HomeMy WebLinkAboutContract 23065 EF
CITY SECRETARY
STATE OF TEXAS § CONTRACT NO
COUNTIES OF TARRANT AND
DENTON §
TAX ABATEMENT AGREEMENT
BETWEEN THE CITY OF FORT WORTH
AND INTEL CORPORATION
THIS TAX ABATEMENT AGREEMENT ("Agreement") is entered into by and between
the City of Fort Worth, Texas ("City"), duly acting herein by and through its City Manager, and
Intel Corporation ("Intel"), a Delaware corporation, which is in good standing to do business in
the State of Texas, duly acting by and through its authorized officers.
WHEREAS, the City has adopted a resolution stating that it elects to be eligible to
participate in tax abatement; and
WHEREAS, on the 13th day of February, 1996, the City Council of the City of Fort
Worth, Texas ("City Council") adopted a "Policy Statement: Tax Abatement for Qualifying
Development Projects" ("Policy Statement"), attached hereto and incorporated herein as Exhibit
A; and
WHEREAS, the Policy Statement constitutes appropriate ",guidelines and criteria"
governing tax abatement agreements to be entered into by the City as contemplated by the Texas
Tax Code, as amended("Code"); and
WHEREAS, on the 28th day of January, 1997, the City Council adopted Ordinance No.
12842 ("Ordinance") establishing Tax Abatement Reinvestment Zone No. 26 ("Zone"); and
WHEREAS, Intel owns certain real property, more particularly described in Exhibit B
attached hereto and incorporated herein by reference ("Premises"), located totally within the
Zone; and
WHEREAS, the Premises and the Zone are both located in the extraterritorial jurisdiction
of the City; and
WHEREAS, on the 21st day of March, 1997, Intel submitted an application for tax
abatement to the City concerning the contemplated use of the Premises ("Application for Tax
Abatement" or the "Application"), attached hereto and incorporated herein as Exhibit "C"; and
WHEREAS, the contemplated use of the Premises, the Required Improvements (as
hereafter defined in paragraph I.A. below) to the Premises as set forth in this Agreement, and the
other tees hereof are consistent with encouraging development of said Zone in accordance with
e"'81
the purposes for its creation and are in compliance with the Policy Statement and the Ordinance
and similar guidelines and criteria adopted by the City and all applicable laws; and
WHEREAS, the City Council finds that the terms of this Agreement, and the Premises
and Required Improvements, satisfy the eligibility criteria of the Policy Statement; and
WHEREAS, 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 taxing units in which the Premises is
located.
NOW, THEREFORE, the City and Intel, for and in consideration of the premises and
promises contained herein, do hereby contract, covenant, and agree as follows:
1.
INTEL COVENANTS
A. Intel shall construct, or cause to be constructed, on and within the Premises,
improvements ("Required Improvements") which are phase I of a potential three phase project,
consisting of an advanced technology semiconductor wafer manufacturing facility which will use
the latest Intel manufacturing technology which is estimated to require an initial investment, for a
base level of equipment, of between one billion and one billion 300 million dollars
($1,000,000,000 - $1,300,000,000). As Intel increases the capacity of this facility and as
manufacturing changes occur, Intel will invest additional funds for manufacturing equipment
such that the total investment is not currently known. However, the Abatement will apply to the
actual total investment and the upper level of the range is not a cap under Section IV.B of the
Policy Statement. The phase I construction will consist of a minimum of 75,000 square feet of
clean room in a building complex of about 650,000 square feet. Support facilities will be part of
the investment.
The kind, number, and location of the Required Improvements is more particularly
described in the Application for Tax Abatement. As long as the conditions in the preceding
paragraph are met and the Required Improvements are used for the purposes and in the manner
described in the Application for Tax Abatement, variations in the kind, number and location of
the Required Improvements from the description provided in the Application shall not be an
Event of Default (as hereinafter defined in paragraph V.A below,)
Intel may, but is not obligated hereunder, at some point in the future and depending upon
market conditions, proceed to construct a phase 11 and a phase III of the project. In order to
qualify for an abatement hereunder, phases 11 and III must start by the end of the Tenn of the
phase I Abatement. For purposes of this Agreement, the start of phase 11 and phase III shall be
considered as the date upon which building construction has begun. Phase 11 would also be a
semiconductor wafer manufacturing facility, The investment would be at least comparable to
phase 1, but phase 11 would probably have a-more advanced manufacturing process which would
2
be more complex and involve more expensive equipment. If constructed, Phase III of the project
shall be a similar or related operation to phases I and 11. However, the Abatement will apply to
the actual total investment for phases 11 and 111.
B. Intel covenants to commence construction of phase I during calendar year 1997
and shall substantially complete said construction with a base level of manufacturing tool sets
within twenty-four (24) months. City acknowledges that Intel may be continually upgrading the
Required Improvements by making additional investments to expand capacity and to further
invest in manufacturing equipment, facilities, and process technology over the Term of the
Abatement. Intel shall have additional time to complete the Required Improvements as may be
required in the event of"force majeure" if Intel is diligently and faithfully pursuing completion
of the Required Improvements. For this purpose, "force majeure" shall mean any contingency or
cause beyond the reasonable control of Intel including, without limitation, acts of God or the
public enemy, war, riot, civil commotion, insurrection, governmental or de facto governmental
action (unless caused by acts or omissions of Intel), fires, explosions or floods and strikes.
C. Intel covenants that the Required Improvements shall be constructed and the
Premises shall be used in accordance with the description of the project set forth in the
Application for Tax Abatement. Intel covenants to comply with and satisfy all of the provisions
and requirements for Tax Abatement, including but not limited to, (i) (subject to paragraph LA
above), the description and location of the Required Improvements; (ii) the activities to be
performed; (iii) the eligibility criteria for the Required Improvements; (iv) the amount to be spent
with Fort Worth contractors and certified Minority and Women Owned Businesses; (v) the
number of Intel employees, and number of those positions to be held by Fort Worth residents;
(vi) the cost of the Required Improvements; (vii) the dollar amount and type of annual supplier
and service contracts that will be awarded to both Fort Worth companies and certified Minority
and Women Owned Enterprises.
For phase 11 and III Intel shall meet or exceed the Fort Worth and Minority and Women
Owned Enterprise contractor and supplier spending goals for Phase I.
D. As part of its obligations under paragraph LC, Intel covenants that, in connection
with operations of phase I on the Premises, Intel shall create a minimum of 600 full time jobs
which less of internal transfers will yield 300 new full time jobs in the first year of operation
(currently expected to be in 1999.) Twenty-five percent (25%) of these new full time jobs to be
filled by Fort Worth residents. In year 5 of operation, Intel covenants to have created a minimuni
of 800 full time jobs with twenty-five percent (25%) of such jobs being filled by Fort Worth
residents. Inner City residents shall equal 6% of the new full time jobs in the first year of
operation and 6% of the fall time jobs in year 5 of operation. In year 5 of operation and in any
year thereafter that Intel receives an Abatement under this Agreement, Intel covenants to meet
the 25%Fort Worth resident and 6% Inner City resident requirements on a site-wide basis.
E. Intel covenants that (i) as of January 1, 1997, there were no existing
improvements on the Premises (except some farin type of buildings)- (ii) all Required
Improvements and any other improvements to the Premises (all improvements to Premises,
3
including Required Improvements, shall be referred to as "Improvements") shall comply with all
applicable City building codes and ordinances, including, but not limited to, subdivision,
building, electrical, plumbing, and fire prevention codes and ordinances; (iii) construction of the
Improvements will be in accordance with all applicable federal and state laws and regulations;
and (iv) throughout the Term (as hereinafter defined in paragraph III.F) of the Abatement, the
Required Improvements shall be operated and maintained for the purposes set forth herein so that
the uses of the Premises shall be consistent with the general purposes of encouraging
development or redevelopment of the Zone, except as otherwise authorized or modified by this
Agreement.
IIo
GENERAL PROVISIONS
A. The City has adopted guidelines and criteria governing tax abatement agreements
for the City and is authorized to enter into this Agreement.
B. Procedures followed by the City shall conform to the requirements of the Code,
and have been and will be undertaken in coordination with Intel's corporate, public, employee,
and business relations requirements.
C. The Premises are not an improvement project financed by tax increment bonds.
D. Neither the Premises nor any of the Required Improvements covered by this
Agreement are owned or leased by any member of the City Council, any member of the City
Planning or Zoning Commission or any member of the governing body of any taxing units
joining in or adopting this Agreement.
E. This Agreement is subject to rights of holders of outstanding bonds of the City.
The City hereby represents to Intel that the City is not aware of any conflict between the terms of
this Agreement and the rights of holders of outstanding bonds of the City existing on the date
hereof
F. In the event of any conflict between the City zoning ordinances, or other City
ordinances or regulations, and this Agreement, such ordinances and regulations shall control.
G. A portion or all of the 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 is not to be construed as evidence that no such exemptions shall
apply to the Premises and/or Required Improvements.
4
III.
ABATEMENT TERMS AND CONDITIONS
A. The City hereby grants a tax abatement ("Abatement") to (i) Intel relative to the
Premises and the Improvements, and to (ii) Intel relative to the personal property located on the
Premises, excluding inventory and supplies, such Abatement to be subject to the terms and
conditions herein. The Abatement shall apply to taxes of the City only if the City annexes the
property during the term of this Agreement.
B. The amount of the Abatement on the increased value of the Premises and the
Improvements over their value on I January 1997, the year in which this Agreement is executed,
shall be as follows:
100% for ten years for each of the three phases.
C. The amount of the Abatement on the tangible personal property located on the
Premises over its value on January 1, 1997, the year in which this Agreement is executed, shall
be as follows:
100% for ten years for each of the three phases.
D. The City shall determine the eligibility of the project for an Abatement based on
this Agreement and the information furnished each year on or before March I of the taxable year
and shall notify Intel, the Appraisal Districts and the City Tax Assessor-Collector.
E. Intel shall have the right to protest and contest any or all appraisals or assessments
of the Premises and/or Improvements, or of the tangible personal property on the Premises.
F. The term of the Abatement (the "Term") shall begin on (i) January I of the year
following the year in which the certificate of occupancy for a particular phase is issued unless the
certificate of occupancy is granted on the assessment date of a given year in which case the Term
will begin in that year. (The applicable date specified in the immediately preceding sentence
shall be referred to as the "Beginning Date".) Unless sooner terminated as herein provided, this
Agreement shall end on the December 31 t immediately preceding the tenth (10') anniversary of
the Beginning Date for each phase, The Abatement shall not begin, however, unless and until
the City annexes the Premises.
G. The City acknowledges receipt from Intel of the required application for Tax
Abatement fee of 1% of project cost, not to exceed $15,000. If construction on the project is
begun within one year from the date of application (with or without a tax abatement), such fee
shall be creditable in full to the benefit of Intel against any permit, impact, inspection or other
lawful fee required by the City in connection with the project, and any remaining amounts shall
be refimded to Intel.
IV.
RECORDS, AUDITS AND EVALUATION OF PROJECT
A. The City shall annually (or at such other times deemed appropriate by the City)
evaluate the project to insure compliance with this Agreement. On or before March I't of every
year during the life of the Agreement, Intel shall provide information and documentation which
details Intel's compliance with each applicable term of the Agreement. City has the right to
review Intel records to verify the information to be provided or which was provided. Failure by
Intel to provide this information shall be considered an event of default as defined in paragraph V
and subject to the provisions of that paragraph. The information shall include, but not be limited
to,the following:
(i) the number and dollar amounts of all construction contracts and subcontracts
awarded on the project during the construction phase, specifying which companies are
Fort Worth entities and certified M/WBE companies;
(ii) the total number of employees who work on the premises, and the number
of employees who reside in Fort Worth and the number who reside in the designated
Inner City target area.
(iii) the gross dollars spent on supplier and service contracts, with detail
sufficient to demonstrate the amounts by contract awarded and performed by Fort Worth
individuals and entities;
(iv) the dollar amount of supply and service contracts awarded to Minority
Business Enterprises and Women Business Enterprises; and
(v) if the dollars or percentages do not equal the original (as detailed in
Exhibit C, "Application for Tax Abatement) or City Council modified requirements of
this Agreement, Intel shall explain the reason for the failure to meet the requirements and
state a recommended course of rectification.
B. The City shall make a decision and rule on the eligibility of the project for tax
abatement, based on the information furnished each year, on or before August I` of the taxable
year and shall so notify, Intel. The City Council's decision on the matter shall be binding, final
and not appealable, except for arbitrary and capricious acts and actions, gross negligence or
willful misconduct, and any appeal shall be under the substantial evidence rule.
C. During normal office hours throughout the Term of this Agreement, providing
reasonable notice is given to Intel, the City shall have access to the Premises by City employees
for the purpose of inspecting the Premises and the Required Improvements to ensure that the
Required Improvements or repairs are made in accordance with the specifications and conditions
of this Agreement and to verify that the conditions of this Agreement are being complied with.
6
V.
BREACH
A. In the event that (i) the Required Improvements for which an abatement has been
granted are not completed in accordance with this Agreement; or (ii) the completion schedule of
Improvements listed in Paragraph I.B. is not satisfied; or (iii) Intel allows its ad valorem real
property taxes with respect to the Premises or Improvements, or its ad valorem taxes with respect
to the tangible personal property to become delinquent and fails to timely and properly follow the
legal procedures for protest and/or contest of any such ad valorem real property or tangible
personal property taxes; or (iv) Intel breaches any of the other terms or conditions of this
Agreement, then Intel shall be in default of this Agreement (an "Event of Default"). Should an
Event of Default occur, the City shall give Intel written notice of such Event of Default and if
Intel has not cured such Event of Default within ninety (90) days of said written notice, this
Agreement may be terminated by the City; provided, however, that if such Event of Default is
not reasonably susceptible of cure within such ninety (90) day period and Intel has commenced
and is pursuing the cure of same, then after first advising City Council of the efforts to cure
same, Intel may utilize an additional ninety (90) days. Time in addition to the foregoing 180
days may be authorized by the City Council. As liquidated damages for an Event of Default after
the expiration of the applicable notice and cure periods, all taxes which otherwise would have
been paid to the City for each year when an Event of Default existed, without the benefit of
Abatement (after taking into account any applicable exemptions), and penalties and interest
thereon charged at the statutory rate for delinquent taxes as determined by Section 33.01 of the
Code, as in effect at the time of the payment of such penalties and interest, for each such year for
which such taxes were abated, will become a debt to the City. Such amount shall be due, owing
and paid to the City within sixty (60) days of the expiration of the above-mentioned applicable
cure period(s) as the sole and exclusive remedy of the City, subject to any and all lawful offsets,
settlements, deductions, or credits to which Intel may be entitled. The parties acknowledge that
actual damages in the event of default and termination would be speculative and difficult to
determine.
B. Notwithstanding the foregoing paragraph, if the City and Intel mutually determine
that the development or use of the Premises or Required Improvements as contemplated herein is
no longer appropriate or feasible or that a higher or better use is preferable, the parties may
terminate this Agreement by a writing signed by both parties, the period of Abatement shall
expire as of the effective date of the termination, there shall be no recapture of amounts
previously abated, and neither party shall have any further rights or obligations hereunder.
Z7
V1.
EFFECT OF SALE,ASSIGNMENT OR LEASE OF PROPERTY
The abatement shall vest in Intel and cannot be assigned to any third party, other than a
parent, subsidiary, or affiliated company, and any such assignment shall be grounds for
7
termination of this Agreement and the tax abatement hereunder upon ten (10) days' written
notice from the City to Intel,
Vii.
NOTICE
All notices called for or required by this Agreement shall be addressed to the following,
or such other party or address as either party designates in writing, by certified mail postage
prepaid or by hand delivery:
INTEL:
Intel Corporation
2200 Mission College Blvd.
Santa Clara, CA 95052
Attn.: General Counsel
with a copy to:
Intel Corporation
[address to be provided]
Fort Worth, TX
Attn.: Site Manager
CITY:
City Manager
1000 Throckmorton Street
Fort Worth, TX 76102
VIII.
CITY COUNCIL AUTHORIZATION
This Agreement was authorized by the City Council at its meeting on the 25th day of
March, 1997, by its approval of Mayor and Council Communication No. C-15968, authorizing
the City Manager to execute this Agreement on behalf of the City,
Ix.
BOARD AUTHORIZATION
This agreement is entered into by Intel pursuant to authority granted by its Board of
Directors on the 15th day of January, 1997, whereby one or more of the officers of Intel were
authorized, by corporate resolution, to execute instruments relating to real estate. A certificate
evidencing the Intel resolution is attached hereto as Exhibit E.
X.
SEVERABILITY
In the event any section, subsection, paragraph, sentence, phrase or word is held invalid,
illegal or unconstitutional, the balance of this Agreement shall stand, shall be enforceable and
shall be read as if the parties intended at all times to delete said invalid section, subsection,
paragraph, sentence,phrase or word. In the event that(i) the Term of the Abatement with respect
to any property is longer than allowed by law, or (ii) the Abatement applies to a broader
classification of property than is allowed by law, then the Abatement shall be valid with respect
to the classification of property abated hereunder, and the portion of the Term, that is allowed by
law.
X1.
ESTOPPEL CERTIFICATE
Any party hereto may request 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 Intel, shall include, but not necessarily be limited to ,
statements that this Agreement is in full force and effect without default (or if default exists the
nature of default and curative action, which should be undertaken to cure same), 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 to receive the certificates.
X11.
INTEL STANDING
Intel, as a party to this Agreement, shall be deemed a proper and necessary party in any
litigation questioning or challenging the validity of this Agreement or any of the underlying
ordinances, resolutions, or City Council actions authorizing same and Intel shall be entitled to
intervene in said litigation.
XIII.
APPLICABLE LAW
This Agreement shall be construed under the laws of the State of Texas. Venue for any
action under this Agreement shall be the State District Court of Tarrant County, Texas.
9
XIV.
AMENDMENT
This Agreement may be modified by the parties hereto to include other provisions which
could have originally been included in this Agreement or to delete provisions that were not
originally necessary to this Agreement pursuant to the procedures set forth in Title 3, Chapter
312 of the Code.
XV.
EFFECTIVENESS
This Agreement shall constitute a valid and binding agreement between the City and Intel
when executed in accordance herewith, regardless of whether any other taxing authority enters
into a similar arrangement with Intel.
XVI.
EXHIBITS
The following Exhibits are attached hereto and incorporated herein:
Exhibit A Policy Statement
Exhibit B Description of Premises
Exhibit C Application for Tax Abatement
Exhibit D City Council Authorization
Exhibit E Intel Board Authorization
EXECUTED this J - day of 1997, by the City.
EXECUTED this
f/,,day of i C-0 1997, by Intel Corporation.
AT/TEST: CITY OF
"OT RTH, TEXAS
4
A
U
By:
City Secretary Assistant City manager
APPROVED AS TO FOW14 AND LEGALITY: A,
j 7
1A) 7 ,
e/
Contract Authorization
Assistant City Atto ey
Date: 41 7 Dat to
10
INTEL CORPORATION
By:
Printed Name: 6tfg_44?,)�) H
Title: Executive Vice-President and
General Manager, Technology and
Manufacturing Group
Attest:
v
Assist t S etary
STATE OF TEXAS §
COUNTY OF TARRANT §
BEFORE ME, the undersigned authority, on this day personally appeared Mike Groomer,
Assistant City Manager of the CITY OF FORT WORTH, a municipal corporation, known to me
to be the person and officer whose name is subscribed of 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 perform 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
1997.
"n
o"
On
TRCY
Notary Public in an4yor
Q
L
the State of Texas
rl
V,
"V
OF T
Notary's Printed Name
a
W, a 71
My Commission Expires:
STATE OF CALIFORNIA §
COUNTY OF SANTA CLARA §
BEFORE ME, the undersigned authority, on this day personally appeared
Executive Vice President of Intel Corporation, a Delaware
222
corporation, known to me to be the person whose name is subscribed to the foregoing instrument,
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 said corporation.
PIVEN UNDER MY HAND AND SEAL OF OFFICE this U day of
f 1997.
SHIRLEY BARRY
n 10-1844-3 -,Notary Public ip' and for
'AZ�M iC — CALISORNIA X
C'UNTY OF SANTA CLARA
the State of California
Notary's Printed Name
My Commission Expires: 1,U-,W7'- ,70
12
ATTACHMENT"A"
"Reinvestment Zone" is an area designated as such by the City of Fort Worth or State of Texas in
accordance with the Texas Property Redevelopment and Tax Abatement Act, Sections 312.001
through 312.209 of the Tax Code.
"Residential Development Project" is a development project which proposes to construct or
renovate multi-family residential living units on property that is (or meets the requirements to be)
zoned multi-family as defined by the City of Fort Worth Zoning Ordinance.
"Fort Worth Company" is a business which has a principal office located within the city limits of
Fort Worth.
"Minority Business Enterprise (MBE) and Women Business Enterprise (WBE)" is a minority or
women owned business that has received certification as either a MBE or E by either
Certification Agency (NTRCA) or the Texas Department of
North Texas Regional Ceif WB e the
rt
Transportation(TxDOT), Highway Division.
"Capital Investment" includes only real property improvements such as new facilities and
structures, site improvements, facility expansion, and facility modernization. Capital investment
does NOT include land acquisition costs and/or any existing improvements, or personal property
(such as machinery, equipment, and/or supplies and inventory),
"Facility Expansion" is a new permanent real property improvement such as a building or
buildings constructed to provide additional square footage to accommodate increased space
requirements of a Fort Worth company.
"Facility Modernization" is a new permanent real property improvement under taken to provide
increased productivity for a new or existing Fort Worth company,
"Supply and Service Expenses"are discretionary expenses incurred during the normal
maintenance and operation activities of a business.
Ill. ELIGIBILITY CRITERIA
A. RESIDENTIAL PROJECT ELIGIBILITY
A residential development project is eligible for property tax abatement if-
The project is located in any of the following census tracts: 1002.02, 1010,
10311, 1016, 1017, 1018, 1019 (partial), 1025, 1028 (partial), 1029, 1030,
1031, 1033, 1035, 1036.1 01, 1037.01, 1038, 1040, 1041 (partial) (see -Map-
Eydribit"XI);AND
2. a. The project will construct or renovate no less than 50 residential
living units of which no less than 20%shall be affordable(as defined
by the U.S. Department of Dousing and Urban Development) to
persons with incomes at or below 80%of median fa_-roily income- OR
b. 'Ehe project has a mirirnurn cap lial investment of S5 million
(exciuding acquisition c-osts fh
Z__1 'I -)r land and any existing
improvements.,
-2-
CITY OF FORT WORTH
POLICY STATEMENT.
TAX ABATEMENT FOR QUALIFYING
DEVELOPMENT PROJECTS 21I3196)
I. GENERAL PURPOSE AND OBJECTIVES
Certain types of investment result in the creation of new jobs, new income and provide for
positive economic growth and inner-city economic stabilization which is beneficial to the City as
a ,vhole. The City of Fort Worth is committed to the promotion of high quality development in
all parts of the City and improv&ment in the quality of life for its citizens.
The City of Fort Worth will, on a case-by-case basis, give consideration to the granting of
property tax incentives to eligible residential, commercial, and industrial development projects.
It is the policy of the City of Fort Worth that consideration of eligible projects will be provided
in accordance with the guidelines and criteria outlined in this document. Texas law authorizes
the City of Fort Worth to grant tax abatement on the value added to a particular property by a
specific development project which meets the economic goals and objectives of the City, and the
requirements of the statute (Vernon's Tax Code Ann. Section 312.001, et. seq.).
As mandated by state law, this policy applies to the owners of real property. It is not the
Policy of the City of Fort Worth to grant property tax abatement to any development
project for which a building permit has been previously issued by the City's Department of
Development. Nothing in the policy shall be construed as an obligation by the City of Fort
Worth to approve any tax abatement application.
Although all applications which meet the eligibility criteria (Section 111.) of this policy statement
will be reviewed, it is the objective of the City of Fort Worth to encourage applications from
projects that:
(a) are located in enterprise zones or other designated target areas; or
(b) result in a development with little or no additional cost to the City; or
(c) result in 1,000 or more new jobs, with a commitment to hire Fort Worth and inner city
residents,
11. DEFINITIONS
"Abaternent" means the full or partial exemption from ad valorem taxes on eligible properties for
a period of up to ten years and air amount of up to 100% of the increase in appraised value (as
reflected on the certified tax roll of the appropriate count-y appraisal district) resulting from
improvements begun after the execution of the tax abatement agreement. Eligible properties
innust be located, in a reinvestinent zone,
ELIGIBILITY CRITERIA
B. COMMERCIALIINDUSTRIAL ELIGIBILITY
New Projects
In order to be eligible for property tax abatement, a new
commercial industrial development project must satisfy one of the
following three criteria:
a. Upon completion will have a minimum capital investment of$10
million and commits to hire an agreed upon percentage of residents
from an eligible inner city census tract (as identified on Exhibit
"A") for full time employment.; OR
b. Is located in the "inner city" (as identified on Exhibit -'.'A") or
property immediately adjacent to the major thoroughfares which
serve as boundaries to any of these inner city census tracts and
commits to hire an agreed upon percentage of residents from an
eligible inner city census tract (as identified on Exhibit"A") for full
time employment.; OR
C. Is located outside of the "inner city", has a minimum capital
investment of less than $10 million, and commits to hire an agreed
upon percentage of residents from an eligible inner city census tract
(as identified on Exhibit"A")for full time employment.
2. Existing Business Expansion and/or Modernization
In order to be eligible for'properly tax abatement a facility'expansion
and/or modernization by an existing commercialfindustrial business
a. Upon completion will have a minimum capital investment of$10
million.; OR
b. Must result in increased employment for which the business
commits to hire and retain an agreed upon percentage of residents
from an eligible inner city census tract (as identified on Exhibit
"A") for new, fall time positions; AND
C. Must have a minimum capital investment of(1) $500,000, OR (2)
an amount equal to or greater than 25% of the appraised value, as
certified by the appropriate appraisal district, of real property
improvements on the property for the year in which the abatement
is requested.
C. PROOF TESTS '
1. Building Permits
No tax abatement will be granted to any development project 'which has
applied for or received a building permit from the City's Department of
Development,
-3-
2. Evidence of Need for Tax Abatement
The applicant must provide evidence to substantiate and justify the tax
abatement request including (but not limited to) an analysis demonstrating
the tax abatement is necessary for the financial viability of the project,
IV. ABATEMENT GUIDELINES
The tax abatement agreement must provide that the applicant:
(1) Hire Fort Worth residents for an agreed upon percentage (at least 25%) of new full
time jobs to be created and make a good faith effort to hire 100% Fort Worth
residents for all new jobs created as a result of the abatement,
(2) Commit to hire an agreed upon percentage of Fort Worth residents from an eligible
inner city census tract (as identified on Exhibit "A") for all new jobs created as a
result of the project. The agreed upon percentage shall be determined by negotiation.
(3) Utilize Fort Worth companies for an agreed upon percentage of the total costs for
construction and Supply and Service Contracts, and
(4) Utilize Minority and Women owned Business Enterprises (M&WBEs) for an agreed
upon percentage of the total costs for construction and supply and service contracts in
the manner provided in the City of Fort Worth's Minority and Women Business
Enterprise ordinance.
In addition to the above, the abatement must comply with the following guidelines:
A. State law prohibits abatement of taxes levied on inventory, supplies or the existing
tax base. City policy is not to abate taxes on personal property-located within Fort
Worth prior to the date of the tax abatement agreement.
B. Unless otherwise specified in the agreement, the amount of the taxes to be abated
shall in no event exceed the amount of the capital investment (as specified in the
application) multiplied by the City's tax rate in effect for the year in which the
calculation is made.
C. In certain cases, the City may consider a tax abatement application from the
owner of real property who serves as a landlord or lessor for a development
project which meets the eligibility criteria of this section,
D. The City may consider an application from the owner or lessee of real property
requesting abatement of real and or personal property owned or leased by, a
certificated air carrier on the condition that the certificated air earner make
specific real property improvements or lease real property improvements for a
to of 10 years or more.
For an eligible development project to be considered for tax abatement. the
"Application for I I ax Abatement" form must be completed and submitted to the
Office of Economic Development.
-4-
F. An application fee must accompany the application. The fee is calculated at the
lesser or. /,il 1% of the project capital investment, or $15,0 0.
If construction on the project is begun on the site specified in the application
within a one (1) year period from the application submittal date (with or without a
tax abatement), this fee shall be credited to any permit, impact, inspection or any
other lawful fee required by the City of Fort Worth. If the project is not
constructed on the site specified in the application or if construction takes place at
the specified site more than one (1) year after the application submittal date, the
application fee shall not be refunded or otherwise credited.
G. If requested, the applicant must provide evidence that there are no delinquent
property taxes due on the property on which the development project is to occur.
H. The tax abatement agreement shall limit the uses of property consistent with the
general purpose of encouraging development or redevelopment of the zone during
the period that property tax abatements are in effect.
1. Tax abatement may only be granted for projects located in a reinvestment or
enterprise zone. For eligible projects not currently located in such a zone, the City
Council may choose to so designate the applicant's property in order to allow for a
tax abatement.
J. The owners of all projects receiving tax abatement shall properly maintain the
property to assure the long term economic viability of the project.
V. PROCEDURAL STEPS
Each request for property tax abatement shall be processed according to the following
procedural guidelines.
A. Application Submission:
Provided that the project meets the criteria detailed in Section III of this policy,
the Applicant must complete and submit a City of Fort Worth "Application For
Tax Abatement" form (with required attachments) and pay the appropriate
application fee,
B. Application Review and Evaluation:
The Economic Development Office will review the application for accuracy and
completeness. Once complete, the application will be evaluated bayed ow
I Types of new jobs created, including respective wage rates, and
employee benefits packages such as health insurance, day care
provisions, retirement package(s), transportation assistance, and any
other.
2. Percent of new jobs committed to Fort Worth residents,
Percent of
new jobs committed to Fort, Worth "huner City" residents.
-5-
4. Percent of construction contracts committed to:
a. Fort Worth based Ifirnis, and
b. Minority and Women owned Business Enterprises (MBEs and WBEs).
5. Percent of supply and service contract expenses committed to:
a. Fort Worth based firms, and
b. Minority and Women owned Business Enterprises(MBEs and WBEs).
6. The project's increase in the value of the tax base.
7. Costs to the City(such as infrastructure participation, etc.).
8. Other items which may be negotiated by the City and the applicant.
Based upon the outcome of the evaluation, the Economic Development Office
may present the application to the City Council's Expanding Economic
Opportunities Committee.
C. Consideration by Council Committee
Should the Economic Development Office present the application to the City
Council's Expanding Economic Opportunities Committee, the Committee will
consider the application at an open meeting. The Committee may:
(1) Approve the application. Staff will then incorporate the application into a
tax abatement agreement which will be sent to the City Council with the
Committee's recommendation to approve the agreement; or
(2) Request modifications to the application. Economic Development staff
will discuss the suggested modifications with the applicant and then,if the
requested modifications are made, resubmit the modified application to the
Committee for consideration; or
(3) Deny the application. The applicant may appeal the Committee's finding
by requesting the City Council to: (a) disregard the Committee's finding
and (b) instruct city staff to incorporate the application into a tax
abatement agreement for future consideration by the City Council.
D. 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 tax abatement application or
tax abatement agreement. The City of Fort Worth is under no obligation to
provide tax abatement in any amount o value to any applicant.
E. Effective Date for Approved Agreements
All tax abatements approved by the City Council will become effective on
January I of the year following the year in which a Certificate of Occupancy (CO)
is issued for the qualifying development proiect (unless otherwise specified in the
tax abatement agreenrient). Unless othe isc specified in the agreement, taxes
levied (luring the construction of the project shali be due and Payable.
-6-
V1. RECAPTURE
If the terms of the tax abatement agreement are not met, the City Council has the right to
cancel or amend the abatement agreement. In the event of cancellation, the recapture of
abated taxes shall be limited to the year(s) in which the default occurred or continued.
V11. INSPECTION AND FINANCIAL VERIFICATION
The terms of the agreement shall include-the City of Fort Worth's right to: (1) review and
verify the applicant's financial statements in each year during the life of the agreement
prior to granting a tax abatement in any given year, (2) conduct an on site inspection of
the project in each year during the life of the abatement to verify compliance with the
terms of the tax abatement agreement.
V111. EVALUATION
Upon completion of construction of the facilities, the City shall no less than annually
evaluate each project receiving abatement to insure compliance with the terms of the
agreement. Any incidents of non-compliance will be reported to all affected taxing units.
On or before March 31" of every year during the life of the agreement, any
individual or entity receiving a tax abatement from the City of Fort Worth shall
provide information and documentation which details the property owner's
compliance with the terms of the respective agreement and shall certify that the
owner is in compliance with each applicable term of the agreement. Failure to
report this information and to provide the required certification by the above
deadline shall result in any taxes abated in the prior year being due and payable.
IX. EFFECT OF SALE, ASSIGNMENT OR LEASE OF PROPERTY
No tax abatement rights may be sold, assigned or leased unless otherwise specified in the
tax abatement agreement. Any sale, assignment or lease of the property which is not
permitted in the tax abatement agreement results in cancellation of the agreement and
recapture of any taxes abated after the date on which an unspecified assignment occurred.
-7-
(' i
'_- ,tom
v
a�
- yy rr
( E t_ I G I B L t....
. � r�
CENSUS AREAS
wt t "A"
LEGEND
•.. � � �� „,�"�""a� ,� '� _� �,�''� ��� Rcstdcnftat lax
Abatement :
\ \ E igtble ConsUS A,-eas
t .
Camzeetcat�,ndast �a)
' Tax Abatement°
Ei bi
Cer us Area
g e
mc,cricalr ^du=fr -
� sq
b
"d C e sus a r e I f t s c� �r Y Ee s; nt i a i a Arc
4 s' r -
i t = i v .y ,� '& E' n� r c a s
u ! - lY ?�",d=„ + u r- ' 'X13+���2 1:
C7 _ j""�-'"j'.✓..�s r Z''a ^"•a
10 1
Tj
°
I .u.
r
�-- � 1Js, "`�`,;d ? ' ;�''' __ r, -t..�.� t3",»sy P? a 1 e�.° M
_ 7 a'
s 5
r 1
r{1t —Y ..w.�A..
T
hfl � P
G4 aq
"
r,
n
w a I 1 R 4 y ,t �al 4
�a GCd 1.
-
. "' '
All ` r "' ✓;`-.�J - �'"w, lt'xvl" -'°"r-- `
ATTACHMENT"B"
LEGAL DESCRIPTION 532 ACRE TRACT
Being a tract of land situated in the P.K. Matthews Survey, Abstract No. 865, and in the James E ads
Survey, Abstract No. 410, and in the Benjamin Matthews Survey, Abstract No. 860, and in the A.
McDonald Survey, Abstract No. 786, all in Denton, County, Texas. and being a portion of those
lands described in a Deed to Hillwood11358, Ltd. As recorded in Volume 2512, Page 460, of the
Deed Records of Denton County, Texas, and being a portion of that tract of land described in a
Deed to Culbertson Enterprises, inc. as recorded in Volume 1023, Page e 934, of said Deed Records,
said tract being more particularly described by metes and bounds as follows:
COMMENCING at the northwest corner of that tract of land described in a Deed to Peterson Farms,
Inc., 10th tract, as recorded in Volume 559, Page 309 of said County Records, point being in
the north line of said Hillwood11358, Ltd. Tract, and in the north line of said Benjamin Matthews
Survey;
THENCE 588-tO, 49' 49" E, 351.21 feet;
THENCE 589-4- 14' 44" E, 1799.52 feet to the POINT OF BEGINNNING:
THENCE 589'to 14' 44" E, 2972.90 feet;
THENCE 50535' 44'" E, 142.75 feet;
THENCE 586 58' 13" E, 502.59 feet;
THENCE S87-,,o 11, 54" E, 683.72 feet;
THENCE NOI'v 48' 07" E, 217.30 feet;
THENCE S89---, 12' 54" E, 667.02 feet;
THENCE NI 5� 59158" E, 456.39 feet;
THENCE S68`1, 31' 04" E, 1045.20 feet to the Northwesterly right-of-way line of Interstate
Highway 35W;
Thence along said right-of-way line the following courses:
THENCE 530-a- 52' 02" W, 1700.10 feet;
THENCE 529-to 45' 56" W, 1300.24 feet;
THENCE N89-1, 36' 58" W, 118.32 feet;
THENCE SOO-ii, 23' 02" W, 199.42 feet;
THENCE S30-4o 54' 25" W, 2157.55 feet to the beginning of a curve to the right;
THENCE with said curve to the right, through a central angle of 03) 42' 10", having a radius of
2844.79 feet, the long chord of which bears Sal-. 44' 377 W, 1183.81 feet, an arc distance
of 183.84 feet the beginning of a curve to the left;
THENCE with said curve to the left, through a central angle of 12-IzO 3629", having a radius of
2884.97 feet, the long chord of which bears S 37-t-, 17115" W, 633.57 feet an are distance
of 634.85 feet;
THENCE S30—s; 54' 25 " W, 181.57 feet to the northerly right-of-way line of Eagle Parkway;
Thence along said northerly right-of-way fine the following courses-
I -
THENCE 572--- 40' 45" W, 121.80 feet;
THENCE N65-to 19' 13" W, 109.20 feet to the beginning of cur-,,,e to the left;
THENCE with said curve to the left. )
through a central angle of 15-to 34'It' 36", having a radius of
1260.00 feet, the long chord of which bears N 73--ti, 06' 31" W, 341.49 feet, an are distance
of 342.55 feet:
THENCE N80`� 53' 49" W, 68.78 feet;
THENCE N00-to 13' 33" W, 621.32 feet leaving said right-of-way line along the cast line of the
Peterson Home tract;
THENCE N80v 30' 33" W, 203.00 feet along the north line of said Peterson Home tract;
THENCE SOO-� 13' 33" E, 572.08 feet along the west line of said Peterson Horne tract to the
northerly of said Eagle Parkway, the beginning of a curve to the right;
I Z�l
Thence along said northerly right-of-way line the following courses:
THENCE with said curve to the right, through a central angle of 10� 03' 06", having a radius of
1140.00 feet, the long chord of which bears N 65� 37' 13" W, 199,74 feet. an are
distance of 200.00 feet;
THENCE N59-1i, 05' 45" w, 348.05 feet;
THENCE N59-%--, 04' 19" W, 38.19 feet to the beginning of a curve to the right:
THENCE with said curve to the right, through a central angle of')2 ---, 1640", having a radius of
1140.00 feet, the long chord of which bears N 42"to 515' 57" W, 633.76 feet, an arc distance
of 642.22 feet;
THENCE N26-to 47' 3711 W, 253.82 feet to the beginning of a curve to the left,
THENCE with said curve to the left, through a central angle of 26--D 54' 51", havu-ig a radius of
Z:�
1260.00 feet, the long chord of which bears N 40� 151 02" W, 586.45 feet, an arc distance
of 591.88 feet;
THENCE N53-to 42' 28" W, 1022.31 feet to the beginning of a curve to the left;
THENCE with said curve to the left, through a central angle of I V� 55' 50", having a radius of
1260.00 feet, the long chord of which bears N 59to 10' 23" W, 240.01 feet, an arc distance
of 240.38 feet;
THENCE N30-w 00' 52" E, 113.23 feet leaving Eagle Parkway to the beginning of a curve to the
left;
THENCE with said curve to the left, through a central angle of 59� 41' 05", having a radius of
245.00 feet, the long chord of which bears N 00-%-- 10' 20" E, 243.83 feet, an arc distance of
255.22 feet;
THENCE N29� 40' 13" W, 193.59 feet to the beginning of a curve to the right:
THENCE with said curve to the right, through a central angle of 15-0 4T 27, having a radius of
205.00 feet, the long chord of which bears N 21�, 48' 59" W, 56-02 feet, an arc distance of
56.20 feet;
THENCE S80-w, 06' 56" W, 67.63 feet;
THENCE N0 53104" W, 1172.39 feet-,
THENCE N76-w- 571 01" E, 457.22 feet;
THENCE N51-o 401 59" E, 457.22 feet;
THENCE N218-w 15' 10" E, 546,24 feet;
THENCE N05-%> 43" 011, W, 523,66 feet to the POINT OF BEGINNING and containma 23,173,919
square feet or 5352.00 acres of land more or less.
ATTACHMENT"C"
,
CITY CFFORT WORTH
APPLICATION FOR
COMN1BDClAIJINDOSTRJALTAX ABATEMENT
}. Applicant Information
Name: Intel Corporation
Address: 2200 Mission College Blvd.
City,State,ZiyCndo Santa Clara,CA950j2
Telephone:�p ouc: (4O0)765-8080
Internet E-mail address: 06\
Contact Person(iooludohde/puoidou): Bill Sheppard,lVK{Site Materials 6l Services&Yaoa�cr-
(585)D93-3293 '
Name o[property owner: Will be Intel Corporation. Currently owned byBi|lv/uod}|358. Ltd,
2. Property Description
See attached legal description
3. Current Appraised Value nfProperty
See attached property tax statements 6nm County Appraisal District
4. Brief description of project including services provided or products manufactured, major customers
and locations, etc.
5. Project Description:
#4 and#5
Intel plans to build an advanced technology semiconductor wafer manufacturing facilit, which will
use the latest Intel manufacturing technology. Tire semiconductor products produced here, after they
are assembled and tested in other Intel or third party facilities,will be distributed to customers
throughout the world. Wc currently estimate that Phase{nf the project will require on investment of
between$113 to$1.313, but this is new technology and the amount maybe higher. O[this investment
approximately$35O&Y would be for construction. \9r project that there will bc about 750OOsquare
/e�ofc}coonommiuubuildiogcomplusofubou165O,0O0xqu�eC6cL '
The semiconductor wafers produced ui this facility are not fioiobedproducts, The wafers are shipped
to other Intel and third party plants for assembly,packaging,�iand�stiogbefore being shipped us
finished products customers. Thus 1o�|expects to ortall inventory from the State within l75
days,and all inventory will 6esubject to the free-port exemption.
lobo}nui&btalsodocide'atsmmepmbmtiu/be future and depending upon market conditions,Coproceed
omo Phase D and u Phase III u[the project. Io that event,this im what inuuoeudyenvisioned. Phase 11
would also Lme semiconductor m'afernaaou�utu6o����}hy.T6c�ovcu�o�u�wvouldbmut least u
comparable investment bm Phase{,but Phase Il would probably have a more advanced mmoufau .bog
process v/hic6w/onld6eroore complex and more expensive and thus�ewquiponeotv/ouldhm---
mxpeosive. T6mmqu{pomot8octb�nmonmadvuuoed�ovm�mhmsontovmubmmudove!Vpedy�tio'---
many
iom�oueuand suthe actual amount mfinvestment iu'not known.
developed
pbosc III ofthe project may include ocomparable invmtmmum Phase 1,or it may include related
operations. |[Phase III ioo similar muovfarvriog,facility k/Phase l and Phase O. h'Would "lost Ukm|y
have o more advanced manufacturing process than either ofdom.phich would 6cmorcunmp\,�xnnd
thus mnnexpensive. The amnun(of investment is not ourond�":nown.
Phase D and yhmc Dl of the project depend upon market conditions and lo1c| is not commituI'll to
actually build Phase llnr Phase DL However, all phases would 6e started by the end o[theabatement
period for Phase l. pbom U is envisioned to start construction by2O0O. Phase Dl vvou|d star-, by the
end of the Phase l abatement period. ltis possible that Phase III might produce some invcntnrvwhin6
would not bo subject mthe free-port exemption.
We are currently io the process of developing a site plan and n'U|rrnvidodto |heCd} upon
completion, Parking and landscaping\vU\ bn done as part of the pxoiout.
6, What percent of the construction costs "iUyoucommbmmpuod^ich:
Fort Worth business? %
Minnri(y and Women owned Business EAntcrprixes? C�
Due oo the unique design and coil s1rucd on,mguimmcno for dzcs: pusof facilities,
nu|ya
companies io the world are qualified uzd:sigo and to,construct OftkeS]�OK4cstim �t_�d
construction umouot, approximately 87OMisuou'spccixUzcd, O{zhisaoouot. Intel
commits /(11spend
S35��nbk Fort \Yodb contractors. Of this omouot 33,5��`p]| b�spent with yIinorir�xnd VVom�n
owned Business. These Fort Worth commdmrotsaccoosorvad':osi/ isinupossib|e todc-cnnino /hc
level of participation by Fort Worth coninzc/ors at suh-cnut-c��r|evd I,,-,the onbrc co/�ruchno
Project. Intel ix aware nf the OtyCounzdpoliryreLardingcuos-,_cbon and K8',`vTBEcn�mbmoo�
and Supports this local vendor policy. Intel will be encouraging contractors to use For., YYooh
contractors where they are able.These numbers are do|i6crateh/conservative. locu) �ill csza6Usb u
local supplier development pmQrum,which n ill include K4ionrit-, and Women Owned businesses, in
order to develop a larger contractor supply base.
Construction of Phase lis expected tobegin in the sccund half o�'97. (About -2) ycarsis re,uircdm
build and begin bz operate each phmcj Intel odmwzusthat there ^i!| be over l50Oronstrcmioo'
related Workers on the site at the peak of construction,with a total, Dayroll range of over S
78. 'Fable of New Jobs oobe Created uz9r�*c/3mu, io the Gftbyear and io the 1Omyear. Numbern�
bnoa(er�whcnoAnm. oe/jnbo,Y�n[Nd jobs robcOUedhy Ft. Worth residents, Y6ofnetjobscobo
filled 6y Central City Residents.
Phase I Project Start* Fifth Year
I Tenth Year
New Jobs to be Created 8 M goo
Less Transt-ers 300
Net Jobs I
'300 800 1 800
filled be Ft, Worth
Residents
filled by Central City
*Assumes Project Star! im |99Awhiuhi»dho date /nm| hopemm have operational startup, Tionsfersxm
anticipated from other Intel facilities, in AZ (`A, N'M,and OR to Nalcilirwe the transi-er"of
manufacturing technology/processes, it is especially important at a new site to brino in a core group
of current employees who are familiar with Intel's manufacturing technology to help to bring up the
new facility on new technology. The need for internal transfers is less important farther out in time as
the experience base builds at a new site.
** Intel will also be seeking qualified oup|oyeer from the Central Cit' lo other communities in
which Intel 6uxmaoufbcU/riog facilities, Intel has developed and deployed on innovative technical
training program,called New Technical Oraduu1o(NTG)which has antroo�ihouaooauzondo�''y�oo
Traditional Students, i.e.,Couvnl City residents" into the�a[oioQpro�rom.and ultimately
employment with Intel,via scholarships and work experiences/internships. Intel would begin to see
the fruits of this program about years after commencement of the program.
Phase 11 Project Start* Fourth Year* Tenth Year*
New Jobs to be Created _�0_0 800 800
Tess-Transfers _150
Net Jobs 450 800 800
filled by Ft. Worth
Residents
filled by Inner City
Residents
*&o an assumption, Project Start could occur in 2002 but would commence construction in 2000
However,the exact timing of Phase 11 is not known; it could occur earlier-, and it is also dependen!
upon business conditions. However,Ukopo employment numbers would occur in the years indicated if
u decision io taken to engage iuo Phase l| iu Fort Worth. Some transfers are anticipated from other
Intel taxUidmo in AZ,CA,NM,and ORto facilitate the transfer nfmanufacturing
technology/processes.
The exact timing and nature of Phase III is not yet known however it would occur by the end of the
Phase l abatement period. /\ono assumption only,assume u Project Start date of2OOJ.
Intel requests that i/6rpermitted to aggregate employment across its phases for the purpose of
measuring compliance m the FTY resident hiring goal.
7C. Description o[jobu. Tcmbm.'engineers,odnolo.,machinists.
Approximately 60%of the Intel employees are manufacturing technicians. These positions have
salaries tothe S35Ktu$45K range plus benefits.
7D Attach u brief description ofthe employee benefit package offered(ic,health insurance,retbcment
pu6Uo�oompodulun�sio�ooe.day c�eprovisions,etoJ including pooioupaid byomnploye�and
'
employer respectively,
Intel's current employee benefit package iom very,comprehensive and competitive packa�a`vhiob
provides &r,aomuugothers, medical,dental, /coo life,accidental dcodu�lmoncm6uoocot' loo&u;on
disability,sick pay,vacation,stock option plan,stock participation plan,employee cash bonus plan,
employee bonus program,and retirement. Additionally, Intel typically participates in community
1-ravel Reduction ocRide Share programs and provides employee incentives as part of area traffic
management programs. Intel requests the assistance o[tbmCityoo�osormtba�boumbo��ithiodhmCi�y
isavai|uh(e nearer the Intel site iuorder torninimuize commuting for Intel employees,
3
S� Reg urd�gsupph/and xorv�e expoox�(io` landscaping,nU�ourmauu�c�rogaupp|iun janitorial
services,etc,):
'
What ix the annual amount o[non-sole source supply and service ozpeusoa? —
What
percentage of the above will hu committed 1 Fort Worth h uu iocsaoo?
_____'% \Y6a1percm�go of
the above will be oommi�edtn8�inoh/yand Women Owned Busiocnyo? �6
In 1999,the year in which Intel expects to begin operation, Intel expects to be spend S4M in non-sole
source supply and service expenses. Intel expects/ospend S3&{o[the S4Mwith Fort Worth
Businesses of which$.5M would be with Minority and Women On'ocd Businesses. In the year 2000
Intel ospcu�m spend approximately S8&4io non-sole source supply and service expenses oy`,hicb '
$UKd would 6e with Fort Worth Businesses. 0f this amount, 3lM would 6o with Minority and Women
Owned 8uaiucoocs. These numbers are deliberately conservative, Intel will establish a local supplier
development program,which will include Minority and Women Owned businesses, in order to
increase the participation in {o/ol`o non-sole source supply and service expenses by Fort \Yo�6
6uoiucu000. )o1e| iuux/noo[the City Council policy regarding construction and y�\YBEcommdmoou
and supports this local vendor po|icy-
9 Is the property appropriately zoned for this project?
All of the property ut the Alliance site is either currently zoncd, or will be zoned, to the standards
required for o project u[this type.
|O lx1h,- property platted? lf yes,will rup|auiug booccessnry7
Required platting will be completed.
|l
Attach a description of any environmental impacts associated x ith this project.
All applicable environmental reports and permits will bc obtained for this project from the appropriate
agencies. Intel has o leadership position io the electronics industry os well nsamong US corporations
relative tu environmental performance, A/n comparable facility, FAB 12, in Chandler AZ, /n/c| \%au
recently selected and approved for ospecial pilot program co||cd Excellence in Leadcrs6ip(}{L) `vhich
is designed to improve environmental performance while dmplityiu�udmioixtrubvo requirements,
The project was recently approved by the EPA and has been cited by President Clinton us unnodc| of
the future for environmental regulation F&B |6 will continue this trend and offer equal orbetter
environmental performance in all major categories since iL will employ u newer manufacturing process
and equipment,
12, /\/tucb udemodpduo o[any direct benefits to the City ofFort Worth as o result ofchio project(i c
sales tax, inventory mx,development b:o. c/o '
Intel will pay local permit and hookup 8:cm Pmyrm|}and local purchases via suppliers and spinoff
impacts will generate sales and inventory taxes (See F\V Chamber nf Commerce study 8oreatinutnd
impact), lo other areas hencIntel operates such facilities, suppliers have moved in zn zhc arca
&noeratiuQudddiouol employment,taxes,etc, It is u|so expected that hotels and restaurants would
benefit,
|3, Doyou intend to pursue o6ozemuntof,
County taxes?: No, Intel and the Cuun�yare purao|ngmnaitornoto incentive puoka�—
Qchou| taxes?,- Yes, PudW abatement urcompamh!coknmutivc incentives,
4
`
'
14. What level of abatement do you request: Years.- 10 Percentage? l00%
Intel is requesting al00%abatement for l0years for each of three phases n[the Project.
15. Ooan attachment, explain why tax abatement is necessary for the success of this project. Include
business pro forma or other documentation io substantiate your request.
Given the cost competitiveness of the semiconductor industry,the property tax burden on a
manufacturing facility isa major site selection determining factor. Furthermore,property tax relief is
necessary to alleviate the disproportionate property tax burden which would otherwise 6e imposed on
this capital intensive project. Other jurisdictions have removed this disincentive. For example,
Oregon,New Mexico,and Arizona(states in which Intel currently has manufacturing facilities)have
such laws. A property tax abatement 6y the City of Fort Worth will help to remove this disiucoudvc
bringing high quality,highly skiUcd`high income unupinymeo/opponooitiestu the Pn�Tfo�b area,
'
On behalf of the applicant, I certify the information contained in this application(including all
attachments)to b d correct. I further certify that,ou behalf of the applicant,l have read the"Policy
o'uzomo � dopmentProico�^and agree to comply with the guidelines
and Name Titl
Date
5
ATTACHMENT"D"
ATTACHMENT"E"
INTEL CONFIDENTIAL
RESOLUTIONS OF
THE BOARD OF DIRECTORS OF
INTEL CORPORATION
REGARDING THE
WAFER MANUFACTURING FACILITY IN TEXAS
RESOLVED, that this Corporation is authorized to set up a wafer manufacturing facility,
designated as Fab 16, and other facilities in Fort Worth, Denton County, Texas, and to
enter into tax abatement agreements and grant agreements with local jurisdictions, all
under such terms as may be acceptable to the Chairman of the Board, the President,
the Chief Executive Officer, and the Chief Operating Officer of this Corporation, singly
or jointly, (the "Authorized Officers"); and be it further
RESOLVED, that the Authorized Officers, the Executive Vice President and General
Manager, Technology and Manufacturing Group and the Director of Corporate Materials
and Services of this Corporation be, and each of them hereby is, authorized and
directed for and in the name on behalf of this Corporation as such authorized person
deems necessary and appropriate, to execute and deliver any and all certificates,
agreements, authorizations, documents and other instruments or papers and to do any
and all further things that may be necessary or advisable to carry out the intent of the
foregoing resolution and fully to perform the obligations of this Corporation under the
agreements executed and delivered on behalf of this Corporation pursuant to such
resolution, all such action having heretofore been taken being thereby ratified,
confirmed and approved.
The foregoing resolutions have not been amended or rescinded and remain in full force
and effect as of January 15, 1997.
Signed on June 6, 1997
Attested:
Cary 17._Klaft, r, Assist t Se4etary
R039&DOC11-15-97
City of Fort Worth, Texas
Mayor and Council Communication
DATE REFERENCE NUM13ER C-15968 LOG NAME I PAGE
03/25/97 02TAX 1 of 2
J
SUBJECT MAKE FINDINGS CONCERNING A PROPOSED TAX ABATEMENT AGREEMENT WITH
INTEL CORPORATION AND AUTHORIZE EXECUTION OF THE AGREEMENT
RECOMMENDATION:
It is recommended that the City Council:
1 . Find that the improvements contained within the attached agreement are feasible and
practical and would be a benefit to the land and to the City after the expiration of the Tax
Abatement Agreement, and
2. Find that written notice of the City's intent to enter into the attached Tax Abatement
Agreement (the Agreement) and copies of the Agreement were delivered to all affected
taxing units in accordance with state law, and
3. Find that the terms and conditions of the Agreement and the property subject to the
Agreement meet the criteria of the City's Policy Statement: Tax Abatement for Qualifying
Development Projects (the "Tax Abatement Policy") as approved by M&C G-11389
(Resolution No. 2142), and
4. Authorize the City Manager to execute the attached Tax Abatement Agreement with Intel
Corporation in accordance with the Tax Abatement Policy.
DISCUS
The property subject to abatement is located in the Alliance Technology Center in far north Fort
Worth. The City Council has designated this property as Tax Abatement Reinvestment Zone
Number 25. This reinvestment zone is located in COUNCIL DISTRICT 2.
Employ
On this property, Intel will construct a 650,000 sq. ft. microchip fabrication facility. Total
investment in the facility will be a minimum of $1 billion and will employ a minimum of 600
people at the project start. Of the initial 600 employees, 300 will be transfer employees.
However, by year five the employment will total a minimum of 800 people, and Intel Corp. has
committed to hire Fort Worth Residents for a minimum of 25% of those positions and Inner City
Residents for a minimum of 6% of those positions.
Utilization of Fort Worth Businesses:
i at
Reg' 'ding utilization,of Fort Worth based businesses, Intel has committed 50% of the total
construction of the $70 million administration building to Fort Worth construction contractors
Printed on Reqded Paper
Uity of Fort Worth, Texas
Mayor and Council Communication
DATE --TREFERENCE NUMBER LOG NAME PAGE
03/25/97 1 C-15968 I 02TAX 1 2 of 2
SUBJECT MAKE FINDINGS CONCERNING A PROPOSED TAX ABATEMENT AGREEMENT WITH
INTEL CORPORATION AND AUTHORIZE EXECUTION OF THE AGREEMENT
and/or subcontractors. Additionally, of the $8 million projected to be spent on supplies and
services by the year 2000, Intel has committed 75% annually to Fort Worth based service and
supply contractors and/or sub-contractors.
Utilization of M/WBE Businesses:
Regarding Minority Business Enterprises (MBEs) and Women Business Enterprises (WBEs), Intel
has committed 5% of the total construction of the $70 million administration building costs to
certified MBE/WBE construction contractors and/or subcontractors. In addition, of $8 million in
supplies and services expenses, Intel has committed 12.5% annually to certified MBE/WBE
supply and service contractors and/or subcontractors.
Abatement Terms:
The abatement agreement includes a 100% abatement on real and personal property for a ten
year period, with the possibility of abatements for two more phases of similar investment if the
additional phases are begun during the ten year term of the abatement of Phase I. Over the ten
year life of the agreement, the estimated value of the abatement on Phase I is approximately
$39,000,000.
FISCAL INFORMATION/CERTIFICATION:
The Director of Fiscal Services certifies that no expenditure of City funds is associated with
approval of this agreement.
BT:m
Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CffY SEC RETARV
Office by: (to)
Mike Groomer 6140 APPROVED
Originating Department Head- CITY COUNCIL
Tom Biggins 6192 -fro nl)
t•;AR z5 iNT
For Additional information
Contact. city seetott"of
*
Jay Chapa 8003 kAz y A W00h,T4C*
0 Printed on Recycled Paper