HomeMy WebLinkAboutResolution 5721-03-2023A Resolution
NO. 5721-03-2023
ESTABLISHING A POLICY FOR THE
ECONOMIC DEVELOPMENT INITIATIVES FUND
WHEREAS, the City of Fort Worth ("City") has established the Economic Development
Department to , among other things , administer programs that further the public purposes of development
and diversification of the City's economy, the elimination of unemployment and underemployment in the
City, and the development and expansion of commerce in the City;
WHEREAS, in accordance with the most recently adopted Comprehensive Plan, and consistent
with previous Comprehensive Plans , the City has committed to use custom-designed incentives and
partnership programs with private businesses on a case-by-case analysis of individual projects to help
ensure the growth and diversification of the local economy;
WHEREAS, on February 22, 2022, City Council accepted an update to the Fort Worth Economic
Development Strategic Plan that, among other things , recommended the establishment of a dedicated cash
fund to support economic development within the City to be known as the Economic Development
Initiatives Fund ("EDIF");
WHEREAS, the purpose of the EDIF to create a strong, resilient, and growing local economy and
promote the development of the City's industrial base through the sustained support of targeted programs
and strategic investment; and
WHEREAS, City Council desires to establish a policy governing the EDIF ("Policy"), with the
intent that the Policy institute the means by which the EDIF will be established, funded, and utilized and
create the guidelines and processes for administration thereof.
NO.W, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FORT WORTH, TEXAS:
1. The Policy, a copy of which is attached hereto as Exhibit A and in corporated herein by
reference, is hereby adopted to be effective on March 21, 2023.
2. This Resolution will take effect on the date of its adoption.
ADOPTED this 21 st day of March, 2023.
ATTEST:
By:r;.~
Jannette S. Goodall, City Secretary
Exhibit A
City of Fort Worth
Economic Development Initiatives Fund Policy
Effective March 21 , 2023
1. Purpose. Recognizing the public interest in supporting a strong, resilient, and
growing local economy and in promoting the development of the community's industrial base
through sustained support for targeted programs and strategic investments , the City Council wishes
to establish and provide for the administration of a fund dedicated to the supp01i and promotion of
economic development in th e City of Fort Worth ("City"). This Policy is intended to institute the
means by which a fund will be established, funded , and utilized and to set forth guidelines and
processes for administration of the fund . Guidelines and requirements for fund utilization as
established within this Policy may be more specifically guided by other associated policies, such
as the City's Economic Development Program Policy , p articularly with respect to any process for
the application to receive fund s by or other guidance relating to the grant of funds to private or
other non-City entities.
2. Special Revenue Fund.
a. Es tablishment of Fund. The City established a Special Revenue Fund for
the purpose of supporting economic development. This Policy recommends that the City
Council establish a dedicated fund , known as the "Economic Development Initiatives
Fund" ("EDIF "), with the expressed purpose of providing long-term annual funding for
economic developm ent projects , programs , and initiatives and their administration.
Establishment of the EDIF does not preclude other City funds from being u se d , dedicated ,
or contributed in support of certain other economic development funds , programs ,
initiatives, or administration.
b . Term. There is no term limitation on the EDIF.
c. Source of Funds . The City will fund the EDIF from a combination of
ongoing annual deposits and certain periodic contributions of City fund s. Except as
otherwise permitted by the City Council, funding for the EDIF will primarily be sourced
from the following:
1. Tax Increment Reinvestment Zone s ("TIRZ" or "TIF").
1. Following expiration or termin at ion of any TIRZ and in accordance
with the City's Policy and Guidelines for TIRZ, it is recommended
tha t an amount equal to a portion of the equivalent City ad valorem
property tax levy as deri ve d from the City's contribution to th e TIF
fund in the final year of p articipation ("Effective TIF Amount") be
dedicated to the EDIF during each budget cycle. In the event that the
City ofFort Worth EDIF Policy Pagel of3
City's final year contribution to the TIF is reduced as a result of a
cap on either lifetime TIF revenues or lifetime City contributions to
the TIF (but not annual caps on contributions), the Effective TIRZ
Amount will be based on the value that would have been contributed
by the City but for the caps.
For example, if the City's contribution in the final year of a TIRZ is
equal to $2 million and the City's total adjusted net taxable value on
ad valorem property is equal to $90 billion while the City's ad
valorem tax rate is $0 . 732 per $100 of valuation, then the Effective
TIF Amount will be equal to $0.0022 per $100 of valuation or ($2
million / ([$90 billion / $100] x 0.7325)) x 0.7325. In this example,
one half of the Effective TIF Amount, or $0.0011 per $100 of
valuation, would be recommended as a dedicated source of funds
for the EDIF.
ii. Proceeds from Certain Property Transactions. Funds resulting from
the sale or lease of certain City-owned property may, with the consent of the City
Council and at the recommendation of City staff, be dedicated for deposit in the
EDIF for use in accordance with this Policy.
111. Other Funds. Other funds may, with the consent of the City Council,
be dedicated for deposit in the EDIF for use in accordance with this Policy.
d. Carry Forward Balance. It is recommended that all funds remaining in the
EDIF at the end of each fiscal year be preserved in the EDIF for future use in accordance
with this Policy along with any interest proceeds that might have accrued.
3. Use of Funds. Funds deposited in the EDIF must be used in the support or
administration of economic development programs, activities, or investments that are utilized for
the benefit of the City. In general, funds deposited into the EDIF should be budgeted in whole or
in part to serve either as Programmatic Funding or Reserved Funding as described below.
a. Programmatic Funding. The EDIF may be used to fund certain ongoing
economic development programs, contracts, or other economic development initiatives as
approved by the City Council or as incorporated into the City's annual budget
("Programmatic Funding" or "Programmatic Funds"). It is proposed that 40% of the funds
in the EDIF to be allocated towards Programmatic Funding, which would include, but not
be limited to professional services agreements for economic development marketing,
funding set-aside for film production projects or administrative contracts for the promotion
or development of certain districts. Programmatic Funding will also include funding for
EDIF administration by the Economic Development Department ( exclusive of staffing
costs) in an amount equal to ten percent of annual deposits into the EDIF.
City of Fort Worth EDIF Policy Page 2 of3
b. Reserved Funding. Certain funds deposited into the EDIF may be reserved
to support future economic deve lopment projects in the form of grants or loans associated
with the City's economic development program in accordance with th e City's Eco nomic
Development Program Policy for Grants Authorized by Chapter 380, Texa s Local
Government Code, or other similar program, and will be authorized by the City Council on
a project-by-project basis.
4. General Policies. Notwithstanding anythin g that may be interpreted to the contrary
herein , the following general terms and conditions govern thi s Policy:
a. The EDIF will be administered by City staff.
b. Any funds contributed to the ED IF are subject to approval of the City
Council through adoption of the annual City budget.
c. City Staff will report annually to the City Council, either by way of a
briefing or written report, on the status of the EDIF and its financial position.
City of Fort Worth EDIF Policy P age 3 of3
City of Fort Worth, Texas
Mayor and Council Communication
DATE: 03/21 /23
LOG NAME: 17EDIFPOLICY
SUBJECT
M&C FILE NUMBER: M&C 23-0212
(ALL) Adopt Resolution Establishing a Policy for the Economic Development Initiatives Fund
RECOMMENDATION:
It is recommended that the City Council adopt the attached resolution establishing a policy for the Economic Development Initi atives Fund .
DISCUSSION:
On February 22, 2022, City Council accepted an update to the Fort Worth Economic Development Strategic Plan (Plan) (M&C G-19192) that ,
among other updates and revisions, called for establishment within the C ity budget of a dedicated cash fund for the purposes of supporting
economic development in the city. The strategic recommendation was made in response to both the need for more flexible resources for
incentivizing certain projects and to the heightened level of competition seen in the market and the emergence of new funds created in other
communities within the region for promoting economic development. In response to the recommendation , City staff has worked with City Council to
evaluate the proposed establishment of such a fund through a dedicated portion of the City's property tax rate and through the use of City TIF
contributions upon their termination . While a special revenue fund was established as part of the fiscal year 2022 and fiscal year 2023 city
budgets, no policy exists recommending such a dedicated fund or one that guides the long-term funding and use of such a fund for the purpose of
supporting economic development.
Therefore , staff is recommending that the City Council adopt a po licy (Policy) for the establishment, long-term funding, and use of an Economic
Development lnititiaves Fund (ED IF ). The EDIF Policy specifies the intended sources of funding that are to be directed to the EDIF and provides
general guidance on the use of EDIF funds. More specifically, the EDIF Policy categorizes allowable use of funds by those that are programmatic
in nature (i.e . costs relating to the annual or multi-year support of programs, initiatives, and administration of economic development efforts) anEI by
those that are to be reserved for use in incentivizing future projects . Final and official approval of annual funding and use of the EDIF will be
established each year by way of approval of the City budget for the applicable fiscal year.
A copy of the proposed EOIF Policy is attached .
Once adopted , the amended Policy will be effective on March 21, 2023 .
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 2023 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: William Johnson 5806
Originating Business Unit Head: Robert Slums 2663
Additional Information Contact: Michael Hennig 6024
Expedited