HomeMy WebLinkAboutOrdinance 16182ORDINANCE NO ~ ~ I ~~
AN ORDINANCE AMENDING ORDINANCE NO 15815 BY
REMOVING CERTAIN PROPERTY FROM NEIGHBORHOOD
EMPOWERMENT REINVESTMENT ZONE NUMBER
THIRTEEN CITY OF FORT WORTH, TEXAS DESIGNATING
THE PROPERTY SO REMOVED AS `NEIGHBORHOOD
EMPOWERMENT REINVESTMENT ZONE NUMBER TWENTY
ONE, CITY OF FORT WORTH, TEXAS"• PROVIDING THE
EFFECTIVE AND EXPIRATION DATES FOR THE ZONE AND A
MECHANISM FOR RENEWAL OF THE ZONE, AND
CONTAINING OTHER MATTERS RELATED TO THE ZONE.
WHEREAS, pursuant to Resolution No 2938, adopted by the City Council of the
City of Fort Worth, Texas (the `City Council") on Apri122, 2003 as amended by M&C
G 13984 approved by the City Council on May 27 2003 and by M&C G-14327
approved by the City Council on April 6, 2004 the Crty has elected to be eligible to
participate rn tax abatement for property located m Neighborhood Empowerment Zones,
as authorized by Chapter 378 of the Texas Local Government Code and in accordance
with Chapter 312 of the Texas Tax Code (the `Code"), and has established guidelines
and criteria governing tax abatement agreements covering property located m
Neighborhood Empowerment Zones (the `NEZ Policy") and
WHEREAS, on January 6, 2004 the Crty Council adopted Resolution No. 3030,
designating the Berry/LJmversity Neighborhood Empowerment Zone (the `NEZ"), and
adopted Ordinance No 15815 designating the NEZ as Neighborhood Empowerment
Reinvestment Zone No. 13 Crty of Fort Worth, Texas, and
WHEREAS, Phoemx Property Inc. ("Developer") intends to lease certain real
property located m the NEZ and that is more particularly described in Exhibit A of this
Ordinance (the `Land") on which Developer wishes to construct and own a rmxed-use
Page 1
Ordinance Designating Neighborhood Empowerment Reinvestment Zone Number Twenty-one,
City of Fort Worth, T
residential and retail development (the `Improvements") in a manner that is consistent
with the Beny Street Initiative Strategic Plan, as outlined m the City's 2004
Comprehensive Plan, adopted by the City Council on February 24 2004 pursuant to M&C
G-14276, and
WHEREAS, the Code requires that the terns and conditions of tax abatement
agreements covenng property located m the same reinvestment zone must be identical, and
WHEREAS, Developer has requested a ten (10)-year real property tax abatement
on the Improvements, which, m accordance with the NEZ Policy is subject to unique terns
and conditions specific to the project; and
WHEREAS, accordingly the Crty Council hereby finds that rt is necessary and
desirable to remove the Land from Neighborhood Empowerment Reinvestment Zone No.
13 and to designate a new Neighborhood Empowerment Reinvestment Zone compnsmg
only the Land (the `Zone"); and
WHEREAS, the Crty Council hereby finds that the project described herein will be
an important element m the realization of the Berry Street Initiative Strategic Plan and that
development of the Land and the Zone nn the manner described herein will best occur by
means of tax abatement on the Improvements m return for Developer's causing
construction of the Improvements and compliance with certain other commitments that
will foster economic development nn the Zone and the City nn general, and
WHEREAS, on October 19 2004 the City Council held a public heanng
regarding the creation of the Zone, received information concerning the Improvements
proposed for the Zone and afforded a reasonable opportunity for all interested persons to
Page 2
Ordinance Designating Neighborhood Empowerment Reinvestment Zone Number Twenty-one,
City of Fort Worth, T xas
speak and present evidence for or against the creation of the Zone ("Public Hearing"),
as required by Section 312.201(d) of the Code; and
WHEREAS, notice of the Public Heanng was published in a newspaper of
general circulation m the Crty on October 11 2004 which satisfies the requirement of
Section 312.201(d)(1) of the Code that publication of the notice occur not later than the
seventh day before the date of the public heanng; and
WHEREAS, m accordance with Sections 312.201(d)(2) and (e), notice of the
Public Heanng was delivered in wntmg not later than the seventh day before the date of
the public heanng to the presiding officer of the governing body of each taxing unit that
includes m its boundanes real property that is to be included m the proposed Zone;
NOW THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF
THE CITY OF FORT WORTH, TEXAS
Section 1
FINDINGS.
That after reviewing all information before rt regarding the establishment of the
Zone and after conducting the Public Hearng and affording a reasonable opportumty for
all interested persons to speak and present evidence for or against the creation of the
Zone, the City Council hereby makes the following findings of fact:
1.1 The statements and facts set forth m the recitals of this Ordinance are true and
correct. Therefore, the City has met the notice and procedural requirements
Page 3
Ordinance Designating Neighborhood Empowerment Reinvestment Zone Number Twenty-one,
City of Fort Worth, T
established by the Code for creation of a reinvestment zone under Chapter 312 of
the Code.
1.2. Without a tax abatement on the Improvements, as requested by Developer
construction of the Improvements would not be financially feasible for Developer
1.3 As a mixed-use retail and residential development, the Improvements will cause,
among other things and without hmrtation, (i) new employment to occur wrthm
the Zone and (ii) existing businesses in the area to prosper as a result of increased
residential actrvrty
1.4. As a result of designation as a reinvestment zone, the area wrthm the Zone is
reasonably likely to contribute to the expansion of pnmary employment and to
attract mayor investment m the Zone that will be a benefit to property m the Zone
and will contribute to the economic development of the City
1.5. The Improvements are feasible and practical and, once completed, will benefit the
land included m the Zone as well as the Crty for a penod m excess of ten (10)
years, which is the statutory maximum term of any tax abatement agreement
entered into under the Chapter 312 of the Code.
Section 2.
REMOVAL OF LAND FROM
NEIGHBORHOOD EMPOWERMENT REINVESTMENT ZONE NO. 13
That Ordinance No 15815 is hereby amended by removing the Land, as described
m Exhibit A from Neighborhood Empowerment Reinvestment Zone Number Thirteen,
City of Fort Worth, Texas.
Page 4
Ordinance Designating Neighborhood Empowerment Reinvestment Zone Number Twenty-one,
City of Fort Worth, T
Section 3.
DESIGNATION OF ZONE.
That the City Council hereby designates the Land, as described in Exhibit A as
Neighborhood Empowerment Zone Number Twenty-one, City of Fort Worth, Texas, as
authorized by and m accordance with Chapter 312 of the Code. The project described
herein is eligible for amixed-use development tax abatement pursuant to Section III.D of
the NEZ Policy
Section 4.
TERM OF ZONE.
That the Zone shall take effect upon the effective date of this Ordinance and
expire five (S) years thereafter The Zone may be renewed by the City Council for one or
more subsequent terms of five (5) years or less.
Section 5.
SEVERABILITY
That if any portion, section or part of a section of this Ordinance is subsequently
declared invalid, inoperative or void for any reason by a court of competent jurisdiction,
the remaining portions, sections or parts of sections of this Ordinance shall be and remain
m full force and effect and shall not m any way be impaired or affected by such decision,
opinion or~udgment.
Page 5
Ordinance Designating Neighborhood Empowerment Reinvestment Zone Number Twenty-one,
City of Fort Worth, T xas
Section 6.
IMMEDIATE EFFECT
That this Ordinance shall take effect upon its adoption.
AND IT IS SO ORDAINED
ADOPTED AND EFFECTIVE / ~ - l J- 0 ~
APPROVED AS TO FORM AND LEGALITY
By.
Peter Vaky
Assistant Crty Attorney
M&C C 2 D35~ 10-/9-D ~
Page 6
Ordinance Designating Neighborhood Empowerment Reinvestment Zone Number Twenty-one,
City of Fort Worth, T xas
EXHIBIT A
PROPERTY TO BE REMOVED FROM
NEIGHBORHOOD EMPOWERMENT REINVESTMENT ZONE NO 13
and
BOUNDARY DESCRIPTION OF
NEIGHBORHOOD EMPOWERMENT REINVESTMENT ZONE NO 21
Being a tract of land ituated in the W.H. Hudson Survey Abstract No 717 City of F rt Worth,
Tarrant County Texas, and being eplat of Lot 1 Block 8, TCU Addition, an addition to the City
of Fort Worth, according to the plat rded in Cabinet A, Slide No 4481 Plat Records, Tarrant
County Texas, part of Lots 1 & 10 and all of Lots 2 5 and 11 14 Block 13, Forest Park Addition,
an addition to the City of Fort W rth, according to the plat rded in Volume 310 Page 49 Plat
Records, Tarrant County Texas and being more particularly described by metes and bounds as
follows:
BEGINNING at an "X" -cut in the oncrete et for the northwest orner of id Lot 1 Block 8
TCU Addition, being the intersection of the st right of way line of Greene Avenue (50' fight of-
way) and the outh fight of-way line of Bowie Street (variable width right of way),
THENCE North 89°26'07" East, with said outh right of way line of Bowie Street, a distance of
262 00 feet to a "T" cut in the oncrete et for the northeast orner of said Lot 1 Block 8 TCU
Addition, being the intersection of said outh right of way line of Bowie Street and the west fight
of-way line of Waits Avenue (50' right of-way),
THENCE South 00°22'04 East, with said west fight of way line on Waits Avenue, a passing
distance of 302 65 feet to an "X'° cut in oncrete et for the northeast orner of Lot 14 Block 13,
F st Park Addition, ontinuing an rall distance of 509 65 feet to an "X" -cut in oncrete et
in the north right of way line of W st Berry Street (variable width right of--way),
THENCE South 89°37'56 W st, with said north right of way line of W st Berry Street, distance
of 262 00 feet to an "X" -cut in oncrete et in the aforementioned st right of-way line of Greene
Avenue;
THENCE North 00°22'04 W st, with said east right of way line of Greene Avenue, a passing
distance of 207 00 feet to a point for the northwest rner of Lot 5, Block 13 of aforementioned
Forest Park Addition, form which an arrow" -cut in top of a wall bears South 02°48'10" East,
distance of 0.25 feet, ontinuing and rall distance of 505.67 feet to the point of beginning and
ontaning 133,400 square feet 3 062 acres of land.
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City of Fort Worth, Texas
Mayor and Council Communication
COUNCIL ACTION Approved on 10/19/2004 Ordinance No 16182
DATE Tuesday October 19 2004
LOG NAME 17PHOENIXTA REFERENCE NO C-20354
SUBJECT
Public Hearing and Ordinance Designating Neighborhood Empowerment Reinvestment Zone No 21
and Tax Abatement Agreement with Phoenix Property Inc. and Related Findings of Fact by the City
Council Regarding Construction of Mixed-Use Project by Phoenix Property Inc. within the
Berry/University Neighborhood Empowerment Zone
RECOMMENDATION
It is recommended that the City Council
1 Hold a public hearing concerning the designation of approximately 3 06 acres of land as described in
Exhibit A (the Land) as Neighborhood Empowerment Reinvestment Zone (NEZ Reinvestment Zone)
Number Twenty-one City of Fort Worth Texas and
2. Adopt the attached ordinance designating the Land as NEZ Reinvestment Zone Number Twenty-one
City of Fort Worth Texas pursuant to the Texas Property Redevelopment and Tax Abatement Act, Tax
Code Chapter 312, and
3 Find that the statements set forth in the recitals of the attached Tax Abatement Agreement with
Phoenix Property Inc. are true and correct; and
4 Authorize the City Manager to enter into the
Property Inc. for the property listed on Exhibit A in
NEZ Basic Incentives as amended (the NEZ Policy)
attached Tax Abatement Agreement with Phoenix
accordance with the NEZ Tax Abatement Policy and
DISCUSSION
REINVESTMENT ZONE
One of the incentives a municipality can provide in a NEZ, according to Chapter 378 of the Texas Local
Government Code is an abatement of municipal property taxes for properties in the NEZ. It is
recommended that the subject property located in Council District 9 and described in Exhibit A be
removed from NEZ Reinvestment Zone No 13 and instead be designated as NEZ Reinvestment Zone No
21 so that the City can enter into a 10-year tax abatement agreement which under the guidelines set forth
in the NEZ Policy are subject to terms and conditions specific to the project. Phoenix Properties Inc is
considering construction of two mixed-use buildings to include residential retail and parking on this site
As required by Chapter 312 of the Texas Tax Code a public hearing must be conducted regarding the
creation of the Zone Notice of this hearing was (1) delivered to the governing body of each affected taxing
unit, and (2) published in a newspaper of general circulation at least seven days prior to this hearing
The area encompassing the proposed Zone meets the statutory criteria for designation as a tax abatement
Logname. 17PHOENIXTA Page 1 of 3
reinvestment zone set forth in Chapter 312 of the Texas Tax Code in that the area is reasonably likely as a
result of the designation to contribute to the retention or expansion of primary employment or to attract
major investment in the Zone that would be a benefit to the property and that would contribute to the
economic development of the City Further the improvements sought in the Zone are feasible practical
and would be a benefit to the land to be included in the Zone and to the City after a.ny tax abatement
agreements which may be entered into have expired
The proposed NEZ Reinvestment Zone No 21 will expire after five years and may be renewed for periods
not to exceed five years.
TAX ABATEMENT TERMS
The real property is located in Berry/University NEZ. Phoenix Property Inc. has applied for aten-year
municipal real property tax abatement on the improvements to be constructed on the Land only (and not the
Land itself) under the NEZ Policy for amixed-use residential and retail project. The Housing Department
has reviewed the application and certified that the property meets the eligibility criteria to receive NEZ
municipal property tax abatement. The NEZ Basic Incentive allows for aten-year municipal real property tax
abatement on the increased value of improvements to the qualified owner of any new construction within
the NEZ.
Under the proposed Tax Abatement Agreement, Phoenix Property Inc. (the Developer) has committed to (i)
invest $46 000 000 in real property improvements, (ii) invest $1 000 000 in personal property investments
and (iii) construct two (2) mixed-use buildings consisting of 245 units of housing 31 000 square feet of
ground-floor retail and an eight-story 580-space structured parking garage by August 31 2007 (the
Completion Date)
In return for the redevelopment of the property the City will abate up to 100% of the Developer's
incremental real property taxes attributable to improvements constructed on the Land but not the Land
itself This abatement will be for up to ten (10) years The City will provide a five (5) year tax abatement for
years 1 through 5 in accordance with the Basic Incentives under the NEZ Policy The total amount of the
tax abatement paid over the term of the agreement shall not exceed a gross aggregate cap of $4 471 955
subject to the Developer's right to a 100% tax abatement in years 1 5 regardless of the value
In order to obtain the maximum benefit under the agreement after year 5 the Developer will be required to
(i) have spent not less than the greater of $7 060 000 in construction hard costs or twenty percent (20%) of
its construction costs, with Fort Worth companies (ii) have spent not less than the greater of $5,295 000 in
construction hard costs or fifteen percent (15%) of its construction costs on Fort Worth Certified MWBE
companies The Developer has also committed to spend the greater of $150 000 per year or sixty percent
(60%) of its annual costs for supplies and services with Fort Worth companies and the greater of $50 000 or
twenty percent (20%) of its annual costs for service and supply contracts with Fort Worth certified M/WBE
companies Additionally the Developer commits to hire at least six (6) individuals in full-time jobs on the
Land at least four (4) Fort Worth residents or sixty seven percent (67%) of the total number of full time jobs,
whichever is greater and at least two (2) Fort Worth Central City residents or thirty three percent (33%) of
the total number of full time jobs whichever is greater on the site as of August 31 2007
The actual amount of the abatement will depend upon the extent of how the Developer meets its
construction and construction spending commitments as outlined above and as allocated as follows.
An amount equal to 60% if the Developer substantially completes at least $46 000 000 in real property
improvements and $1 000 000 in personal property on the site by August 31 2007 Failure to meet this
commitment will constitute an event of default;
An amount equal to 25% if the Developer spends at least 20% of its construction costs or $7 060 000
in construction hard costs whichever is greater with Fort Worth companies Should the Developer not
achieve this commitment, the value of the abatement will be reduced pursuant to a formula based on the
Logname 17PHOENIXTA Page 2 of 3
degree by which the Developer failed to achieve the commitment.
An amount equal to 15% if the Developer spends at least 15% of its construction costs or $5,295 000 in
construction hard costs whichever is greater with Fort Worth Certified MMBE companies Should the
Developer not achieve this commitment, the value of the abatement will be reduced pursuant to a formula
based on the degree by which the Developer failed to achieve the commitment.
If the Developer does not meet its service and supply spending commitment for Fort Worth Companies and
Fort Worth Certified MWBE companies in any given year the value of the tax abatement for the following
year will be reduced by an amount equal the number of dollars by which the Developer failed to meet the
commitments If the Developer fails to meet its employment commitments the value of the abatement for
the following year will be reduced by $10 000 for each employee by whom the Developer failed to meet
such commitments.
The Developer is also requesting City participation in paying for the incremental increase in enhanced
pedestrian improvements bounding the property in accordance with the Berry Street streetscape Initiative
design standards not to exceed $305100 Should the City's T/PW Department determine these
improvements can occur in the future without damaging any near term enhanced streetscape improvements
along Berry Street fronting the property then the City would participate in an Enhanced CFA at a future
date for the incremental cost of upgrading the public streetscape and pedestrian areas under certain
conditions Additionally the Developer is also requesting the City waive up to $347 600 in temporary
encroachment fees for the project that will be requested at a future date
This project is consistent with the City's goals to encouraget redevelopment of the Central City the Berry
Street Initiative Strategic Plan and the Comprehensive Plan The project qualifies for tax abatement under
the City's Neighborhood Empowerment Zone Incentive Policy for qualified mixed-use projects in the Central
City This Tax Abatement Agreement is authorized by Chapter 312 of the Texas Tax Code
The proposed Project is located in COUNCIL DISTRICT 9
FISCAL INFORMATION/CERTIFICATION
The Finance Director certifies that this action will require no direct expenditure from the currently held City
funds
TO Fund/AccountlCenters FROM Fund/AccountlCenters
Submitted for City Manager's Office by• Dale Fisseler (Acting) (6140)
Originating Department Head Tom Higgins (6192)
Additional Information Contact: Christine Maguire (8187)
Logname 17PHOENIXTA Page 3 of 3