HomeMy WebLinkAboutContract 54447 CITY SECRETARY_ i
CONTRACT NO.
Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley)
Improvement Area #2 Reimbursement Agreement
This Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley)
Improvement Area #2 Reimbursement Agreement (this "Area #2 Reimbursement
Agreement") is entered into by QUAIL VALLEY DEVCO II, L.L.C. ("Quail Valley"), and WALSH
RANCHES LIMITED PARTNERSHIP ("Walsh Ranches" and together with Quail Valley, the
"Developer") and the CITY OF FORT WORTH, TEXAS (the "City"), to be effective September
_, 2020 (the "Effective Date"). The Developer and the City are sometimes individually
referred to as a "Party" and collectively as the "Parties."
SECTION 1. RECITALS
1.1 WHEREAS, capitalized terms used in this Area #2 Reimbursement Agreement shall
have the meanings given to them in Section 2, unless otherwise defined herein or unless the
context in which a term is used clearly requires a different meaning; and
1.2 WHEREAS, all resolutions, ordinances, agreements, documents, and instruments
referenced in this Area #2 Reimbursement Agreement are incorporated as part of this
agreement; and
1.3 WHEREAS, Quail Valley is a Texas limited liability company; and
1.4 WHEREAS, Walsh Ranches is a Texas limited partnership; and
1.S WHEREAS, the City is a Texas home-rule municipality; and
1.6 WHEREAS, the City Council is authorized by Chapter 372, Texas Local Government
Code, as amended (the "PID Act"), to create public improvement districts within the City's
corporate limits and extraterritorial jurisdiction; and
1.7 WHEREAS, the PID Act authorizes public improvement districts to undertake public
improvement projects that confer a special benefit on the property within the districts and
to pay for such public improvement projects by levying assessments against benefited
property within the districts; and
1.8 WHEREAS, Devco I and Walsh Ranches filed with the municipal secretary of the City
(the "City Secretary") a petition (the "Petition") requesting the creation of a public
improvement district covering the Property; and
1.9 WHEREAS, the Petition satisfied the requirements of the PID Act; and
1.10 WHEREAS, on August 30, 2016, the City Council approved Resolution No. 4671-08-
2016: (1) accepting the Petition; (2) calling a public hearing for September 20, 2016 (the
"Public Hearing") to take public testimony on the feasibility and advisability of creating Fort
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Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley) (the "District") and
the feasibility and advisability of the public improvement projects proposed by the Petition;
and (3) authorizing and directing notices of the Public Hearing be mailed and published as
required by the PID Act; and
1.11 WHEREAS, City staff caused notice of the Public Hearing to be mailed before the 15t11
day before the date of the Public Hearing as required by the PID Act; and
1.12 WHEREAS, City staff caused notice of the Public Hearing to be published in a
newspaper of general circulation before the 1501 day before the date of the Public Hearing as
required by the PID Act; and
1.13 WHEREAS, after publishing, mailing, and otherwise providing all notices required by
the PID Act and state law, the City Council conducted the Public Hearing on the date and at
the location and time specified in such notices, at which Public Hearing the City Council took
public testimony on the feasibility and advisability of creating the District and the feasibility
and advisability of undertaking the public improvement projects proposed by the Petition;
and
1.14 WHEREAS, on September 27, 2016, the City Council approved Resolution No. 4686-
09-2016 authorizing the creation of the District covering the Property; and
1.15 WHEREAS, notice of Resolution No. 4686-09-2016 was published in a newspaper of
general circulation as required by the PID Act,whereupon the District authorization became
effective; and
1.16 WHEREAS, Resolution No. 4686-09-2016 was filed (1) November 29, 2016, as
Instrument No. 201627203, in the real property records of Parker County, Texas and (2)
December 6, 2016, as Instrument No. D216284552, in the real property records of Tarrant
County, Texas; and
1.17 WHEREAS, the Property is to be developed in phases, and
1.18 WHEREAS, a Master Reimbursement Agreement by and among the City, Walsh
Ranches, and Quail Valley Devco I, LLC, a Texas Limited Partnership, an affiliate of the Quail
Valley ("Devco I"), was executed relating to the financing of certain Authorized
Improvements in each phase of the District for the special benefit of Assessed Property
within that phase; and
1.19 WHEREAS, Devco I has assigned all of its rights under the Master Reimbursement
Agreement with respect to Improvement Area #2 to Quail Valley (the "Assignment"); and
1.20 WHEREAS, pursuant to Section 13.A of the Master Reimbursement Agreement, a
copy of the notice of the Assignment (the "Notice") has been received by the City and is
attached hereto as Schedule I to this Agreement; and
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1.21 WHEREAS,prior to the first reimbursement payment to be made hereunder, the City
will have received a copy of the instrument effectuating the Assignment; and
1.22 WHEREAS, the City hereby waives the provisions of Section 13.A of the Master
Reimbursement Agreement requiring that (i) no assignment shall be effective until five days
after the receipt of the Notice, and (ii) a copy of the instrument evidencing the assignment
be attached to the Notice, and therefore the Assignment is deemed effective on or before the
date hereof; and
1.23 WHEREAS,in connection with the development of Improvement Area#1, Fort Worth
Public Improvement District No. 16 (Walsh Ranch/Quail Valley) Improvement Area #1
Reimbursement Agreement was executed ("Area #1 Reimbursement Agreement") as
approved by Resolution 4777-05-2017; and the Fort Worth City Council adopted an
ordinance approving the Original SAP, allocating and levying assessments on the Lots in
Improvement Area #1, and ordaining related matters (the "Improvement Area #1
Assessment Ordinance"); and
1.24 WHEREAS, development of Improvement Area #2 required construction of
Authorized Improvements within Improvement Area #2, including the Improvement Area
#2 Funded Improvements, which the Developer has completed; and
1.25 WHEREAS, the Actual Costs of all of the Authorized Improvements that could be
assessed against Lots within Improvement Area #2 based on the special benefit conferred
on the Lots by the Authorized Improvements benefitting Improvement Area #2 is
$27,333,342, as shown on Table III-B in the 2020 SAP Update; and
1.26 WHEREAS, the PID-Funded Actual Costs of the Improvement Area #2 Funded
Improvements that are being assessed against Lots within Improvement Area #2 based on
the special benefit conferred on the Lots by the Improvement Area#2 Funded Improvements
is $5,850,000.00, which amount is shown in Table III-B in the 2020 SAP Update (the "Total
Improvement Area #2 Assessment Amount"); and
1.27 WHEREAS,the methodology by which the Total Improvement Area #2 Assessment
Amount is apportioned, and the apportionment of the Total Improvement Area #2
Assessment Amount to each Lot Type and Lot within Improvement Area #2 is set f orth in the
2020 SAP Update; and
1.28 WHEREAS, the apportionment of the Total Improvement Area #2 Assessment
Amount to each Lot within Improvement Area #2 is shown on the Improvement Area #2
Assessment Roll; and
1.29 WHEREAS, on September 1, 2020, the City Council passed and approved Ordinance
No. 24386-09-2020 (the "Improvement Area #2 Assessment Ordinance") and in connection
therewith approved and authorized the execution of this Agreement; and
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1.30 WHEREAS,the Improvement Area #2 Assessment Ordinance: (1) approved the 2020
SAP Update; and (2) levied the Improvement Area #2 Assessments against each Lot within
Improvement Area #2 in accordance with the Improvement Area #2 Assessment Roll; and
1.31 WHEREAS, the Improvement Area #2 Assessment Ordinance provides that an
Improvement Area #2 Assessment levied against a Lot may be paid in full at any time in
accordance with the PID Act; however,if not paid in full,the owner of the Lot shall not be in
Default but shall be deemed to have elected to pay the Improvement Area #2 Assessment in
Annual Installments in accordance with the 2020 SAP Update and this Agreement; and
1.32 WHEREAS, Annual Installments of the Improvement Area #2 Assessments shall be
billed and collected by or on behalf of the City in accordance with the Improvement Area #2
Assessment Ordinance, the 2020 SAP Update, and this Agreement and as authorized by the
PID Act; and
1.33 WHEREAS,all Assessment Revenue from the collection of the Improvement Area #2
Assessments shall be deposited into the Improvement Area #2 Account of the District Fund;
and
1.34 WHEREAS,the Assessment Revenue from the collection of the Improvement Area #2
Assessments on deposit in the Improvement Area #2 Account of the District Fund shall only
be used to pay the Improvement Area #2 Reimbursement Balance or to pay debt service on
PID Bonds secured by Improvement Area #2 Assessments, if issued ("Improvement Area #2
PID Bonds"); and
1.3S WHEREAS, this Agreement is a "reimbursement agreement" authorized by Section
372.023(d)(1) of the PID Act; and
1.36 WHEREAS,the foregoing RECITALS: (1) are part of this Agreement for all purposes;
(2) are true and correct; and (3) constitute representations, warranties, and covenants that
each Party has relied upon in entering into this Agreement.
NOW THEREFORE,for and in consideration of the mutual obligations of the Parties set forth
in this Agreement, the Parties agree as follows:
SECTION 2. DEFINITIONS
2.1 "2020 SAP Update" means the Fort Worth Public Improvement District No. 16(Walsh
Ranch/Quail Valley) Service and Assessment Plan dated May 2, 2017, as updated for
Improvement Area #2 on September 1, 2020, approved by Improvement Area #2
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Assessment Ordinance, including updates, modifications, and amendments approved by the
City Council from time to time in accordance with the SAP and the PID Act.
2.2 "Actual Costs" are defined in the SAP
2.3 "Administrative Expenses" are defined in the SAP.
2.4 "Administrator" is defined in the SAP.
2.5 "Annual Installment" is defined in the SAP. As used herein, the term Annual
Installment is comprised of two components: (a) Administrative Expenses, and (b)
Assessment Revenues.
2.6 "Area#1 Reimbursement Agreement" is defined in Section 1.23.
2.7 "Area#2 Reimbursement Agreement" is defined in the Preamble.
2.8 "Assessment" is defined in the SAP and includes the Improvement Area #1
Assessments and the Improvement Area #2 Assessments.
2.9 "Assessment Revenue" means: (1) revenue collected from the payment of
Assessments (including pre-payments and amounts received from the foreclosure of liens
but excluding costs and expenses of collection); and (2) revenue collected from the payment
of the Annual Installments (excluding Administrative Expenses) of the Assessments.
2.10 "Assignment" is defined in Section 1.19.
2.11 "Authorized Improvements" means the public improvement projects authorized by
the PID Act and to be constructed in in the District that confer a special benefit on Property
within the District, including, but not limited to, the Improvement Area #2 Funded
Improvements.
2.12 "Chief Financial Officer" the Chief Financial Officer of the City of Fort Worth, also
known as the Director of Financial Management Services.
2.13 "City" is defined in the Preamble.
2.14 "City Council" means the governing body of the City of Fort Worth, Texas.
2.15 "City Engineer" means the person designated in writing as the "City Engineer" for
purposes of this Agreement by the City Manager of the City.
2.16 "City Secretary" is defined in Section 1.8.
2.17 "Default" is defined in Section 3.12.
2.18 "Delinquent Collection Costs" are defined in the SAP.
2.19 "Devco I" is defined in Section 1.18.
2.20 "Developer" is defined in the Preamble.
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2.21 "Developer's Continuing Disclosure Agreement" means a continuing disclosure
agreement of the Developer entered into in connection with the issuance of the PID Bonds,
if any, in satisfaction of the requirements of Rule 15c2-12, promulgated by the United States
Securities and Exchange Commission.
2.22 "Development Agreement" means that certain Economic Development Agreement by
and between the City of Fort Worth and Walsh Ranches, the Walsh Children's Trusts, The
Walsh Grandchildren's Trust, and F. Howard Walsh, Jr., entered into on May 6, 2003, as the
same may be amended from time to time.
2.23 "District" is defined in Section 1.10.
2.24 "District Fund" means a fund created by the City for the sole benefit of the District
that is segregated from all other funds of the City and containing the Improvement Area #2
Account into which the City shall deposit Assessment Revenue from the collection of the
Improvement Area #2 Assessments pursuant to Section 3.2 and from which the City will pay
the Improvement Area #2 Reimbursement Balance pursuant to Section 3.3.2.
2.25 "Effective Date" is defined in the Preamble.
2.26 "Failure" is defined in Section 3.12.
2.27 "Improvement Area #1" is defined in the SAP.
2.28 "Improvement Area #1 Assessment Ordinance" is defined in Section 1.23.
2.29 "Improvement Area #1 Assessments" is defined in the SAP.
2.30 "Improvement Area #1 Assessment Roll" means the assessment roll attached as
Appendix A-1 to the Original SAP and the 2020 SAP Update that identifies the Assessments
against each Lot within Improvement Area #1.
2.31 "Improvement Area #1 Funded Improvements" is defined in the SAP.
2.32 "Improvement Area #1 Indenture" means the Indenture relating to the Improvement
Area #1 PID Bonds.
2.33 "Improvement Area #1 PID Bonds" is defined in the Improvement Area #1
Reimbursement Agreement.
2.34 "Improvement Area #1 Reimbursement Agreement" means that certain Fort Worth
Public Improvement District No. 16 (Walsh Ranch/Quail Valley) Reimbursement Agreement,
effective as of May 2, 2017, by and between the City, Walsh Ranch, and Devco I and the
Developer pursuant to which the Developer agrees to fund the Actual Costs of the Authorized
Improvements in Improvement Area #1 of the District and the City agrees to reimburse the
Developer for the PID-Funded Actual Costs of the Improvement Area #1 Funded
Improvements,with interest, as permitted by the PID Act.
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2.35 "Improvement Area 41 Reimbursement Amount" is defined as the "Reimbursement
Amount" defined in Section 3.3.1 of the Improvement Area 41 Reimbursement
Agreement.
2.36 "Improvement Area #1 Reimbursement Balance" is defined as the "Reimbursement
Balance" defined in Section 3.3.1 of the Improvement Area #1 Reimbursement
Agreement.
2.37 "Improvement Area #2" is defined in the 2020 SAP Update.
2.38 "Improvement Area 42 Account" means the account in the District Fund into which
the Assessment Revenue from the collection of the Improvement Area #2 Assessments shall
be deposited.
2.39 "Improvement Area #2 Assessment Ordinance" is defined in Section 1.29.
2.40 "Improvement Area #2 Assessments" is defined in the 2020 SAP Update.
2.41 "Improvement Area #2 Assessment Roll" means the assessment roll attached as
Appendix A-2 to the 2020 SAP Update that identifies the Assessments against each Lot within
Improvement Area 41.
2.42 "Improvement Area #2 Funded Improvements" is defined in the 2020 SAP Update.
2.43 "Improvement Area #2 Indenture" means the Indenture relating to the Improvement
Area #2 PID Bonds.
2.44 "Improvement Area #2 PID Bonds" is defined in Section 1.34.
2.45 "Improvement Area #2 Reimbursement Amount" is defined in Section 3.3.1.
2.46 "Improvement Area #2 Reimbursement Balance" is defined in Section 3.3.1.
2.47 "Improvement Area#3" means the Future Improvement Area (as defined in the SAP)
of the District that is the third improvement area of the District.
2.48 "Improvements Completion Date"means the date on which the City Engineer certifies
in writing that the Authorized Improvements for Improvement Area #2 have been
constructed in substantial compliance with the approved plans and specifications for such
improvements and are ready to be accepted by the City.
2.49 "Indenture" is defined in the SAP.
2.50 "Lot" is defined in the SAP.
2.51 "Lot Type" is defined in the SAP.
2.52 "Master Reimbursement Agreement" means that certain Master Reimbursement
Agreement entered into by and between the City and Devco I, effective as of July 17, 2017, as
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assigned pursuant to the Assignment, pursuant to which the timing of certain obligations of
the City and the Developer with respect to the District is established, including the proposed
levy of assessments for Future Improvement Areas (as defined in the SAP) and the issuance
of PID Bonds, if any.
2.53 "Maturity Date" is defined in Section 3.3.1.
2.36 "Net Proceeds" means the proceeds generated from the issuance and sale of PID
Bonds minus costs of issuance and reserve fund deposits and capitalized interest, if any,
required by the applicable Indenture related to such PID Bonds.
2.54 "Notice" is defined in Section 1.20.
2.55 "Original SAP" means the Fort Worth Public Improvement District No. 16 (Walsh
Ranch/Quail Valley) Service and Assessment Plan dated May 2, 2017, approved by the
Improvement Area #1 Assessment Ordinance.
2.56 "Party" or "Parties" are defined in the Preamble.
2.57 "Petition" is defined in Section 1.8.
2.58 "PID Act" is defined in Section 1.6.
2.59 "PID Bonds" are defined in the SAP and include the Improvement Area #1 PID Bonds,
if issued, and the Improvement Area #2 PID Bonds, if issued.
2.60 "PID-Funded Actual Costs" are defined in the SAP.
2.61 "Prepayments" are defined in the SAP.
2.62 "Property" means the approximately 1,704 acres within the corporate limits and
extraterritorial jurisdiction of the City as described in the Petition and the SAP.
2.63 "Quail Vallev" is defined in the Preamble.
2.64 "SAP" means the Original SAP as updated by the 2020 SAP Update, including updates,
modifications, and amendments approved by the City Council from time to time in
accordance with the SAP and the PID Act.
2.65 "Total Improvement Area #2 Assessment Amount" is defined in Section 1.26.
2.66 "Transfer" is defined in Section 3.9.
2.67 "Transferee" is defined in Section 3.9.
2.68 "Walsh Ranches" is defined in the Preamble.
SECTION 3. ADDITIONAL PROVISIONS
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3.1 Construction of Improvement Area #2 Funded Improvements. The Developer, at its
cost and expense, has constructed or caused to be constructed all of the Authorized
Improvements, including the Improvement Area#2 Funded Improvements. The Authorized
Improvements shall be constructed in accordance with all applicable laws, ordinances, rules,
and regulations of the State of Texas, the City, and any other political subdivision or
governmental agency that has jurisdiction over the construction of the Authorized
Improvements; provided, however, contracts for the construction of such Authorized
Improvements shall be exempt from competitive bidding requirements pursuant to Section
252.022(a)(9), Texas Local Government Code, as amended. The Developer shall prepare,
bid, award, and manage all contracts for the construction of the Authorized Improvements
and shall provide to the City Engineer, the City's PID Administrator and the Chief Financial
Officer copies of all contracts within ten (10) business days of such contract being entered
into, but in no event later than thirty (30) days after the date on which such contracts were
awarded. All plans and specifications for the Authorized Improvements must be approved
by the City Engineer, and all construction shall be inspected by or on behalf of the City for
compliance with the approved plans and specifications. The Developer shall maintain books
and records evidencing the Actual Costs, including the PID-Funded Actual Costs, paid or
incurred by the Developer in the construction of the Authorized Improvements, including
the Improvement Area #2 Funded Improvements, copies of which books and records shall
be provided to the City Engineer,the City's PID Administrator and the Chief Financial Officer.
When construction of the Authorized Improvements is complete, and when the completed
Authorized Improvements have been inspected by the City Engineer and determined to be
in substantial compliance with the approved plans and specifications,the City Engineer. shall
certify such compliance in writing, including the Actual Costs of the completed Authorized
Improvements, and the Developer shall dedicate (and the City shall accept) the Authorized
Improvements, lien free, in accordance with standard City policies applicable to such
improvements, including maintenance bonds and assignments of warranties, if any.
3.2 District Fund. Until Improvement Area #2 PID Bonds are issued, the City shall bill,
collect, and deposit into the Improvement Area #2 Account of the District Fund all
Assessment Revenue from the collection of the Improvement Area #2 Assessments. Annual
Installments of the Improvement Area #2 Assessments shall be billed and collected by the
City (or by any other person, entity, or governmental agency permitted by law) in the same
manner and at the same time as City ad-valorem taxes are billed and collected. Collection of
Annual Installments of the Improvement Area #2 Assessments shall be deferred pursuant to
Section 372.017 of the PID Act until the first date on which such Annual Installments of the
Improvement Area#2 Assessments can be collected in the manner and at the time described
above. Collection of the Annual Installments of the Improvement Area #2 Assessments is
anticipated to commence by October 1, 2020, with such Annual Installments being
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delinquent if not paid on or before January 31, 2021. In the event collection does not
commence by such time, the parties shall negotiate in good faith to update the terms of
Section 3.3 below accordingly. For the avoidance of doubt, Assessment Revenue from the
collection of Assessments for each improvement area, including Annual Installments thereof,
deposited into the District Fund will only be used to pay the reimbursement balance for that
improvement area or as directed in the indenture entered into in connection with the
issuance of the PID Bonds for that improvement area, if issued, in accordance with the
improvement-area-specific reimbursement agreement. Assessment Revenue from the
collection of Improvement Area #2 Assessments, including Annual Installments thereof,
deposited into the District Fund will only be used to pay the Improvement Area #2
Reimbursement Balance or as directed in the Improvement Area #2 Indenture entered into
in connection with the issuance of the Improvement Area #2 PID Bonds, if issued. After
issuance, and for so long as Improvement Area #2 PID Bonds are outstanding under the
terms of the Improvement Area #2 Indenture, Assessment Revenue shall be deposited, and
payments therefrom shall be applied in accordance with the provisions of the Improvement
Area #2 Indenture. Once Improvement Area #2 PID Bonds are issued, the Improvement Area
#2 Indenture shall control in the event of any conflicts with this Agreement. For the
avoidance of doubt, (1) while any Improvement Area #2 PID Bonds are outstanding under
the terms of the Improvement Area #2 Indenture, the right of the Developer to receive
payment of the Reimbursement Balance shall be subordinate to the deposits required under
the Improvement Area #2 Indenture related to the Improvement Area #2 PID Bonds, and (2)
in no event will Developer be entitled to payment of the Improvement Area #2
Reimbursement Balance from Administrative Expenses.
3.3 Payment of Improvement Area #2 Reimbursement Balance.
3.3.1 Subject to the terms and conditions herein, including Section 3.2 above, the
City agrees to pay to the Developer from Assessment Revenues collected from
the Improvement Area #2 Assessments and deposited to the Improvement
Area #2 Account of the District Fund, commencing March 15, 2021, and
continuing until September 15, 2050 (the "Maturi , Date") the principal
amount equal to FIVE MILLION EIGHT HUNDRED FIFTY THOUSAND AND
NO/100THS DOLLARS ($5,850,000.00) (the "Improvement Area #2
Reimbursement Amount"). The Improvement Area #2 Reimbursement
Amount shall bear simple interest per annum on the unpaid balance at the rate
of FOUR AND 62/100THS PERCENT (4.62%) for years one through 30 or
until Improvement Area #2 PID Bonds are issued. The interest rates have been
determined by the City Council in accordance with Section 372.023(e) of the
PID Act based on the Bond Buyer Revenue Bond Index published in The Bond
Buyer, a daily publication that publishes this interest rate index (and on the
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date of the determination by the City Council, the average index rate was not
less than 2.62%). If any portion of the Improvement Area #2 Reimbursement
Amount remains unpaid after the City has elected to issue Improvement Area
#2 PID Bonds, the interest rate on the unpaid Improvement Area #2
Reimbursement Amount shall be the same as the interest rate on the
Improvement Area #2 PID Bonds; provided, however, that such rate shall not
exceed five percent (5%). The Improvement Area#2 Reimbursement Amount
shall be reduced by the difference, if any, determined by subtracting the Actual
Costs of the Authorized Improvements within Improvement Area #2 from
$5,850,000.00. The Improvement Area #2 Reimbursement Amount together
with interest payable as described above is referred to as the "Improvement
Area #2 Reimbursement Balance".
3.3.2 The Improvement Area #2 Reimbursement Balance is payable solely from: (1)
quarterly payments by the City to the Developer made each March 15, June 15,
September 15, and December 15 beginning March 15, 2021 from the
Assessment Revenue from the collection of Improvement Area #2
Assessments, including Annual Installments thereof, deposited into the
Improvement Area #2 Account of the District Fund beginning on March 15,
2021, and continuing each calendar quarter thereafter until the earlier of the
Maturity Date or the date on which the Improvement Area #2 Reimbursement
Balance is paid in full, (2) the Net Proceeds of the Improvement Area #2 PID
Bonds issued by the City and secured by the Improvement Area #2
Assessments; or (3) a combination of items (1) and (2). The Improvement
Area #2 Reimbursement Balance shall be further reduced by the costs of
issuance associated with the issuance of ImprovementArea#2 PID Bonds,
including any underwriter's discount, in addition to any reserve fund
deposits and capitalized interes4 ifany,required by thelmprovementArea
#2 Indenture, notwithstanding that such funds shall not actually be paid
to the Developer. Each quarterly payment to the Developer from the District
Fund shall be accompanied by an accounting from the City's Chief Financial
Officer or the City's PID Administrator that certifies the Improvement Area #2
Reimbursement Balance as of the date of the payment and that itemizes all
deposits to and disbursements from the District Fund since the last quarterly
payment. If there is a dispute over the amount of any quarterly payment, the
City shall nevertheless pay the undisputed amount, and the Parties shall use
all reasonable efforts to resolve the disputed amount before the next quarterly
payment is due; however, if the Parties are unable to resolve the disputed
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amount, the determination certified by the City's Chief Financial Officer of the
disputed amount shall control.
3.3.3 Beginning in the year in which the Improvement Area #2 PID Bonds are to be
paid in full, the City will amortize the outstanding Improvement Area #2
Reimbursement Balance in a manner that is determined by the City's Chief
Financial Officer to provide the most expedient payoff of the outstanding
Improvement Area #2 Reimbursement Balance while seeking to maintain
level reimbursement payments and taking into account Administrative
Expenses associated with the Improvement Area #2 Assessments.
3.4 PID Bonds.
3.4.1 The Parties acknowledge and agree that the District was created with the
expectation that the Parties would enter into the Master Reimbursement
Agreement and improvement-area-specific reimbursement agreements and
that the City would issue PID Bonds in satisfaction of the each improvement-
area-specific reimbursement balance in accordance with provisions set forth
in each improvement-area-specific reimbursement agreement, with the
provisions for this Area #2 Reimbursement Agreement set forth in Section
3.4.2 below. For the avoidance of doubt, bonds for each improvement area, if
issued, shall be secured by and paid solely from the assessments for that
improvement area in accordance with the improvement-area-specific
reimbursement agreement and indenture. While any Improvement Area #2
PID Bonds are outstanding, subject to the terms of the Improvement Area
#2 Indenture, the Developer shall only be entitled to annual payments
from the Assessment Revenues collected from the Improvement Area #2
Assessments to the extent any such Assessment Revenues remain available
after subtracting any amounts required to be paid, deposited or
transferred under the Improvement Area #2 Indenture, including debt
service payments on the Improvement Area #2 PID Bonds, and amounts
required to be deposited into any reserve fund. If the Improvement Area#2
PID Bonds are paid in full prior to the Maturity Date, the City shall thereafter
continue to make payments to the Developer from the Assessment Revenue
generated from the collection Improvement Area #2 Assessments, including
Annual Installments thereof, deposited into the Improvement Area #2
Account of the District Fund until the earlier of the Maturity Date or the date
on which the Improvement Area #2 Reimbursement Balance is paid in full.
The parties acknowledge that approval of the issuance of any Improvement
Area #2 Bonds by the City Council is a governmental function within the City's
sole discretion, and is subject to prevailing state and federal law at the time of
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the proposed issuance. The inability or failure of the City to issue
Improvement Area #2 Bonds shall not constitute a Failure by the City or
otherwise result in a Default by the City under this Agreement.
3.4.2 Improvement Area #2 PID Bonds will not be issued until a final plat has been
recorded for Improvement Area #3. If no final plat has been recorded with
respect to Improvement Area #3 within five (5) years of the date hereof, then
no Improvement Area #2 PID Bonds will be issued, and the payment of the
Improvement Area #2 Reimbursement Balance will be limited to quarterly
payments by the City to the Developer from the Assessment Revenues
generated from the collection Improvement Area #2 Assessments, including
Annual Installments thereof, deposited into the District Fund.
3.4.3 Any Prepayments of Improvement Area #2 Assessments while any
Improvement Area #2 PID Bonds are outstanding shall be applied pursuant to
the term of the Improvement Area #2 Indenture.
3.4.4 The Improvement Area #2 PID Bonds shall have a maximum maturity date of
20 years.
3.5 Unpaid Improvement Area #2 Reimbursement Balance. If any portion of the
Improvement Area #2 Reimbursement Balance remains unpaid on the Maturity Date, such
portion of the Improvement Area #2 Reimbursement Balance shall be canceled and for all
purposes this Agreement shall be deemed to have been conclusively and irrevocably PAID
IN FULL, and such portion of the Improvement Area #2 Reimbursement Balance shall no
longer be deemed to be payable. The Developer shall not be relieved of its duty to construct
or cause to be constructed the Authorized Improvements for the benefit of the Property
within Improvement Area #2 even if there are insufficient funds payable under this
Agreement to pay the PID-Funded Actual Costs of the Improvement Area #2 Funded
Improvements.
3.6 Payment of Certain Assessments. The Developer agrees to pay in full the amount of
any Improvement Area #2 Assessments on each Lot that has closed with a homebuyer on or
before the date on which the Improvement Area #2 Assessment Ordinance is adopted.
3.7 City Obligations: Limitations.
3.7.1 The Improvement Area #2 Reimbursement Balance is payable to the
Developer and secured under this Agreement solely as described above. NO OTHER CITY
FUNDS, REVENUE, TAXES, INCOME OR PROPERTY MAY BE PLEDGED TO THE PAYMENT OF
ANY AMOUNTS UNDER THIS AGREEMENT OR SHALL BE USED EVEN IF THE
IMPROVEMENT AREA#2 REIMBURSEMENT BALANCE IS NOT PAID IN FULL AT MATURITY.
NOTWITHSTANDING ITS COLLECTION EFFORTS, IF THE CITY FAILS TO RECEIVE ALL OR
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1920.010\90428.6
ANY PART OF THE ASSESSMENT REVENUES COLLECTED FROM THE IMPROVEMENT AREA
#2 ASSESSMENTS AND, AS A RESULT, IS UNABLE TO MAKE ANY PAYMENT DESCRIBED
HEREIN, SUCH FAILURE SHALL NOT CONSTITUTE A FAILURE OR DEFAULT BY THE CITY
UNDER THIS AGREEMENT. THIS AGREEMENT AND ANY IMPROVEMENT AREA #2 PID
BONDS ISSUED IN CONNECTION HEREWITH SHALL NOT AND SHALL NEVER GIVE RISE TO
OR CREATE: (1) A CHARGE AGAINST THE GENERAL CREDIT OR TAXING POWERS OF THE
CITY OR ANY OTHER TAXING UNIT; (2) A DEBT OR OTHER OBLIGATION OF THE CITY
PAYABLE FROM ANY SOURCE OF REVENUE, TAXES, INCOME OR PROPERTIES OF THE CITY
OTHER THAN FROM (A) ASSESSMENT REVENUE COLLECTED FROM THE IMPROVEMENT
AREA #2 ASSESSMENT REVENUES PURSUANT TO THIS AGREEMENT, OR (B) THE NET
PROCEEDS OF ANY IMPROVEMENT AREA #2 BONDS PAYABLE FROM SUCH ASSESSMENT
REVENUE PURSUANT TO THE IMPROVEMENT AREA#2 INDENTURE; (3) ANY OBLIGATION
OF THE CITY TO ISSUE PID BONDS OR OTHER OBLIGATIONS; OR (4) ANY OBLIGATION OF
THE CITY TO PAY ANY AMOUNT DUE OR TO BECOME DUE UNDER THIS REIMBURSEMENT
AGREEMENT OTHER THAN FROM (A) ASSESSMENT REVENUE COLLECTED FROM THE
IMPROVEMENT AREA #2 ASSESSMENTS PURSUANT TO THIS AGREEMENT, OR (B) THE
NET PROCEEDS OF ANY IMPROVEMENT AREA #2 BONDS PAYABLE FROM SUCH
ASSESSMENT REVENUE PURSUANT TO THE IMPROVEMENT AREA#2 INDENTURE.
3.7.2 None of the City or any of its elected or appointed officials or any of its officers,
employees, consultants or representatives shall incur any liability hereunder to the
Developer or any other party in their individual capacities by reason of this Agreement or
their acts or omissions under this Agreement.
3.7.3 Until Improvement Area #2 PID Bonds are issued,the obligation of the City to
deposit Assessment Revenue from the collection of Improvement Area #2 Assessments,
including Annual Installments thereof,into the Improvement Area#2 Account of the District
Fund is subject only to the condition that the Improvements Completion Date has occurred.
Upon the issuance of Improvement Area #2 PID Bonds, the City shall deposit Assessment
Revenue as required by the Improvement Area #2 Indenture.
3.7.4 Notwithstanding Section 3.7.3 above, the obligation of the City to make
payments to the Developer under this Agreement is subject to Section 3.7.1 above and is
conditioned upon: (1) the Improvements Completion Date having occurred; (2) the City
Engineer having certified that the Total Improvement Area #2 Assessment Amount does not
exceed eighty percent (80%) of the Actual Costs of the Authorized Improvements within
Improvement Area#2; and (3) the Developer being in compliance with its obligations under
any Developer's Continuing Disclosure Agreement, if any, entered into in connection with
the issuance of Improvement Area #2 PID Bonds. From and after the satisfaction of each of
the foregoing conditions: (1) the obligations of the City under this Area #2 Reimbursement
Agreement to make payments to the Developer shall be unconditional, and shall continue
16
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until the Maturity Date or until the Improvement Area #2 Reimbursement Balance has been
paid in full, whichever is earlier; and (2) there shall be no conditions, defenses, or rights of
offset to the obligations of the City: (i) to make payments to the Developer from the
Improvement Area #2 Account of the District Fund in accordance with this Area #2
Reimbursement Agreement; (ii) if Improvement Area #2 PID Bonds are issued, to use the
Net Proceeds thereof to pay all or a portion of the Improvement Area #2 Reimbursement
Balance and thereafter to use Assessment Revenue from the collection of Improvement Area
#2 Assessments, including Annual Installments thereof, to pay debt service on the
Improvement Area #2 PID Bonds in accordance with this Area #2 Reimbursement
Agreement and the Improvement Area #2 Indenture; and (iii) , subject to Section 3.3.3, if
Improvement Area#2 PID Bonds have been issued and paid in full prior to the Maturity Date,
to resume making payments to the Developer from the Improvement Area#2 Account of the
District Fund until the Maturity Date or until the Improvement Area #2 Reimbursement
Balance is paid in full,whichever is earlier.
3.8 Term. The term of this Area #2 Reimbursement Agreement shall begin on the
Effective Date and shall continue until the earlier to occur of the Maturity Date or the date on
which the Improvement Area #2 Reimbursement Balance is paid in full.
3.9 Transfers. Quail Valley and Walsh Ranches each has the right to assign, convey,
transfer, mortgage, pledge, or otherwise encumber, in whole or in part without the consent
of (but with notice to) the City, their respective obligations, rights, title, or interest under
this Area #2 Reimbursement Agreement to any person or entity, including, but not limited
to,their respective rights,title,or interest in and to payments of the Reimbursement Balance,
whether such payments are made quarterly from the District Fund or from the Net Proceeds
of Improvement Area #2 PID Bonds (any of the foregoing, a "Transfer," and the person or
entity to whom the Transfer is made, a "Transferee"). Notwithstanding the foregoing, no
Transfer shall be effective until five (S) days after written notice of the Transfer is received
by the City, including, for each Transferee, the notice information required pursuant to
Section 3.11. The City may rely on notice of a Transfer received from the Developer without
obligation to investigate or confirm the validity of the Transfer. The Developer waives all
rights or claims against the City for any funds paid to a Transferee as a result of a Transfer
for which the City received notice. The foregoing notwithstanding, no Transfer of payments
of the Reimbursement Balance may be pledged to the payment of debt service on public
securities issued by any state of the United States or any political subdivision thereof without
the approval of the City Council.
3.10 Applicable Law: Venue. This Area #2 Reimbursement Agreement is being executed
and delivered and is intended to be performed in the State of Texas. Except to the extent that
the laws of the United States may apply, the substantive laws of the State of Texas shall
govern the interpretation and enforcement of this agreement. In the event of a dispute
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1920.010\90428.6
involving this agreement, venue shall lie in any court of competent jurisdiction in Tarrant
County, Texas.
3.11 Notice. Any notice required by or contemplated by this Area #2 Reimbursement
Agreement must be in writing and shall be deemed given at the addresses shown below: (1)
when delivered by a nationally recognized delivery service such as FedEx or UPS with
evidence of delivery signed by any person at the delivery address regardless of whether such
person is the named addressee; or (2) seventy-two (72) hours after deposited with the
United States Postal Service, Certified Mail, Return Receipt Requested.
If to the City:
City of Fort Worth
Jesus Chapa,Assistant City Manager
200 Texas Street
Fort Worth, Texas 76102
With a copy to:
McCall, Parkhurst& Horton, L.L.P.
Attn: Jeff Leuschel
717 North Harwood, Suite 900
Dallas, Texas 75201
and:
Kelly Hart& Hallman LLP
Attn: Jonathan Cranz
201 Main Street, Suite 2500
Fort Worth, Texas 76107
If to the Developer:
QUAIL VALLEY DEVCO II, L.L.C.
c/o Republic Property Group, Inc.
Attn: Jake Wagner
400 S. Record Street, Suite 1200
Dallas, Texas 75202
and:
WALSH RANCHES LIMITED PARTNERSHIP
Attn: Gary Goble
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1920.010\90428.6
500 West Seventh Street, Suite 1007
Fort Worth, TX 76102
With a copy to:
Shupe Ventura, PLLC
Attn: Misty Ventura
9406 Biscayne Blvd.
Dallas, TX 75218
Any Party may change its address by delivering notice of the change in accordance with this
section.
3.12 Default/Remedies.
3.12.1 If either Party fails to perform an obligation imposed on such Party by this
Area #2 Reimbursement Agreement (a "Failure") and such Failure is not cured after notice
and the expiration of the cure periods provided in this section, then such Failure shall
constitute a "Default." If a Failure is monetary, the non-performing Party shall have thirty
(30) days within which to cure. If the Failure is non-monetary, the non-performing Party
shall have forty-five (45) days within which to cure.
3.12.2 If the Developer is in Default, the City's sole and exclusive remedy shall be
to compel performance through injunctive relief or specific performance. No Default by the
Developer shall entitle the City to terminate this Area #2 Reimbursement Agreement. No
Default by the Developer after the Improvements Completion Date shall entitle the City to
withhold payments to the Developer from the District Fund in accordance with this
agreement.
3.12.3 If the City is in Default, the Developer's sole and exclusive remedies shall
be to: (1) compel performance through injunctive relief or specific performance; and/or (2)
seek specific enforcement of this Area #2 Reimbursement Agreement. No Default by the City
shall entitle the Developer to terminate this agreement.
3.12.4 The City shall give notice of any alleged Failure by the Developer to each
Transferee identified in any notice from the Developer, and such Transferees shall have the
right, but not the obligation,to cure the alleged Failure within the same cure periods that are
provided to the Developer. The election by a Transferee to cure a Failure by the Developer
shall constitute a cure by the Developer but shall not obligate the Transferee to be bound by
this Area#2 Reimbursement Agreement unless the Transferee agrees in writing to be bound.
3.13 Remedies Outside the Agreement. Nothing in this Area #2 Reimbursement
Agreement constitutes a waiver by the City of any remedy the City may have outside this
agreement against any the Developer, any Transferee, or any other person or entity involved
in the design, construction, or installation of the Authorized Improvements. The obligations
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1920.010\90428.6
of the Developer hereunder shall be those of a party hereto and not as an owner of property
in the PID. Nothing herein shall be construed as affecting the City's or the Developer's rights
or duties to perform their respective obligations under other agreements, use regulations or
subdivision requirements relating to the development of property in the PID.
3.14 Anti-Boycott Verification. The Developer hereby verifies that it and its parent
company, wholly- or majority-owned subsidiaries, and other affiliates, if any, do not boycott
Israel and, to the extent this Area #2 Reimbursement Agreement is a contract for goods or
services,will not boycott Israel during the term of this agreement. The foregoing verification
is made solely to comply with Section 2270.002, Texas Government Code, and to the extent
such Section does not contravene applicable state and federal law. As used in the foregoing
verification, "boycott Israel" means refusing to deal with, terminating business activities
with, or otherwise taking any action that is intended to penalize, inflict economic harm on,
or limit commercial relations specifically with Israel, or with a person or entity doing
business in Israel or in an Israeli-controlled territory, but does not include an action made
for ordinary business purposes.The Developer understands"affiliate" to mean an entity that
controls, is controlled by, or is under common control with the Underwriter and exists to
make a profit
3.15 Iran Sudan and Foreign Terrorist Organizations. The Developer represents that
neither it nor any of its parent company, wholly- or majority-owned subsidiaries, and other
affiliates is a company identified on a list prepared and maintained by the Texas Comptroller
of Public Accounts under Section 2252.153 or Section 2271.0201, Texas Government Code,
and posted on any of the following pages of such officer's internet website:
https://comptroller.texas.gov/purchasing/docs/sudan-list.pdf,
https://comptroller.texas.gov/purchasing/docs/iran-list.pdf, or
https://comptroller.texas.gov/purchasing/docs/fto-list.pdf.
The foregoing representation is made solely to comply with Section 2252.152, Texas
Government Code, and to the extent such Section does not contravene applicable state and
federal law and excludes the Underwriter and its parent company, wholly- or majority-
owned subsidiaries, and other affiliates, if any, that the United States government has
affirmatively declared to be excluded from its federal sanctions regime relating to Sudan or
Iran or any federal sanctions regime relating to a foreign terrorist organization. The
Developer understands "affiliate" to mean any entity that controls, is controlled by, or is
under common control with the Underwriter and exists to make a profit
3.16 Form 1295. Submitted herewith is a completed Form 1295 in connection with the
Developer's participation in the execution of this agreement generated by the Texas Ethics
Commission's (the "TEC") electronic filing application in accordance with the provisions of
Section 2252.908 of the Texas Government Code and the rules promulgated by the TEC (the
20
1920.010\90428.6
"Form 1295"). The City hereby confirms receipt of the Form 1295 from the Developer, and
the City agrees to acknowledge such form with the TEC through its electronic filing
application not later than the 30th day after the receipt of such form. The Developer and the
City understand and agree that, with the exception of information identifying the City and
the contract identification number, neither the City nor its consultants are responsible for
the information contained in the Form 1295; that the information contained in the Form
1295 has been provided solely by the Developer; and, neither the City nor its consultants
have verified such information
3.17 Entire Agreement; Amendment. This Area #2 Reimbursement Agreement
supersedes all prior agreements (whether written or oral) between the Parties regarding the
subject matter hereof and constitutes the only agreement between the Parties with regard
to the subject matter hereof. For the avoidance of doubt, the Master Reimbursement
Agreement remains in full force and effect with respect to any other applicable improvement
area and is not superseded with respect to any other improvement area by this Agreement.
In the event of any conflict between this Agreement and any other instrument, document, or
agreement to which either Party is a party or by which either Party is bound, the provisions
and intent of this Agreement shall control. This Agreement may only be amended by written
agreement of the Parties.
3.18 Severability. If any provision of this Agreement is held invalid by any court, such
holding shall not affect the validity of the remaining provisions.
3.19 Non-Waiver. The failure by a Party to insist upon the strict performance of any
provision of this Agreement by the other Party, or the failure by a Party to exercise its rights
upon a Default by the other Party, shall not constitute a waiver of such Party's right to insist
and demand strict compliance by such other Party with the provisions of this Agreement.
3.20 Third Party Beneficiaries. Nothing in this Area #2 Reimbursement Agreement is
intended to or shall be construed to confer upon any person or entity other than the City and
the Developer (including Developer's Transferees following a transfer) any rights under or
by reason of this agreement. All provisions of this agreement shall be for the sole and
exclusive benefit of the City and the Developer (including Developer's Transferees following
a Transfer).
3.21 Counterparts. This Area #2 Reimbursement Agreement may be executed in multiple
counterparts, which, when taken together, shall be deemed one original. This Agreement
may be delivered by the exchange of signed signature pages by facsimile transmission or by
electronic mail with a "pdf' copy or other replicating image attached, and any printed or
copied version of any signature page so delivered shall have the same force and effect as an
originally signed version of such signature page.
G1
1920.0 1 0\90428.6
3.22 Representations and Warranties.
3.22.1 Quail Valley represents and warrants, on behalf of itself and Devco I,to the
City that: (1) Quail Valley has the authority to enter into and perform its obligations under
this Agreement; (2) Quail Valley has the financial resources, or the ability to obtain sufficient
financial resources, to meet its obligations under this Agreement; (3) the person executing
this Agreement on behalf of Quail Valley has been duly authorized to do so; (4) this
Agreement is binding upon Quail Valley in accordance with its terms; and (5) the execution
of this Agreement and the performance by Quail Valley of its obligations under this
Agreement do not constitute a breach or event of default by Quail Valley or Devco I under
any other agreement, instrument, or order to which Quail Valley or Devco I is a party or by
which Quail Valley or Devco I is bound.
3.22.2 Walsh Ranches represents and warrants to the City that: (1) Walsh
Ranches has the authority to enter into and perform its obligations under this Agreement;
(2) ) Walsh Ranches has the financial resources, or the ability to obtain sufficient financial
resources, to meet its obligations under this Agreement; (3) the person executing this
Agreement on behalf of Walsh Ranches has been duly authorized to do so; (4) this Agreement
is binding upon Walsh Ranches in accordance with its terms; and (5) the execution of this
Agreement and the performance by Walsh Ranches of its obligations under this Agreement
do not constitute a breach or event of default by Walsh Ranches under any other agreement,
instrument, or order to which Walsh Ranches is a party or by which Walsh Ranches is bound.
3.22.3 Quail Valley and Walsh Ranches each represent and warrant to the City
that with regard to the obligations of the"Developer"under this Agreement, Quail Valley and
Walsh Ranches are jointly and severally liable for such obligations unless and until either of
them has transferred such obligations, in whole or in part, pursuant to Section 3.9. In the
event of a Transfer by either Quail Valley or Walsh Ranches of all or any of its obligations
under this Agreement pursuant to Section 3.9, the Transferee shall only be liable to the
extent of the obligations that are the subject of the Transfer and shall not be jointly liable
with the Developer or with any other Transferee for any other obligations under this
Agreement.
3.22.4 The City represents and warrants to Quail Valley and Walsh Ranches that:
(1) the City has the authority to enter into and perform its obligations under this Agreement;
(2) the person executing this Agreement on behalf of the City has been duly authorized to do
so; (3) this Agreement is binding upon the City in accordance with its terms; and (4) the
execution of this Agreement and the performance by the City of its obligations under this
Agreement do not constitute a breach or event of default by the City under any other
agreement, instrument, or order to which the City is a party or by which the City is bound.
22
1920.010\90428.6
CITY OF FORT WORTH, TEXAS -
By:
Name-3 O- uS
Title `laPV
.s� '�`��' ..�:�'�•-�`1':. Date:
ATT S F
City Secre a
iA&C. ')4-C* o�joi jao t-m
ftb iag5 acQo-QoI qSq `
AVO AS WFORM
Assistant C t ttorney
QUAIL VALLEY DEVCO II, LLC,
a Texas limited liability company
By: RPG QVR, LLC,
a Texas limited liability company
By: Republic Property Group, Ltd.,
a Texas limited partnership, its Manager
By: RPG, LLC, a Texas , ' ited liability
company, it ene ner
By:
MARK Kl K 6R, Ti-casu,rer
WALSH RANCHES LIMITED PARTNERSHIP,
a Texas limited partnership,
By: Walsh North Star Company,
a Texas cor ration, iP General Partner
By: _
Gary G le, Vic �
23
1920.0 1 0\90428.6
SHUPE VENTURA, PLLC
9406 Biscayne Blvd.
Dallas, Texas 75218
214.328.1101
September 1, 2020 Corey Admire
Attorney
9406 Biscayne Blvd.
Dallas,Texas 75218
214.328.1100
VIA EMAIL AND CERTIFIED MAIL Corey.Admire'c)svlandlaw.com
Attn: Jesus Chapa, Deputy City Manager
City of Fort Worth, Texas
200 Texas St.
Fort Worth, Texas 76102
Re: Assignment of Master Reimbursement Agreement Rights related to Improvement
Area#2 of Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley)
Dear Mr. Chapa,
Pursuant to the provisions of the Master Reimbursement Agreement for Fort Worth Public
Improvement District No. 16 (Walsh Ranch/Quail Valley) (the "Master Reimbursement
Agreement"), I am providing notice on behalf of Quail Valley Devco I, LLC, a Texas limited
liability company ("Devco I") that it has assigned its rights related to "Improvement Area #2"
(as defined in the Fort Worth Public Improvement District No. 16 (Walsh Ranch/Quail Valley),
City of Fort Worth, Texas, Service and Assessment Plan, approved May 2, 2017, as updated for
Improvement Area #2 on September 1, 2020) under the Master Reimbursement Agreement to
Quail Valley Devco II, LLC, a Texas limited liability company, an entity affiliated with Devco I.
An executed copy of the assignment will be provided to the City under separate cover.
Sincerely,
Corey Admire
cc: Denis McElroy, City of Fort Worth, Texas (by email)
Jonathan Cranz, Kelly Hart & Hallman, LLP (by email)
Jeff Leuschel, McCall, Parkhurst& Horton, L.L.P. (by email)
G. Malcom Louden, Walsh Ranches Limited Partnership (by email)
Jake Wagner, Quail Valley Devco I, LLC c/o Republic Property Group, Inc. (by email)
1920.010\91122.2
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City of Fort Worth, Texas
Mayor and Council Communication
DATE: 09/01/20 M&C FILE NUMBER: M&C 20-0639
LOG NAME: 13QUAIL VALLEY PID FY2021 (NIA#2)
SUBJECT
(CD 3)Conduct a Public Hearing to Consider the Levying of Special Assessments in Improvement Area No.2 of Fort Worth Public Improvement
District 16—Walsh Ranch/Quail Valley(Quail Valley PID);Adopt Ordinance(1)Levying Special Assessments on the Property Located in
Improvement Area No.2 of the Quail Valley PID,(2)Approving a Service and Assessment Plan Update for the Quail Valley PID to Include
Improvement Area No.2(Service and Assessment Plan Update),(3)Approving Assessment Roll for Improvement Area No.2 of the Quail Valley
PID(Assessment Roll),and(4)Ordaining Other Matters Related Thereto;Authorize Execution of a Reimbursement Agreement with Quail
Valley DEVCO II,LLC and Walsh Ranches Limited Partnership to Address Construction,Acquisition,and Financing of the Improvements in
Improvement Area No.2 of the Quail Valley PID;Authorize Execution of a Majority Landowner Agreement;and Adopt Appropriation Ordinance
(PUBLIC HEARING-a. Report of City Staff:Alex Laufer; b. Public Comment;c.Council Action:Close Public Hearing and Act on M&C)
RECOMMENDATION:
It is recommended that the City Council:
1. Conduct a public hearing concerning the proposed special assessments to be levied on the property located in Improvement Area No.2 of
the Quail Valley PID,with collection to begin in the 2020 Tax Year;
2. Adopt the attached ordinance(a)levying special assessments on the property located in Improvement Area No.2 of the Quail Valley PID, (b)
approving a Service and Assessment Plan Update to Include Improvement Area No.2, (c)approving the Assessment Roll for Improvement
Area No.2,and(d)ordaining other matters related thereto;
3. Authorize execution of a Reimbursement Agreement with Quail Valley DEVCO II, LLC and Walsh Ranches Limited Partnership(collectively
Developers)to address construction,acquisition,and financing of the improvements in Improvement Area No.2 of the Quail Valley PID;
4. Authorize execution of a Majority Landowner Agreement with the Developers,outlining responsibilities associated with coordination of
notices and payment of assessments for land in Improvement Area No.2 that is not owned by Developers;and
5. Adopt the attached appropriation ordinance increasing receipts and appropriations in the FWPID#16-Quail Valley Fund in the amount of
$419,754.00,from available funds.
DISCUSSION:
The purpose of this Mayor and Council Communication(M&C)is to take actions associated with commencement of assessments in the second
phase of Fort Worth Public Improvement District No. 16,also known as the Walsh Ranch/Quail Valley Public Improvement District or"Quail Valley
PID."
On September 2016,the City Council approved the creation of the Quail Valley PID,encompassing approximately one-fourth of the entire Walsh
Ranch property,as a vehicle to reimburse the Developers for certain infrastructure costs. Full development of the Quail Valley PID will encompass
seven phases that occur over several years as phases of the Quail Valley PID are developed.Pursuant to Ordinance No.2207-05-2017,the City
Council previously adopted a service and assessment plan for the Quail Valley PID,which has been updated annually through subsequent City
Council actions,and levied assessments on Improvement Area No. 1 of the Quail Valley PID. This M&C addresses Improvement Area No.2 of the
Quail Valley PID,which is the second phase of development.
On August 18,2020,the City Council adopted Resolution No.5263-08-2020 concerning certain matters related to the Quail Valley PID, including
the following: (1)determining the costs of certain public improvements; (2)accepting a preliminary service and assessment plan update for
Improvement Area No.2, including a proposed assessment roll; (3)directing the filing of the proposed assessment roll with the City Secretary; (4)
calling for a public hearing to consider the ordinance levying special assessments on property located within the area defined as Improvement
Area No.2 of the Quail Valley PID,and(5)directing staff to publish and mail notice of this public hearing to the property owners liable for payment
of the special assessment.
The purpose of this public hearing is to receive comments regarding the proposed special assessments to be levied on each property in
Improvement Area No.2 of the Quail Valley PID.As outlined in the Service and Assessment Plan update,improvements in the amount of
$5,850,000.00 are to be funded by the special assessments on Improvement Area No.2,consisting of$5,132,890.50 for paving expenses and
$717,109.50 for landscaping expenses. The special assessments will be levied across 553 residential units(representing 185.66 acres)and
collected over a 30-year period.The 553 lots are divided into six categories,with each category represented by lot width and/or type.Widths
including categories as follows:35 feet,50 feet,60 feet,70 feet and two additional lot types including townhomes and garden homes.
Assessments will be allocated as follows:
Lot Size #of Lots Annual Installment
35 feet 61 $545.78
50 feet 152 F $719.04
60 feet 165 $874.97
70 feet 67 $1,134.87
Townhome 96 $537.11
Garden Home 12 $433.16
The above shown amounts are calculated using an interest rate of 4.62%per annum.This interest rate is based on the bond index rate of 2.62%
applicable for the month of August through August 27th plus 2.0%.
In addition to the$5,850,000.00 of improvements funded by the special assessments,the Developers are constructing,without reimbursement
from the Quail Valley PID,additional improvements in the amount of$21,483,342.00 in this phase of the PID, bringing the total costs of
improvements in Improvement Area No.2 to$27,333,342.00.
The Developers are responsible for managing all construction and the associated Agreements for the development of the lots and residential units
within Improvement Area#2 of the Quail Valley PID.Beginning in 2021,the City will begin to make quarterly payments to the Developers in
satisfaction of the Reimbursement Amount from the special assessments revenues,less any administrative fees,once the Developer submits
payment requisitions.The Reimbursement Amount for Improvement Area No.2 will be paid over a maximum period of 30 years. Until bonds,if any,
are issued,the Developer will be entitled to interest on the unpaid Reimbursement Amount at the rate of 4.62 percent. If any portion of the
Reimbursement Amount remains unpaid after the City has elected to issue bonds and those bonds have been repaid in full,the interest rate on the
unpaid Reimbursement Amount will be the same as the interest rate on the bonds. It is anticipated that within five years,provided that the
Developers have satisfied certain obligations designed to ensure the rapid development of the entire Quail Valley PID,the City will explore options
to accelerate the reimbursement of the Developers by issuing debt secured by a portion of the special assessments.
In order to maintain the Developer's construction schedule, portions of the property in Improvement Area No.2 have been sold to home developers
and individual homeowners.As reflected in the Reimbursement Agreement, Developers have agreed to assume responsibility for the payment of
PID assessments for properties already sold to individual homeowners. The Majority Landowner Agreement addresses the responsibilities of the
Developers and City with respect to notices,assurances,and payment of assessments for property in Improvement Area No.2 that is not owned
by the Developers.
Finally,the adoption of the attached appropriation ordinance provides the necessary funding for the City to pay the costs of services associated
with ongoing administration of the Quail Valley PID and the implementation of assessments in Improvement Area No.2. Expenses will cover costs
for financial advisors, PID administrators,and legal services up to$419,754.00. Revenues will also be adjusted by the same amount but are not
anticipated to be received until Fiscal Year 2021.
It is recommended that the City Council adopt the attached ordinance levying such special assessments and approving the Service and
Assessment Plan update and updated Assessment Roll;authorize the execution of the Reimbursement Agreement;and adopt the appropriation
ordinance increasing estimated receipts and appropriations in the FWPID#16-Quail Valley Fund in the amount of$419,754.00.
A Form 1295 is not required because:This M&C does not request approval of a contract with a business entity.
FISCAL INFORMATION/CERTIFICATION:
The Director of Finance certifies that upon approval of the above recommendations funds are available in the current operating budget,as
previously appropriated,and upon adoption of the Fiscal Year 2021 Budget by the City Council,funds will be available in the Fiscal Year 2021
Operating Budget,as appropriated, in the FWPID#16-Quail Valley Fund. Prior to an expenditure being incurred,the Financial Management
Services Department has the responsibility to validate the availability of funds.
Submitted for City Manager's Office by. Jay Chapa 5804
Originating Business Unit Head: Reginald Zeno 8517
Additional Information Contact: Alex Laufer 2268
From: Corey Admire
To: McElroy,Denis C.
Cc: Jonathan W.Cranz lJonathan.Cranz(cbkellvhart.com);Samford.John
Subject: FW:fixing blanks in Quail Valley Area#2 documents
Date: Tuesday,September 22,2020 3:28:48 PM
Attachments: imaae001.ona
CAUTION:This email originated from outside of the City of Fort Worth email system. Do not click any links or open
attachments unless you recognize the sender and know the content is safe.
It was my turn to hit send too soon. See below on the replacement pages.
Corey Admire
Shupe Ventura, PLLC
9406 Biscayne Blvd.
Dallas, Texas 75218
2 14.3 28.1100 - direct
214.704.6237 - cell
corey.admire(@svlandlaw.com
www.svlandlaw.com
From: Mark Kiker<mkiker@republicpropertygroup.com>
Sent:Tuesday, September 22, 2020 3:19 PM
To: Corey Admire <corey.ad mire @svlandlaw.com>
Subject: RE: fixing blanks in Quail Valley Area #2 documents
Yes, I am good with this. Thank you.
From: Corey Admire <corey.ad mire(cDsvlandlaw.com>
Sent:Tuesday, September 22, 2020 3:17 PM
To: Mark Kiker<mkikerPrepublicpropert)�group.com>
Subject: FW: fixing blanks in Quail Valley Area #2 documents
Hi Mark-
Do I have your permission to authorize the City to slip page the agreements as referenced below?
Corey Admire
Shupe Ventura, PLLC
9406 Biscayne Blvd.
Dallas, Texas 75218
2 14.3 28.1100 - direct
214.704.6237 - cell
corey.admire(@svlandlaw.com
www.svlandlaw.com
From: McElroy, Denis C. <Denis.McElro) (Pfortworthtexas.gov>
Sent: Wednesday, September 16, 2020 5:29 PM
To: Corey Admire <corey.ad mire Psvlandlaw.com>
Cc:Jonathan Cranz (Jonathan.Cranz(@kellyhart.com) <Jonathan.Cranz(@kellyhart.com>; Samford,
John <John.Samford(@fortworthtexas.gov>
Subject:fixing blanks in Quail Valley Area #2 documents
Corey,
Our City Secretary brought to my attention that the executed landowner and reimbursement
agreement for Quail Valley Area #2 included some blanks that should have been filled in.
In the landowner agreement (CSC 54448), there is a blank on the top of numbered page 2 (page 3 of
pdf)where the ordinance number should have been inserted.
For the reimbursement agreement (54447), there are blanks on numbered pages 5, 6, and 13 (pages
1, 2, and 11 of pdf) where the date, ordinance number, and reported interest rate were to be filled
in.
In an effort to make the public record as complete and clean as possible, I am requesting that your
client give written permission (an email is fine) for those blanks to be filled in and the associated
pages to be slipsheeted with corrected versions.
I have attached highlighted and clean versions of the affected pages. Would you please see if you
client would agree to these insertions and slipsheeting?
Thanks,
Denis
Denis McElroy
Assistant City Attorney
200 Texas Street
Fort Worth, Texas 76102
(817)392-2758
denis.mcelro�:Afortworthtexas. oovv
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