HomeMy WebLinkAboutResolution 5337-01-2021 A Resolution
NO. 5337-01-2021
PROVIDING THAT THE CITY OF FORT WORTH ("CITY")
ELECTS TO BE ELIGIBLE TO PARTICIPATE IN TAX ABATEMENT
AUTHORIZED BY CHAPTER 312 OF THE TEXAS TAX CODE AND
ESTABLISHING A TAX ABATEMENT POLICY GOVERNING
CERTAIN TAX ABATEMENT AGREEMENTS
WHEREAS, a municipality may enter into tax abatement agreements authorized
by Chapter 312 of the Texas Tax Code ("Code") only if .the governing body of the
municipality has previously adopted a resolution stating that the municipality elects to
be eligible to participate in tax abatement and has established guidelines and criteria
governing tax abatement agreements ("Tax Abatement Policy"); and
WHEREAS, pursuant to the Code, a Tax Abatement Policy is effective for two (2)
years from the date of its adoption; and
WHEREAS, the City Council's Tax Abatement Policy for all tax abatements other
than those granted pursuant to the Neighborhood Empowerment Zone Policy (Resolution
No. 5040-01-2019) will expire on January 28, 2021;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE
CITY OF FORT WORTH, TEXAS:
Section 1. That the City hereby elects to be eligible to participate in tax
abatement in accordance with Chapter 312 of the Code.
Section 2. That the City hereby adopts the Tax Abatement Policy attached hereto
as Exhibit "A", which constitutes the guidelines, criteria, and procedures governing tax
abatement agreements entered into by the City (other than those granted pursuant to the
Neighborhood Empowerment Zone Policy), to be effective from January 29, 2021
through January 28, 2023, unless earlier amended or repealed as required by the Code, as
amended.
Section 3. That this Tax Abatement Policy, as it may subsequently be amended,
will expressly govern all tax abatement agreements entered into by the City (other than
those granted pursuant to the Neighborhood Empowerment Zone Policy) during the
period in which this Tax Abatement Policy is in effect.
Adopted this 26th day of January 2021.
ATTEST: F FOR
By: ��O r 0
Mary J. Kayser, City Secretary )0.;*..........
1QNS
EXHIBIT A
GENERAL TAX ABATEMENT POLICY
City of Fort Worth
General Tax Abatement Policy
Effective January 29,2021 through January 28,2023
1. GENERAL PROVISIONS.
1.1. Purpose
Chapter 312 of the Texas Tax Code allows, but does not obligate or require, the City to
grant a Tax Abatement on the value added to a particular property on account of a specific
development project that meets the eligibility requirements set forth in this Policy. In order for
the City to participate in Tax Abatement, the City is required to establish guidelines and criteria
governing Tax Abatement Agreements. This Policy is intended to set forth those guidelines and
criteria for persons or entities interested in receiving a Tax Abatement from the City. This Policy
expires on January 28, 2023.
1.2. General Eligibility Criteria
A Tax Abatement can only be granted to persons or entities eligible for Tax Abatement
pursuant to Section 312.204(a) of the Texas Tax Code, which persons or entities as of the
effective date of this Policy must be (i) the owner of taxable real property located in a Tax
Abatement reinvestment zone;or(ii)the owner of a leasehold interest in real property located in
a Tax Abatement reinvestment zone. Although the City will consider all applications for Tax
Abatement that meet the eligibility requirements set forth in the associated Policy,it is especially
interested in supporting projects that are expected to produce a meaningful impact on the City
and its economy and that result in one or more of the following:
• Growth of business activity, employment, or investment in one of the City's identified
Target Industries;
• Creation of high-wage jobs;
• Significant Investment;
• Growth of business activity, employment, or investment in the Central Business District;
• Revitalization with likelihood of ancillary development in a key employment node or
specifically designated area of the city;
• Retention or expansion of an existing major employer; and
• Anchoring of a business expansion project with potential to generate additional supply
chain activity.
1.3. General Exclusions and Limitations
1.3.1. Lessees of Real Property
A person or entity seeking Tax Abatement on real property that is leased from a
third party should be advised that,pursuant to state law,unless the real property owner is
also a party to a Tax Abatement Agreement,the City can only abate taxes on the increased
value of the taxable leasehold interest in the real property,if any,and the increase in value
of taxable improvements and Business Personal Property located on the real property and
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subject to the leasehold interest, if any. Before applying for a Tax Abatement from the
City, such persons or entities should seek professional and legal guidance, and may wish
to consult with the appraisal district having jurisdiction over the property in question as
to whether their development projects will result in a taxable leasehold interest in the
property and, if so, the anticipated value of that leasehold interest.
1.3.2. Property Located in Neighborhood Empowerment Zones ("NEZs")
The City Council has designated certain distressed areas of the City needing
economic development and expanded public services as NEZs. Notwithstanding
anything that may be interpreted to the contrary, this Policy does not apply to property
located in a NEZ. A person or entity seeking Tax Abatement on property owned or leased
in a NEZ should refer to the Neighborhood Empowerment Zone Tax Abatement Policy,
adopted by the City Council pursuant to Resolution No. 5042-01-2019, as may be
amended or readopted.
1.3.3. Property Located in Tax Increment Reinvestment Zones ("TIFs")
The City Council has designated certain areas of the City as TIFs. This Policy
does apply to property located in a TIF. However, a person or entity seeking Tax
Abatement on property owned or leased in a TIF should be advised that state law requires
a TIF's board of directors and the governing bodies of all taxing jurisdictions contributing
tax increment revenue to a TIF to approve a City Tax Abatement Agreement on property
located in that TIF before the Agreement can take effect.
1.3.4. Property Located in Enterprise Zones
The State of Texas has designated certain areas of the City with high
unemployment as enterprise zones. Various economic development incentives are
available to owners of property located in enterprise zones. In accordance with state law,
all property located within an enterprise zone is automatically designated as a Tax
Abatement reinvestment zone. However, the City typically designates individual Tax
Abatement reinvestment zone overlays when it wishes to grant Tax Abatements on
property located in an enterprise zone.
2. DEFINITIONS
Capitalized terms used in this Policy but not defined elsewhere shall have the following
meanings:
Abatement or Tax Abatement - A full or partial exemption from ad valorem taxes on eligible taxable
real property and Business Personal Property located in a Reinvestment Zone for a specified period on
the difference between(i) the amount of increase in the appraised value(as reflected on the most recent
certified tax roll of the appropriate appraisal district) and (ii) the appraised value (as reflected on the
certified tax roll of the appropriate county appraisal district for the year in which the Tax Abatement
Agreement was executed).
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Abatement Benefit Term — The period of time specified in a Tax Abatement Agreement, but not to
exceed ten(10)years,that the recipient of a Tax Abatement may receive the Abatement.
Abatement Compliance Term —The period of time specified in a Tax Abatement Agreement during
which the recipient of a Tax Abatement must comply with the provisions and conditions of the Tax
Abatement Agreement and file an annual report with the City which outlines and documents the extent
of the recipient's compliance with such provisions and conditions.
Business Personal Property—Any taxable tangible personal property other than inventory and supplies
that(i)is subject to ad valorem taxation by the City; (ii)is located on the property subject to Abatement;
(iii) is owned or leased by the party to the Tax Abatement Agreement; and (iv) was not located in the
City prior to the effective date of the Tax Abatement Agreement.
Capital Investment — Expenditures for real property improvements such as, without limitation, new
facilities and structures, site improvements, infrastructure improvements, facility expansion, facility
modernization, and utility installation. Capital Investment does NOT include land acquisition costs or
the cost or value of any improvements existing on the property prior to the City Council's authorization
of execution of a Tax Abatement Agreement.
Catalytic Development—A development that meets the prerequisites set forth in Section 8.
Central Business District—A geographic area within the City,also referenced as Downtown,as defined
in the Fort Worth Comprehensive Plan.
Comprehensive Plan - The City of Fort Worth's official guide for making decisions about growth and
development.The Plan is a summary of the goals,objectives,policies, strategies,programs,and projects
that will enable the city to achieve its mission of focusing on the future,working together to build strong
neighborhoods,develop a sound economy, and provide a safe community.
Designated Investment Zone —The geographic area within the City containing those census tracts (i)
that are eligible for community development block grants (CDBG), as defined and determined by the
United States Department of Housing and Urban Development (HUD), meaning that fifty-one percent
(51%)or more of residents have low to moderate incomes and(ii)those census tracts that have a poverty
rate of 20%of higher, as shown in the map of Exhibit"A"of this Policy.
Existing Business —A business that was operating within the corporate limits of the City prior to the
effective date of this Policy.
Investment—The aggregate of Capital Investment and Personal Property Investment.
Mega Project-A project meeting the prerequisites set forth in Section 6.
Mixed-Use Development Project — A development project in which a facility or facilities will be
constructed or renovated such that (i) at least twenty percent (20%) of the total gross floor area will be
used as residential space and(ii) at least ten percent(10%) of the total gross floor area will be used for
office, restaurant, entertainment and/or retail sales and service space. In the event that all or any portion
of the residential space is rental(i.e. apartments),there must be at least fifty(50)units.
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Personal Property Investment—The value of Business Personal Property installed on a development
site by a date certain, as determined solely by the appraisal district having jurisdiction over the
development site.
Reinvestment Zone — An area designated by the City as a Tax Abatement reinvestment zone in
accordance with Chapter 312 of the Texas Tax Code.
Salary — A cash payment or remuneration made to a full-time employee, including paid time off,
commissions, and non-discretionary bonuses. A Salary does not include any benefits, such as health
insurance or retirement contributions by the employer, reimbursements for employee expenses, or any
discretionary bonuses.
Target Industry—A business providing services in the sectors specifically identified in Section 4.
Tax Abatement Agreement—A written Agreement that the recipient of a Tax Abatement must enter
into with the City that outlines the specific terms and conditions pertaining to and governing the Tax
Abatement.
Technology Company —A company working in an industry with a high concentrations of workers in
STEM (Science, Technology, Engineering, and Mathematics) occupations, including, but not limited to,
design,prototype development and testing,preliminary manufacturing and product marketing.
Transit Oriented Development - A Mixed-Use Development located within one-half mile of a
commuter rail line station and in which all buildings will be at least 3 stories in height.
3. ELIGIBILITY CRITERIA FOR GENERAL PROJECTS.
Unless a project meets one of the other minimum eligibility criteria set forth in Sections 4-10
below, in order to be considered for Tax Abatement, a project must commit to a minimum Investment
of at least$25 million and creation of new full-time jobs with certain minimum annual average employee
Salary levels. The table below establishes the maximum percentage of Abatement that may be available
to general projects based on minimum Investment and employment and annual average employee Salary
levels:
Minimum Annual Average Wage Rate and Minimum Investment Level
Base Tax
Abatement $70 Million $55 Million $40 Million $25 Million
Percentage Investment Investment Investment Investment
20% $52,300-$65,799
30% $65,800-$80,389 $65,800-$80,389
40% $80,390-$94,949 $80,390-$94,949 $80,390-$94,949
50% $94,950 or above $94,950 or above $94,950 or above $94,950 or above
As reflected in this table, a general project that commits to annual average annual Salary levels of
less than$94,950(but not less than$52,300)will be considered for Abatement only if the project commits
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to higher minimum levels of Investment,but only at lower maximum percentages of Abatement,depending
on the Salary commitments that are made.
In general,the City of Fort Worth will consider the following lengths of time for Tax Abatements
for general projects that are not otherwise covered in Sections 4-10:
Maximum
Abatement
Term Parameters
3-5 years Less than$50 Million Invested or Less than 250 Jobs
5-7 years $50+Million or 250+Jobs
7-9 years $75+Million Invested or 350+Jobs
10 years $100+Million Invested or 500+jobs
4. ELIGIBILITY REOUIREMENTS FOR TARGET INDUSTRY PROJECTS.
The City is particularly interested in developing certain target industries (each defined herein as
a "Target Industry"), whose presence the City has determined especially will help strengthen and
diversify the City's economy:
Established Sectors Emerging Sectors
• Transportation and warehousing • Transportation innovation
• Manufacturing • Life sciences delivery and innovation
• Healthcare • Geotechnical engineering
• Oil and gas • International business
• Tourism • Corporate and regional headquarters
• Professional services
• Financial services
• Aerospace Manufacturing and design
In order to be considered for Tax Abatement, a Target Industry project must commit to a
minimum Investment of at least $25 million and creation of new full-time jobs with certain minimum
annual average employee Salary levels. The table below establishes the maximum percentage of
Abatement that will be available to general projects based on minimum Investment and employment and
annual average employee Salary levels:
Minimum Annual Average Wage Rate and Minimum Investment Level
Base Tax
Abatement $70 Million $55 Million $40 Million $25 Million
Percentage Investment Investment Investment Investment
40% $52,300-$65,799
50% $65,800-$80,389 $65,800-$80,389
60% $80,390-$94,949 $80,390-$94,949 $80,390-$94,949
70% $94,950 or above $94,950 or above $94,950 or above I $94,950 or above
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As reflected in this table, a general project that commits to annual average annual Salary levels of
less than$94,950(but not less than$52,300)will be considered for Abatement only if the project commits
to higher minimum levels of Investment,but only at lower maximum percentages of Abatement,depending
on the Salary commitments that are made. The difference in the eligibility criteria between general projects
under Section 3 and Target Industry projects under this Section 4 is that the maximum percentage of
Abatement available for Target Industry projects is 70%instead of 50%.
5. ELIGIBILITY REQUIREMENTS FOR EXISTING BUSINESS EXPANSION
PROJECTS.
The City wants to support the growth of business already located in the City. In order to be
considered for Tax Abatement, an Existing Business expansion project must commit to a minimum
Investment of at least$10 million and creation of at least 25 new full-time jobs with a minimum annual
average employee Salary level of$52,300.
Any Existing Business expansion project will be considered for Tax Abatement at an Abatement
percentage not to exceed 85%.
6. ELIGIBILITY REQUIREMENTS FOR MEGA PROJECTS.
A "Mega Project" can be within any industry However, the City of Fort Worth is especially
interested in Fortune 1,000, Fortune Global 500, or Inc. 5000 designated firms, pursing development or
redevelopment opportunities within the City. Projects granted this designation must commit to at least one
of the following (with the exception of data centers or other unique low employment/high capital
investment projects which must have a minimum investment of$50 million):
• Commit to a minimum Investment of at least$250 million; or
• Commit to hire at least 1,500 full-time employees; or
• Commit to a minimum annual payroll of at least$150 million.
A Mega Project will be considered for Tax Abatement at an Abatement percentage not to exceed
85%.
7. ELIGIBILITY REQUIREMENTS FOR TECHNOLOGY COMPANY PROJECTS.
The City wishes to encourage and promote the development of technology businesses. In order to
be considered for Tax Abatement, a Technology Company project must employ at least 5 individuals.
Incentives delivered to a Technology Company may include abatement that equals one of the following:
• Up to 80%of net new real property taxes on owned or leased facilities for up to 5 years;or
• Up to 80%of net new Business Personal Property taxes for up to 5 years.
8. ELIGIBILITY REQUIREMENTS FOR CATALYTIC DEVELOPMENT PROJECTS.
A"Catalytic Development Project" is a business project that:
• will be located within either a Designated Investment Zone, Urban Village, or identified
Revitalization Target Areas,depicted in Exhibits"A", `B"and"C",respectively;
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• commits to at least$5 million in Investment; and
• complies with at least one of the following requirements:
o will be a Mixed-Use Development;
o will fill a gap, such as a grocery store in a food desert or a childcare facility, as
determined by City staff based on goals set forth in the City's then-current
Comprehensive Plan or other statistical data or relevant documentation;
o will be located along a commercial corridor or within an urban village,as identified
in the City's then-current Comprehensive Plan;
o Generates significant job opportunities in the area,as determined by City staff based
on then-current employment data; or
o Helps create a hub of entrepreneurial activity, positioning the City to attract
entrepreneurs and high-growth companies, as determined by City staff based on
goals and recommendations set forth in the City's Economic Development Strategic
Plan, the City's then-current Comprehensive Plan, or on other statistical data or
relevant documentation.
Notwithstanding the foregoing, a Mixed-Use Development that commits to at least $5
million in Investment and whose residential component comprises rental units(i.e.apartments)that
meet the affordable housing commitments set forth in Section 11.2 will be considered as a
"Catalytic Project" eligible for Tax Abatement even if it is located outside of a Designated
Improvement Zone.
All Catalytic Projects will be eligible for consideration for Tax Abatement. The maximum
percentage of Abatement available for a Catalytic Development Project will be 80%of incremental
real property and Business Personal Property tax.
9. ELIGIBILITY REQUIREMENTS FOR TRANSIT ORIENTED DEVELOPMENTS.
The City encourages and supports the construction of Transit Oriented Developments. In order
to be considered for Tax Abatement,a Transit Oriented Development project must commit to at least$5
million in Investment. The maximum percentage of Abatement available for a Transit Oriented
Development project will be 50%of incremental real property and Business Personal Property taxes for
a maximum term of 7 years.
10. ELIGIBILITY FOR REDEVELOPMENT PROJECTS ON CENTRAL BUSINESS
DISTRICT SURFACE PARKING LOTS.
The City encourages and supports redevelopment of surface parking lots in the Central Business
District and its major arterial roads of East Lancaster and Jacksboro Highway with buildings that will
support compatible businesses in the Central Business District and associated commercial corridors. In
order to be considered for Tax Abatement, a project must redevelop a surface parking lot in the Central
Business District that occupies at least 30% of the area of the City block on which it is located. The
maximum percentage of Abatement available for a Central Business District surface parking lot
redevelopment project is 40% for a maximum term of 5 years; provided, however, that if the
redevelopment project involves two or more surface parking lots owned by unrelated parties, the
maximum percentage of Abatement available for the project will be 45%.
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11. ADDITIONAL TAX ABATEMENT REQUIREMENTS.
11.1 Commitment for Utilization of Certified M/WBE Companies.
All projects subject to Tax Abatement are subject to the City's Business Equity
Ordinance (Chapter 20, Article X of the City Code) and must make a commitment to utilize
Certified MAYBE Companies (as those terms are defined in the Business Equity Ordinance) for
a minimum of 15% of all construction costs (both hard and soft) associated with the project.
Failure to meet the goal will result in a reduction of the overall percentage of Abatement available
under the Tax Abatement Agreement of 10%.
11.2. Affordable Housing Commitment for Mixed-Use Development Proiects.
All Mixed-Use Development Projects subject to Tax Abatement that contain rental
residential units must make a commitment to provide affordable housing as follows:
• At least 10% of all rental residential units must be set aside exclusively for lease
to qualifying households whose adjusted incomes do not exceed the then-current
eighty percent (80%) income limits established by HUD at rents that are
affordable to such households.
• At least 10% of all rental residential units must be set aside exclusively for lease
to qualifying households whose adjusted incomes do not exceed the then-current
sixty percent(60%)income limits established by HUD at rents that are affordable
to such households.
12. TAX ABATEMENT CALCULATION.
12.1. Improvements Required.
All Tax Abatement Agreements shall require the recipient to construct or cause
construction of specific improvements on the real property that is subject to the Abatement.
Failure to construct these specific improvements at the minimum Capital Investment expenditure
and by the deadline established in the Tax Abatement Agreement will constitute an event of
default and give the City the right to terminate the Tax Abatement Agreement.
12.2. Percentage and Amount.
Although this Policy establishes the maximum percentage of Abatement that may be
available for a particular type of project,the specific amount of a particular Tax Abatement shall
be negotiated on a case-by-case basis and may be less than the maximum available percentage
specified in this Policy,based,without limitation, on the review criteria set forth in Section 14.3.
The calculation of Tax Abatement for any project that meets the requirements of this Policy shall
be negotiated on a case-by-case basis and governed solely by the terms and conditions of the Tax
Abatement Agreement.
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13. TAX ABATEMENT IMPLEMENTATION
13.1. Term.
Although this Policy establishes the maximum term of Abatement that may be available
to certain types of projects,the actual term of a Tax Abatement shall be negotiated on a case-by-
case basis and may be less than the maximum available term specified in this Policy, based on
the review criteria set forth in Section 14.3.
13.2. Compliance.
The City will review and determine the recipient's compliance with the terms and
conditions of the Tax Abatement Agreement in each year of the Abatement Compliance Term.
The first year of the Abatement Compliance Term shall be either the calendar year in which the
recipient achieved all Investment required by the Tax Abatement Agreement or the following
calendar year, as negotiated and set forth in the Tax Abatement Agreement. Tax Abatements
will be provided for the tax years comprising the Abatement Benefit Term,with the first such tax
year occurring in the year following the first year of the Abatement Compliance Term. In other
words, the degree to which the recipient meets the commitments set forth in the Tax Abatement
Agreement will determine the percentage of taxes abated for the following tax year. The City
will continue to review and determine the recipient's compliance with the terms and conditions
of the Tax Abatement Agreement for each subsequent calendar year,which findings shall govern
the percentage of taxes abated for the following tax year, until expiration of the Tax Abatement
Agreement.
14. TAX ABATEMENT APPLICATION PROCEDURES
Each Tax Abatement application shall be processed in accordance with the following standards
and procedures:
14.1. Submission of Application
If a given development project qualifies for Tax Abatement pursuant to the eligibility
criteria detailed in of this Policy, an applicant for Tax Abatement must complete and submit a
City of Fort Worth Tax Abatement Application(with required attachments)(the"Application").
An Application can be obtained from and must be submitted to the City's Economic
Development Department. In order to be complete,the Application must include documentation
that there are no delinquent property taxes due for the property on which the development project
is to occur. In addition,projects that include, in whole or in part, the renovation of one or more
existing structures shall provide,as part of the applicant's Tax Abatement Application,a detailed
description and the estimated costs of the renovations contemplated.
14.2. Application Fee
Upon submission of the Application,an applicant must also pay an application fee. This
application fee shall be $5,000 ("Application Fee") of which $3,000 will be credited to any
permit, impact, inspection or other fee paid by the applicant and required by the City directly in
connection with the proposed project, as long as substantive construction on the project, as
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determined by the City in its sole and reasonable discretion,has been undertaken on the property
specified in the Application within one(1) year following the date of its submission.
If any Application Fee funds are remaining after the development project covered in the
Application has been completed in accordance with the Tax Abatement Agreement,the applicant
must submit a letter to the director of the City's Economic Development Department requesting
a refund of the remaining funds. The request must be made within ninety (90) days following
the date of the project's completion date. Any Application fees remaining after ninety(90)days
following the project's completion date will become the property of the City and will not be
eligible for. The remaining$2,000 of the Application Fee is non-refundable and will be utilized
for City staff expenses associated with processing the Application and fees associated with legal
notice requirements.
14.3. Application Review and Evaluation
The Economic Development Department will review an Application for accuracy and
completeness. Once complete, the Economic Development Department will evaluate an
Application based on the perceived merit and value of the project, including the guidelines
established by this Policy as well as,without limitation,the following criteria:
• Types and number of new jobs created, including: respective Salaries and employee
benefits packages, such as health insurance, day care provisions, retirement packages,
transportation assistance, employer-sponsored training and education, any other benefits
and whether all benefits are offered on an equal and non-discriminatory basis to all
employees;
• Percentage of Capital Investment committed to local companies, including Certified
NMBE Companies;
• Financial viability of the project;
• The project's reasonably projected increase in the value of the tax base;
• Costs to the City(such as infrastructure participation, etc.);
• Remediation of an existing environmental problem on the real property;
• Type of industry and activities associated at the project site;
• If the company is foreign owned and/or includes Capital Investment sources from outside
the United States; and
• Any other items that the City may determine to be relevant with respect to the project.
14.4. Consideration by the City Council
The City Council retains sole authority to approve or deny any Tax Abatement Agreement
and is under no obligation to approve any Application or Tax Abatement Agreement.
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15. GENERAL POLICIES AND REQUIREMENTS
Notwithstanding anything that may be interpreted to the contrary herein, the following general
terms and conditions shall govern this Policy:
15.1. A Tax Abatement shall not be granted for any development project in which a building
permit application has been filed with the City's Planning and Development Department. In
addition,the City will not abate taxes on the value of real or Business Personal Property for any
period of time prior to the year of execution of a Tax Abatement Agreement with the City.
15.2. The applicant for a Tax Abatement must provide evidence to the City that demonstrates
that a Tax Abatement is necessary for the financial viability of the development project proposed.
15.3. The City will not abate taxes levied on inventory, supplies or the existing tax base.
15.4. An applicant for Tax Abatement shall provide Salary and employee benefit information
for all positions of employment to be located in any facility covered by the Application as well
as a copy of the applicant's written non-discrimination policy applicable to the applicant's
employees.
15.5. Unless otherwise specified in the Tax Abatement Agreement,the amount of real property
taxes to be abated in a given year shall not exceed one hundred fifty percent(150%)of the amount
of the minimum Capital Investment expenditure required by the Tax Abatement Agreement for
improvements to the real property subject to Abatement multiplied by the City's tax rate in effect
for that same year, and the amount of Business Personal Property taxes to be abated in a given
year shall not exceed one hundred fifty percent (150%) of the minimum value of Business
Personal Property required by the Tax Abatement Agreement to be located on the real property,
if any, subject to Abatement multiplied by the City's tax rate in effect for that same year.
15.6. The owner of real property and/or Business Personal Property for which a Tax Abatement
has been granted shall properly maintain the property to assure the long-term economic viability
of the project.
15.7. If the recipient of a Tax Abatement breaches any of the terms or conditions of the Tax
Abatement Agreement and fails to cure such breach in accordance with the Tax Abatement
Agreement, the City shall have the right to terminate the Tax Abatement Agreement. In this
event,the recipient will be required to pay the City any property taxes that were abated pursuant
to the Tax Abatement Agreement prior to its termination.
15.8. As part of the consideration under all Tax Abatement Agreements, the City shall have,
without limitation, the right to (i) review and verify the applicant's financial statements and
records related to the development project and the Abatement in each year during the term of the
Tax Abatement Agreement prior to the granting of a Tax Abatement in any given year and (ii)
conduct an on-site inspection of the development project in each year during the term of the Tax
Abatement to verify compliance with the terms and conditions of the Tax Abatement Agreement.
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Any incidents of non-compliance will be reported to all taxing units with jurisdiction over the
real property subject to Abatement.
15.9. The recipient of a Tax Abatement may sell, assign, transfer, or otherwise convey any of
its rights under a Tax Abatement Agreement to an affiliate of the recipient, as defined in the Tax
Abatement Agreement, or as security to a lender of the recipient, provided that the City, the
assignor, and the assignee each execute a document acceptable to the City that outlines the roles
and responsibilities of the parties in that event. Otherwise, a recipient of a Tax Abatement may
not sell,assign,transfer or otherwise convey its rights under a Tax Abatement Agreement unless
specifically approved by the City Council. A sale, assignment, lease,transfer or conveyance of
the real property that is subject to the Abatement and which is not permitted by the Tax
Abatement Agreement shall constitute a breach of the Tax Abatement Agreement and may result
in termination of the Tax Abatement Agreement and recapture of any taxes abated after the date
on which the breach occurred. For additional information about this Tax Abatement Policy,
contact the City of Fort Worth's Economic Development Department using the information
below:
City of Fort Worth
Economic Development
1150 South Freeway
Fort Worth, Texas 76104
817-392-6021 1 www.fortworthtexas.gov/ecodev
City of Fort Worth General Tax Abatement Policy
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Exhibit"A"
DESIGNATED INVESTMENT ZONES
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Copyright 2020 City of Fort Worth. Unauthorized reproduction is a violation of applicable laws.This products of
for informational purposes and may not have been prepared for or be suitable for legal, engineering, or
surveying purposes. It does not represent an on-the-ground survey and represents on the approximate relative
location of property boundaries.The City of Fort Worth assumes no responsibility for the accuracy of said data.
City of Fort Worth General Tax Abatement Policy
Page 13 of 15
Exhibit"B"
URBAN VILLAGES
: � 7 1
26 2
I
183
Nlstorfcitlakn 121 �.
199
18
Six Points
yWst Seventh
{ ► Near East Side
L r South Maln Oakland Comers
+Ma nolla lolytechnic/Wesleyan Historic Handley
g Evans 6 Rosedale00,
Rldglea
87
Bem/6-gversRy t Ben /R/Riverside Lake ArlingtoNBerry/Stalcup
lvegyBluebonnet Circle "e �
183 ►
0 8
Copyright 2020 City of Fort Worth. Unauthorized reproduction is a violation of applicable laws.This products of
for informational purposes and may not have been prepared for or be suitable for legal, engineering, or
surveying purposes. It does not represent an on-the-ground survey and represents on the approximate relative
location of property boundaries.The City of Fort Worth assurnes no responsibility,for the accuracy of said data.
City of Fort Worth General Tax Abatement Policy
Page 14 of 15
Exhibit"C"
REVITALIZATION TARGET AREAS
ILIQ r
� 77 26 121
183
199 Near Northsldo 121
83
East Lancaster
r Evans and Rosedale,Weslayaw Poly Historic Handley
80 West Camp Bovde Rosedale and R�ve
como!Horne Street 87
Stop alx r
t
77 183
t 87
Altamesa and McCart �~
Copyright 2020 City of Fort Worth. Unauthorized reproduction is a violation of applicable laws.This products of
for informational purposes and may not have been prepared for or be suitable for legal, engineering, or
surveying purposes. It does not represent an on-the-ground survey and represents on the approximate relative
location of property boundaries.The City of Fort Worth assumes no responsibility for the accuracy of said data.
City of Fort Worth General Tax Abatement Policy
Page 15 of 15
City of Fort Worth, Texas
Mayor and Council Communication
DATE: 01/26/21 M&C FILE NUMBER: M&C 21-0074
LOG NAME: 17TAPOLICY2021
SUBJECT
(ALL)Conduct Public Hearing,Adopt Resolution Stating the City of Fort Worth Elects to be Eligible to Participate in Tax Abatement Authorized by
Chapter 312 of the Texas Tax Code and Adopt New General Tax Abatement Policy
(PUBLIC HEARING-a.Report of City Staff:Robert Stums;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 City's participation in property tax abatement and the adoption of the General Tax Abatement Policy.
2. Adopt the attached resolution stating that the City elects to be eligible to participate in property tax abatement,pursuant to the Texas Property
Redevelopment and Tax Abatement Act,Chapter 312 of the Texas Tax Code,as amended;and
3.Adopt the attached General Tax Abatement Policy,including guidelines and criteria,governing certain property tax abatements granted by the
City of Fort Worth for a period of two-years,with an effective adoption date of January 29,2021.
DISCUSSION:
Chapter 312 of the Texas Tax Code authorizes cities to designate tax abatement reinvestment zones and to enter into Tax Abatement Agreements
only after the city elects to become eligible to participate in tax abatement and adopts a Tax Abatement Policy that establishes guidelines and
criteria governing its tax abatement program.A Tax Abatement Policy adopted by a city is effective for two years from the date of adoption.The
City of Fort Worth's most recent General Tax Abatement Policy,which was adopted pursuant to Resolution No.5040-01-2019(Mayor t£Council
Communication(M&C)G-19464),and expires on January 28,2021.
The adopted policy enhanced the tools available to the City and was developed,following significant stakeholder engagement and research,to
specifically address the Economic Development Strategic Plan recommendation 4.2 Create new incentive tools to encourage business growth
within target industries and to facilitate development and redevelopment in designated districts.The City Council accepted the Economic
Development Strategic Plan(M&C G-19192)on December 12,2017.
Staff is recommending amending the existing policy with four basic changes as follows:
1. Definition of Certified MBE Company to mirror the definitions included in the New Business Equity Ordinance,Chapter 20,Article X,as
approved by City Council November 17,2020(M&C 20-0841).
2. Revise the minimum average annual salary from$43,992 to$52,300,which remains 80%of the City of Fort Worth Median Income.This
change will impact the eligibility criteria in Sections 3,4 and 5 of the policy as found in the attached redlined version.
3. Revise Section 8: Eligibility Requirements for Catalytic Development Projects to include Urban Villages and identified Revitalization Areas in
addition to the Designated Investment Zones.
4. Revise Section 10: Eligibility for Redevelopment Projects on Central Business District Surface Parking Lots to include areas of East
Lancaster and Jacksboro Highway.
A copy of the proposed policy is attached.
Once adopted,the proposed General Tax Abatement Policy will be effective from January 29,2021 through January 28,2023,unless amended or
repealed by at least a three-fourths vote of the City Council.The General Tax Abatement Policy does not apply to tax abatement granted pursuant
to the City's Neighborhood Empowerment Zone(NEZ)Policy.
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 approval of this Policy will have no material effect on the Fiscal Year 2021 Budget,and any effect on
expenditures and revenues will be budgeted in future fiscal years and included in the long term forecast.
Submitted for City Manager's Office by: Jay Chapa 5804
Originating Business Unit Head: Robert Stums 2663
Additional Information Contact: Brenda Hicks-Sorensen 2606
Expedite Requested