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HomeMy WebLinkAboutOrdinance 16989-06-2006ORDINANCE NO. 16989-06~2Q~6 AN ORDINANCE REPEALING ORDINANCE 16634 AND AMENDING ORDINANCE 15815 I3Y REMOVING CERTAIN PROPERTY FROM NEIGHBORHOOD EMPOWERMENT REINVESTMENT ZONE NUMBER THIRTEEN OF THE CITY OF FORT` WORTH, TEXAS; DESIGNATING THE PROPERTY SO REMOVED AS "NEIGHBORHOOD EMPOWERMENT REINVESTMENT ZONE NUMBER TWENTY-NINE, CITY OF FORT WORTH, TEXAS"; PROVIDING THE EFFECTIVE AND EXPIRATION DATES FOR THE ZONE AND A MECHANISM FOR RENEWAL OF THE ZONE; AND CONTAINING OTI~IER MATTERS RELATED TO THE ZONE. WHEREAS, pursuant to the City Council's adoption on May 17, 2005 Resolution No. 3207w05--2045 (M&C G-14802}, the City of Fort Worth, Texas (the "City") has elected to be eligible to participate in tax abatement and has established guidelines and criteria governing tax abatement agreements entered into between the City and various third parties, as authorized by and in accordance with the Property Redevelopment and Tax Abatement Act, codified in Chapter 312 of the Texas Tax Code {the "Cade"); and WHEREAS, the City Council desires to promote the development of the area in the City mare specifically described in Exhibit "A" of this Ordinance {the "Zane") through the creation of reinvestment zone for purposes of granting residential and commercial-industrial tax abatement, as authorized by and in accordance with Chapter 312 of the Code; and WHEREAS, on January 6, 2004, the City Council adopted Resolution No. 3430 designating the Berry/University Area as a Neighborhood Empowerment Zone {the SSNEZ") and adopted Ordinance No. 1 SS 15, designating the NEZ as Neighborhood Empowerment Reinvestment Zone Number Thirteen, City of Fort Worth, Texas and WHEREAS, Zarif, Inc. {"Developer") had purchased certain real property located in the NEZ on which developer wished to rehabilitate and expand asingle-story professional office/retail building; and WHEREAS, on 4ctaber 4, 2005, the City Council adopted Ordinance No.16634 establishing "Neighborhood Empowerment Reinvestment Zone No. 23 City of Fort Worth, Texas" {the "FWI~TERZ 23") for the property owned by Developer; and WHEREAS, improvements have not been made on FWNERZ 23, the subject property has been enlarged and replatted and is as more particularly described in Exhibit "A" attached hereto (the "Premises"),anew construction budget has been obtained and the original tax abatement agreement has been terminated; and WHEREAS, Developer wishes to rehabilitate and expand asingle-story professional office/retail building (the "Improvements") on the Premises; and WHEREAS, the Code requires that the Lerms and conditions of tax abatement agreements covering property located in the same reinvestments zone must be identical; and WlF-IEREAS, Developer has requested a 5 year commercial tax abatement on the lmprovements, which in accordance with the NEZ policy, is subject to unique terms anal conditions specific to the project; and WHEREAS, accordingly, the City Council hereby finds that is necessary and desirable to repeal Ordinance No. 16634, to remove the Premises from the Neighborhood Empowerment Reinvestment Zane Na. 13 and to designate a new 2 Neighborhood Empowerment Reinvestment Zone comprising only the Premises {the "Zone"); and WHEREAS, the City Council hereby finds that the project described herein will be an important element in the revitalization of the Ben y/ilniversity Area by creating jobs opportunities to the community that are not available in the immediate area and that the development of the Premises and the Zone in the manner described herein will best occur by means of tax abatemenf on the Improvernents in return for Developer's causing construction of the Improvements and compliance with certain other commitments that will foster economic development in the Zone and the City in general; and WHEREAS, on June 6, 2006 the City Council held a public hearing regarding the creation of the Zone, received information concerning floe Improvements proposed far the Zane and afforded a reasonable opportunity for aII interested persons to speak and present evidence for or against the creation of the Zane ("Public Hearing") as required by Section 312.201(d} of the Code; and WHEREAS, notice of the Public Hearing was published in a newspaper of general circulation in the City on May 24, 2006 which satisfies the requirement of Section 312.201{d}(1) of the Code that publication of the notice occur not later than the seventh day before the date of the public hearing; and WHEREAS, in accordance with Sections 3I2.201(d)(2} anal (e) of the Code, notice of the Public Hearing was delivered in writing not later than the seventh day before the date of the public hearing to the presiding officer of the governing body of 3 each taxing unit that includes in its boundaries zeal property that is to be included in the proposed Zone; NOV6', THEREFORE, BE IT ORDAINED BY TIIE CITY COUNCIIJ OF THE CITY OF FORT VVORTI-I, TEXAS: Section 1. FINDINGS. That aftex reviewing all information before it regarding the establishment of the Zane and after conducting the Public Hearing and affording a reasonable opportunity for all interested persons to speak and present evidence far ar against the creation of the Zone, the City Council hereby makes the following findings of fact: I.1. The statements and facts set forth in the recitals of this Ordinance are true and correct. Therefore, the City has met the notice and procedural requirements established by the Code far creation of a reinvestment zone under Chapter 312 of the Cade; and 1.2. Without a tax abatement oxa the lmprovenaents, as requested by Developer, construction of the Improvements would not be financially feasible for Developer; 1.3. As a retail commercial development, the Improvements will cause among other things and without limitation, {i) new employment to occur with the Zone and {ii} existing business in the area to prosper as a result of increased residential activity; and 1.4. The Zone meets the criteria fox the designation of a reinvestment zone as set forth in V.T.C.A., Tax Code, Section 312.202, as amended, in that the area is 4 reasonably likely as a result of the designation to contribute to the retention or expansion of primary employment or to attract anajor investment in the zone that would be a benefit to the property and that would contribute to the econorraic development of the municipality; and 1.5. The Ixnprovements are feasible and practical and, once completed, will benefit the land included in the Zone as well as the City for a period in excess of ten (10) years, which is the statutory maximum term of any tax abatement agreement entered into under Chapter 312 of the Code. Section ~. REPEAL OF ORDINANCE 1b534 That all ordinances or parts of ordinances in conflict herewith are hereby repealed. Section 3. REMOVAL OF I'REIl~IISES FROIVI NEIGIIRORHOOD EMPOWERMENT REIN'VESTIVIENT ZONE NO. 13 That Ordinance No. 1 S$15 is hereby amended by removing the Premises, as described in Exhibit "A", from Neighborhood Empowerment Reinvestment Zone Number Thirteen, City of Fort Worth, Texas. Section 4 DE~IGNA,TION OF ZONE That the City Council hereby designates the Zone described in the boundary description attached hereto as Exhibit "A" "Neighborhaod Empowerment Reinvestment Zone Number Twenty-Nine, City of Fort Worth, Texas". The project described herein is eligible for commercial developzxrent tax abatement pursuant to Section IIiC of the NEZ Policy. 5 Section 5. TERM OF Z®NE That the Zone shall take effect upon the effective date of this Ordinance and expire five {5} years fihereafter. The Zone may be renewed by the City Council for one or more subsequent terms of five {5} years or Iess. Section 6. SEVERABILITY 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 farce and effect and shall not in any way be impaired or affected by such decision, opinion ar judgment. Section 7. IMMEDIATE EFFECT That this Ordinance shall take effect upon its adoption. AND IT IS S® ®RDAINEI~. ADOPTED AND EFFECTIVE: June 13, 2006 APPROVED AS TO FORM AND LEGALITY: By: earn Guzman Assistant Cit Attorney Date: M&C: ~' ~ ~ 6 Exhibit A Fort Wnrth Neighborhood Empowerment Reinvestment Zone Number Twenty-Nine General Description The area to be designated as Fort Worth Neighborhood Enrapowerznent Reinvestment Zane Number Tr~venty-Five for tax abatement purposes contains 1.371 acres of land and is described belaw: 2747 8~~' Avenue, Lot 14R1-R, Block 27, Being a Revision of Lot 14R1, Block. 27, Ryan Addition, Recorded in Cabinet A, glide 10422, and Lot 22, Block 27, Ryan Place Additian, Recorded in Volume 204-A, Page 170 in the City ofFort Worth, Plat Records, Tarrant County, Texas. 7 ~.~'_. W's °u! c ~i .k ~ ~e e...x' Rt} +Me ~~ ~.r . ~ tv ~E ~.' ~~~,. _ ,.:,<, ~T. ,R,: ,FLL 'r ~~~~ .~ .~. ;_~ `x :~; ~~.. ~H ~° R;~t= ~. ~i E; r. t ~~ fef ~' ~' $ 'I' I `s `. s+wo.~e.++i::~: - ~, .:. Y~ d~ ~~yy .yAw 3n' I~ .,- ~ ~ ' ~ ~~ i ~t .~'~, ~ - ~.~~ ~,~ , - ~ _- .... _ ~ ~ .~ ~ - 4 ~ ~.~. ,.~. ~ _ . - _ ..~ ~~ I ~ - ,_ I ~ t ~ - _. f ~ ~^ v ... ~ ' _r~._ 4 ~ A: 7~ - ~ ~ _.. .._ ~_ L E ` ~ I ~.._ .....w..u. R.c.......,... ; _ -.. q} 3,- ~ - ~ W gym'^~ .,. b ~~ 'ALL _..- .. -..- ;. ~ _ _... _._ #. __ .. ti4 ~{ f.... . Exhibit "A" Pro a Descri tiou 2747 8th Avenue, Lnt 14R1-R, Block 27, Being a Revision of Lot 14R1, Bloclc 27, Ryan. Place Addition, Recorded in Cabinet A, Slide 10422, and Lot 22, Block 27, Ryan Place Addition, Recorded in Volume 2Q4-A, Page 1'70 in the City of Port Worth, Plat Records, Tarrant County, Texas. Exhibit "B" Proiect I3escri~pti©n Rehabilitation and expansion Single-story professional office/retail building Brick and stone exterior G63Q square feet Addition of landscape & plant areas Addition of Monument ,sign STATE OF TEXAS ~ Exhibit "C" COUNTY OF TARRA.NT § TAX ABATEII~ENT AGREEMENT FOR PROPERTY LOCATED IN A NEIGHBORFIOOD EMPOWERMENT ZONE 2747 Stn Avenue This TAX ABATEMENT AGREE1VdENT ("Agreement") is entered into by and between the CITY OF FORT WORTH, TEXAS (the "C`ity"), a home rule municipal corporation organized under the Taws of the State of Texas and acting by and through Dale Fisseler, its duly authorized Assistant City Manager, and Zarif, Inc., acting by and through Saxnir Khalil, its duly authorized representative, owner of property located at 2747 Sth Avenue, Lot 14R1-R, Block 27, Being a Revision of Lot 14R1, Block 27, Ryan Place Addition, Recorded in Cabinet A, Slide 10422, and Lot 22, Black 27, Ryan Place Addition, Recorded in Volume 204-A, Page 170 in the City of Fort Worth, Plat Records, Tarrant County, Texas. The City Counerl of the City of lion Worth ("City Caa~ncil") hereby finds and the City and Owner hereby agree that the following statements are true and correct and constitute the basis upon which the City and Owner have entered into this Agreement: A. Chapter 37S of the Texas Local Goverrunent Code allows a municipality to create a neighborhood empowerment zone if the municipality determines that the creation of the zone would promote: (1} the creation of affordable housing, including manufactured housing in the zone; (2) an increase in economic development in the zone; (3) an increase in the quality of social services, education, or public safety provided to residents of the zone; or (4) the rehabilitation of affordable housing in the zone. B. Chapter 37$ of the Texas Local Government Code provides that a municipality that creates a neighborhood empowerment zone may enter into agreements abating municipal property taxes on property in the zone. C. On July 31, 2001, the City Council adopted basic incentives for property owners who own property located in a Neighborhood Empowerment Zone, stating that the City elects to be eligible to participate in tax abatement and including guidelines and criteria governing tax abatement agreements entered into between the City and various third parties, titled "Neighborhood Empowerment Zone NEZ Basic Incentives" ("NEZ Incentives"), which were readopted on October 4, 2005 (M&C G-14947). The October 4, 2005 NEZ lncentives are attached hereto as Exhibit "A" hereby made a part of the Agreement far all purposes. D. The NEZ Incentives contain appropriate guidelines and criteria governing tax abatement agreements to be entered into by the City as contemplated by Chapter 312 of the Texas Tax Code, as amended (the "Code"). E. On January 6, 2004, the Fort Warth City Council adopted Ordinance Na. 15815 establishing "Neighborhood Empowerment Reinvestzxaent Zane Na.13, City of Fort Worth, Texas" and adopted Resolution No. 3030 establishing "Designation of Berry University Axea as a Neighbaxhaod Empowerment Zone" {the "NEZ"). F. On October 4, 2005, the City Council adopted Ordinance No.l 6f 34 establishing "Neighborhood Empowerment Reinvestment Zone No. 23 City of Fort Worth, Texas" (the "FWNERZ 23") for a portion of the Pxemises, as hereinafter defined, and a tax abatement agreement (Contract No. 33008} was entered into far the FWNERZ 23 ("Existing Agreement"}. G. Impxovements have not been made on FWNERZ 23, the property has been enlarged and replotted, and a new construction budget has been prepared. ii-lC. The Existing Agreement, identified as Contract No. 33008, is hereby terminated contemporaneously with the execution of this Agreement as of the effective date hereof and fully substituted by this Agreement, and neither party to the Existing Agreement shall have any further duties or responsibilities under the Existing Agreement as of the effective date hereo£ .T. Owner owns certain zeal property located entirely within the Zone and that is more particularly described in Exhibit "i3", attached hereto anal hereby made a part of this Agreement for all purposes {the "Premises"}. K. Owner or its assigns plan to construct an addition to an office/retail center, Required Improvements, as defined in Section 1.1 of this Agreement, an the Premises (the "Project"). I.. On April 20, 2006 Owner submitted an application for tax abatement to the City concerning the Premises (the "Application"}, attached hereto as Exhibit "G" and hereby made a part of this Agreement for all purposes. Il~I. The contemplated use of the Premises, the Required improvements, as defined in Section 1.1, and the terms of this Agreement are consistent with encouraging development of the Zone in accordance with the purposes for its creation and are in compliance with the NEZ Incentives, the Ordinance and other applicable laws, ordinances, rules and regulations. N. The terms of this Agreement, and the Premises and Required Improvements, satisfy the eligibility criteria of the NEZ Incentives. ®. Written notice that the City intends to enter into this Agreement, along with a copy of this Agreement, has been furnished in the manner prescribed by the Code to the presiding officers of the governing bodies of each of the taming units in which the Premises is located. I. On June 6, 2006, the City Council adopted Ordinance No. (the "Ordinance"} establishing "Neighborhood Empowerment Reinvestment Zone No. 29 City of Fort Warth, Texas {the "Zane") fox the Premises. NOW, T)EIEREFORE, the City and Owner, for and in consideration of the terms and conditions set forth herein, do hereby contract, covenant and agree as follows: 1. OWNER'S COVENAIi~TS. 1.1. Real Property 1Cnataroveaxaea~ts. Owner shall construct, or cause to be constructed, an and within the Premises certain improvements consisting of an office/retail center, (i) of at least 6630 squaxe feet in size, and (ii) having a construction cost upon completion of $277,000.00 including side development casts but such minimum construction costs shall be reduced by any construction cost saving (collectively, the "Required tanprovements"). The type, number anal location of the Required Improvements are described in Exhibit "D." The "Required Improvements" shall have an appraised value of $200,000.00 as determined by arc independent appraiser. Owner shall provide a copy of the final site plan and. independent appraisal to City once it is approved by the Department of Development and the parties agree that such final site plan and independent appraisal shall be a part of this Agreement and shall be labeled Exhibit "E". The final site plan shall be in substantially the same form as the preliminary site plan. Minor variations, and nacre substantial variations if approved in writing by both of the parties to this Agreement, in floe Required Improveaxaents from the description provided in the Application for Tax Abatement shall not constitute an Event of Default, as defined in Section 4.1, provided that the conditions iaa the first sentence of this Section 1.1 are met and the Required lmprovements are used for the purposes and in the manner described in Exhibit "D." ~..2. Cora. letion Date oi' Re aired Ian roveaaents. Owner covenants to substantially complete construction of all of the Required Improvements within two years from the issuance and receipt of the first building permit, unless delayed because of farce majeure, in which ease the one-year shall be extended by the number of days comprising the specific force majeure. For purposes of this Agreement, force majeure shall mean an event beyond Owner's reasonable control, including, without limitation, delays caused by adverse weather, delays in receipt of any required permits or approvals from any governmental authority, or acts of God, fires, strikes, national disasters, wars, riots and material or labor restrictions, and shortages as determined by the City of Fort Worth in its sole discretion, which shall not be unreasonably withheld, but shall not include construction delays caused due to purely financial matters, such as, without limitation, delays in the obtaining of adequate financing. 1.3. Use of Preaaaises. Owner covenants that the Required Impraveaaaents shall be constructed and the Premises shall be continuously used as an addition to an office/retail center and in accordance with the description of the Project set forth in the Exhibit "D." In addition, Owner covenants that throughout the Term, the Required Improvements shall be operated and maintained for the purposes set forth in this Agreement and in a manner that is consistent with the general purposes of encouraging development ar redevelopment of the Zone. ~. ABATEMENT AMOU101TS TERMS AND CONDITIONS. Subject to and in accordance with this Agreement, the City hereby grants to Owner real property tax abatement on the Premises, the Required Improvements, as specifically provided in this Section 2 ("Abatement"). "Abatement" of real property taxes only includes City of Fart Worth-imposed taxes and not taxes from other taxing entities. 2.1. Amount of Abatement, The actual amount of the Abatement granted under this Agreement shall be based upon the increase in value of the Premises and the Required Improvements over their values on January 1, 2006, said values being in the $770,160.00, (as of January 1, 2006. The Abatement shall be one hundred percent (100%) of the increase in value from the construction of the Required Improvements. If the square faatage requirement and. the appraised value of the Required Improvements are less than as provided in Section 1.I a~ this Agreement, except that such minimum construction costs shall be reduced by construction east savings, Owner shall not be eligible to receive any Abatement under this Agreement. 2.2. Increase in Value. The Abatement shall apply only to taxes on the increase in value of the Premises due to construction of the Required Improvements and shall not apply to taxes on the land. 2.3. Abatement Limitatiaa, Notwithstanding anything that may be interpreted to the contrary in this Agreement, the Abatement in any given year shall be based on the increase in value of the Premises over its value on January 1, 2006, including the Required Improvements, up to a maximum of $415,500.00. In other words, by way of example only, if the increase in value of the Premises over its value on .Ianuary 1, 2006, including the Required hmprovements, in a given year is $420,000.00, the Abatement for that tax year shall be capped and calculated as if the appraised value of the Premises for that year had only been $415,500.00. 2.4. Protests Over Ampraisals ar Assessments. Owner shall have the right to protest and contest any or all appraisals or assessments of the Premises and/or improvements thereon. 2..5. Term. The term of the Abatement {the "Term") shall begin on January 1 of the year following the calendar year in which a final certificate of occupancy is issued for the Required Improvements (`Beginning Date") and, unless sooner terminated as herein provided, shall end on December 31 immediately preceding the fifth (S`~) anniversary of the Beginning Date. 2.6. Abatement Application Fee. The City acknowledges receipt from Owner of the required Abatement application fee of one half of one percent (.5%} of Project's estimated cost, not to exceed $2,OOQ. The application fee sha11 not be credited or refunded to any party other than the City for any reason. 3. REC®RDS AUDITS ANI3 EVALUATI®N ®F PIS®JECT. 3.1. Insyection of Premises. Between the execution date of this Agreement and the last day of the Term and far five (5) years after termination {"Compliance Auditing Term"}, at any time during normal office hours throughout the Term and the year following the Term and following reasonable notice to Owner, the City shall have and Owner shall provide access to the Premises in order for the City to inspect the Premises and evaluate the Required Improvements to unsure compliance with the terms and conditions of this Agreement. Owner shall cooperate fully with the City during any such inspection and/ar evaluation. 3.2. Audifs. The City shall have the right to audit at the City's expense the financial and business records of Owner that relate to the Project and Abatement terms and conditions {collectively, the "Records") at any time during the Compliance Auditing Term in order to determine compliance with this Agreement and to calculate the correct percentage of Abatement available to Owner. Owner shall make all applicable Records available to the City on the Premises or at another location in the City following reasonable advance notice by the City and shall otherwise cooperate fully with the City during any audit. 3.3. Provision of Information. On or before February 1 following the end of every year during the Compliance Auditing Term and if requested by the City, Owner shall provide information and documentation far the previous year that addresses Owner's compliance with each of the terms and conditions of this Agreement far that calendar year. This information shall include, but not be limited to, the number and dollar amounts of all construction contracts and subcontracts awarded on the Project. Failure to provide all ixrforuration within the eantroC of ®wrr.er required by this Section 3.3 shall constitute an Event of.Default, as defined in Section 4.1. 3.4. Determination of Connt~liance. On ar before August 1 of each year during the T erm, the City shall make a decision and rule on the actual annual percentage of Abatement available to Owner for the following year of the Term and shall notify Owner of such decision and ruling. The actual percentage of the Abatement granted for a given year of the Term is therefore based upon Owner's compliance with the terms and conditions of this Agreement during the previous year of the Terra. 4. EVENTS OF DEFAE.TLT. 4.I. Defined. UX~less otherwise specified herein, Owner shall be in default of this Agreement if (i) Owner fails to construct the Required Improvements as defined in Section 1.1., {ii} ad valorem real property taxes with respect to the Premises ar the Project, ar its ad valorem taxes with respect to the tangible personal property located on the Premises, become delinquent and Owner does not timely and properly follow the legal procedures for protest and/or contest of any such ad valorem real property or tangible personal property taxes ar (iii} OWNER DOES NOT COMPLY WITH CHAPTER 7 AND APPENDIX B OF THE CODE OF ETHICS (?} ORDINANCE OF THE CITY OF FORT WORTH. (collectively, each an "Event of Default"}. 4.2. Notice to Cure. Subject to Section 5, if the City determines that an Event of Default has occurred, the City shall provide a written notice to Owner that describes the nature of the Event of Default. Owner shall have ninety {90) calendar days from the date of receipt of this written notice to fully cure or have cured the Event of Default. If Owner reasonably believes that Owner will require additional time to cure the Event of Default, Owner shall promptly notify the City in writing, in which case after advising the City Council in an open meeting of Owner's efforts and intent to cure, Owner shall knave one hundred eighty {1$0) calendar days from the original date of receipt of the written notice. Alternatively, if Owner reasonably believes that Owner will require more than one hundred eighty (1$0) days to cure the Event of Default, after advising the City Council in an open meeting of Owner's efforts and intent to cure, such additional time, if any, as may be offered by the City Council in its sole discretion. 4.3. Termination for Event of Default and Payment of Liquidated Damages. if an Event of Default, which is defined in Section 4.1, has not been cured within the time frame specifically allowed under Section 4.2, the City shall have the right to terminate this Agreement immediately. Owner acknowledges and agrees that an uncured Event of Default will (i} harm the City's economic development and redevelopment efforts on the Premises and in the vicinity of the Premises; (ii) require unplanned and expensive additional administrative oversight and involvement by the City; and. (iii) otherwise harm. the City, and Owner agrees that the amounts of actual damages therefrom are speculative in nature and will be difficult or impossible to ascertain. Therefore, upon termination of this Agreement for any Event of Default, Owner shall not be eligible for the Abatement for the remaining Term and Owner shall pay the City, as liquidated damages, all taxes that were abated in accordance with this Agreement far each year when an Event of Default existed and which otherwise would have been paid to the City in the absence of this Agreement.. The City and Owner agree that this arrrount is a reasonable approximation of actual damages that the City will incur as a result of an uncured Event of Default and that this Section 4.3 is intended to provide the City with compensation for actual damages and is not a penalty. This amount naay be recovered by the City through adjustments made to Owner's ad valorem property tax appraisal by the appraisal district that has jurisdiction over the Premises. Otherwise, this amount shall be due, owing and paid to the City within sixty (60) days following the effective date of termination of this Agreement. In the event that all or any portion of this amount is not paid to the City within sixty (60) days following the effective date of termination of this Agreement, Owner shall also be liable for all penalties and interest on any outstanding amount at the statutory rate far delinquent taxes, as determined by the Code at the time of the payment of such penalties and interest. 4.4. Termination at Will. If the City and Owner mutually determine that the development or use of the Premises or the anticipated Required Improvements are no longer appropriate or feasible, or that a higher or better use is preferable, the City and Owner may terminate this Agreement in a written format that is signed by both parties. In this event, (i) if the Term has commenced, the Term shall expire as of the effective date of the termination of this Agreement; (ii) there shall be na recapture of any taxes previously abated; anal {iii) neither party shall have any further rights or obligations hereunder. 4.5. Sexually ~rie~tec~ business ~ Liguar Stares or Paeka~e Stores. a. Owner understands and agrees the City has the right to terminate this agreement if the Project contains or will contain a sexually oriented business. b. Owner understands and agrees that the City has the right to terminate this agreement as determined in City's sole discretion if the Project contains or will contain a liquor store or package store. S. EFFECT (~F SALE ®F PItEIVIISES. The Abatement granted hereunder shall vest only in Owner and cannot be assigned to a new owner of all or any portion of the Premises and/or Required Improvements without the prior written consent of the City Council. Owner may not otherwise assign, lease ar convey any of its rights under this Agreement. Any attempted assignment without the City Council's prior written consent shall constitute grounds for termination of this Agreement and the Abatement granted hereunder fallowing ten (10} calendar days of receipt of written notice from the City to Owner. In no event shall the Term. be extended in the event of a subsequent sale or assignment. b. 7. TERMINATION OF EXISTING ~.GREEMENT. The Existing Agreement, identified as Contract No. 33005, is hereby terminated eontenrzpaxaneously with the execution of this Agreement as of the effective date hereof and fully substituted by this Agreement, and neither party to the Existing Agreement shall have any further duties or responsibilities under the Existing Agreement as of the effective date hereof. NOTICES. All written notices called for or required by this Agreement shall be addressed to the following, or such other party ar address as either early designates in writing, by certified mail, postage prepaid, or by hand delivery: City: City of Fort Worth Attn: City Manager 1000 Throckmorton Fort Worth, TX 76102 ®vvner: Zarif Inc. Attn: Sam Khalil 2747 8th Avenue Fort Worth, TX 76110 and Housing Department Attn:.lerome Walker 1000 Tlarockmorton Fort Worth, TX 76102 8. MISCELLANEOUS. 8.1.. Bonds, The Required Improvements will not be financed by tax increment bonds. This Agreement is subject to rights of holders of outstanding bands of the City. 8.2. Conflicts of Interest. Neither the Premises nor any of the Required Izx~provements covered by this Agreement are owned ax leased by any member of the City Council, any member of the City Planning or Zoning Commission or any member of the goverrrning body of any taxing units in the Zone. 8.3. Conflicts Between. I3ocuments. In the event of any conflict between the City's zoning ordinances, or other City ordinances or regulations, and this Agreement, such ordinances ar regulations shall control. In the event of any conflict between the body of this Agreement and Exhibit "D", the body of this Agreement shall control. As of June 6, 2006, the City is unaware of any conflicts between this Agreement and the City's zoning ordinance or other ordinances or regulations. 8.~. Future A~~plication. A portion or all of tlxe Premises and/or Required Improvements may be eligible for complete or partial exemption from ad valorem taxes as a result of existing law or future legislation. This Agreement shall not be construed as evidence that such exemptions do not apply to the Premises and/or Required Improvements. 8.5. City Coa~ncil Anthori~zation. This Agreement was authorized by the City Council through approval of Mayor and Council Communication No. C-- on Tune 6, 2006, which, among other things, authorized the City Manager to execute this Agreement on behalf of the City. S.G. Esta~pel Certi~eate. Any party hereto may xequest an estoppel certificate from another party hereto so long as the certificate is requested in connection with a bona fide business purpose. The certificate, which if requested will be addressed to the Owner, shall include, but not necessarily be limited to, statements that this Agreement is in full force and effect without default (or if an Event of Default exists, the nature of the Event of Default and curative action taken and/or necessary to effect a cure), the remaining term of this Agreement, the levels and remaining term. of the Abatement in effect, and such other matters reasonably requested by the party or parties to receive the certificates. 8.7. Owner ,Standing. Owner shall be deemed a proper and necessary party in any litigation questioning or challenging the validity of this Agreement or any of the underlying laws, ordinances, resolutions, ar City Council actions authorizing this Agreement, and Owner shall be entitled to intervene in any such litigation. S.S. Venue and durrsdietion. This Agreement shall be construed in accordance with the laws of the State of Texas and applicable ordinances, rules, regulations, or policies of the City. Venue far any action under this Agreement shall lie in the State District Court of Tarrant County, Texas. This Agreement is performable in Tarrant County, Texas. $.9. Recordation. A certified copy of this Agreement in recordable form shall be recorded in the Deed Records of Tarrant County, Texas. $.l.0. Severalbility. if any provision of this Agreement is held to be invalid, illegal, or unenforceable; the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired. $.11. 1Fieadin s loot Controllin . Headings and titles used in this Agreement are for reference purposes only and shall oat be deemed a part of this Agreement. $.I2. Entirety of A~reeme~a~. This Agreement, including any exhibits attached hereto anal any documents incozparated herein by reference, contains the entire understanding and agreement between the City and Owner, their assigns and successors in interest, as to the matters contained herein. Any prior or contemporaneous oral or written agreement is hereby declared null and void to the extent in conflict with any provision of this Agreement. This Agreement shall not be amended unless executed in writing by both parties and approved by the City Council. This Agreement may be executed in multiple counterparts, each of which shall he considered an original, but all of which shall constitute one instrument. [THE REMAINDER OF THIS PAGE IS INTENTIONALLY LEFT BLANK] EXECUTED this day of Texas. EXECUTED this day of CITX (~F F4RT W®RTH: By: Dale A. Fisseler Assistant City Manager ATTEST: By: City Secretary APPROVED AS TO FORM AND LEGALITY: By: Leann Guzman Assistant City Attorney 2006, by the City of Fort Worth, 2006, by Zarif, Inc. By: Samir Khalil President M & C: STATE OF TEXAS ~ C(3~(1NT'~' ~F TARRANT § BEFORE ME, the undersigned authority, on this day personally appeared Dale A. Fisseler, Assistant City Manager of the CITY OF FORT WORTH, a municipal corporation, known io me to be the person and officer whose Warne is subscribed to the foregoing instrument, and acknowledged to me that the same was the act of the said CITY OF FORT WORTH, TEXAS, a municipal corporation, that he was duly authorized to perfoxm the same by appropriate resolution of the City Council of the City of Fort Worth and that he executed the same as the act of the said City for the purposes and consideration therein expressed and in the capacity therein stated. GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of 206. Notary Public in and for the State of Texas Notary's Printed Name STAT)~ OF TEXAS ~ COUNTY OF TARRANT ~ BEFORE ME, the undersigned authority, on this day personally appeared Samir Khalil, known to me to be the person whose Warne is subscribed to the foregoing instrurnent, and acknowledged to me that he executed the same for the purposes and consideration therein expressed, in the capacity therein stated and as the act and deed of Zarif, Inc. GIVEN UNDER MY HAND AND SEAL Op' OFFICE this day of . 2006. Notary Public in and far The State of Texas Notary's Printed Name Exhibit A: NEZ Incentives Exhibit B: Property Description Exhibit C: Application: (NEZ) Incentives and Tax Abatement Exhibit D: Project description including kind, number, and location of the proposed izxaprovements. Exhibit E. Final Site Plan & Independent Appraisal ~'it~ ~f F®rt VI/~r~th, Texas i SUBJECT: Approve Termination of Existing Tax Abatement Agreement with Zarif, Inc., for Fort Worth Neighborhood Empowerment Reinvestment Zane Number 23, Adapt C}rdinance to Designate Fart Worth Neighborhood Empowerment Reinvestment Zane Number 29 and Authorize Tax Abatement Agreement with Zarif, Inc., far Property Located at 2747-8th Avenue, in the Berry/University Neighborhood Empowerment Zone ,~_ RECOIVIIViENDA,TION: It is recommended that the City Council: 1. Approve termination of the existing tax abatement agreement with Zarif, Inc., for Fart Worth Neighborhood Empowerment Reinvestment Zane (FWNEZ) Number 23; 2. Hold a public hearing concerning the designation of 1.371 acres of land as described in Exhibit "A" as FWNERZ Number 29; 3. Adopt the ordinance to designate the area as FWNERZ Number 29 pursuant to the Texas Property Redevelopment and Tax Abatement Act, Tax Code, Chapter 312; 4. Find that the statements set Earth in the recitals of the attached Tax Abatement Agreement {the Agreement) with Zarif, Inc., are true and correct; 5. Approve afive-year Municipal Property Tax Abatement for a property located at 2747 8th Avenue in the BerrylUniversity Neighborhood Empowerment Zone (NEZ) owned by Zarif, Inc.; and 6. Authorize the City Manager #o enter into the Tax Abatement Agreement with Zarif, Inc., for the property located at 2747 8th Avenue in the Berry/University NEZ in accordance with the NEZ Tax Abatement Policy and NEZ Basic Incentives, as amended. ©1SCUSSION: Chapter 378 of the Texas Local Government Code provides that a municipality can offer an abatement of municipal property taxes for properties located in a Neighborhood Empowerment Zane. Zarif, Inc., is the owner of the property located at 2747-8th Avenue. The property is located in the Berryl University NEZ Zarif, inc., applied for afive-year municipal property tax abatement under the NEZ Tax Abatement Policy and Basic Incentive. These incentives were readopted on October 4, 2005, (M&C G- 14947). The Housing Department reviewed the application and certified that the property met the eligibility criteria to receive NEZ municipal property tax abatement. The NEZ Basic Incentive includes afive-year municipal property tax abatement on the increased value of improvements to the qualified owner of any Lngname: OSZARIP2 Page t o~ 3 new construction or rehabilitation within the NEZ. In 2005 Zarif, loc., was granted a NEZ tax abatement an a property adjacent to 2747-8th Avenue, which was designated as FWNERZ 23. Ta date, improvements have not been started in FWNERZ 23. The property has been enlarged and replotted and a new construction budget has been obtained by Zarif, Inc. Far the replotted property, Zarif, Inc., will invest, at a minimum, $277,000 to expand a professional office and retail center. The project description and picture of the shopping center layout are attached as Exhibit "13." City staff recommends that City Council designate the 1.371 acre tract (2747-8th Avenue) described in the attached Ordinance as FWNERZ Number 29. Further, the original tax abatement agreement for FWNERZ 23 should be terminated and a new tax abatement agreement should be executed with Zarif, Inc., for FWNERZ 29 under the guidelines set forth in the Tax Cade and the NEZ Tax Abatement Policy and Basic Incentive. The form of the tax abatement agreement is attached as Exhibit "'C." TAX ABATEMENT TERMS Upon execution of the agreement, the total assessed value of the improvement used for calculating municipal property tax will be frozen for a period of five years, starting nn January 1, 2007, at the estimated pre-improvement value as defined by the Tarrant Appraisal District {TAD} an January 1, 2006, for the property as follows: Pre-lmpravement TAD Value of Improvements Pre-Improvement Estimated Value of Land Total Pre-Improvement Estimated Value $z8s,ataa.aa $770,160.00 $1, a59,150.00 The municipal property tax on the improved value of the property is estimated at $9677.00 per year for a total of $8385.00 over afive-year period. However, this estimate may differ from the actual tax abatement value, which will be calculated based on the TAD appraised value of the property. In the event of a sale of the property, the agreement may be assigned, with City Council approval, to the new owner{s), so long as the new owner(s) meets all of the eligibility criteria as stated in the NEZ Tax Abatement Policy and Basic Incentives. As required by Chapter 312 of the Texas Tax Code, a public hearing must be conducted regarding the creation of the Zone. Notice of this hearing was (1) delivered to the governing body of each affected taxing unit and {2) published in a newspaper of general circulation at least seven days prior to this hearing. The proposed area meets the criteria for the designation of a reinvestment zone contained in Chapter 312 of the Tax Code. As a result of the designation, the area wil! contribute to the retention ar expansion of primary employment and attract major investment in the zone that would be a benefit to the property and contribute to the economic development of the municipality. Further, future improvements in the zone will benefit the City, after any Tax Abatement Agreements that may be entered into have expired. The proposed FWNERZ Number 29 expires after five years and may be renewed for periods not to exceed five years. This property is located in COUNCIL DISTRICT 9. FISCAL INFORMATIONlCERTIFICATION: Logname: 45ZARf~'2 Page 2 0£ 3 The Finance Director certifies that this action will have no material effect on city funds. TO FundlAccountlCenters FROM FundlAccountlCenters Submitted iror Ci Mane er`s Of€ice b Dale 1=isseler (6140) Ori ina~in De artmen~ Head: Jerome Walker (7537} Additional information Contact: Sarah Odle (7316} Logname: 05ZARIF2 Page 3 0£ 3