HomeMy WebLinkAboutContract 43174-A1 (2)STATE OF TEXAS
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COUNTY OF TARRANT §
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IViIEI`�1IDMEI`�T 11 I`�T0o 1 TO
Y SEC;, ': ARY CONTRACT NO. 43174
TAX ABATEMENT AGREEMENT BETWEEN
CITY OF FORT WORTH AND
ALCON LABORATORIES HOLDINGS CORPORATION
This AMENDMENT NO. 1 TO CITY SECRETARY CONTRACT NO.
43174 ("Amendment") is entered into by and between the CITY OF FORT WORTH
(the "City"), a home rule municipality organized under the laws of the State of Texas,
and ALCON LABORATORIES HOLDINGS CORPORATION ("Company"), a
Delaware corporation.
The City and Company hereby agree that the following statements are true and
correct and constitute the basis upon which the City and Company have entered into this
Amendment:
A. Company is one of the largest manufacturers of contact lenses and lens
care products in the United States. On July 6, 2011 Company submitted an application
for tax abatement to the City concerning a proposal for Company to expand its facility at
6201 South Freeway in the City.
B. On November 1, 2011 the City Council adopted Ordinance No. 19961-11-
2011 designating the property at 6201 South Freeway as Tax Abatement Reinvestment
Zone No. 77, City of Fort Worth, Texas, and, through approval of Mayor and Council
Communication ("M&C") C-25263, authorized the City Manager to execute a Tax
Abatement Agreement for expansion of Company's facility on that property.
C. After preparation of such Tax Abatement Agreement, but before execution
thereof by the parties, Company notified the City that its expansion project would also
encompass property located at 6801 Will Rogers Boulevard. In order to include that
property, and improvements constructed thereon, within the scope of the Tax Abatement
Agreement, it was necessary for the City Council to designate such property as a tax
abatement reinvestment zone, as required by Chapter 312 of the Texas Tax Code, prior to
execution of the Tax Abatement Agreement. On February 21, 2012 the City Council
approved M&C G-17526 and adopted Ordinance No. 20074-02-2012 designating the
property at 6801 Will Rogers Boulevard as Tax Abatement Reinvestment Zone No. 80,
City of Fort Worth, Texas in order for that property to be included within the scope of the
Tax Abatement Agreement.
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Amendment No. 1 to CSC No. 43174
Tax Abatement Agreement between City of Fort Worth and Alcon Laboratories Holdings Corporation
12-05-12 P03 : 30 IN
D. The Tax Abatement Agreement document prepared in 2011 was then
revised in accordance with M&C G-17526 and Ordinance No. 20074-02-2012 and
executed as of May 2, 2012. That Tax Abatement Agreement is a public document on
file in the City Secretary's Office as City Secretary Contract No. 43174 (the
"Agreement").
E. Section 312.204(a) of the Texas Tax Code authorizes the abatement of
taxes pursuant to a tax abatement agreement only to the extent that the value of property
subject to abatement exceeds its value for the year in which the agreement was executed.
Section 2 of the Agreement contains language from the initial draft prepared in 2011 and
states, erroneously, that Company's Abatement under the Agreement will be on real
property taxes on improvements located on the Land (but not on the Land itself) and on
New Taxable Tangible Personal Property based upon the increase in value "over their
respective values as of January 1, 2011, which is the year in which this Agreement was
entered into....."
F. Because the Agreement was not executed until 2012, and because the
Texas Tax Code only authorizes the abatement of taxes on property only to the extent
that the value of property subject to abatement exceeds its value for the year in which a
tax abatement agreement was executed, it is necessary that the parties correct the error in
Section 2 of the Agreement to reflect that Company s Abatement will be based on the
increase in value of improvements located on the Land (but not on the Land itself) and on
New Taxable Tangible Personal Property based upon the increase in value over their
values in 2012, not 2011.
G. This Amendment is authorized under § 312.208 of the Texas Tax Code
because (i) the provisions of this Amendment could have been included in the original
Agreement and (ii) this Amendment has been entered into following the same procedure
in which the Agreement was approved and executed.
NOW, THEREFORE, the City and Company, for and in consideration of the
terms and conditions set forth herein, do hereby contract, covenant and agree as follows:
1. Section 2 of the Agreement (Abatement Amounts, Terms and Conditions) is
hereby amended to read as follows:
Subject to and in accordance with this Agreement, the City will
during the ten (10)-year Abatement Term, as defined in Section 2.3, grant
an annual abatement of the City s ad valorem real property taxes on
improvements located on the Land (but not on the Land itself) and on New
Taxable Tangible Personal Property based upon the increase in value of
improvements located on the Land and on New Taxable Tangible Personal
Property over their respective values as of January 1, 2012, which is the
year in which this Agreement was entered into, and further based on the
extent to which certain construction, construction contracting,
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Amendment No. 1 to CSC No. 43174
Tax Abatement Agreement between City of Fort Worth and Alcon Laboratories Holdings Corporation
employment, and supply and service spending benchmarks, all as more
specifically set forth in this Section 2, have been met (the "Abatement").
2. Section 2.2 of the Agreement (Abatement Limitation) is hereby amended to read as
follows:
Notwithstanding anything to the contrary herein, in accordance
with Section 11.5 of the Policy, Company's Abatement in any given year
of the Abatement Term shall be based (i) on the increase in the real
property value of any improvements on the Land (and not on the Land
itself) since January 1, 2012, up to a maximum increase of Four Million
Five Hundred Thousand Dollars ($4,500,000.00) and (ii) on the increase
in the value of New Taxable Tangible Personal Property located on the
Land since January 1, 2012, up to maximum increase of Twelve Million
Dollars ($12,000,000.00). In other words, in any year in which the taxable
value of improvements on the Land exceeds their value as of January 1,
2012 plus $4,500,000.00, Company's Abatement attributable to
improvements on the Land for that tax year shall be capped and calculated
as if the increase in the value of the Land and improvements on the Land
since January 1, 2012 had only been $4,500,000.00. For example, and as
an example only, if in a given year of the Abatement Term the value of
improvements on the Land is $5,000,000.00 over their value as of January
1, 2012, the City would grant a maximum real property Abatement of
eighty percent (80%) of $4,500,000.00 in valuation for that year and full
taxes on the $500,000.00 difference over the cap would be owed. Along
the same lines, if the value of New Taxable Tangible Personal Property
located on the Land in a given year of the Abatement Term is
$15,000,000.00 over the value of that Property as of January 1, 2012, the
City would grant a maximum personal property Abatement of eighty
percent (80%) of $12,000,000.00 in valuation for that year and full taxes
on the $3,000,000.00 difference over the cap would be owed.
3. Capitalized terms used but not identified in this Amendment shall have the same
meanings assigned to them in the Agreement.
4. Except as otherwise specifically amended in this Amendment, the Agreement shall
remain in full force and effect
5. This Amendment contains the final written expression of the City and Company
with respect to the subject matter hereof. This Amendment may be executed in multiple
counterparts, each of which shall be considered an original, but all of which shall
constitute one instrument.
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Amendment No. 1 to CSC No. 43174
Tax Abatement Agreement between City of Fort Worth and Alcon Laboratories Holdings Corporation
6. This Amendment shall be effective as of the Effective Date of the Agreement
(May 2, 2012).
EXECUTED as of the last date indicated below:
[SIGNATURES IMMEDIATELY FOLLOW ON NEXT PAGE]
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Amendment No. 1 to CSC No. 43174
Tax Abatement Agreement between City of Fort Worth and Alcon Laboratories Holdings Corporation
CITY OF FORT WORTH:
Fernando Costa
Assistant City Manager
Date: /2���2.-
APPROVED AS TO FORM AND LEGALITY:
By: Zda-Y)
Peter Vaky
Deputy City Attorney
•
M&C: i��lYtQ.
STATE OF TEXAS
COUNTY OF TARRANT §
ATTEST:
By:
Date:
Name: /VVWg3 Kityyc
Title: CAN seend-avz(
BEFORE ME, the undersigned authority, on this day personally appeared
Fernando Costa, Assistant City Manager of the CITY OF FORT WORTH, a
municipality organized under the laws of the State of Texas, known to me to be the person
and officer whose name is subscribed to the foregoing instrument, and acknowledged to me
that the same was the act of the CITY OF FORT WORTH, that he was duly authorized to
perform the and that he executed the same as the act of the CITY OF FORT WORTH for
the purposes and consideration therein expressed and in the capacity therein stated.
tsirc
GIVEN UNDER MY HAND AND SEAL OF OFFICE this 14 day of
ha , 2012.
LIACtv--- L4\11i4A n
ataxy Public in and for
the State of Texas j$t',<� '- LINDA M. HIRRLJNGER
Ltrvdc. lust' '►'` _ . %� r MY COMMISSION EXPIRES
Notary's Printed Name
Page 5
Amendment No. 1 to CSC No. 43174
Tax Abatement Agreement between City of Fort Worth and Alcon Laboratories Holdings Corporation
ALCON LABORATORIES HOLDINGS
CORPORATION, a Delaware corporation:
B
Robert Karsunky
Chief Financial Officer
Date: ( / I K. / Lz.
ATTEST:
By:
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, on this day personally appeared __Robert
Karsunky, Chief Financial Officer of ALCON LABORATORIES HOLDINGS
CORPORATION, known to me to be the person and officer whose name is subscribed to
the foregoing instrument, and acknowledged to me that the same was his act and that s/he
executed the same as the act of ALCON LABORATORIES HOLDINGS
CORPORATION for the purposes and consideration therein expressed and in the
capacity therem stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this
NOJL-Av13-Ez , 2012.
Notary Public m and for
the State of Texas
Notary's Printed Name
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Amendment No. 1 to CSC No. 43174
Tax Abatement Agreement between City of Fort Worth and Alcon Laboratories Holdings Corporation
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