HomeMy WebLinkAboutIR 8345 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 8345
Date: July 31, 2W1
O�Lp S.a To the Mayor and Members of the City Council
Page 1 of 1
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0 SUBJECT: Tax Abatement Agreement for Meacham Rail 191 Limited
ya,a Partnership
Purpose
This Informal Report presents an overview of the tax abatement application (Exhibit A) submitted by
Meacham Rail 191 Limited Partnership which will be presented in Pre-Council on July 31, 2001.
Council action on this item is requested for August 9, 2001.
Background
Meacham Rail 191 Limited Partnership is the current owner of property that ConAgra Foods, Inc.
will purchase to operate a distribution center. ConAgra Foods, Inc., a fortune 100 company is North
America's number one foodservice supplier and number two supplier to grocery stores. ConAgra
has 80,000 employees located around the world and is known for its over 33 brands which include
Armour, Banquet, Butterball, Eckrich, Hunt's, Marie Callender's, Orville Redenbacher's, Parkay,
and Van Camp's.
Meacham Rail 191 Limited Partnership is requesting consideration of tax abatement to help offset
the substantial start up costs associated with developing a new distribution center for ConAgra in
Fort Worth. -fhe request was reviewed by the Economic Development Committee at the July 2001
meeting and referred to the full Council for consideration.
Proiect Information
The proposed 27 acre site will be developed as a 420,360 square foot regional distribution center
for ConAgra. The proposed facility is a consolidation of 4 distribution centers all of which are
located outside of Fort Worth. ConAgra is planning to invest $14.2 million in real and personal
property. Additionally, a possible expansion of 125,000 square feet with an estimated cost of $3
million in real property is also planned. The proposed location is in the Central City and in the
North Enterprise Zone. A total of 84 new jobs will be created initially. The majority of these jobs
have an average wage of$11 .50 excluding benefits.
Abatement Structure
The abatement structure will provide the property owner with the opportunity to receive specified
percentages for performance in the areas of construction contracting, supply and service spending,
and employment up to a maximum abatement of 90%. This structure is more fully described in
Exhibit B.
f
Gary . Jac on
City Manager
I°SSUED BY THE CITY MANAGER FORT WORTH TEXAS
Exhibit A
City of Fort Worth
COMMERCIAL/INDUSTRIIAL
Tai. Abatement Application.
February 1999
Fo kT Q kTE
Office of Economic Development
City Manager's Of=fice
Fort Worth, Texas 76102
(817) 871-6103
1. Applicant Information:
li Name MEACHAM RAIL 191 LIMITED PARTNERSHIP
Address 100 E. 15th STREET, SUITE 640
City, State, Zip Code FORT WORTH, TX 76102
Telephone 817 332 - 9088 ext.
Fax 817 332 - 9080 ext.
Internet E-mail addresses (if available):
Contact Person (include title/position): MICHAEL E. RADER
2. Property Description
Attach legal description or surveyor' metes & bounds description.
3. Current Appraised Value of Property
Attach latest copy of property tax statement from the County Appraisal District.
4. Attach a brief description of the project including: services provided or products
manufactured, major customers and locations, etc.
5. Project Description
A. New Facilities PHASE I PHASE II
1. Size 420,360_sq. ft. 125,470 SQ. FT.
2. Cost of Construction 12,000,000 $3,011,280
including Site Development
B. Site Development (parking, fencing, landscaping, etc.):
1. Type of work to be done EXCAVATION, SITE GRADING, PARKING, LIGHTING,
PERIMETER FENCING, LANDSCAPING, RAIL SPUR
2. Projected Costs $ 2,575,000
C. Personal Property:
1. Value of
a. Inventory $25,000,000
b. Supplies
2. Percent of inventory eligible for freeport exemption (inventory, exported from Texas
within 175 days) 25 %
3. Value of equipment, machinery, furnishings, etc. $ 2,200,000
6. Project Construction:
A. What percent of the construction costs (5A.&B. above) will you commit to spend with:
1, Fort Worth businesses? 25 %
2. Minority and Women owned Business Enterprises? 10 %
B. When will construction Start? LATE AUGUST 2001
C. How many construction jobs will be created? 150
D. What is the estimated payroll for these jobs? $4,000,000
7, Employment:
A. If this project is an expansion or modernization of an existing facility:
1. How many persons are currently employed? N/A
2. What percent of TA. above are Fort Worth residents? N/A %
3. What percent of TA above are Inner City residents? N/A %
B. Please complete the following table.
y� First Audit Year Fifth Year Tenth Year
New Jobs to be Created 84 100 110
Less Transfers* 5 0 0
Net Jabs 79 100 110
% of Net Jobs to be
filled by Fort Worth
Residents 50% 50% 50%
% of Net Jobs to be
filled by Inner City
Residents 30% 30% 30%
* If any employees will be transferring,please describe where they will be transferring from.
** Must be at Ieast 25%
C. Attach a description of the jobs to be created (technician, engineer, manager, etc.),tasks
to be performed for each, and wage rate for each classification.
D. Attach a brief description of the employee benefit package(s) offered (i.e. health
insurance, retirement, public transportation assistance, day care provisions, etc.)
including portion paid by employee and employer respectively.
8. Regarding supply and service expenses (i.e. landscaping, office or manufacturing
supplies,janitorial services, etc.)-.
A. What is the amount of non-sole source supply and service expenses? $ 200,000
B. What percentage will be committed to Fort Worth businesses? 25 %
C. What percentage will be committed to Minority and Women Owned Businesses? 15 %
9. Is the property appropriately zoned for the project? YES
10. Is the property platted? If yes, will replatting be necessary? FINAL PLAT UNDERWAY
11. Attach a description of any environmental impacts associated with this project. NONE
12. Attach a description of any direct benefits to the City of Fort Worth as a result of this
project (Le. sales tax, inventory tax, development fees, etc.)
13. Do you intend to pursue abatement of:
County Taxes? [2 Yes ❑ No
School Taxes? ❑ Yes 0 No
14. What level of abatement do you request: Years? 10 Percentage? 90%
15. Is any person or firm receiving any form of compensation, commission or other
benefit i
monetary t based on the level of incentive obtained by the applicant from the City
of Fort Worth? If yes, please attach details. No
16. On an attachment, explain why tax abatement is necessary for the success of this
project. Include a business pro-forma or other documentation to substantiate your
request.
On behalf of the applicant, I certify the information contained in this application (including all
attachments) to be true and correct. I further certify that, on behalf of the applicant, I have read
the Policy Statement: Tax Abatement For Qualified Development Projects" and agree to comply
with the guidelines and criteria stated therein.
Name Title
Date
8. Regarding supply and service expenses (i.e. landscaping, office or manufacturing
supplies,janitorial services, etc.):
A. What is the amount of non-sole source supply and service expenses? S 200,000
B. What percentage will be committed to Fort Worth businesses? 25 %
C. What percentage will be committed to Minority and Women Owned Businesses? 15 %
9. Is the property appropriately zoned for the project? YES
10. Is the property platted? If yes, will replatting be necessary? FINAL PLAT UNDERWAY
11. Attach a description of any environmental impacts associated with this project. NONE
12. Attach a description of any direct benefits to the City of Fort Worth as a result of this
project (i.e. sales tax, inventory tax, development fees,etc.)
13. Do you intend to pursue abatement of.
County Taxes? 12 Yes ❑ No
School Taxes? ❑ Yes 10 No
14. What level of abatement do you request: Years? 10 Percentage? 90%
15. Is any person or firm receiving any form of compensation, commission or other
monetary benefit based on the level of incentive obtained by the applicant from the City
of Fort Worth? If yes, please attach details. NO
16. On an attachment, explain why tax abatement is necessary for the success of this
project. Include a business pro-forma or other documentation to substantiate your
request.
On behalf of the applicant, I certify the information contained in this application (including all
attachments) to be true and correct. I further certify that, on behalf of the applicant, I have read
the Policy Statement: Tax Abatement For Qualified Development Projects" and agree to comply
with the guidelines and criteria stated therein.
Name Title
Date
STATE OF TEXAS
COUNTY OF TARRANT.-
Being a tract of land situated in the San Antonio & Mexican Gulf
Railroad Company Survey, Abstract No. 1464, City of Fort Worth,
Tarrant County, Texas, being a portion of a tract of land (Tract I)
as described in deed to Meacham Rail 191 Limited Partnership, as
recorded in Volume 12819, Page 563 of the Deed Records, Tarrant
County, Texas (D.R.T.C.T.) also being a portion of a tract of land
described in Quitclaim deed to Meacham Rail 191 Limited
Partnership, as recorded in Volume 13156, Page 66 of the
D.R.T.C.T., and being more particularly described by metes and
bounds as follows:
BEGINNING at a found 1 inch iron rod at the Northwesterly
corner of said Tract I and the Southwesterly corner of Lot 2, Block
A Railhead Fort Worth Phase One Addition, per plat recorded in
Cabinet A, Slide 4358, Plat Records, Tarrant County, Texas
(P.R.T.C.T.) and lying in the Easterly R.O.W. line of the C.R.I. &
G. Railway Company, from which a found 5/8 inch iron rod with a
cap stamped "Carter & Burgess", bears North 47 degrees 35
minutes 52 seconds West a distance of 0.30 feet;
THENCE South 89 degrees 29 minutes 48 seconds East (Record
South 89 degrees 29 minutes 13 seconds East) along the Northerly
line of said Quitclaim and the Southerly line of said Lot 2 and Lot
3 of said Railhead Fort Worth Phase One Addition. a distance of
1449.68 feet to a set 1/2 inch iron rod with a cap stamped "Wier &
Assoc., Inc.", from which a found 1/2 inch iron rod bears North 89
degrees 29 minutes 48 seconds West a distance of 1.73 feet, and
lying in the Westerly R.O.W. line of Gold Spike Drive (68'
R.O.W.) as shown per plat of Meacham Boulevard R.O.W.
Extension and Gold Spike Drive R.O.W. Extension Cabinet A,
Slides 5688 & 5689, P.R.T.C.T,
THENCE South 00 degrees 20 minutes 46 seconds West along the
Westerly R.O.W. line of Gold Spike Drive, a distance of 871 .33
feet to a set 1/2 "inch iron rod with a cap stamped "Wier & Assoc.,
Inc.";
THENCE North 89 degrees 29 minutes 48 seconds West a distance
of 1293.61 feet to a set 1/2 *inch iron rod with a yellow plastic cap
stamped "Wier & Assoc., Inc.", lying in the Westerly boundary
line of said 55. 37 5 acre tract and being the beginning of'a curve to
the right with a radius of 5680. 15 feet,
THENCE along said curve to the fight with a central angle of 07
degrees 48 minutes 10 seconds, a chord bearing of North 10
t:1
degrees 18 minutes 00 seconds West a distance of 772.96 feet, and
an arc length of 773.56 feet to a found 1/2 inch iron rod,
THENCE North 06 degrees 23 minutes 53 seconds West (Record
North 06 degrees 22 minutes 47 seconds West), continuing along
the Westerly line of said Tract I and the Easterly line of said
Railroad R.O.W., a distance of 112.89 feet (Record 112.96 feet) to
the POINT OF BEGINNING and containing 27.661 Acres or
1,204,906 Square Feet of Land.
0
(EXAS, COUNTY OF TARRANT TARRANT COUNTY ADMINISTRATION BUILDING
TAX ASSESSOR-COLLECTOR 100 E.WEATHERFORD, FORT WORTH,TEXAS 76196.0301
817/884-1100
TAX STATEMENT 2000 32075
STATEMENT DATE: 10/07/2000 LEGAL: S A& M G RR CO SURVEY
ACCOUNT: 00004698444 A 1464 TR 1
AG
OWNER: MEACHAM RAIL 191 LTD PRTNSHP, PIDN: A1464-1-A1
PARCEL ADDRESS: 0000800 MEACHAM BLVD ACRES! 70.897000
EXEMPTION CODES: AGO02 FID: 5550000285
LAkI E
A
8,366 2,020,565 2,012,199
v, .trr -Ivry Tt^v`,r AT E — PENAL—iT I
kx
TAXING ENTITIES AMOUNT TAXABLE VALUE PER 5100 BASE TAX INTEREST
FT WORTH CITY 2,012, 199 8,366 0.875000 73 .20 0.00
TARRANT COUNTY 2,012, 199 8,366 0. 274785 22.99 0.00
,REG WATER DIST 2,012, 199 8,366 0.020000 1 .67 0.00
T C HOSPITAL 2,012, 199 8,366 0.234070 19 .58 0 .00
T C COLLEGE 2,012, 199 8,366 0. 106410 8 .90 0.00
FT WORTH ISO 2, 012, 199 8 ,366 1 .641100 137 .29 0 .00
SUBTOTAL 263. 63 0.00
TOTAL AMOUNT DUE $263.63�
*CALL 8171884-1100 FOR PRIOR YEAR TAXES DUE WHICH ARE NOT INCLUDED IN TOTAL AMOUNT DUE.
This top portion and your canceled check will serve as your receipt. Please see reverse side for important information.
..........
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'01
Tax Abatement Application
City of Fort Worth
ConAgra Distribution Facility
Item 4 4 Project Description
PHASE 1
ConAgra is proposing to occupy a 420,360 square foot distribution facility to be
constructed in the Railhead Industrial Park in Fort Worth, Texas that is to be used as a
Regional Distribution Center. This facility will be receiving dry temperature products
from various manufacturing, processing and packaging facilities and distributing them to
various retail and foodservice customers.
This project will include the development of 26.6 acres fronting Gold Spike Drive north
of the intersection of Gold Spike Drive and Meacham Boulevard. Located within the
project will be a 420,360 square foot tilt wall building that will house the distribution.
facility. The property development will also include parking for employees, trucks and
trailers for distribution purposes. The perimeter of the property and areas around the
building will be landscaped. Perimeter fencing and lighting of operation areas will
provide security of the site.
PHASE 2
Within an estimated 5 years ConAgra proposes to expand the proposed facility by
125,470 +/- square feet. This expansion will be tilt wall and will fit onto the existing 26.6
acres. This expansion will serve future growth ConAgra has planned.
Tax Abatement Application
ConAgra Distribution Facility
Item # 7D Employee Benefits
Medical Coverage
Available to all employees who work 30 or more hours per week. HMO & PPO
plan options available. Employee cost will vary upon plan and # dependents. A
prescription drug plan is also available.
Dental Coverage
A dental plan is available through Blue Cross and Blue Shield. Coverage is shared
by employer and employee.
Vision Coverage
A vision coverage plan is available on a voluntary basis through Vision Service
Plan.
Survivors Benefit
Life Insurance
A basic life insurance plan is provided and paid by the employer for up to two
times the employee's annual salary ($1,000,000 max. benefit). A supplemental life
insurance is available to employee at employee's cost.
Disability Benefit
Employer provides and pays for accidental death and dismemberment insurance
for employees and dependent AD & D insurance at employee's cost. There is also short -
term and long-term disability, short-term disability is covered by the employer.
Additional Benefits
Pre-tax spending account is available for healthcare costs.
Costs
1 Q See attached benefit summary book for cost information.
Tax Abatement Application
ConAgra Distribution Facility
Item 4 X Job Description
Wage Description for Non-Exempt Employees at ConAgra
Warehouse positions: 70 at $11.50/hour
Descriptions: Clamp truck/forklift operators, material handlers, checkers.
Supervisory Positions: 14 at an average annual compensation of x,45,000
See attached Addendum
Of
Addendum ko Item #7C Job Description
OPUS SOUTH CORPORATION
0��
OPUS.� l5455 North Dallas Parkway
Addison, Texas 75001
THE OPUS GROUP Phone 972-480-9787
�
ARCHITECTS Fax 972-669-2216
CONTRACTORS vvw
DEVELOPERS
MEMORANDUM
To: Tom Higgins/City Of Fort Worth
Fnznn� Steve Chilton
972-480-9787
Date: 7Y2772001
Re: ConAgra job descriptions
Below is an estimate of the positions and descriptions for the ConAgra taoi|ih/ in Railhead:
84 Total Employees '
70 Warehouse positions
�
14 Supervisory/Clerical positions
Warehouse positions:
• Clamp trunk operators-moving inventory
• Fork |iftoperahora'moving inventory
• Material Hand|ars-|oading trucks and boxcars
• Maintenance Personnel-runs battery room and responsible for maintenance of mechanical equipment
All warehouse positions require high school diploma or equivalent. On the job training for safety, equipment
operadon, and job cross-training is done. Promotions to supervisory level are available to those who merit it.
Supervisory/clerical positions:
• Clerks- shipping and raoek/ing, inventory control, payroll and benefits management; computer skills
required
• Logistics Supervisors-for rail and truck traffic and coordination for inventory movement; computer skills
required
• Warehouse Supervisors- coordinates warehouse positions
• Distribution Center Managers-oversee all operations in distribution center
All supervisory/clerical positions require high school diplomas orthe equivalent and some college is preferred.
Promotions to management level positions are possible for those who merit consideration.
��
Tax Abatement Application
ConAgra Distribution Facility
Item # 12 Benefits to the City of Fort Worth
ConAgra is proposing to locate their Regional Distribution Center in Railhead
Industrial Park/Fort Worth, Texas. ConAgra is consolidating several distribution facilities
serving a five state region into one Regional Distribution Center. ConAgra will be a Fort
Worth company and will additionally be located in an inner city and enterprise zone area
of the City of Fort Worth with the opportunity to obtain workforce from the immediate
area. ConAgra is a "Fortune 100" company based in the U.S. with operations around the
globe. The North Forth distribution center will enhance the Meacham AirportfNorth Fort
Worth area offering job opportunities for inner city Fort Worth residents. ConAgra
projects the initial facility will create 84 new jobs for Fort Worth and will hold an
estimated $25,000,000 in inventory.
i ^ Tax Abatement Application
ConAgra Distribution Facility
Item # 16 Success of Project
ConAgra is a public corporation and operates in a highly competitive industry and must
contain costs in order to stay competitive. ConAgra's distribution operation cost per
package includes personnel, shipping, and other operational expenses and real and
personal property taxes. Control and containment of these costs are extremely important
in maintaining competitiveness.
If the company is unable to succeed in its cost containment efforts, it will be forced to
entertain other options offering Inventory Freeport Exemption and Property Tax
Abatements. ConAgra is proposing to make a substantial investment in the North Fort
Worth Enterprise Zone and in the inner city area. Abatement of property tax of the
project will assist in meeting cost control objectives and assure that the Fort Worth
ConAgra operations are successful in Fort Worth.
Exhibit B
City of Fort Worth
Tax Abatement Structure
Meacham Rail 191 Limited Partnership and ConAgra Foods, Inc.
Assumptions:
1. Meacham Rail 191 Limited Partnership and ConAgra Foods, Inc. to develop a 420,000 SF
distribution facility in the Fort Worth Railhead Development and be operational in the first
quarter 2002.
2. The proposed project will have a minimum investment as follows:
a. Buildings &c Improvements: $13.7 million
b. Personal Property: $2.2 million
c. Inventory: $25 million (25% subject to freeport exemption)
3. The first phase will result in 84 new jobs.
4. Construction on phase 2 will begin approximately 5 years after the certificate of occupancy
has been received for phase 1.
Structure:
Meacham Rail 191 Limited Partnership and ConAgra Foods, Inc. will be eligible to receive a 10
year abatement of up to 90% of the appraised value of the improvements of the real and personal
property. The actual value of the annual abatement will be calculated on the basis of the following
criteria for each phase:
r,
1. 25% base abatement:
• Construction of$11 million in facilities, and
• Utilize Fort Worth companies for 25% of the cost of construction, and
• Utilize certified Minority/Women-owned Business Enterprises (MWBE) for
5% of the cost of construction
2. 20% additional abatement:
+ 25% of the ongoing business expenses are spent with Fort Worth companies, and
• 15% of the ongoing business expenses are spent with certified MWBE companies
3. 30% additional abatement for each phase if:
• 50% of new positions are filled by Fort Worth residents, and
• 30% of new positions are filled by Central City residents
4. 15% additional abatement for each phase if:
+ For each new employee above the 30% of new positions filled by Central City
residents, one percentage point will be given, up to a maximum of 15%
Each percentage calculation will be measured separately based on meeting or exceeding the
respective criteria.