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HomeMy WebLinkAboutContract 28551 ' CITE' SECRETARY NTRACT NO 04-18-03P03:46 RCVD ECONOMIC DEVELOPMENT PROGRAM AGREEMENT This ECONOMIC DEVELOPMENT PROGRAM AGREEMENT ("Agreement") is made and entered into by and between the CITY OF FORT WORTH (`City"), a home rule municipal corporation organized under the laws of the State of Texas, and TLC GREEN PROPERTY ASSOCIATES I, L.P. ("TLC"), a Texas limited partnership acting by and through Greenfield — TLC GP, LLC, a Delaware limited liability company and Owner's general partner. RECITALS WHEREAS, the City has created an Economic and Community Development Department in order to, among other things, oversee economic development programs authorized by Texas law and approved by the City Council, including those authorized by Chapter 380 of the Texas Local Government Code, to promote state and local economic development and to stimulate business and commercial activity in the City, as further outlined in Resolution No. 2704 adopted by the City Council on January 30, 2001; and WHEREAS, in accordance with the 2002 Comprehensive Plan adopted by the City Council pursuant to M&C G-13541 on February 26, 2002, the City's economic development programs are based on a model of 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; and WHEREAS, the 2002 Comprehensive Plan embraces the Downto L'Flo_w� HUD Strategic Action Plan, sponsored by the City, Downtown Fort Worth, Inc arde,� 1� Page lU� '�yurJU1�ggq � G�o Economic Development Program Agreement between City of Fort Worth and TLC.Greenfield,L.P. Worth Housing Authority, which encourages the .promotion of public incentives to encourage downtown housing development; and WHEREAS, the City Council has found and determined that by entering into this Agreement, the potential economic benefits that will accrue to the City under the terms and conditions of this Agreement are consistent with the City's economic development objectives and the increased housing development in the downtown area of the City will further the goals espoused by the City and set forth. in the Downtown Fort Worth Strategic Action Plan; NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: AGREEMENT SECTION 1. INCORPORATION OF RECITALS The City Council hereby finds that the recitals set forth above are true and correct and form the basis upon which the City has entered into this Agreement. SECTION 2. PURPOSE 2.1. Objectives. Affiliates of TLC are under contract to purchase property in downtown Fort Worth that includes the former Bank One high-rise office bi i0gic# CRY 3MI"JIMIRY Page 2 FYI � "�`' ON TL�30 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. severely damaged in a tornado on March 28, 2000 (the "Tower") and an adjacent structure utilized as a parking garage and office building, as more specifically depicted in Exhibit "A", attached hereto and hereby made a part. of this Agreement for all purposes. The Tower has been vacant for almost three (3) years and several attempts by the private sector alone to redevelop the Tower have failed. The City is concerned that the upswing in quality urban development that the downtown area has enjoyed for over a decade will stall or decline if the Tower is not redeveloped in a timely fashion. Due to various factors, the City Council does not believe that redevelopment of the Tower at this point is likely to occur without public assistance. Therefore, the City and TLC have jointly created the Program outlined in this Agreement in order to facilitate redevelopment of the Tower that would probably not occur without the Program. 2.2. Concent.and Structure. Under the .Program, the City will provide TLC with certain annual economic development grants based on the amount of real property tax revenue received by the City from the TLC Site, as defined in Section 3 of this Agreement, and on compliance by TLC with various commitments that will benefit the City, as further provided in this Agreement. The economic development grants provided under this Agreement will compliment an abatement of TLC's property taxes in the year preceding payment of the first such grant to TLC. ;xiki i�MC'UPO Page 3U Economic Development Program Agreement between City of Fort Wortb and TLC Greenfield,L.P. SECTION 3. DEFINITIONS Capped Taxable.Assessed Value means the maximum taxable assessed value of the TLC Site for a given tax year, as set forth in Exhibit`B", attached hereto and hereby made a part of this Agreement for all purposes, on which the City will calculate its Program Grant to TLC for that tax year. Central City means the area of the corporate limits of the City within Loop 820 (i) consisting of all Community Development Block Grant ("CDBG") eligible census block groups; (ii) all state-designated enterprise zones; and (iii) all census block groups that are contiguous by seventy-five percent (75%) or more of their perimeter to CDBG eligible block groups or enterprise zones, as well as any CDBG-eligible block in the corporate limits.of the City outside Loop 820, as more specifically depicted in the map of Exhibit"C", attached hereto and hereby made a part of this Agreement for all purposes. Central City Resident means an individual whose principal place of residence is at a location within the Central City. Construction Costs means site development costs, actual construction costs, including contractor fees, the costs of supplies and materials in constructing the Required Improvements. Excess TLC Site Property Taxes means the positive difference, if any, between property tax revenue received by the City in a given tax year which is based on the entire taxable assessed value of the TLC Site and that which is based on the Capped Taxable Assessed Value for the same tax year in accordance with Exhibit "C". For example, and as an example only, if the Capped Taxable Assessed Value in a give ,"'j,,1 � ��� N'B 'C Page 4 ''.��JUIN, 00 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. $500,000 and the entire taxable assessed value of the TLC Site for that tax year is actually$750,000, Excess TLC Site Property Taxes would be the tax revenue received by the City for that tax year based on the $250,000 difference between $750,000 and $500,000. Force Maieure shall mean an event beyond Owner's reasonable control, including, without limitation, acts of God, fires, strikes, national disasters, wars, riots, material or labor restrictions, delays caused by unforeseen structural issues, weather delays, unreasonable delays.by the City in issuing any permits or certificates of occupancy or conducting any inspections of or with respect to the Required Improvements, or delays caused by unforeseen construction or site issues, but shall not include construction delays caused due to purely financial matters involving Owner, such as,without limitation, delays in the obtaining of adequate financing. Fort Worth Company means a business that has a principal office located within the corporate limits of the City. Fort Worth M/WBE Company means a minority or woman-owned business that has received certification as either a minority business enterprise (MBE) or a woman business enterprise ()VBE) by either the City, the North Texas Regional Certification Agency (NTRCA) or' the Texas Department of Transportation (TxDOT), Highway Division, and whose principal business office is located within the corporate limits of the City. Full-time Equivalent Job means a job provided directly by TLC on the TLC Site that is filled for a period of not less than forty (40) hours per week or another 6,1 FIC"IA�dll ICECOQU Page 5 'FI ':7�'JSH VEIL Economic Development Program Agreement q between City of Fort Worth and TLC Greenfield,L.P. measurement used to define full-time equivalent employment by TLC in accordance with its then-current corporate-wide personnel policies and regulations. Program means the economic development program authorized by Chapter 380 of the Texas Local Government Code and established and outlined in this Agreement. Program Grants means the annual economic development grants paid by the City to-TLC in accordance with this Agreement and as part of the Program. Residential/Mixed Use Purposes means the use of the Tower at all times as residential apartments for rent at market rates for the same or similar apartments, or . condominiums available for rent or sale, and approximately 20,000 square feet of street level retail and services and other commercial purposes, with office space comprising no more than 40,000 square feet of the Tower at any time. Substantial Completion means the issuance by the City of a final certificate of occupancy for the residential units in the Tower and notice of compliance with shell building standards with respect to the retail space in the Tower. Tax Abatement Agreement means that agreement between the City and TLC under which the City will abate the real property taxes paid by TLC to the City for the 2005 tax year. The Tax Abatement Agreement is a public document on file in the City Secretary's Office as City Secretary Contract No. and is incorporated herein by reference for all purposes. TLC means TLC Green Property Associates I, L.P. and its successors and permitted assigns. TLC Site Property Taxes means the amount of real property tax paid in a given tax year to the City based on the lesser of(i) the entire taxable assessed val u. ;', z, Lf,�ra a Page 6 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. Site less the taxable assessed value of the TLC Site in the 2003 tax year or(ii)the Capped Taxable Assessed Value. The entire taxable assessed value of the TLC Site will be established solely by the appraisal district that has jurisdiction over the TLC Site at the time, with the understanding that TLC or other owner(s) of property comprising or within. the TLC Site shall retain all rights to protest and contest any such appraisals. TLC Site means the real property described in Exhibit "A" and all real property improvements thereon, including but not limited to, the Tower and adjacent parking garage and office building. SECTION 4. TERM This Agreement shall be effective as of the date of execution by both parties and shall expire upon payment by the City to TLC of the ninth(9th) annual Program Grant, as provided by Section 6 hereof, unless terminated earlier as provided by and in accordance with this Agreement(the "Term"). SECTION 5. TLC OBLIGATIONS AND GOALS 5.1. Required Improvements. TLC will make or cause to be made Substantial Completion of real property investments on the TLC Site of at least $50 million in Construction Costs by June 30, 2005, as may be extended by Force Majeure, in order for the Tower to be used for Residential/Mixed Use Purposes, with the To v-eF-, t ,o r'11 x UI�J 1 D Page 7 J '''1'J��fc�U i(➢q U a. Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. (i) at least 200 residential units occupying at least 300,000 square feet of space, and (ii) at least 20,000 square feet of' space for street level retail business (collectively, the "Required Improvements"). If the City determines that TLC is entitled to receive a tax abatement for substantially completing the Required Improvements in accordance with and pursuant to Section 2.1.1 of the Tax Abatement Agreement, then TLC will be deemed to have satisfied the conditions of this Section 5.1. 5.2. Construction Spending Goals. 5.2.1., Fort Worth Companies. Without regard to the actual amount of dollars spent on the Required Improvements, TLC will spend at least twenty-five percent (25%) of its Construction Costs for the Required Improvements with contractors that are Fort Worth Companies. If the City determines that TLC is entitled to receive a tax abatement for spending at least twenty-five percent (25%) of its Construction Costs for the Required Improvements with contractors that are Fort Worth Companies, in accordance with and pursuant to Section 2.1.2 of the Tax Abatement Agreement, then TLC will be deemed to have satisfied the conditions of this Section 5.2.1. 5.2.2. Fort Worth M/WBE Companies. Without regard to the actual amount of dollars spent on the Required Improvements, TLC will spend at least twenty percent (20%) of its Construction Costs for the Required Improvements with contractors that are Fort Worth M/WBE Companies. If the City determ' Page 8 R9° Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. is entitled to receive a tax abatement for spending at least twenty percent (20%) of its Construction Costs for the Required Improvements with contractors that are Fort Worth M/WBE Companies, in accordance with and pursuant to Section 2.1.3 of the Tax Abatement Agreement, then TLC will be deemed to have satisfied the conditions of this Section 5.2.2. 5.3. Central City Employment Goals. From January 1, 2006 through the end of the Term, if TLC provides any Full-time Equivalent Jobs on the TLC Site, at least twenty-five percent (25%) of. those positions will be held by Central City Residents. 5.4. Supply and Service Spending Goals. 5.4.1. .Fort Worth Companies. Beginning with calendar year 2006, and in each subsequent year of the Term of this Agreement, if TLC is under any contractual arrangement for supplies and services to be provided directly in connection with the operation of the Required Improvements, TLC will spend at least $50,000 under such contracts with Fort Worth Companies. 5.4.2. Certified MIWBE Companies. Beginning with calendar year 2006, and in each subsequent year of the Term of this Agreement, if TLC is under any contractual arrangement for supplies and services to be provided directly in connection with the operation of the Required Improvements, TLC will spend at least $20,000 under such contracts with Fort Worth MIWBE Companies. 'Ceti -K�IR }G?V Page 9 G' E Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. 5.5. Use of TLC Site for Residential/Mixed Use Purposes. TLC shall use the TLC Site or cause the TLC Site to be used or available for use for Residential/Mixed Use Purposes at all times during the Term of this Agreement., 5.6. Reports. On or before February 1, 2007 and February 1 of each subsequent year during the Term of this Agreement, TLC will provide the City with the following reports in order for the City to assess the degree.to which TLC met the goals set r forth in Sections 5.3, 5.4.1 and 5.4.2 during the previous calendar year: 5.6.1. Central City Employment Report. TLC shall provide the City with a report that sets forth the total number of Full-time Equivalent Jobs as of August 1 of the preceding calendar year, if any, including the number of Central City residents holding such Full-time Equivalent Jobs and reasonable documentation regarding the residency of each such employee. 5.6.2. Supply and Service Spending. TLC shall provide the City with a report that sets forth the gross dollars and supporting documentation showing the amounts spent by TLC on local discretionary supply and service contracts entered into or otherwise in effect directly in connection with the operation of the Required Improvements, if any, with (i) Fort Worth Companies and (ii) Fort Worth M/WBE Companies. r" Page 10 J U ^.'`'''' 1U�U��y NIX. Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. 5.7. Audits. TLC agrees that the City will have the right to audit the financial and business records of TLC that relate to the TLC Site and the Required Improvements (collectively "Records") at any time during the Term of this Agreement in order to determine compliance with this Agreement. TLC shall make all Records available to the City on the TLC Site or at another location in the City acceptable to both parties following reasonable advance'notice by the City and shall otherwise cooperate fully with the City during any audit. SECTION 6. PROGRAM GRANTS Beginning in calendar year 2007, the City will pay to TLC nine (9) annual Program Grants as provided by this Section 6 and subject to Section 8.4 and all other terms and conditions of this Agreement. 6.1. Base Benefit. The base amount of each annual Program Grant paid by the City to TLC under this Agreement shall be based on a combination of TLC's compliance with its requirements to construct the Required Improvements, as provided by and in accordance with Section 5.1, and the degree to which TLC meets or has met the construction spending goals under Sections 5.2.1 and 5.2.2,calculated as follows: 6.1.1 Required Improvements (60%). If TLC achieved Substantial Completion of the Required Improvements as provided by and in accordance with Page l l Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. Agreement, TLC's Program Grant in each year of the Term shall include an amount equal to sixty percent (60%) of the TLC Site Property Taxes paid to the City in the preceding calendar year. 6.1.2. Construction Spending with Fort Worth Companies (20%). If TLC met its goal to spend TLC will spend at least twenty-five percent (25%) of its Construction Costs for the Required Improvements, without regard to the actual amount of those Construction Costs (but subject to and provided that TLC spent a minimum of$50 million in such Construction Costs), with contractors that are Fort Worth Companies, as provided by and in accordance with Section 5.2.1 of this Agreement, TLC's Program Grant in each year of the Term shall include an amount equal to twenty percent (20%) of the TLC Site Property Taxes paid to the City in the preceding calendar year. 6.1.3. Construction SpendinLy with Fort Worth M/WBE Companies (20%). If TLC met its goal to spend at least twenty percent (20%) of its Construction Costs for the Required Improvements, without regard to the actual amount of those Construction Costs (but subject to and provided that TLC spent a minimum of $50 million in such Construction Costs), with contractors that are Fort Worth M/WBE Companies, as provided by and in accordance with Section 5.2.2 of this Agreement, TLC's Program Grant in each year of the Term shall include an amount equal to twenty Fq J'l�'L =! - 1 J"G ,]; v Page 12 J�� `'JUGJu11p �LG,10 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. percent (20%) of the TLC Site Property Taxes paid to the City in the preceding calendar year. 6.1.4. Final Calculation of Base Benefit. The degree to which TLC met its requirement to achieve Substantial Completion of the Required Improvements and its construction spending goals will be determined by the City on or before June 30, 2005, as may be extended by Force Majeure, in accordance with the procedure set forth in the Tax Abatement Agreement. The base amount of each annual Program Grant shall be the sum of Sections 6.1.1, 6.1.2 and 6.1.3 (the "Base Benefit"). In other words, as an example only, if TLC constructed the Required Improvements in accordance with Section 5.1 of this Agreement and met its goal to spend at least twenty-five percent (25%) of its Construction Costs for the Required Improvements with Fort Worth Companies in accordance with Section 5:2.1 of this Agreement,but failed to spend at least twenty percent (20%) of its Construction Costs for the Required Improvements with Fort Worth M/WBE Companies in accordance with Section 5.2.2 of this Agreement, then TLC's Base Benefit would be an amount equal to eighty percent (80%) of the TLC Site Property Taxes paid to the City in the preceding calendar year. 6.2. Reduction of Base Benefit. 6.2.1. Failure to Meet Central City Employment Goals. If during the previous calendar year TLC provided any Full-time Equivalent Jobs on the TLC Site, but less than twenty-five er e-�t f h� B Page 13Uo Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. of such Full-time Equivalent Jobs were held by Central City Residents, as provided by and in accordance with Section 5.3 of this Agreement, then the Base Benefit for the next calendar year shall be reduced by an amount equal to ten percent (10%) of the of the TLC Site Property Taxes paid in the preceding calendar year. 6.2.2. Failure to Meet Supply and Service Spending Goals with Fort Worth Companies. If during the previous calendar year TLC was under any contractual arrangement for supplies and services to be provided directly in connection with the operation of the Required Improvements, and TLC did not spend at least $50,000 under the aggregate of all such arrangements with Fort Worth Companies, as provided by and in accordance with Section 5.4.1 of this Agreement, then the Base Benefit for the next calendar year shall be reduced by an amount equal to five percent (5%) of the TLC Site Property Taxes paid in the preceding calendar year. 6.2.3. Failure to Meet Supply and Service Spending Goals with Fort Worth M/WBE Companies. If during the previous calendar year TLC was under any contractual arrangement for supplies and services to be provided directly in connection with the operation of the Required Improvements, and TLC did not spend at least $20,000 under the aggregate of all such arrangements with Fort Worth M/WBE Companies, as provided by and in accordance with Section 5.4.2 of this Agreement, then the Ba�se 1-5C n 1.U the next calendar year shall be reduced by an amount equal t' five percent. �<r7 Page 14 ,l3 V�EK. Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. (5%) of the TLC Site Property Taxes paid to the City in the preceding calendar year. 6.3. No Offsets. A deficiency in attainment of any of the goals set forth in Sections 5.2.1, 5.2.2, 5.3, 5.4.1 and/or 5.4.2 may not be offset by exceeding other such goals. In other words, if in a given.year TLC exceeded its goal, as set forth in Section 5.4.1, to spend at least$50,000 in discretionary funds for supplies and services with Fort Worth Companies by $5,000 but spent only $10,000 in discretionary funds for supplies and services with Certified MJWBEs instead of$15,000, as required by Section 5.4.2, TLC's Program Grant would still be reduced in the next calendar year by five percent(5%) for its failure to meet its goal under Section 5.4.2. 6.4. Excess TLC Site Property Taxes Excluded for Program Grants. TLC understands and agrees that any Excess TLC Site Property Taxes received by the City shall remain the property of the City; that the City will not at any time be required to pay TLC any amounts equal to Excess TLC Site Property Taxes as part of the Program; and that amounts equal to Excess TLC Site Property Taxes received in one year will not in any manner be applied to or carried over to any Program Grant to TLC in a subsequent year. 6.5. Deadline for Payment. Annual Program Grants will be paid to TLC on or before June 1, 2007 and on or before June 1 of each subsequent calendar year during the Term of this Agreement. It is understood and agreed that all Program Grants paid pursuant to YHEIV It. PIN C, C117Y ` i�G? Page 15 7 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. this Agreement shall come from currently available general revenues of the City and not directly from the TLC Site Property Taxes paid to the City. SECTION 7. OTHER CITY OBLIGATIONS 7.1. Waiver of Development Fees. In constructing the Required Improvements, TLC will be required to apply for all permits and other licenses and certificates customarily required by the City in i similar circumstances. However, in return for the public purposes achieved by redevelopment of the Tower and the construction of the Required Improvements by TLC under this Agreement, unless otherwise provided herein, the City will waive the following fees related to the construction of the Required Improvements that would otherwise be charged by the City: (i) building permit fees, including fees for inspections; (ii) temporary and permanent encroachment fees; (iii) platting fees; and (iv) fire, sprinkler and alarm permit fees. If TLC is subsequently notified that any other City fees are required as a condition of any aspect of TLC's construction of the Required Improvements, TLC may request in writing that the City waive such fees, and the City will consider, on a case-by- case basis, and not unreasonably deny such request. The City will also waive any fees of the City's Health Department required to establish food service operations in the Tower, but will not waive any annual food service operation or license fees. TLC specifically understands and agrees that in no event will the City waive or 'INC,�IAt R,�I k�D, 9�1 ` E 9�� -IR r1� / Page 16 t.T�`6�FRI TEN. Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. reimburse TLC for (i) any water or sewer impact fees or (ii) fees of any nature assessed by third parties, such as third party inspection fees. 7.2. Fast-Track Development Approvals. The City will provide a procedure to expedite all Development Department and Transportation/Public Works Department approvals for the TLC Site. However, TLC understands and agrees that the City has entered into development agreements for several other major projects in the downtown area of the City and that expedited approvals-.will be reasonably subject to the then- current workloads and staffing capacity of such Departments. 7.3. Estoppel Certificate. TLC may request an estoppel certificate from the City so long as the certificate is requested in connection with a bona fide business purpose. The certificate, which will be addressed to TLC if requested, shall include, but not be limited to, statements that this Agreement is in full force and effect without ,default (or if a default exists, the nature of the default and curative action taken and/or necessary to effect a cure), the remaining term of this Agreement,.and such other matters reasonably requested by the party or parties to receive the certificate. 7.4. Code Compliance. The City recognizes that the Tower is being redeveloped from office to mixed residential and retail use and that it was rendered uninhabitable due to acts of God and not by failure to comply with previous or existing regulatory codes.. The City and its officers and agents will give all due consideratio to frf_�pa v � !CR Y Page 17 'ty� $J` Ul� q ULl�10 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. current and existing condition under the circumstances and recognize that TLC will install fire protection devices throughout the Tower in accordance with current codes and standards. SECTION 8. DEFAULT, TERMINATION AND FAILURE TO MEET VARIOUS OBLIGATIONS. Failure to Construct Required Improvements. 8.1. � The City may terminate this Agreement upon written notice to TLC if the Required Improvements have not been substantially completed by June 30, 2005 unless delayed because of Force Majeure, in which case the .June 30, 2005 deadline shall be extended by the number of days comprising the specific Force Maj eure. 8.2. Termination of Tax Abatement Agreement. This Agreement shall automatically terminate upon any lawful early termination of the Tax Abatement Agreement. 8.3. Failure by TLC to Meet Construction Expenditure,Emplovment and/or Supply and Service Expenditure Goals. TLC's failure in any given year to meet any of the goals set forth in Section 5.2.1, 5.2.2, 5.3., 5.4.1 and 5.4.2 shall not place TLC in default hereunder or provide the City with the right to terminate this Agreement, but, rather, shall only be weighed against the amount of the Program Grants that the City is required to pay TLC in accordance with this Agreement and as specifically provided in Sections 6.1, 6.2, 6.3 and 6.4. Page I S OEM, EX. Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. 8.4. Failure to Use the Tower for Residential/Mixed Use Purposes. Beginning January 1, 2006.and throughout the Term of this Agreement, if the TLC Site is at any time not available for use as for Residential/Mixed Use Purposes, as required by Section 5.5, TLC shall not be deemed to be in default hereunder and the City will not have the right to terminate this Agreement, but, rather,the following provisions shall apply: 8.4.1. For an Entire Year. If the TLC Site is not used or available for use for Residential/Mixed Use Purposes for an entire calendar year, the City,will have no obligation to make any Program Grant payment to TLC or any successor in interest for the following year, with the understanding that the Term of this Agreement shall not be extended and that any such waiver shall be counted as a Program Grant payment for purposes of calculating the Term.of this Agreement. In such an event,the revenue comprising the Program Grant that the City would otherwise have been obligated to make for such following year shall instead be treated as Excess TLC Site Property Taxes, as provided in Section 6.3, and will be retained by the City and shall not be carried over to any Program Grant in any subsequent year. 8.4.2. For a Portion of a Year. If the TLC Site is used or available for use for Residential/Mixed Use Purposes for only a portion of a year, the City's Program Grant payment to TLC or any successor in interest for the follow' g.,yp4.raf�1 �1(p� Page 19 FRI TM Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. be prorated in accordance with the number of days during the previous year that the TLC Site was used for Residential/Mixed Use Purposes. In such an event, the revenue comprising difference between the Program Grant actually made in such following year and the Program Grant that the City would otherwise have been obligated to make for such following year shall be treated as Excess TLC Site Property Taxes, as provided in Section 6.3, and will be retained by the City and shall not be carried over to any Program Grant in any subsequent year. SECTION 9. MUTUAL ASSISTANCE. The City and TLC will do all things reasonably necessary or appropriate to carry out the objectives, terms and provisions of this Agreement and to aid and assist each other in carrying out such objectives,terms and provisions. SECTION 10. REPRESENTATIONS AND WARRANTIES. The City represents and warrants to TLC that the Program and this Agreement are within the scope of its authority and the provisions of the charter and code of the City and that it is duly authorized and empowered to establish the Program and enter into this Agreement. TLC represents and warrants to the City that it has the requisite authority to enter into this Agreement. Page 20 l ' `*. 0—MR, HEK. Economic Development Program Agreement between City of Fort Wortb and TLC Greenfield,L.P. SECTION 11. SECTION OR OTHER HEADINGS. Section or other headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. SECTION 12. AMENDMENT. This Agreement may only be amended, altered, or revoked by written instrument ` signed by the City and TLC. SECTION 13. SUCCESSORS AND ASSIGNS. This Agreement shall be binding on and inure to the benefit of the parties, their respective successors and assigns. Provided that TLC is not in default at the time, TLC may assign all or part of its rights and obligations hereunder without the approval or consent of the City. In any such event, TLC shall promptly provide the City with written notice of the name of and a local contact for any successor or assign. SECTION 14. NOTICE. Any notice and/or statement required and permitted to be delivered shall be deemed delivered by depositing same in the United States mail, certified with return Page 21 HH, REK. Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. receipt requested, postage prepaid, addressed to the appropriate party,at the following addresses, or at such other addresses provided by the parties in writing: TLC: Attn: Tony Landrum TLC Green Property Associates I, L.P. . 512 Main St., Suite 1500 Fort Worth, TX 76102 With copies to: Attn: Dee S. Finley, Jr. Harris,Finley&Bogle,P.C. 777 Main St., Suite 3600 Fort Worth, TX 76102 Attn: Barry P. Marcus Greenfield Partners, LLC 50 North Water St. South Norwalk, CT 06854 CITY: Attn: Director Economic & Community Development Department City of Fort Worth 1000 Throckmorton Fort Worth, Texas 76102 With a copy to: Attn: City Attorney City Attorney's Office 1000 Throckmorton Street Fort Worth, Texas 76102 SECTION 15. INTERPRETATION. Regardless of the actual drafter of this Agreement, this Agreement shall, in the event of any dispute over its meaning or application, be interpreted fairly and reasonably, and neither more strongly for or against any party. t '� r '�0(� C' G 1l IP ��VO Page 22 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. SECTION 16. APPLICABLE.LAW. This Agreement is made, and shall be construed and interpreted under the laws of the State of Texas, and venue shill lie in state courts located in Tarrant County, Texas or in the United States District Court for the Northern District of Texas, Fort Worth Division. SECTION 17. SEVERABILITY. In the event any provision of this Agreement is illegal, invalid, or unenforceable under present or future laws, then, and in that event, it is the intention of the parties hereto that the remainder of this Agreement shall not be affected thereby, and it is also the intention of the parties to this Agreement that in lieu of each clause or provision that is found to be illegal, invalid, or unenforceable a provision be added to this Agreement which is legal, valid and enforceable and is as similar in terms as possible to the provision found to be illegal, invalid or unenforceable. SECTION 18. COUNTERPARTS. This Agreement may be executed in multiple counterparts, each of which shall be considered an original,but all of which shall constitute one instrument. C1VY 9�RELPgV Page 23 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. SECTION 19. ENTIRE AGREEMENT Other than the Tax Abatement Agreement, this Agreement contains the entire agreement between the parties with respect to the transaction.contemplated herein. EXECUTED as of the last date indicated below: CITY OF FORT WORTH: TLC GREEN PROPERTY � ASSOCIATES I,L.P.: By: GREENFIELD TLC GP, LLC, a Delaware limited liability company and its General Partner. Y• Y Reid Rector Barry P. Marcus Assistant City Manager Senior Vice President Date: _l�;�.� 3 Date: 03 APPROVED AS TO FORM AND LEGALITY: By: Peter Vaky Assistant City Attorney M&C: C-19480 2-18-03 ATTESTED BY Page 24 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. EXHIBITS "A"—Map Depicting the TLC Site "B"—Capped Taxable Assessed Values for Each Year "C"—Map of the Central City Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. Exhibit"A" LEGAL DESCRIPTION AND MAP DEPICTING TLC SITE Beginning at a point of the intersection of the north ROW line of 5th St. and the east ROW line of Lamar St.,thence Northeasterly along the north ROW line of 5th St. to a point where said line intersects with the west ROW line of Throckmorton St., thence Northwesterly along the west ROW line of Throckmorton St. to a point where said line intersects with the south ROW line of 4th St., thence Southwesterly along the south ROW line of 4th St. to a point where said line intersects with the west ROW line of Taylor St.,thence Northwesterly along the west ROW line of Taylor St. to the midpoint of Block 76, Fort Worth Original Town Addition, thence Southwesterly to the midpoint of Block 76, Fort Worth Original Town Addition, to a point where said line intersects-with the east ROW line of Lamar St., thence Southeasterly along the east ROW line of Lamar St. to a point where said line intersects with the north ROW line of 5th St.,which is the point of beginning. West ROW line of Taylor St Midpoint of South Row Block 76 line of 4th St West ROW line of Throckmorton St East ROW line of Lamar St North ROW line of 5th St M m� Fti L LAL-j between City of Fort Worth and TLC Greenfield,L.P. Exhibit"B" CAPPED TAXABLE ASSESSED VALUES OF TLC SITE City's Fiscal Capped Year in Taxable Which Taxes Assessed Are Received Value 2007 (2006 tax year) $200,000,000 2008 (2007 tax year) $220,000,000 2009 (2008 tax year) $242,000,000 2010 (2009 tax year) $266,200,000 2011 (2010 tax ear) $292,800,000 2012 (2011 tax ear) $322,100,000 2013 (2012 tax ear) $354,300,000 2014 (2013 tax year) $389,700,000 2.015 (2014 tax year) $428,700,000 Economic Development Program Agreement between City of Fort Worth and TLC Greenfield,L.P. r L d O iQ f u ti f, t t r 1 - t t i } f. ( S J- r 1. ,r F � r a tr,I1i i t ) eeCC��77t t`i It 3q t r( (tj J 4 I C \ �y:.�: lit::. -+•'�. ,T(� '. t r t ✓ u! ra ' N O` '� 1 City of.Fort Worth, Texas go 094 affor and C, ounel Communication DATE REFERENCE NUMBER LOG NAME PAGE 2/18/03 C-19480 1 17TLC 1 of 2 SUBJECT AUTHORIZE EXECUTION OF ECONOMIC DEVELOPMENT PROGRAM AGREEMENT WITH TLC GREENFIELD, L.P. FOR REDEVELOPMENT OF FORMER BANK ONE TOWER AND ADJACENT PROPERTY RECOMMENDATION: It is recommended that the City Council 1. Authorize the City Manager to execute an Economic Development Program Agreement with TLC Greenfield, L.P. or TLC Green Property Associates I, L.P. (TLC) related to the redevelopment of the former Bank One Tower and adjacent property (the Agreement); and 2. Find that the terms and conditions of the Agreement, as outlined below, constitute a custom- designed economic development program, as provided in the 2002 Comprehensive Plan and in accordance with Chapter 380 of the Texas Local Government Code, and comprise an appropriate public incentive to encourage downtown housing development, as provided in the Downtown Fort Worth Strategic Action Plan. DISCUSSION: Under the proposed Agreement,TLC has committed to (i) substantially complete at least $50 million in real property investments on property in downtown Fort Worth that includes the former Bank One Tower (the Property) by June 30, 2005; and (ii) spend at least 25% of its total construction costs in making those improvements with Fort Worth contractors; and (iii) spend at least 20% of its total construction costs in making those improvements with Fort Worth contractors that are certified as M/WBE companies. The Property is currently damaged and vacant. Unless the Property is expediently redeveloped, business and commercial activity in that area of downtown may stall. Therefore, in return for the economic benefits and increased downtown housing opportunities that will accrue as a result of TLC's redevelopment of the Property, the City will make nine (9) annual economic development program grants to TLC, as authorized by Section 380 of the Texas Local Government Code. These grant payments will commence in 2007 (based on the tax revenue received for the 2006 tax year),the year after TLC receives a one-year tax abatement (based on TLC's Property taxes for the 2005 tax year) under a proposed Tax Abatement Agreement that the City Council is considering pursuant to M&C C-19479. The maximum annual grant that TLC will be eligible to receive under the proposed Agreement is a sum equal to one hundred percent (100%) of the increased property taxes received by the City from the Property on account of its redevelopment, subject to an annual cap based on the taxable assessed value of the Property. The actual amount of each grant will depend upon the extent to which TLC met its construction and construction spending commitments, as outlined above and allocated as follows: • An amount equal to 60% of real property taxes received from the Property if TLC substantially completed at least$50 million in real property investments on the Property by June 30, 2005; and • An amount equal to 20% of real property taxes received from the Property if TLC spends at least 25% of its total construction costs with Fort Worth contractors; and • An amount equal to 20% of real property taxes received from the Property if TLC spends at least 20% of its total construction costs with Fort Worth contractors that are certified as M/WBE companies. City of.Fort North, Texas "Agorr and Council commu"icatio" DATE REFERENCE NUMBER I LOG NAME PAGE 2/18/03 C-19480 17TLC 2 of 2 SUBJECT AUTHORIZE EXECUTION OF ECONOMIC DEVELOPMENT PROGRAM AGREEMENT WITH TLC GREENFIELD, L.P. FOR REDEVELOPMENT OF FORMER BANK ONE TOWER AND ADJACENT PROPERTY However, each grant may be reduced if TLC does not meet certain goals, as follows: • By an amount equal to 10% of real property taxes received from the Property if TLC provides any full time jobs on the Property and at least 25% of those jobs are not held by residents of the Central City; and • By an amount equal to 5% of real property taxes received from the Property if TLC enters into any contracts for the provision of supplies and services to the Property but does not spend at least $50,000 per year under those contracts with Fort Worth companies; and • By an amount equal to 5% of real property taxes received from the Property if TLC does not spend at least $20,000 per year under those contracts with Fort Worth certified M/WBE companies. TLC anticipates that it will have few, if any, employees on the Property and that any supply and service contracts will be minimal. Therefore, the gist of this incentive program is directed at the actual redevelopment of the Property, and specifically the former Bank One Tower. Because of the importance in increasing available housing downtown, TLC has agreed that it will receive grants under the Agreement only if the former Bank One Tower is used as residential apartments or condominiums, with approximately 20,000 square feet of street level retail and no more than 40,000 square feet of office space at any time. TLC will not be entitled to receive any grants under the Agreement for any period of time in which these minimal use requirements are not met. The Agreement is authorized by Chapter 380 of the Texas Local Government Code and is consistent with the City's commitment to use custom-designed incentives and partnership programs with private businesses on a case-by-case basis to help ensure the growth and diversification of the local economy, as stated in the 2002 Comprehensive Plan adopted by the City Council on February 26, 2002 (M&C G-13541). In addition, the program outlined in the Agreement is consistent with the Downtown Fort Worth Strategic Action Plan, which encourages the promotion of public incentives to increase downtown housing development. FISCAL INFORMATION/CERTIFICATION: The Finance Director certifies that this action will require no direct expenditure from currently held City funds. RR:r Submitted for City Manager's FUND ACCOUNT CENTER AMOUNT CITY SECRETARY Office by: (to) Reid Rector 6140 Originating Department Head: Tom Higgins 6192 (from) APPROVED 2/18/03 Additional Information Contact: Peter Valy 7601