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HomeMy WebLinkAboutContract 43284 (3)CITY SECRETARY coN1RACT NO. ECONOMIC DEVELOPMENT PROGRAM AGREEMENT This ECONOMIC DEVELOPMENT PROGRAM AGREEMENT ("Agreement") is entered into by and between the CITY OF FORT WORTH, TEXAS (the "City"), a home rule municipality organized under the laws of the State of Texas, and STATION VENTURE OPERATIONS, LP ("Company"), a Delaware limited partnership. 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 Agreement: A. Company is in the business of, among other things, owning, operating, promoting, marketing, developing and managing the television station KXAS, the Dallas - Fort Worth affiliate of the NBC broadcasting network. Company currently owns approximately 26 acres of property in the City at 3 900 Barnett Street (the "Land"), which is the location of a significant portion, but not all, of Company's broadcast operations, together with other Affiliates. The Land is more specifically described in Exhibit "A", attached hereto and hereby made a part of this Agreement for all purposes. Company wishes to consolidate the KXAS and Telemundo regional administrative and production studio operations at one, centrally located site in the Fort Worth -Dallas Metroplex, but prefers to remain a part of the Fort Worth community. B. Company is willing to consider the relocation of its regional facilities and operations to an approximately 8.1 acre site at 4805 Amon Carter Blvd. in the City (the "New Location"). The New Location is more specifically described in Exhibit "B", attached hereto and hereby made a part of this Agreement for all purposes. Relocation to and consolidation at the New Location will require construction of an approximately 75,000 square foot facility (the "Project"). Company has provided City staff with evidence of a financial gap between the costs of Company's consolidation of operations at the New Location and costs of location at other sites outside the City. The remainder of the New Location will be used by other Affiliates or otherwise used by NBCUniversal Media, LLC, with the understanding that Company may assign all or any portion of its rights and obligations hereunder, including its right to the grants, to its Affiliates andlor any other entity that succeeds to the ownership of the television station currently known as KXAS in accordance with and pursuant to this Agreement so long as such applicable parties occupy their respective portion of the New Location, in which case such applicable parties' satisfaction of all or any portion of the criteria required to secure the grants shall be deemed satisfaction of the same hereunder. Page 1 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) OFFICIAL RECORD CITY SECRETARY Ft woaTh,'X C. In order to encourage Company to consolidate the KXAS and Telemundo regional administrative and production studio operations at the New Location, together with its other Affiliates, and keep its current operations on the Land until Company is ready to relocate to the New Location, the City has offered Company a twenty-five (25) year economic development incentive consisting of (i) a one (1)-year real and personal property tax abatement at the New Location, as governed by that certain Tax Abatement Agreement by and between the City and Company, a public document on file in the City Secretary's Office as City Secretary Contract No. 43283 (the "Tax Abatement Agreement"), which is incorporated herein by reference and hereby made a part of this Agreement for all purposes, and (ii) twenty-four (24) annual economic development program grants, as authorized by Chapter 380 of the Texas Local Government Code and as governed by this Agreement D. As recommended by the 2012 Comprehensive Plan, adopted by the City Council on March 6, 2012 pursuant to Ordinance No. 20085-03-2012, and in accordance with Resolution No. 3716-03-2009 adopted by the City Council on March 10, 2009, the City has established an economic development program pursuant to which the City will, on a case -by -case basis, offer economic incentive packages authorized by Chapter 380 of the Texas Local Government Code that include monetary loans and grants of public money, as well as the provision of personnel and services of the City, to businesses and entities that the City Council determines will promote state or local economic development and stimulate business and commercial activity in the City in return for verifiable commitments from such businesses or entities to cause specific employment and other public benefits to be made or provided in the City (the "380 Program") E. The City Council has deteliiiined that by entering into this Agreement, the potential economic benefits that will accrue to the City under the terms and conditions of this Agreement are consistent with the City's economic development objectives. In addition, the City Council has determined that the 380 Program is an appropriate means to achieve the Project, which the City Council has determined is necessary and desirable, and that the potential economic benefits that will accrue to the City pursuant to the terms and conditions of this Agreement are consistent with the City's economic development objectives as outlined in the Comprehensive Plan. This Agreement is authorized by Chapter 380 of the Texas Local Government Code. F. The City has determined that the feasibility of the Project is contingent on Company's receipt of the Program Grants, as provided in this Agreement The City's analysis is specifically based on financial information provided by Company. NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: Page 2 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) AGREEMENT 1. INCORPORATION OF RECITALS. The City Council has found, and the City and Company hereby agree, that the recitals set forth above are true and correct and form the basis upon which the parties have entered into this Agreement. 2. DEFINITIONS. In addition to terms defined in the body of this Agreement, the following terms shall have the definitions ascribed to them as follows: 380 Program has the meaning ascribed to it in Recital D. Affiliate means all entities, incorporated or otherwise, under common control with, controlled by or controlling Company. For purposes of this definition, "control' means fifty percent (50%) or more of the ownership determined by either value or vote. Certificate of Completion means the Certificate of Completion issued by the Director pursuant to and in accordance with the Tax Abatement Agreement that certifies whether the City was able to verify that at least Eight Million Dollars ($8,000,000.00) in Construction Costs were expended for the Project by the Completion Date and that the Completion Date occurred on or before the Completion Deadline and, if so, the amounts expended specifically with Fort Worth Companies and Fort Worth Certified M/WBE Companies. Company Records has the meaning ascribed to it in Section 4.10. Completion Date means the date as of which a final certificate of occupancy has been issued by the City for all of the occupiable improvements comprising the Project. Completion Deadline means September 30, 2013, subject to extension due to force majeure pursuant to and in accordance with Section 17 hereof. Construction Costs means actual site development and construction costs, including interior and extenor work directly -related contractor fees, costs of supplies and matenals, engineering fees, architectural and design fees and permit fees, and specifically excludes property acquisition costs. Director means the director of the City's Housing and Economic Development Department. Page 3 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) Effective Date has the meaning ascribed to it in Section 3. Employment Commitment has the meaning ascribed to it in Section 4.5. Employment Percentage has the meaning ascribed to it in Section 5.1.4. First Full Operating Year means the first full calendar year following the year in which the Completion Date occurs. Fort Worth Certified M/WBE Company means a minority or woman -owned business that has received certification as either a minority business enterprise (MBE), a woman business enterprise (WBE) or a disadvantaged business enterprise (DBE) by the North Texas Regional Certification Agency (NTRCA) and that has a principal business office located within the corporate limits of the City that performs a commercially useful function and that provides the services for which Company is seeking credit under this Agreement. Fort Worth Company means a business that has a principal office located within the corporate limits of the City that performs a commercially useful function and that provides the services for which Company is seeking credit under this Agreement. Fort Worth Construction Commitment has the meaning ascribed to it in Section 4.3. 5.1.2. Fort Worth Construction Percentage has the meaning ascribed to it in Section Fort Worth -Dallas Call Sign means Company's visual and audio station identification of itself wherein Fort Worth is listed or announced as the first community served by any of Company's stations, e.g. 'Fort Worth -Dallas," "Fort Worth -Dallas - Arlington," "Fort Worth -Dallas Metroplex", etc. Fort Worth Identification Commitment has the meaning ascribed to it in Section 4.7. Full-time Job means a job provided to one (1) individual by Company at the New Location for at least forty (40) hours per week. Land has the meaning ascribed to it in Recital A. M/WBE Construction Commitment has the meaning ascribed to it in Section 4.4. M/WBE Construction Percentage has the meaning ascribed to it in Section 5.1.3. Page 4 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) New Location has the meaning ascribed to it in Recital B. New Location Personal Property Tax Revenues means ad valorem taxes on New Taxable Tangible Personal Property that are received by the City. With respect to New Taxable Tangible Personal Property leased by Company New Location Personal Property Tax Revenues will include that portion of annual property tax paid by Company prorated on a daily basis, which is attributable to the period during which Company was the lessee of such property. The taxable appraised value of such New Taxable Tangible Personal Property for any given tax year will be established solely by the appraisal district that has jurisdiction over the New Location. New Location Real Property Tax Revenues means ad valorem taxes on improvements located at the New Location (and excluding any taxes on the land comprising the New Location itself), which is described in Exhibit `B" of this Agreement, minus the taxes payable on any improvements located at the New Location for the 2011 tax year, if any. The taxable appraised value of such improvements for any given year will be established solely by the appraisal district that has jurisdiction over the New Location New Taxable Tangible Personal Property means any personal property other than inventory or supplies that (i) is subject to ad valorem taxation by the City; (ii) is located at the New Location; (iii) is owned or leased by Company; and (iv) was not located in the City prior to the Effective Date of this Agreement. Overall Construction Percentage has the meaning ascribed to it in Section 5.1.1. Program Grants means the annual economic development grants paid by the City to Company in accordance with this Agreement and as part of the 380 Program. Program Initiation Year means the second full calendar year following the year in which Company receives its tax abatement pursuant to and in accordance with the Tax Abatement Agreement. Program Source Funds means the maximum amount of City funds upon which a given Program Grant will be calculated, which shall equal the New Location Real Property Tax Revenues plus the New Location Personal Property Tax Revenues received by the City during the Twelve -Month Period ending in the same Program Year in which the Program Grant is payable pursuant to and in accordance with this Agreement. Program Year means a calendar year in which the City is obligated pursuant to this Agreement to pay Company a Program Grant, beginning with the Program Initiation Year. Proiect has the meaning ascribed to it in Recital B. Page 5 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) Second Full Operating Year means the second full year following the year in which the Completion Date occurs. Tax Abatement Agreement has the meaning ascribed to it in Recital C. Term has the meaning ascribed to it in Section 3. Twelve -Month Period means the period between February 1 of a given year and January 31 of the following year. 3. TERM. This Agreement shall be effective as of the date of execution by both parties (the "Effective Date") and, unless terminated earlier in accordance with this Agreement, shall expire on the date as of which the City has paid all Program Grants required hereunder (the "Term"). 4. COMPANY OBLIGATIONS AND COMMITMENTS. 4.1. Real Property Improvements. In accordance with the terms and conditions of this Agreement, by the Completion Date at least Eight Million Dollars ($8,000,000.00) in Construction Costs shall have been expended for the Project. The Completion Date must occur on or before the Completion Deadline, subject to extension due to force majeure pursuant to and in accordance with Section 17 hereof. Compliance with this requirement shall be determined pursuant to and in accordance with the Tax Abatement Agreement as confirmed in the Certificate of Completion issued thereunder. 4.2. Installation of Tangible Personal Property. New Taxable Tangible Personal Property having a value of at least Eight Million Dollars ($8,000 000.00) shall be placed by Company at the New Location by January 1 of the First Full Operating Year, subject to extension due to force majeure pursuant to and in accordance with Section 17 hereof. The value of such New Taxable Tangible Personal Property will be determined solely by the appraisal district having jurisdiction over the New Location at that time, as reflected in the certified appraisal roll received by the City from such appraisal district in the First Full Operating Year. Compliance with this requirement shall be determined pursuant to and in accordance with the Tax Abatement Agreement, as confirmed in the Certificate of Completion issued thereunder. Page 6 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) 4.3. Construction Spending Commitment for Fort Worth Companies. By the Completion Date, at least twenty-five percent (25%) of all Construction Costs for the Project, regardless of the total amount of such Construction Costs, shall have been expended with Fort Worth Companies (the 'Fort Worth Construction Commitment"). The extent of compliance with the Fort Worth Construction Commitment shall be determined pursuant to and in accordance with the Tax Abatement Agreement, as confirmed in the Certificate of Completion issued thereunder. 4.4. Construction Spending Commitment for Fort Worth Certified M/WBE Companies. By the Completion Date, at least twenty-five percent (25%) of all Construction Costs for the Project, regardless of the total amount of such Construction Costs, shall have been expended with Fort Worth Certified M/WBE Companies (the "M/WBE Construction Commitment"). Dollars spent with Fort Worth Certified M/WBE Companies shall also count as dollars spent with Fort Worth Companies for purposes of the Fort Worth Construction Commitment outlined in Section 4.3. The extent of compliance with the M/WBE Construction Commitment shall be determined pursuant to and in accordance with the Tax Abatement Agreement, as confirmed in the Certificate of Completion issued thereunder. 4.5. Employment Commitment. In the first full calendar year following the year in which Company receives its tax abatement pursuant to and in accordance with the Tax Abatement Agreement, and in all subsequent years during the Term of this Agreement Company shall provide and fill at least two hundred seventy-eight (278) Full-time Jobs at the New Location (the "Employment Commitment"). Determination of compliance with the Employment Commitment shall be based on Company's employment data as of December 1 (or such other date as may mutually be acceptable to both the City and Company) of each year. The City agrees that Company may evidence compliance with the above requirements by providing a full listing of applicable employees using such employee's company -specific identification numbers (referred to as "SSO" numbers) along with street names and zip codes, but not including any other personal information or data (such as street addresses or names). 4.6. Conveyance of Land. Company hereby agrees to convey the Land to the City or another entity designated by the City, as and when required pursuant to and in accordance with the Tax Abatement Agreement. Page 7 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) 4.7. Use of Fort Worth -Dallas Call Sign. Beginning January 1 of the First Full Operating Year and at all times thereafter, Company will use the Fort Worth -Dallas Call Sign at least fifty percent (50%) of the time that Company is required to identify itself, whether visually or audibly, pursuant to and in accordance with applicable laws, rules or regulations, including, but not limited to, Federal Communications Commission rules and regulations (the "Fort Worth Identification Commitment"). Compliance with the Fort Worth Identification Commitment will be determined from the proof of performance affidavit and any other information submitted by Company in accordance with Section 4.8.2 In the event that any applicable laws, rules or regulations require Company to identify itself whether visually or audibly, in such a manner that Company cannot meet the Fort Worth Identification Commitment, Company shall take all commercially reasonable steps, including, but not limited to, the purchase of automated broadcast equipment, in order to comply with the Fort Worth Identification Commitment 4.8. Reports and Filings. 4.8.1. Annual Employment Report. On or before February 1 of the Program Initiation Year and of each year thereafter, in order for the City to assess the degree to which Company met the Employment Commitment in the previous calendar year, Company shall provide the Director with a report in a form reasonably acceptable to the City that sets forth the total number of individuals who held Full-time Jobs at the New Location, all as of December 1 (or such other date requested by Company and reasonably acceptable to the City) of the previous year, together with reasonable supporting documentation. The City agrees that Company may evidence compliance with the above requirement by providing a full listing of applicable employees using such employees' company -specific identification numbers (referred to as "SSO' numbers) along with street names and zip codes, but not including any other personal information or data (such as street addresses or names). 4.8.2. Call Sign Reports. Beginning with the last calendar quarter of the Tax Abatement Agreement and for each calendar quarter thereafter throughout the Term of this Agreement, in order to measure the Fort Worth Identification Commitment, Company will submit a proof of performance affidavit, signed by an officer of Company and in a form that is reasonably acceptable to both Company and the City, that sets forth the date and time of each occasion in which Company identified itself, whether visually or Page 8 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) audibly, during the previous calendar quarter as well as the date and time of each occasion in which Company identified itself using the Fort Worth - Dallas Call Sign. Such affidavits shall be submitted quarterly on or before February 15 (for any fourth calendar quarter), May 15 (for the first calendar quarter), August 15 (for the second calendar quarter), and November 15 (for the third calendar quarter). 4.8.3. General. Company will supply any additional information reasonably requested by the City that is pertinent to the City's evaluation of compliance with each of the terms and conditions of this Agreement. 4.9. Inspections. At any time during Company's normal business hours throughout the Term and following reasonable notice to Company, the City shall have the right to inspect and evaluate the Land, and any improvements thereon, and Company will provide full access to the same, in order for the City to perform any due diligence that the City, in the City's sole opinion, deems necessary as part of the acquisition of the Land pursuant to Section 4 6 of this Agreement. At any time during Company's normal business hours throughout the Term and following reasonable notice to Company, the City shall have the right to inspect and evaluate the New Location, and any improvements thereon, and Company will provide full access to the same, in order for the City to monitor compliance with the terms and conditions of this Agreement. Company will cooperate fully with the City during any such inspection and evaluation. Notwithstanding the foregoing, Company shall have the right to require that any representative of the City be escorted by a Company representative or security personnel during any such inspection and evaluation. No access or inspections shall interrupt production taping or rehearsals. 4.10. Audits. The City will have the right throughout the Term to audit the financial and business records of Company that relate to the Project and any other documents to the extent necessary to evaluate Company's compliance with this Agreement or with the commitments set forth in this Agreement including, but not limited to construction documents and invoices (collectively "Company Records"), provided that such audits shall not take place more than one (1) time per year. Any audit conducted by the City shall be conducted during normal business hours and shall not unreasonably interfere with the conduct of Company s business operations. Company shall make all Records available to the City on the Land, at the New Location, or at another location in the City acceptable to both parties following reasonable advance notice by the City and shall otherwise cooperate fully with the City during any audit. Any such audit shall be conducted subject to Page 9 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) a confidentiality agreement, in reasonable and mutually agreeable form and substance, with the understanding that the City is subject to Chapter 552, Texas Government Code (also known as the Texas Public Information Act). 4.11. Use of the New Location. The New Location shall be used for Company's KXAS and Telemundo administrative and production studio operations, and their Affiliates at all times during the Term of this Agreement 5. PROGRAM GRANTS. Subject to the terms and conditions of this Agreement, provided that (i) at least Eight Million Dollars ($8,000,000.00) in Construction Costs were expended for the Project by the Completion Date, and the Completion Date occurred on or before the Completion Deadline, both as confirmed by the City in the Certificate of Completion, and (ii) New Taxable Tangible Personal Property having a value of at least Eight Million Dollars ($8,000,000.00) was placed by Company at the New Location by January 1 of the First Full Operating Year (subject to extension due to force majeure pursuant to and in accordance with Section 17 hereof) as determined solely by the appraisal district having jurisdiction over the New Location at that time and reflected in the certified appraisal roll received by the City from such appraisal district in the First Operating Year, Company will be entitled to receive from the City twenty-four (24) annual Program Grants in accordance with the provisions of this Agreement. The amount of each Program Grant shall equal a percentage of the Program Source Funds available for that Program Grant, which shall be based on the extent to which Company met the Fort Worth Construction Commitment, the M/WBE Construction Commitment and, in any given year, the Employment Commitment as follows: 5.1. Calculation of Each Program Grant Amount. Subject to the terms and conditions of this Agreement, the amount of a given Program Grant shall equal the sum of the Overall Construction Percentage, the Fort Worth Construction Percentage, the M/WBE Construction Percentage, and the Employment Percentage as defined in Sections 5.1.1, 5.1.2 5.1.3 and 5.1.4, respectively, multiplied by the Program Source Funds, as defined in Section 2. 5.1.1. Completion of Protect (40%). If (i) at least Eight Million Dollars ($8,000,000.00) in Construction Costs were expended for the Project by the Completion Date, and the Completion Date occurred on or before the Completion Deadline, as confirmed by the City in the Certificate of Completion, and (ii) New Taxable Tangible Personal Property having a value of at least Eight Page 10 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) Million Dollars ($8,000,000.00) was placed by Company at the New Location by January 1 of the First Full Operating Year (subject to extension due to force majeure pursuant to and in accordance with Section 17 hereof), as determined solely by the appraisal district having jurisdiction over the New Location at that time and reflected in the certified appraisal roll received by the City from such appraisal district in the First Operating Year, each annual Program Grant shall automatically include forty percent (40%) of the Program Source Funds (the "Overall Construction Percentage"). Notwithstanding anything to the contrary herein, if (i) at least Eight Million Dollars ($8 000,000.00) in Construction Costs were not expended for the Project by the Completion Date; (ii) the Completion Date did not occur on or before the Completion Deadline; or (iii) New Taxable Tangible Personal Property having a value of at least Eight Million Dollars ($8,000,000 00) was not placed by Company at the New Location by January 1 of the First Full Operating Year, the City shall have, as its sole remedy, the right to terminate this Agreement pursuant to Section 6 1 and Company shall not have any further liability or exposure hereunder based upon such failure to meet such requirements. 5.1.2. Fort Worth Construction Cost Snendine (Un to 20%). Each annual Program Grant shall include an amount that is based on the percentage by which the Fort Worth Construction Commitment, as outlined in Section 4.3, was met (the "Fort Worth Construction Percentage"). The Fort Worth Construction Percentage will equal the product of twenty percent (20%) multiplied by the percentage by which the Fort Worth Construction Commitment was met, which will be calculated by dividing the actual Construction Costs expended for the Project by the Completion Date with Fort Worth Companies by the number of dollars comprising the Fort Worth Construction Commitment, as determined in accordance with Section 4.3. For example, if the Fort Worth Construction Commitment is $2 000,000.00 and only $1,600,000.00 in Construction Costs were expended with Fort Worth Companies by the Completion Date, the Fort Worth Construction Percentage for all Program Grants payable hereunder would be 16% instead of 20% (or .20 x [$1.6 million/$2 million], or .20 x .80 or 16) If the Fort Worth Construction Commitment is met or exceeded, the Fort Worth Construction Percentage will be twenty percent (20%). 5.1.3. Fort Worth M/WBE Construction Cost Snending (Un to 5%). Each annual Program Grant shall include an amount that is based on the percentage by which the M/WBE Construction Commitment, as outlined in Section 4.4, was met (the "M/WBE Construction Percentage"). The M/WBE Construction Percentage will equal the product of five percent (5%) multiplied by the percentage by which the Page 11 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) M/WBE Construction Commitment was met, which will be calculated by dividing the actual Construction Costs expended for the Project by the Completion Date with Fort Worth Certified M/WBE Companies by the number of dollars comprising the M/WBE Construction Commitment, as determined in accordance with Section 4 4. For example, , if the M/WBE Construction Commitment is $2,000,000.00 and only $1,600,000.00 in Construction Costs were expended with Fort Worth Certified M/WBE Companies by the Completion Date the M/WBE Construction Percentage would be 4% instead of 5% (or .05 x [$1.6 million/$2 million], or .05 x .80, or 04) If the M/WBE Construction Commitment is met or exceeded, the M/WBE Construction Percentage will be five percent (5%). 5.1.4. Employment (Up to 20%). Each annual Program Grant shall include an amount that is based on the percentage by which the Employment Commitment, as outlined in Section 4 5, was met (the ` Employment Percentage"). The Employment Percentage will equal the product of twenty percent (20%) multiplied by the percentage by which the Employment Commitment was met, which will be calculated by dividing the actual number of Full-time Jobs provided at the New Location in the previous calendar year by two hundred seventy-eight (278), which is the number of Full-time Jobs constituting the Employment Commitment. For example, if only two hundred fifty-one (251) Full-time Jobs were provided at the New Location in a given calendar year, the Employment Percentage payable in the following Program Year would be 18% instead of 20% (or .20 x [251/278)), or .20 x .90287, or .18 If the Employment Commitment is met or exceeded in any given year, the Employment Percentage payable in the following Program Year will be twenty percent (20%). 5.1.5. No Offsets. A deficiency in attainment of one commitment may not be offset by the exceeding attainment in another commitment. For example, if in a given year Company failed to meet the M/WBE Construction Commitment by $5,000.00, but exceeded the Fort Worth Construction Commitment by $5,000.00, all Program Grants payable hereunder would still be reduced in accordance with Section 5.1 3 on account of Company's failure to meet the M/WBF Construction Spending Commitment. 5.2. Deadline for Payments. Company will be eligible to receive an abatement of certain taxes payable by Company to the City on real property improvements located at the New Location and on New Taxable Tangible Personal Property pursuant to and in accordance with the Tax Abatement Agreement. Company will receive Program Page 12 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations. LP (KXAS) Grants pursuant to this Agreement after expiration of the Tax Abatement Agreement. Because Program Grants hereunder are based on the amount of those taxes received by the City, and the City will not receive those taxes in the year in which taxes are abated under the Tax Abatement Agreement, Company will not receive a Program Grant in the year following the year in which it receives the abatement Accordingly, the first Program Grant payable hereunder will be paid by the City on or before June 1 of the second year following the year in which Company receives its abatement under the Tax Abatement Agreement (defined in Section 2 and referred to elsewhere in this Agreement as the "Program Initiation Year") Each subsequent annual Program Grant payment will be made by the City to Company on or before June 1 of the Program Year in which such payment is due. 5.3. Source of Funds. It is understood and agreed that all Program Grants paid pursuant to this Agreement shall come from currently available general revenues of the City and not directly from New Location Personal Property Tax Revenues or New Location Real Property Tax Revenues. Company understands and agrees that any revenues of the City other than those dedicated for payment of a given annual Program Grant pursuant to this Agreement may be used by the City for any lawful purpose that the City deems necessary in the carrying out of its business as a home rule municipality and will not serve as the basis for calculating the amount of any future Program Grant or other obligation to Company. 6. DEFAULT, TERMINATION AND FAILURE BY COMPANY TO MEET VARIOUS DEADLINES AND COMMITMENTS. 6.1. Failure to Comnlete Proiect. If (i) at least Eight Million Dollars ($8,000 000.00) in Construction Costs for the Project were not expended by the Completion Date; (ii) the Completion Date did not occur on or before the Completion Deadline; or (iii) New Taxable Tangible Personal Property having a value of at least Eight Million Dollars ($8 000,000.00) was not in place at the New Location by January 1 of the First Full Operating Year (subject to extension due to force majeure pursuant to and in accordance with Section 17 hereof), as determined solely by the appraisal district having jurisdiction over the New Location at that time and reflected in the certified appraisal roll received by the City from such appraisal district in the First Operating Year, the City shall have as its sole remedy the right to terminate this Agreement by providing written notice to Company without further obligation to Company hereunder and Company shall not have any further liability or exposure hereunder based upon such failure to meet such requirements. Page 13 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) 6.2. Termination of Tax Abatement Agreement. This Agreement shall automatically terminate upon any lawful termination of the Tax Abatement Agreement pursuant to Section 6 thereof or by mutual agreement of the City and Company. 6.3. Failure to Convey Land. If Company fails to convey the Land to the City or another entity designated by the City pursuant to and in accordance with the Tax Abatement Agreement, the City shall have, as its sole remedy, the right to terminate this Agreement by providing written notice to Company without further obligation to Company hereunder and Company shall not have any further liability or exposure hereunder based upon such failure to meet such requirements. 6.4. Failure to Pay City Taxes. An event of default shall occur under this Agreement if any City taxes owed by Company or an Affiliate or arising on account of Company's or an Affihate's operations at the New Location become delinquent and Company or the Affiliate does not either pay such taxes or properly follow the legal procedures for protest and/or contest of any such taxes. In this event, the City shall notify Company in writing and Company shall have thirty (30) calendar days to cure such default. If the default has not been fully cured by such time, the City shall have the right to terminate this Agreement immediately by providing written notice to Company and shall have all other rights and remedies that may be available to it under the law or in equity. 6.5. Violations of City Code, State or Federal Law. An event of default shall occur under this Agreement if any written citation is issued to Company or an Affiliate due to the occurrence of a violation of a material provision of the City Code at the New Location or on or within any improvements thereon (including, without limitation, any violation of the City's Building or Fire Codes and any other City Code violations related to the environmental condition of the New Location; the environmental condition of other land or waters which is attributable to operations at the New Location; or to matters concerning the public health safety or welfare) and such citation is not paid or the recipient of such citation does not properly follow the legal procedures for protest and/or contest of any such citation. An event of default shall occur under this Agreement if the City is notified by a governmental agency or unit with appropriate jurisdiction that Company or an Affiliate, or any successor in interest thereto; any third party with access to the New Location pursuant to the express or implied permission of Company or an Affiliate, or any successor in interest thereto, or the City (on account of the Project or the act or omission of any party other than the City on or after the effective date of this Agreement) is declared to Page 14 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) be in violation of any material state or federal law, rule or regulation on account of the New Location, improvements at the New Location or any operations thereon (including, without limitation, any violations related to the environmental condition of the New Location; the environmental condition of other land or waters which is attributable to operations at the New Location; or to matters concerning the public health, safety or welfare). Upon the occurrence of such default, the City shall notify Company in writing, and Company shall have (i) thirty (30) calendar days to cure such default or (ii) if Company has diligently pursued cure of the default but such default is not reasonably curable within thirty (30) calendar days, then such amount of time that the City reasonably agrees is necessary to cure such default. If the default has not been fully cured by such time, the City shall have as its sole remedy under this Agreement (subject to the last sentence of this Section 6.5) the right to terminate this Agreement immediately by providing written notice to Company and Company shall not have any further liability or exposure under this Agreement based upon such violation. Notwithstanding the foregoing, nothing herein shall limit the City's other nghts or remedies against Company separate and apart from this Agreement that the City may have against Company or Affiliate related to a particular violation by Company or Affiliate, but without reference to this Agreement. 6.6. Knowing Employment of Undocumented Workers. Company acknowledges that the City is required to comply with Chapter 2264 of the Texas Government Code, enacted by House Bill 1196 (80th Texas Legislature), which relates to restrictions on the use of certain public subsidies. Company hereby certifies that Company, and any branches, divisions, or departments of Company, does not and will not knowingly employ an undocumented worker, as that term is defined by Section 2264 001(4) of the Texas Government Code. In the event that Company, or any branch, division, or department of Company, is convicted of a violation under 8 U.S.C. Section 13244) (relating to federal criminal penalties and injunctions for a pattern or practice of employing unauthorized aliens): • if such conviction occurs during the Term of this Agreement, this Agreement shall terminate contemporaneously upon such conviction (subject to any appellate rights that may lawfully be available to and exercised by Company) and, as the City's sole remedy for such violation under this Agreement, Company shall repay, within one hundred twenty (120) calendar days following receipt of written demand from the City, the aggregate amount of all Program Grants received by Company hereunder, if any, plus Simple Interest at a rate of four percent (4%) per annum based on the amount of each Program Grant paid In each previous Program Year as of the date on which each such Program Grant was paid, and Company shall not have any further liability or exposure hereunder based upon such violation; or Page 15 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) • if such conviction occurs after expiration or termination of this Agreement, subject to any appellate rights that may lawfully be available to and exercised by Company, as the City's sole remedy for such violation under this Agreement Company shall repay, within one hundred twenty (120) calendar days following receipt of written demand from the City, the aggregate amount of all Program Grants received by Company hereunder, if any, plus Simple Interest at a rate of four percent (4%) per annum based on the amount of each Program Grant paid in each previous Program Year as of the date on which each such Program Grant was paid, and Company shall have no further liability or exposure Hereunder based upon such violation. For the purposes of this Section 6.6, "Simple Interest" is defined as a rate of interest applied only to an original value, in this case the aggregate amount of a Program Grant This rate of interest can be applied each year, but will only apply to the aggregate amount of a particular Program Grant and is not applied to interest calculated. For example, if the aggregate amount of a Program Grant is $10,000 and it is required to be paid back with four percent (4%) interest five years later, the total amount would be $10,000 + [5 x ($10,000 x 0.04)], which is $12,000 This Section 6.6 does not apply to convictions of any Affiliate of Company, any franchisees of Company or any person or entity with whom Company contracts. Notwithstanding anything to the contrary herein, this Section 6.6 shall survive the expiration or termination of this Agreement. 6.7. Failure to Use Fort Worth -Dallas Call Sign. Notwithstanding anything to the contrary herein, if Company fails to meet the Fort Worth Identification Commitment in any given year, for any reason, whether or not within the control of Company, Company shall (as the City's sole remedy for such failure) forfeit payment of the Program Grant payable in the following Program Year In such an event, notwithstanding anything to the contrary herein, the forfeited Program Grant shall nevertheless count as one of the twenty-four (24) Program Grants payable hereunder for purposes of calculating the Term of this Agreement. 6.8. Failure to Meet Construction Cost Snending and/or Emnlovment Commitments. If the Fort Worth Construction Commitment or the M/WBE Construction Commitment are not met, or if Company fails to meet the Employment Commitment in any given year, such event shall not constitute a default hereunder or provide the City with the right to terminate this Agreement, but rather, shall only cause the amount of the Program Grants that the City is required to pay pursuant to this Agreement to be reduced in accordance with this Agreement. Page 16 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) 6.9. Failure to Submit Reports. Without limiting the application of Section 6.10, if Company fails to submit any report required by and in accordance with Section 4.8, the City's obligation to pay any Program Grants at the time, if any, shall be suspended until Company has provided all required reports. 6.10. General Breach. Unless stated elsewhere in this Agreement, Company shall be in default under this Agreement if Company breaches any term or condition of this Agreement. In the event that such breach remains uncured after thirty (30) calendar days following receipt of written notice from the City referencing this Agreement (or, if Company has diligently and continuously attempted to cure following receipt of such written notice but reasonably requires more than thirty (30) calendar days to cure, then such additional amount of time as is reasonably necessary to effect cure, as determined by both parties mutually and in good faith), the City shall have the right to terminate this Agreement immediately by providing written notice to Company. 7. INDEPENDENT CONTRACTOR. It is expressly understood and agreed that Company shall operate as an independent contractor in each and every respect hereunder and not as an agent, representative or employee of the City. Company shall have the exclusive right to control all details and day-to-day operations relative to the New Location and any improvements thereon and shall be solely responsible for the acts and omissions of its officers, agents, servants, employees, contractors, subcontractors, licensees and invitees. Company acknowledges that the doctrine of respondent superior will not apply as between the City and Company, its officers, agents, servants, employees, contractors, subcontractors licensees, and invitees. Company further agrees that nothing in this Agreement will be construed as the creation of a partnership or joint enterprise between the City and Company. 8. INDEMNIFICATION. COMPANY, AT NO COST TO THE CITY, AGREES TO DEFEND, INDEMNIFY AND HOLD THE CITY, ITS OFFICERS, AGENTS SERVANTS AND EMPLOYEES, HARMLESS AGAINST ANY AND ALL CLAIMS, LAWSUITS, ACTIONS, COSTS AND EXPENSES OF ANY KIND, INCLUDING, BUT NOT LIMITED TO, THOSE FOR PROPERTY DAMAGE OR LOSS (INCLUDING ALLEGED DAMAGE OR LOSS TO COMPANY'S BUSINESS AND ANY RESULTING LOST PROFITS) AND/OR PERSONAL INJURY, INCLUDING Page 17 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations. LP (KXAS) DEATH, THAT MAY RELATE TO, ARISE OUT OF OR BE OCCASIONED BY ANY NEGLIGENT ACT OR OMISSION OR INTENTIONAL MISCONDUCT OF COMPANY, ITS OFFICERS, AGENTS, ASSOCIATES, EMPLOYEES, CONTRACTORS (OTHER THAN THE CITY) OR SUBCONTRACTORS, RELATED TO THE PROJECT, THE NEW LOCATION AND ANY OPERATIONS AND ACTIVITIES THEREON, OR THE LAND AND ANY OPERATIONS AND ACTIVITIES THEREON PRIOR TO CONVEYANCE PURSUANT TO AND IN ACCORDANCE WITH SECTION 4.6. 9. NOTICES. All written notices called for or required by this Agreement shall be addressed to the following, or such other party or address as either party designates in writing, by certified mail, postage prepaid or by hand delivery: City: City of Fort Worth Attn: City Manager 1000 Throckmorton Fort Worth, TX 76102 with copies to: the City Attorney and Housing/Economic Development Dept. Director at the same address 10. ASSIGNMENT AND SUCCESSORS. Company: Station Venture Operations, LP (KXAS) Attn: Tom Ehlmann, President and General Manager 3900 Barnett St. Fort Worth, TX 76103 with a copy to: NBCUniversal Media, LLC 30 Rockefeller Plaza New York NY 10012 Attn• Law Department Company shall have the right to assign, transfer or otherwise convey any of its rights or obligations under this Agreement to an Affiliate or any other entity that succeeds to the ownership of the television station currently known as KXAS without the approval of the City, provided that Company provides the City with written notice within thirty (30) calendar days after the effective date of such assignment, and the Affiliate or other successor executes a written agreement with the City under which the Affiliate or other successor agrees to assume and be bound by all assigned covenants and obligations of Company under this Agreement. Otherwise, Company may not assign, transfer or otherwise convey any of its rights or obligations under this Agreement to any other person or entity without the prior consent of the City Council, which consent shall not be unreasonably withheld, conditioned on (i) the prior approval of the assignee or successor and a finding by the City Council that the proposed assignee or successor is financially Page 18 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) capable of meeting the terms and conditions of this Agreement and (ii) prior execution by the proposed assignee or successor of a written agreement with the City under which the proposed assignee or successor agrees to assume and be bound by all covenants and obligations of Company under this Agreement. Any attempted assignment that does not comply with this Section 10 shall constitute grounds for termination of this Agreement, which shall be effective thirty (30) calendar days following receipt of written notice from the City to Company if such default has not been cured to the reasonable satisfaction of the City by such time. Any lawful assignee or successor in interest of Company of all rights under this Agreement shall be deemed "Company" for all purposes under this Agreement. 11. COMPLIANCE WITH LAWS, ORDINANCES, RULES AND REGULATIONS. This Agreement will be subject to all applicable federal, state and local laws, ordinances, rules and regulations, including but not limited to, all provisions of the City's Charter and ordinances, as amended. 12. GOVERNMENTAL POWERS. It is understood that by execution of this Agreement, the City does not waive or surrender any of it governmental powers or immunities. 13. SEVERABILITY. If any provision of this Agreement is held to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired, unless (i) any party can demonstrate that it would not have entered into this Agreement without inclusion of that term or (ii) the exclusion of the term fundamentally alters the balance of the rights and obligations of the parties In the circumstances referred to in (i) or (ii) above, the parties agree that they shall enter into negotiations in good faith to agree to a substitute clause which achieves so far as possible, the objectives and effect of the unenforceable, invalid or illegal provision. 14. NO WAIVER. the failure of either party to insist upon the performance of any term or provision of this Agreement or to exercise any right granted hereunder shall not constitute a waiver of that party's right to insist upon appropriate performance or to assert any such right on any future occasion. Page 19 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) 15. VENUE AND JURISDICTION. If any action, whether real or asserted, at law or in equity, arises on the basis of any provision of this Agreement, venue for such action shall lie in state courts located in Tarrant County, Texas or the United States District Court for the Northern District of Texas — Fort Worth Division. This Agreement shall be construed in accordance with the laws of the State of Texas. 16. NO THIRD PARTY RIGHTS. The provisions and conditions of this Agreement are solely for the benefit of the City and Company, and any lawful assign or successor of Company, and are not intended to create any rights, contractual or otherwise, to any other person or entity. 17. FORCE MAJEURE. It is expressly understood and agreed by the parties to this Agreement that if the performance of any obligation hereunder is delayed by reason of war, civil commotion, acts of God, inclement weather or other circumstances which are reasonably beyond the control of the party obligated or permitted under the terms of this Agreement to do or perfoitu the same, regardless of whether any such circumstance is similar to any of those enumerated or not, the party so obligated or permitted shall be excused from doing or performing the same during such period of delay, so that the time period applicable to such requirement shall be extended for a period of time equal to the period such party was delayed. Notwithstanding anything to the contrary herein, it is specifically understood and agreed that a failure to obtain adequate financing to complete the Project shall not be deemed to be an event of force majeure and that this Section 17 shall not operate to extend the Completion Deadline in such an event. 18. ESTOPPEL CERTIFICATES. Any party hereto may request an estoppel certificate from another party so long as the certificate is requested in connection with a bona fide business purpose The certificate shall include, but not necessarily be limited to, statements as to whether this Agreement is in full force and effect, whether an event of default exists and, if so, the nature of the default and curative action taken and/or necessary to effect a cure), the remaining term of this Agreement, the levels and remaining Willi of the Abatement in effect, and such other related matters reasonably requested. If requested, the party receiving the request shall use reasonable efforts to execute the estoppel certificate within thirty (30) days of the request. Page 20 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations, LP (KXAS) 19. INTERPRETATION. In the event of any dispute over the meaning or application of any provision of this Agreement, this Agreement shall be interpreted fairly and reasonably, and neither more strongly for or against any party, regardless of the actual drafter of this Agreement. 20. CAPTIONS. Captions and headings used in this Agreement are for reference purposes only and shall not be deemed a part of this Agreement. 21. ENTIRETY OF AGREEMENT. This Agreement, including any exhibits attached hereto and any documents incorporated herein by reference, contains the entire understanding and agreement between the City and Company, and any lawful assign and successor of Company, as to the matters contained herein Any prior or contemporaneous oral or written agreement is hereby declared null and void to the extent in conflict with any provision of this Agreement. Notwithstanding anything to the contrary herein, this Agreement shall not be amended unless executed in writing by both parties and approved by the City Council of the City in an open meeting held in accordance with Chapter 551 of the Texas Government Code. 22. COUNTERPARTS. This Agreement may be executed in multiple counterparts, each of which shall be considered an original, but all of which shall constitute one instrument. EXECUTED as of the last date indicated below: [SIGNATURES IMMEDIATELY FOLLOW ON NEXT PAGE] Page 21 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations. LP (KXAS) CITY OF FORT WORTH: By: �i'lAM4 Fernando Costa Assistant City Manager Date: 4/7//2 APPROVED AS TO FORM AND LEGALITY: By: Peter Vaky Deputy City Attorney M&C: C-24973 06-14-11 STATION VENTURE OPERATIONS, LP: By: NBC Telemundo License, LLC, a Laccda bsizt limited liability company and its sole general partner: By: 41 i Name: --m = 4,44"4„,v-k) Title: p, 3 .rcolive 14 Date: tc; / 7/7_, } ,t_es)140,1111: oath ottA eta* _ FO 14°: ri 00 a QdO0p4� 64' *ZZftXAS Page 22 Economic Development Program Agreement between City of Fort Worth and Station Venture Operations. LP (KXAS) k s" --Tv OFFICIAL RECORD CITY SECRETARY FT. WORTH, TX EXHIBITS "A" — Description and Map Depicting the Land "B" — Description and Map Depicting the New Location Economic Development Program Agreement between City of Fort Worth and Station Venture Operations. LP (KXAS) EDIT "A" PROPERTY DESCRIPTION BEING 26.568 awes of land more or less situated in the City of Fort Worth, Tarrant County, Texas, being part of the E. Johnson Survey, Abstract No 852 and being more particularly described as follows: BEGINNING at a 7/8 inch iron in the East line of said Johnson Survey for the Southeast corner of the 83.80 acres tract described in the deed to Carter Publications, Inc., recorded in Volume 2040, Page 298 of the Tarrant County Deed Recordr, THENCE: N 88° 09' 00" W, along the South Lure of said 83.80 acres tract, 995.10 feet to a galvanized iron; THENCE: N 00° 00' 15" W, 630.50 feet to a galvanized iron; THENCE: N 35° 30' 00" E, 865.00 feet to a galvanized iron; THENCE:. N 88° 41' 00" E, 300.80 feet to a galvanized iron in the West line of Barnett Avenue North; THENCE Southeastaiy, along said street line, along a curve to the left with a radius of 206.34 feet a distance of 264 10 feet to a metal plug in concrete walls in the East line of said 83.80 acres tract and being in the west line of original Block 4 of SCANERY HILL ADDITION and 0.6 feet from its Northwest corner, and the chord of said arc bears S 53° 11' 00" E, 246.44 feet; THENCE: along the East line of said 83.80 acres tract and with said Survey line: S 00° 27 30" E, 689.80 feet pass a "Y" cut in the top of the North curb of Normandy Drive, and in all 702..80 feet; and S 01 ° 14' 15" W, 523.40 feet to the PLACE OF BEGINNING and containing 26.568 acres of land. UNDEVELOPED NATIVE LAND SATELLITE DISHES STL TOWER SATELLITE DISHES UNDEVELOPED NATIVE LAND r PARKING LOT KXAS 3900 BARNETT STREET r EMPTY TOWER VANGUARD WIRELESS TOWER PARKING LOT • SINGLE-FAMILY RESIDENCES 1 C as411•El Figure Not To Scale LEGEND APPROXIMATE SUBJECT PROPERTY BOUNDARY FENCE )8( BROADCAST TOWER MAGNOLIA PIPELINE (AS MAPPED) SOURCE: Google Earth, 2011 Site Plan KXAS TV Station 3900 Barnett Street Fort Worth, Texas 76103 FIGURE 2 EXHIBIT B LEGAL DESCRIPTION OF NEW LOCATION Being a 8.10 acre tract of land situated in the Vincent J. Hutton Survey, Abstract No. 681, Tarrant County, Texas and being a portion of 311.26 acres of land conveyed by deed to Centreport Venture Inc., as recorded in Volume 10169, Page 1067 and Volume 13585, Page 484, Deed Records, Tarrant County, Texas, and being more particularly described as follows: BEGINNING at a found 5/8 inch iron rod with Pate 5647 cap for corner, being the most northerly point of a corner -clip with the south right-of-way line of F.A.A. Boulevard (a variable width R.O.W.) and the west right-of-way line of Amon Carter Boulevard (a 150 foot R O.W.) THENCE South 45°13'26" East, leaving said south right-of-way line, a distance of 14.14 feet to a point for corner, said point being in the west right-of-way line of said Amon Carter Boulevard; THENCE South 00° 13'26" East, along said west right-of-way line, a distance of 709.40 feet to a point for corner; THENCE South 89°52'16" West, leaving said west right-of-way line, a distance of 491.00 feet to a point for corner; THENCE North 00°13'26" West, a distance of 718.58 feet to a point for corner, said point being in the future south right-of-way line of F.A.A. Boulevard; THENCE North 89°46'34" East, along said future south right-of-way line, distance of 481.00 feet to the POINT OF BEGINNING and CONTAINING 352,975 square feet, 8 10 acres of land, more or less. UAL GATT LOCK PROVIDE NEW GM RANTO N - .11.114.111. -: L I I- 1J� J I I i iii 1:: FL!. 7 -- UNITS AND CONCRETE PAD Ea CMG ,.PIMA ION TIME PREOERVATION i MUSE 00.1ERATOR Nib 1 1 1- . Ir uw.r. C Ititttilytttill The '— • • I METFL CANOPY .-.-. mom .—.—._.—._. mu* .—.J KAMM NEW CUPS 11410/1 CNA TOR CURD RAMP DETAL1 acrmma PMorAP�Ltn_ ------ � SOLIARDS UCITIT WW1 COATED GNAW TM FENCE ,_ -__-- of RAMP . TYPICAL AT SPUD ALCMS M 1TXTURTI) Et NI 75,025 SF BUILDING ( I SATELLITE TONER IJ WROUGHT .11 ON GATE i 11 AMON CARTER BOULEVARD -------------- GENERAL NOTES FAA BOULEVARD CORGAN :ORGAN ASSOCIATES, INC Dian TX 111112 )SS4F.S OxISID.13 'MIL VON PCP Yr 4 i 0 REVISIONS /1/10211/ SITE PLAN JOB 11 17,0000 DATE 05/16/2012 SHEET A 1-01 M&C Review Page 1 of 2 CIL ,A COUNCIL ACTION: Approved on 4/10/2012 Official site of the City of Fort Worth, Texas FORT WORTH DATE: 4/10/2012 REFERENCE NO.: **C-25548 LOG NAME: 17KXASCORR CODE C TYPE: CONSENT PUBLIC NO HEARING: SUBJECT: Amend M&C C-24973 Authorizing Tax Abatement and Economic Development Program Agreements with KXAS/NBC-5 for Construction of a New Production Facility at the Southwest Corner of Amon Carter Boulevard and FAA Boulevard to Extend Various Completion Deadlines (COUNCIL DISTRICT 5) RECOMMENDATION: It is recommended that the City Council amend M&C C-24973 authorizing a Tax Abatement and Economic Development Program Agreements with KXAS/NBC-5 by extending various completion deadlines required by the Agreement. DISCUSSION: On June 14, 2011, (M&C C-24973) the City Council authorized execution of a one year Tax Abatement and 24 year Economic Development Program Agreement with KXAS/NBC-5 to facilitate the company s relocation and construction of a new production facility in the Centreport Business Park. Following completion of this new facility, KXAS/NBC-5 will convey its current site a 26 acre parcel located at 3900 Barnett Avenue to the City or an entity designated by the City. Due to a delay in finalizing the purchase of the property at Centreport Business Park, construction has been delayed and it is not anticipated that the new facility will be complete by the deadline approved by City Council. Therefore, KXAS/NBC-5 is requesting an extension of the completion deadline from December 31 2012 to September 30, 2013 and extension of the deadline to convey the property at 3900 Barnett Avenue to the City from December 31, 2013 until March 30, 2014. Extension of the completion deadline will result in the employment commitment deadline being extended to the September 30, 2013 date as well. KXAS/NBC-5 will have the right to continue operating at its current site until its new studios and offices are completed on or before March 30, 2014. The company's commitments will remain the same as previously stated in M&C C-24973. The project is estimated to have an investment of at least $8,000,000.00 in construction costs and $8,000,000.00 in new taxable business personal property KXAS/NBC-5 is required to spend a minimum of 25 percent of the construction costs in making the improvements with contractors that are Fort Worth companies and spend a minimum of 25 percent of its construction costs with contractors that are Fort Worth certified M/WBE companies (with the understanding that dollars spent with Fort Worth certified M/WBE companies will also count as dollars spent with Fort Worth companies) KXAS/NBC-5 is required to retain 200 full-time employees from the existing Fort Worth location and relocate a minimum of 78 additional employees from outside of Fort Worth to the Centreport site by the completion date. Staff recommends that the City Council amend M&C C-24973 to reflect the new completion deadline, the conveyance of land date, and the employment commitment deadline for KXAS/NBC-5 allowing the City of Fort Worth and KXAS/NBC-5 to proceed with the execution of a Tax Abatement and Economic Development Program Agreement for the relocation and construction of its new production studio at Centreport Business Park. http://apps.cfwnet.org/council_packet/mc_review.asp?ID=16708&councildate=4/10/2012 4/17/2012 M&C Review Page 2 of 2 FISCAL INFORMATION/CERTIFICATION: The Financial Management Services Director certifies that this action will have no material effect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for Citv Manager's Office bv: Fernando Costa (6122) Originating Department Head: Jay Chapa (5804) Additional Information Contact: Robert Sturns (8003) ATTACHMENTS KXAS Proiect Location Map.pdf http://apps.cfwnet.org/council_packet/mc_review.asp?ID=16708&councildate=4/10/2012 4/17/2012 M&C Review Page 1 of 3 CIL GEA COUNCIL ACTION: Approved on 6/14/2011 Official site of the City of Fort Worth, Texas FORT WORTI I DATE: 6/14/2011 REFERENCE NO.. C-24973 LOG NAME: 17EDPAKXAS CODE: C TYPE: NON -CONSENT PUBLIC NO HEARING: SUBJECT: Authorize Execution of Tax Abatement Agreement and Economic Development Program Agreement with KXAS/NBC-5 for Construction of a New Production Facility at the Southwest Corner of Amon Carter Boulevard and FAA Boulevard (COUNCIL DISTRICT 5) RECOMMENDATION. It is recommended that the City Council authorize the City Manager to execute a one-year Tax Abatement Agreement and a 24-year Economic Development Program Agreement with KXAS/NBC-5 for construction of the new production facility at the southwest corner of Amon Carter Boulevard and FAA Boulevard (COUNCIL DISTRICT 5). DISCUSSION: The Housing and Economic Development Department is proposing a 25-year economic development program with KXAS/NBC-5 for construction of a new production facility in the Centreport Business Park. Project: KXAS/NBC-5 is considering the consolidation of its operations to a new production studio at the southwest corner of Amon Carter Blvd and FAA Blvd in the Centreport Business Park The proposed project is estimated to have a construction cost of at least $8 000,000.00 and KXAS/NBC-5 will invest at least $8 000,000.00 in new taxable personal property by December 31, 2012. Failure to meet the criteria for the real and personal property improvements will be a condition of default and will result in immediate termination of both the Tax Abatement Agreement and the Economic Development Program Agreement. Tax Abatement Aareement and Economic Development Program Agreement The Housing and Economic Development Department is proposing a one-year Tax Abatement Agreement with KSAS/NBC-5 that could potentially abate up to 85 percent of the City's taxes on the incremental value of real and personal property at the site. This abatement will be for one year only. Execution of the Tax Abatement Agreement by the City will allow other taxing jurisdictions also to grant abatements of real and personal property taxes assessed by those jurisdictions. Under state law, a taxing jurisdiction other than a municipality may not grant tax abatement on property within a municipality unless the municipality has also granted tax abatement for the same property. The Tax Abatement Agreement will compliment a 24-year Economic Development Program Agreement with KXAS/NBC-5, as authorized by Chapter 380 of the Texas Local Government Code, pursuant to which the City will make annual economic development grants to KXAS/NBC-5 in amounts not to exceed 85 percent of the City's tax receipts on the incremental value of real and personal property at the site. The Tax Abatement Agreement and the Economic Development Program Agreement will be structured as follows: http://www.fortworthgov.org/council_packet/mc_review.asp?ID=15307&councildate=6/1... 6/21/2011 M&C Review Page 2 of 3 Utilization of Fort Worth Companies and Fort Worth M/WBE Businesses (Real Property Improvements) KXAS/NBC-5 is required to spend a minimum of 25 percent of the construction costs in making the improvements with contractors that are Fort Worth companies and spend a minimum of 25 percent of its construction costs with contractors that are Fort Worth certified M/WBE companies (with the understanding that dollars spent with Fort Worth certified M/WBE companies will also count as dollars spent with Fort Worth companies). Employment Commitments KXAS/NBC-5 is required to retain the 200 full-time employees from the existing Fort Worth location and relocate a minimum of 78 additional employees from outside of Fort Worth to the Centreport site by December 31, 2013. Current Property at 3900 Barnett Avenue KXAS/NBC-5 will deed the 26-acre property located at 3900 Barnett Avenue to the City or an entity designated by the City on or before December 31, 2013, exclusive of mineral interest and clear of any and all encumbrances. KXAS/NBC-5 will have the right to continue operating at its current site until its new studios and offices are completed on or before December 31, 2013. City Commitments The tax abatement and all grant payments are based on and shall not exceed 85 percent of the incremental increase in value of real property improvements (above a base year value) and business personal property at the new facility calculated in accordance with achievement of the commitments and goals set forth in the following chart Company Commitment Real & Personal Property Investment Real Property Improvements with Fort Worth Contractors Real Property Improvements with Fort Worth M/WBE Contractors Overall Employment TOTAL Potential Maximum Abatement/Grant 40 percent 20 percent 5 percent 20 percent 85 percent Failure to meet a commitment (other than the requirement to meet the minimum real and personal property investment) will result in a reduction of the corresponding component of the abatement or grant, as applicable, for that year proportional to the amount the commitment was not met. The project is located in COUNCIL DISTRICT 5. FISCAL INFORMATION/CERTIFICATION: The Financial Management Services Director certifies that this action will have no material effect on City funds. TO Fund/Account/Centers FROM Fund/Account/Centers Submitted for City Manaaer's Office by: Susan Alanis (8180) Oriainatina Department Head: Jay Chapa (5804) http://www.fortworthgov.org/council_packet/mc_review.asp?ID=15307&councildate=6/1... 6/21/2011 * M &C Review Page 3 of 3 Additional Information Contact: Robert Sturns (8003) ATTACHMENTS http: / /www.fortworthgov.org /council _packet /mc_ review. asp ?1D = 15307 &councildate= 6/1... 6/21/2011