department will release the appropriate liens. VII. REFUND POLICY In order for an owner/developer of a Project in a NEZ to receive a refund of development fees or impact fees, the conditions set forth in the Refund of Development and Impact Fee Policy, attached as Attachment 'W' must be satisfied. VIII. OTHER INCENTIVES A. Plan reviews of proposed development projects in the NEZ will be expedited by the Planning and Development Department, 13, The City Council may add the following incentives to a NEZ in the Resolution adopting the NEZ: 1. Municipal sales tax refund 2. Homebuyers assistance 3. Gap financing 4.` Land assembly 5. Conveyance of tax foreclosure properties . Infrastructure improvements 7. Support for Low Income Housing Tax Credit (LIHTC) applications 3. Land use incentives and zoning/building code exemptions, e.g., mixed-use, density bonus, parking exemption . Tax Increment Financing 'TIF 10, Pudic Improvement District IFID 11 Tax-exempt bond inar cis�g 12, New Model Blocks 13, Loan guarantees 14. Equity investments 15. Other incentives that will effectuate the intent and purposes of NEZ. A8 i IX. Public Notification a. Subject to subsection (b), in order for an owner/developer to apply to receive any incentives provided for under the NEZ Tax Abatement Policy and Basic Incentives, an owner/developer must meet with the following persons and organizations to discuss the Project: 1. the Council Member for the District the Project is located; and 2. the neighborhood associations or community based organizations registered with the city-1he N1 E* � i that are within 300 feet of the proposed Project. The measurement of the distance between the proposed project and Neighborhood Associations or Community ;Based Organizations shall be along the property lines of the street fronts and from front door to front door, and in direct line across the intersections. b. Subsection (a) shall be satisfied upon: 1. the owner/developer meeting with the City Council Member for the District the Project is located and the neighborhood associations or community based organizations registered with the city 4i; -� ct :: i ^- s4 that are within 300 feet of the proposed Project; or 2. meeting with the City Council Member for the District the Project is located and upon the owner/developer providing proof that the owner/developer attempted to meet with the neighborhood associations and the community based organizations registered with the city � ` � ' Z within 330 feet of where the K proposed Project is located and the associations or organizations failed to arrange a meeting with the owner/developer within two weeks of initial contact. C. it - r• €. - sf°.- e t s,e o It . X. Ineligible Projects The following Projects or Businesses shall not be eligible for any incentives under the City' of Fort Worth's Neighborhood 'Empowerment Zone (NEZ) Tax Abatement Policy and Basic Incentives: 1. Sexually Oriented Businesses 2 Non-residential mobile structures ATTACHMENT A REFUND OF DEVELOPMENT AND IMPACT FEES POLICY Purpose This refund policy is for the purpose of establishing the conditions under which the City may refund development and impact fees, normally waived through the Neighborhood Empowerment Zone (NEZ). Applicability Unless expressly excepted, this policy applies to all development and impact fees waived by the City through the NEZ. Under the NEZ Tax Abatement Policy and Basic Incentives, City Departments are authorized to waive impact and development fees'for qualified projects located in a designated NEZ. The impact fees include only water and sewer impact fees, up to $55,000 for commercial, industrial, mixed-use or community facilities projects. The development fees that can be waived through the NEZ include: 1. All building permit fees (including Plans Review and Inspections) 2. Plat application fee (including concept plan, preliminary plat, final plat, short form replat) �x 3. Board of Adjustment application fee 4. Demolition fee 5. Structure moving fee & Community Facilities Agreement (CFA) application fee 7. Zoning application fee 8. Street and utility easement vacation application fee. To take advantage of these waivers, applicants need to obtain a certification letter from the gig--Planning and Development Department. Conditions for Refunds The City will consider refunds only when circumstances beyond the developers control prevent them from obtaining the qualification letter from the 14�-­ ...::�Planning and Development Department, A property owner and/or developer may qualify for a refund if the proposed development project meets all criteria to receive a fee waiver under the NEZ Tax Abatement and Basic Incentives Police and- a. The owner and/or developer was not made aware of the NEZ incentives at the time the fees were paid" or f a m The owner and/or developer was mistakenly ly toed that his/her propel by was not in a designated 'EZ. or c. The owner and/or developer has put funds in an escrow account with a City Department while awaiting a decision from the City Council about his/her project; or d. City Council authorizes a City Department to issue a refund to the owner/developer. Refund Charge A refund charge will be assessed to help defray administration cost associated with the processing of refund check. The charge shall be 20% of the amount of the refund. This charge will be automatically deducted from the total refund amount. Statute of Limitations Any request, action or proceeding concerning the refund of fees normally waived through the NEZ must be filed within ninety days following the date that the fees were paid. An applicant who does not submit a refund request within 90 days of the transaction shall not qualify for a refund. To obtain a refund the applicant needs to: • submit a NEZ application to the Fl nning and Development Department for determination of the eligibility for NEZ fee waivers, and • submit a written request to the Department in which the fees were paid. Upon receiving a confirmation from the °441_­ * Fianning and Development Department that the project meets all NEZ fee waiver criteria, that Department shall process the request based on the qualifications discussed in this policy. Exemptions The provisions of this policy do not apply to: a. Fees that are not waived through the NEZ program-, and b. Taxes and special assessments, and c. City liens such as mowing, beard-up, trash, demolition and paving liens. An applicant shall not qualify for any refund if: a. The applicant was made aware of the NEZ incentives before he/she pays the fees; or b. The applicant does not meet the requirements for NEZ incentives at the time he/she paid the fees; or c, The applicant paid the fees before the refund police was put in place; or d. Th applicant paid the fees before the designation date of the NEZ. Disclaimer I € the ,v t of any conflict � ween the City's ordinanc regulations and this olio c ordinances or regulabons shall .,-ont o In the event" f any conflic t bethoveen this 2 policy and ether policies or regulations adopted by the City Department issuing the refund, such department policies or regulations shall control. The City reserves the right to deny any or all request for refunds.