HomeMy WebLinkAboutResolution 4319-05-2014 A Resolution
NO. 4319-05-2014
AMENDING SECTION 7.5 OF THE CITY'S GENERAL TAX ABATEMENT POLICY
(RESOLUTION NO. 4096-06-2012) TO PERMIT PAYMENTS TO
THE FORT WORTH HOUSING FINANCE CORPORATION IN LIEU OF
COMMITMENTS FOR SPECIFIC AFFORDABLE HOUSING SET-ASIDES
FOR RENTAL RESIDENTIAL DEVELOPMENTS
RECEYVIING TAX ABATEMENTS
WHEREAS, a municipality may enter into tax abatement agreements authorized by Chapter 312
of the Texas Tax Code ("Code") only if the governing body of the municipality has previously adopted
a resolution stating that the municipality elects to be eligible to participate in tax abatement and has
established guidelines and criteria governing tax abatement agreements; and
WHEREAS, pursuant to the Section 312.002(c) of the Code, once adopted, a tax abatement
policy is effective for two (2) years and, during that time, may only be amended by a vote of three-
fourths (3/4) of the members of the City Council; and
WHEREAS, the City's General Tax Abatement Policy contains guidelines and criteria
governing all tax abatements granted by the City Council except those on properties located in
Neighborhood Empowerment Zones-, and
WHEREAS, the City's current General Tax Abatement Policy was adopted by the City Council
pursuant to Resolution No. 4096-06-2012 and went into effect on June 22, 2012; and
WHEREAS, Section T5 of the General Tax Abatement Policy requires that any multi-family
rental residential development or mixed-use development that includes a multi-family rental residential
component must have a percentage of the total residential units set aside exclusively for lease to
qualifying households whose adjusted incomes do not exceed the then-current eighty percent (80%)
income limits established by the United States Department of Housing and Urban Development (HUD)
for the Fort Worth-Arlington HUD Metro FMR Area at rents that are affordable to such households, as
defined by HUD (an "Affordable Housing Set-Aside Commitment"); and
WHEREAS, the City Council wishes to amend Section 7.5 of the General Tax Abatement
Policy to change the Affordable Housing Set-Aside Commitment to be defined as 1.0% of the units for
lease to qualifying households whose adjusted incomes do not exceed the then current eighty percent
(80%) income limits established by the United States Department of Housing and Urban Development
(HUD) for the Fort Worth-Arlington HUD Metro FNfR Area and 10% of the units for lease to qualifying
households whose adjusted incomes do not exceed the then current sixty percent (60%) income limits
W.Wnm
Resolution No. 4319-04-2014
established by the United States Department of Housing and Urban Development (HUD) for the Fort
Worth-Arlington HUD Metro FMR Area, both at rents that are affordable to such households, as defined
by HUD; and
WHEREAS, the City Council also wishes to amend Section 7.5 of the General Tax Abatement
Policy to provide that the City Council, in its sole discretion, may allow an applicant for tax abatement
under that Policy whose property will include multi-family rental residential units to make annual
payments to the Fort Worth Housing Finance Corporation in the amount of$200.00 per rental residential
unit located on the property in lieu of making the Affordable Housing Set-Aside Commitment; and
WHEREAS, the Fort Worth Housing Finance Corporation is a housing finance corporation
created pursuant to authorization by the City Council in accordance with Chapter 394, Texas Local
Government Code, to assist in the financing of the costs of residential development and ownership for
citizens of decent, safe and sanitary housing at affordable prices; and
WHEREAS, the City Council believes that such an amendment to the City's General Tax
Abatement Policy will provide greater flexibility and incentive for developers to invest in developments
that the City Council finds to meet the land use and economic expansion goals of the City while, at the
same time, providing for an alternative resource for the growth of affordable housing in the City;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
FORT WORTH, TEXAS:
1. THAT the City Council hereby adopts the following amendment to Section 7.5 of the City's
General Tax Abatement Policy (Resolution No, 4096-06-2012), to be effective from the date of adoption
of this Resolution through June 21, 2014, unless earlier amended or repealed by a vote of at least three-
fourths (3/4) of the members of the City Council. Amended language is indicated by a double-
underline, as follows:
7.5. For Residential Development Projects and Mixed-Use Development Projects that
include rental residential units, to:
W commit to-a set riti be r- of that,atjea5t�te _percentage of total rental
residential units that--must be set aside exclusively for lease to qualifying households
whose adjusted incomes do not exceed the then-current eighty percent (80%) income
limits established by the United States Department of Housing and Urban Development
("HUD") for the Fort Worth-Arlington, TX HUD Metro FMR (fair market rents) Area at
rents that are affordable to such households, as defined by HUD and that at least ten
pq�n 10 of
o total rental residential—units-must b&_set aside_exclusiy!dy for lease to
cduali_ in households then-current— ht
percent income limits esLub—lishe—d—b the United t-S States D- 4qmen_t_of1_ous_= and
gftpn.Devel me T r the Fort Worth--Arl 1 nRtQn__TX HUD Metro FMR air
market rents) Area at ren tba are affordable to such households, efined b D o
tab — _ ---=y Ujjj�
u�Wo_0
Resolution No. 4319-04-2014
Ub.�f spqcificalIy=pprj_jft d,��the,_Cjj _Cortuncil it its sole d� ere ion _and as
Q(
f
led--,in- t&
' — xaat eprt eme n t d--pth -o r-t
Werth I
Housing
=in=
g--F--i-n-a_n'
-
-
e
— - -
Corporation sg �a I t oIZ00.00f QLgachrental residential unit located the
— - -
P-wa - which iss&ect to the tax abatement. The Fort WQrthj9p sin Finance
Corporation js a-housing fqance o oration cr al u suaRt 19 adhorization by the C
Council Worth.-W-%q!-c-o-rdAncg- with Chapter 394, Texas Local
Government Cqde,_to_as i5tjn the financing of the cogs of residential wt and
qwnq§hjp�for s�if zen5 sake and sanita a
g housjR? t a,-a- An
awlicantLs-choicf-, as�w�wether to commit to an affo dab
--je-boys et-aside or too an
annuaaa .ment to �,or
.th.eFart Hoqsi e ior to
Co d
_pju-Sion must be ma -�rL
7V
execution of the tax abatement reemen an ma not be in .the ter n of the
p" ta� ay -- the
number of rental residentiabqnjts on fte=pr� A hchjs sub*.ei;t to the
tax abatement will be calculate annuv Parnent_of the annual sum will be due on or
be-or-cFe-broaa-1—of ea-sh--Y-eaLinwt��chA�-taA-4b�-e-m-erit--i-s-z;�nLed usa-ch other-d-atQ
jt ranted==(Q
thAt- a o in tax abatement Bement Failure to aa he u�ijl
may Xe -aw
=gA vy� —j"
moment to the Housing itur of the
entire tax abatement for the tax-year in which payment was due, Additional terms and
emhtions governing this annual payZient
--requirement will be set forth_ in he tax
abat t agreement.
eme
n-- _—
2. THAT this amended General Tax Abatement Policy, as it may subsequently be amended, will
expressly govern all tax abatement agreements governed by such Policy and entered into by the City
during the period in which such Tax Abatement Policy is in effect.
ADOPTED this 6h day of May, 2014.
VoRr
000000
47 00
ATTEST: 00". 0
rJ
Mary J. Ka., ity Se etary 00 0000000°p°
0000000 /V
ORTWO
City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION: Approved on 5/6/2014 - Resolution Nos. 4318-05-2014 & 4319-05-2014
CONTINUED FROM A PREVIOUS WEEK
DATE: Tuesday, March 04, 2014 REFERENCE NO.: G-18138(Revised)
LOG NAME: 17TAPOLICIESAMENID-R
SUBJECT:
Adopt Resolutions to Amend the City's General Tax Abatement Policy and the Neighborhood
Empowerment Zone Tax Abatement Policy and Basic Incentives to Revise Language on Affordable
Housing Commitments for Residential Tax Abatement Projects (ALL COUNCIL DIS"T"RICTS)
RECOMMENDATION:
It is recommended that the City Council:
1. Adopt the attached Resolution amending Section 7.5 of the City's General Tax Abatement Policy to
revise requirements for affordable housing set-aside commitments for rental residential developments and
mixed-use developments with residential components receiving a tax abatement and, at the City Council's
discretion, permit annual payments to the Fort Worth Housing Finance Corporation in lieu of commitments
for an affordable housing set-aside in the amount of$200.00 per unit in the development; and
2. Adopt the attached Resolution amending Sections B.1, B.2, D.1 and D.2 of the City's Neighborhood
Empowerment Zone Tax Abatement Policy to revise requirements for affordable housing set-aside
commitments for rental residential developments and mixed-use developments with residential
components receiving a tax abatement and, at the City Council's discretion, permit annual payments to the
Fort Worth Housing Finance Corporation in lieu of an affordable housing set-aside in the amount of
$200.00 per unit in the development.
DISCUSSION:
Chapter 312 of the Texas Tax Code authorizes municipalities to designate tax abatement reinvestment
zones and to enter into Tax Abatement Agreements only after they elect to become eligible to participate
in tax abatement and adopts a Tax Abatement Policy that sets forth guidelines and criteria governing their
tax abatement programs. A Tax Abatement Policy adopted by a municipality is effective for two years and,
during that time, can only be amended by a vote of 3/4 of the members of the City Council.
Tax Abatement Agreements covering properties located in Neighborhood Empowerment Zones (NEZs)
are governed by the Neighborhood Empowerment Zone Tax Abatement Policy, which was adopted on
May 21, 2013 (M&C G-17901, Resolution No. 4209-05-2013). All other Tax Abatement Agreements are
governed by the City's General Tax Abatement Policy, which was adopted on June 12, 2012 (M&C G-
17617, Resolution No. 4096-06-2012). Both the General Tax Abatement Policy and the Neighborhood
Empowerment Zone Tax Abatement Policy require that any multi-family rental residential developments or
mixed-use developments that include a multi-family rental residential component must have a percentage
of the total residential units set aside exclusively for lease to qualifying households whose adjusted
incomes do not exceed the then-current 80 percent income limits established by the United States
Department of Housing and Urban Development (HUD) for the Fort Worth-Arlington HUD Metro FMR Area
at rents that are affordable to such households, as defined by HUD. Under the General Tax Abatement
Logname: 17TAPOLICIESAMEND-R. Page 1 of 2
Policy, the percentage of affordable units is negotiated between the City and the developer. Under the
Neighborhood Tax Abatement Policy, at least 20 percent of the total number Of units nnUSt be @ffo[d@b|B'
although the City Council may waive or reduce this requirement.
Staff recommends two amendments to both Policies. First. both Policies would require that at least ten
percent of all units in the development be set aside exclusively for lease to qualifying households vvhOs8
adjusted incomes do not exceed the then-current 80 percent income levels established by HUD for the
Fort Worth-Arlington HUD Metro FKAR Area and that at least another ten percent Of all units in the
dov9|OprneOt be Set aside for lease tDqualifying households whose adjusted incomes do not exceed the
then-current 60 percent inCDrO8 levels established by HUD, both at rents that are affordable to those
households.
Second, both Policies vvOU|d 8||Dvv @ deve|oper, with the consent of the City Council in its S0|8 discretion,
to pay the Fort Worth Housing Finance Corporation the sum of two-hundred dollars ($200.00) per PgOLa|
residential unit in the deve|Op0eDt, annually for the term of the Tax Abatement Agreement in lieu Of
committing to the actual affordable housing set-aside described above The Fort Worth Housing Finance
Corporation is a housing 'finance corporation created pursuant to authorization by the City COUOCi| to
assist in the financing of the COStS of residential development and ownership for citizens of decent, safe
and sanitary housing at affordable prices. Funds received from these proposed alternative payments will
be deposited into 8 fund to be administered by the Fort Worth Housing Finance Corporation for the
development or renovation Of low and moderate income housing.
Once the developer nl@keS its [8qUeSt. Staff would review the request and the multi-family project with
City Council before negotiating the final incentive agreement. The City Council vvnu|d make the final
determination as to whether the payment to the Fort Worth Housing Finance Corporation would be
permitted in lieu ofthe developer's making the actual affordable housing set-aside for the development.
State |ovv requires a vote Of 3/4 of the nO8rOherS Of the City Council (7 votes) in order to amend a tax
abatement policy. Once adopted, the proposed amendments tothe General Tax Abatement Policy and
the Neighborhood Empowerment Zone Tax Abatement Policy will be effective immodiat9|y.
FISCAL INFORMATION / CERTIFICATION:
The Financial Management Services 0i[eCt0[ certifies that this action will not increase the total
appropriations of City funds,
FUND CENTERS:TO Fund/Account/Centers FROM Fund/Account/Centers
CERTIFICATIONS:Submitted for City Manager's Office by:
Fernando Costa (6122)
Originating Department Head: JayChapo (5804)
Robert StUrnS (212-2663)
Additional Information Contact: Ana Alvarado /212-2680\