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HomeMy WebLinkAboutOrdinance 16795-01-2006ORDINANCE NO. 1.6795--1-2006 AN ORDINANCE AMENDING ORDINANCE NO. 15775 BY REDUCING THE CITY OF FORT WORTIEI'S CONTRIBUTIONS OF TAX INCREMENT TO TIIE TAX INCREMENT FUND OF TAX INCREMENT REINVESTMENT ZONE NUMBER EIGHT, CITY OF FORT WORTH, TEXAS (LANCASTER CORRIDOR TIF); PROVIDING FOR T1iIE SURVIVAL OF ALL PROVISIONS OF ORDINANCE NO. 1 S77S THAT ARE NOT AMENDED BY T~IIS ORDINANCE; PROVIDING FOR SEVERABILITY; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, pursuant to Ordinance No. 15775, adopted by the City Council of the City of Fort Worth (the "City") on December 9, 2003, the City created Tax Increment Reinvestment Zone Number Eight, City al' Fort Worth, Texas (Lancaster Corridor TIF) (the "Zone"); and WHEREAS, pursuant to Ordinance Nos. 15844 and 1634303-2005, adopted by the City Council on .Tanuary 27, 2004 and March 29, 2005 respectively, the City Council approved the project and financing plans far the Zane (the "Plans"), as required by Section 311.011(a) of the Texas Tax Code (the "Cade"); and WHEREAS, Section 311.013(zn) of the Code allows the City Council to reduce the portion of the City's tax increment, as defined by Section 311.012{a) of the Code, that the City will pay into the tax increment fund (the "TIF Fund"} for Zone provided that each county that has entered into an agreement with the City to pay tax increment into the TIF Fund is afforded the same opportunity and provided that the anticipated revenues in the TIF Fund, taking into account such reductions, will still be sufficient for the Zone to pay any estimated project costs outlined in the Plans; and Page 1 Ordinance Amending Ordinance No. 15775 {City Contributions to Lancaster Corridor TIF} WHEREAS, the City wishes to reduce the amount of tax increment that the City will pay into the TIF Fund only from tax increment generated by property in the Zone platted as Blocks 7 and $, Tarrant County Convention Center Addition (the "Property"), on which Omni port Worth Partnership, L.P. ("Omni"} is expected to construct a hotel, residential condominiums and a parking garage (the "Paroject"), and only to the extent that such tax increment serves as the basis for calculating certain economic development incentives payable to Omni by the City pursuant to that certain Economic Development Program Agreement between Omni and the City, as amended and restated (the "380 A.greeanent"), NOW, THEREF®RE, BE IT ORDAII®lEI3 BY TIDE CITY COUNCIL, OF THE CITY OF FORT WORTII, TEXAS: Section 1. FIl®1DINGS. That after reviewing all information before it regarding the reduction of tax increment that the City will pay into the TIF Fund for the Zone, the City Council hereby makes the following findings of fact: 1.1. The statements, facts, terms and conditions set forth in the recitals of this Ordinance are true and correct. 1.~. Tarrant County is the only county that levies real property taxes in the Zone. Tarrant County has not entered into an agreement with the City to pay any tax increment into the TIF Fund. When and if Tarrant County does enter into such an agreement, Tarrant County will have the right to determine the amount of tax Page 2 Ordin.anee Amending Ordinance No. 15775 (City Contributions to Lancaster Corridor T1F) increment that it wishes to pay into the TIF Fund, taking into account the City's level of contribution thereto. 1.3. The Plans adopted by the board of directors for the Zone and approved by the City Council did not anticipate any tax increment to be generated from the Property, which was and currently remains tax exempt. Therefore, any stipulation by the City to pay less than 100% of its tax increlxlent generated by the Property into the TIF Fund far the Zone will not affect anticipated revenues in the TIF Fund from funding all estimated project casts of the Zone. I.4. The Project is anticipated to stimulate additional private development in the Zane and to Iaene~t the Zone and property in the Zone. Omni will not construct the Project without the City's provision of the economic development incentives outlined in the 380 Agreement. 1.5. The reduction of the amount of tax increment generated by the Property that the City will pay into the TIF Fund to the extent that such tax increment serves as the basis for calculating certain economic development incentives payable to Omni by the City under the 380 Agreement will allow the City to fund those economic development incentives without an overall negative impact an the City's revenues. 5ecti©n 2. REDUCTION ®F TAX INCREMENT PAYMENTS BY THE CITY INT® THE TIF FUND FAR THE ZONE. That the second sentence of Section 6 (Tax Increment Fund} of Ordinance No. 15775 is hereby amended to read as follows: Page 3 Ordinance Amending Qrdinance No. 15775 (City Contributions to ~,ancaster Corridor TIF) The T1F Pund shall consist of (i) the percentage of the tax increment, as dehned by Section 311.012(x) of the Code, that each taxing unit which levies real property taxes in the Zone, other than the City, has elected to dedicate to the T1F Fund under an agreement with the City authorized by Section 311.x13{f) of the Code, plus {ii) one hundred percent (100%) of the City's tax increment, as defined by Section 311.x 12(x) of the Code, less any of the City's tax increment attributable to Blacks 7 and 8, Tarrant County Convention Center Addition to the extent that such tax increment serves as the basis for calculating certain economic development incentives authorized by Chapter 38x of the Texas Local Government Code and payable pursuant to a written agreement between the City and Omni Fart Worth Partnership, L.P., as rraay be subsequently arraended, restated or assigned. ~CCtiU~l 3. SURVIVAL OF REIVIAINING PROVISIONS. That all other terms and provisions of Ordinance No. 15775 that are not amended by this Ordinance shall remain in full force and effect. Secti®n 4. SEVERARILITY. That if any portion, section or part of a section of this Ordinance is subsequently declared invalid, inoperative or void for any reason by a court of competent jurisdiction, the remaining portions, sections or parts of sections of this Ordinance shall be and remain in full force and effect and shall not in any way be impaired ar affected by such decision, opinion or judgment. rage 4 Ordinance Amending Ordinance No. 15775 (City Contributions to Lancaster Corrid°r'FIF) Section S. EFFECTIVENESS. That this Ordinance shall take effect and be in full force and effect from and after its adoption. AND IT IS SO ORDAINED. ADOPTED AND El~'1~'ECTIVE: January 24, 2006 APPROVED AS TO FORM AND LEGALITY: 13y: Peter Vaky Assistant City Attorney Date: January 24, 2006 M&C: G-21274 Page 5 Ordinance Amending Ordinance No. F 5775 (City Contributions to Lancaster Gorridor'i'IP) Cety ®f F'®rt VI®®r~f~, 7'ex~~ Mayor and Council Communication COUNCIL ACTION: Approved on '112412006 -Ordinance No. 76795-1-20Q6 DATE: Tuesday, January 24, 2006 LOG NAME: 120MNi TIF REFERENCE N©.. C-2'1274 5U13JECT: Adopt Ordinance Amending Ordinance No. 15775, Reducing Certain Contributions of Tax Increment to Tax Increment Reinvestment Zane Number Eight, City of Fort Worth, Texas (Lancaster Corridor TIF} RECOMMICN©ATION: if is recommended that the City Council adopt the attached Ordinance amending Ordinance No. 15775 in order to provide that the City's contributions of tax increment to the Lancaster Corridor TIF will be reduced to the extent that the same tax increment is used to calculate any economic development program grant payable to Omni Fort Worth Partnerhsip, L.P. {Omni) under a proposed Amended and Restated Economic ©evelapment Program Agreement with Omni. DISCUSSION: On December 9, 2003, the City Council adapted Ordinance No. 1577'5, creating the Lancaster Corridor TIF (the TIF}. Under that Ordinance, the City committed to contribute 100% of its tax increment from property located in the TIF to the TIF's tax increment fund for use toward any authorized TIF project. On April 27, 2005 the City and Omni executed numerous documents relating to Omni's development of a headquarters hots[ for the Fort Worth Convention Center. One of those documents was an Economic Development Program Agreement {the Original 380 Agreement) pursuant to which the City agreed to pay Omni certain economic development grants in return for Omni's construction of the hate! and a hotel parking garage. The City also executed a Tax Abatement Agreement with Omni pursuant to which the City agreed to abate for 10 years 100% of the real and personal property taxes an the hotel and, subject to certain conditions, the hotel garage. Because this project was to be constructed on property located in the TIF, state law required that the TIF's board of directors approve the Tax Abatement Agreement before it could take effect. That approval was secured pursuant to Resolution 2005-01 an February 24, 2005. Because no other taxing unifs had agreed at that time to contribute tax increment to the T1F, no other approvals of the Tax Aba#ement Agreement were necessary. Under a separate agenda item, the City staff is recommending that the City Council authorize the City Manager to execute an Amended and Resta#ed 380 Agreement {the Amended 380 Agreement). Under the Amended 380 Agreement, the City will pay Omni certain additional grants to help offset unanticipated higher construction casts associated with the project. The amounts of two of these additional grants wil! be based on property tax receipts of the City. First, in the first 5 years following completion of the project, the City will include in Omni's grants amounts equal to 100% of the real property taxes received by the City from residential condominium units that are owned by Omni and not otherwise used for residential purposes {i.e. unsold, unoccupied condominiums). Second, in years 11-15, the City will include in Omni's grants amounts equal to 100% of the real and personal property taxes received from the hotel, the hotel property {provided that Omni owns that property at the time}, and, subject to certain conditions, the hotel garage. The proposed Ordinance provides that the City will not contribute tax increment to the TIF only to the extent Lognann:e: t 20MN)• T1 F Page t of 2 that such tax increment is used to calculate any grant payable to Omni under the Amended 380 Agreement. Otherwise, the City will continue to contribute 1D0% of its tax increment to the TI1=. Without this proposed Ordinance, the City's general fund would realize a net lass. FISCAL INFORMATIONlCERTIFICATION: The Finance Director certifies that this action will have no material effect an City funds. TO FundlAccc~untlCenters FROM FundlAccountlCenters Submitted fnr City Manager's OfFice by_ Joe Paniagua (8191) Originating De~arttnent Dead: David Yett {7623) Additional Inforrnatian Contact: Peter Vaky (76A1) Logname: 120MNI TTF Page 2 of 2