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Ordinance 2000-08 ORDINANCE NO. :1.00()-Oe, AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF WYLIE, COLLIN COUNTY, TEXAS, DESIGNA TING REINVESTMENT ZONE NO.2; PROVIDING ELIGIBILITY OF THE ZONE FOR INDUSTRIAL TAX ABATEMENT; CONTAINING FINDINGS THAT THE AREA QUALIFIES TO BE DESIGNA TED AS A REINVESTMENT ZONE AND THE IMPROVEMENTS SOUGHT ARE FEASIBLE AND PRACTICABLE AND OF BENEFIT TO THE LAND AND THE CITY; PROVIDING FOR A SEVERABILITY CLAUSE; PROVIDING FOR A REPEALING CLAUSE; AND PROVIDING FOR THE EFFECTIVE DATE OF SAID ORDINANCE. WHEREAS, the City Council of the City of Wylie, Texas, has caused notice to be published in a newspaper having general circulation the City of Wylie and has delivered such notice to the presiding officer of the governing body of each taxing unit that includes in its boundaries real property described herein; and WHEREAS, the City Council of the City of Wylie, Texas, has conducted a public hearing on the designation of the area described herein as a reinvestment zone; and WHEREAS, the proposed Tax Abatement Agreement by and among the City of Wylie, Texas and Sanden International (U.S.A.), Inc., a Texas Corporation, attached hereto as Exhibit "A," has been presented to the City Council; and the City Council is of the opinion and finds that the terms and conditions thereof should be approved and that the Mayor should be authorized to execute the Agreement on behalf of the City of Wylie, Texas. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WYLIE, COLLIN COUNTY, TEXAS: SECTION 1. That the City Council of the City of Wylie, Texas, finds that the area described herein will, if designated as a reinvestment zone, be reasonably likely to contribute to the retention or expansion of primary employment, or to attract major investment in the zone that will be of benefit to the property and contribute to the economic development of the City. The City Council further finds that the improvements sought are feasible and practicable and would be of benefit to the land to be included in the zone and to the City after the expiration of the tax abatement agreement. SECTION 2. That pursuant to the provisions of Section 312.201 of the Texas Tax Code, the real property described in the Tax Abatement Agreement attached hereto as Exhibit "A" and made part hereof for all purposes is hereby designated as a reinvestment zone and for identification is assigned the name "Reinvestment Zone NO.2." SECTION 3. That the property within Reinvestment Zone No.2 is eligible for industrial tax abatement effective on January 1,2000, and for a period of six (6) years. SECTION 4. The Agreement attached hereto as Exhibit "A" having been reviewed by the City Council and found to be acceptable and in the best interest of the City and its citizens, is hereby approved, and the Mayor is hereby authorized to execute the Agreement on behalf of the City of Wylie, Texas. SECTION 5. That should any word, sentence, paragraph, subdivision, clause, phrase or section of this ordinance, or the Code of Ordinances, as amended hereby, be adjudged or held to be void or unconstitutional, the same shall not affect the validity of the remaining portions of said ordinance or the Code of Ordinances, as amended hereby, which shall remain in full force and effect. SECTION 6. That all ordinances of the City of Wylie, Texas, in conflict with the provisions of this ordinance shall be, and the same hereby, repealed; however, that all other provisions of said ordinances not in conflict herewith shall remain in full force and effect. SECTION 7. That this ordinance shall take effect immediately from and after its passage in accordance with the provisions of the Charter of the City of Wylie, Texas, and it is accordingly so ordained. DULY PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF WYLIE, COLLIN COUNTY, TEXAS, ON THIS THE 13th DAY OF JUNE, 2000. ATTEST: ry ,.:.lS:~" ~x; \ ~: J] III n !t'.~! !,! I. ,f~~\"~i' 0 F ~V)'')%~ ~~'X. "' / .~ ~ '" " " ~/ A~ i:$r ~ .f..{,"~ ,;:~ ;:':....., " .... f! y, - ,- - '-.' - -' .... -,' ~~ -- ~~ -- .~ -- ",'" '"-., \ .J~ ~ I. . .,C:! ,'':y' ~ Yj/YL . c."..'..'. '.:,",;.- ~I,~'i.. IE."\ ,.' .<.,;.,- ~':;i:i;'':i;I,.';; ~; r~, .'.\' ,,'.., 06/08/00 16:49 FAX 214 651 4330 STRASBURGER & PRICE 1lI002!014 DRAFT 6/8/00 3:33 PM State of Texas ) ) City of Wylie ) TAX ABATEMENT AGREEMENT This Tax Abatement Agreement ("Agreement") is entered into by and between the City of Wylie. Texas, a home mle city and municipal corporation of Collin County, Texas, duly acting herein by and through it~ Mayor (lhe "City"), and Sanden International (U.S.A.), Inc.. a Texas corporation (the "Owner"). R E C I TAL S: WHEREAS, on ,_, the City COlmcil of the City of Wylie, Texas passed Ordinance No. establishing Reinvestment Zone No.2, City of Wylie, Texas for cOlmncrciaVindustrial tax abatement (the "Ordinance"), as authorized by V.T.C.A Tax Code. Chapter 312 (the "Act"); WHEREAS, on the ~ day of .~, the City Council of Wylie, Texas agreed to abate an amount of ad valorem taxes on certain real and personal property which is located within Reinvestment Zone No.2; WHEREAS, the Owner wishes to make improvements and to install personal property within Reinvestment Zone No.2; WHEREAS, the City has adopted by Resolution No. the City of Wylie Economic Incentive Guidelines and Criteria ("Guidelines and Criteria") governing tax abatement agreements to be entered into by the City as contemplated by the Act; WHEREA.S, the contemplated improvements to the Property (as hereinafter defined) and any other of the temlS set forth herein are consistent with encouraging development of the City ofWy lie, S8USX6 ;lSP3/? 1221 illl 0510GOS200o 1 06/08/00 16: 49 FAX. 214 651 4330 STR~SBVRGER & PRICE I/J 003/014 Texas in accordance with the purposes for its creation and are in compliance with the Guidelines and Criteria; WHEREAS, the City wishes to maintain and enhance the commercial/industrial economic and employment base of the Wylie area tor the long-term interest and benefit of the City in accordance with the Ordinance and the Act; WHEREAS, the addition of Personal Property on the Premises, as those tenns are hereinafter defined, is consistent with encouraging further development of said Reinvestment Zone No.2 in accordance with the purposes for its creation and are in compliance with the intent of the Guidelines and Criteria and the Ordinance adopted by the City and all other applicable laws; and NOW, THEREFORE, the parties to this Agreement do mutually agree as follows; 1. Property (a) The property subject to this Agreement (the "Property") includes (i) the real property within the metes and bOllllds of Reinvestment Zone No.2 as described on Exhibit "A" hereto and any improvements thereon (the "Real Property"), and (ii) the personal property (the "Personal Property") that is situated on the Real Property, as set forth on Exhibit "B." The abatement shall be calculated for each year covered by this Agreement to the extent the value of Real Property for that year exceeds the $ value for the tax year in which the Agreement was executed, and for the value of the Personal Property that was not located on the Real Property at any time before the period covered by tlllS Agreement. (b) Tax abatement on the Property is expressly contingent on the Owner improving the Real Property according to the terms of this Section I (b) and Exhibit "B." As set forth on Exhibit "B," the Owner will install Personal Property and will make improvements to the Real Property in an amount detennined by the Collin County Appraisal District of approximately 19 mHlion dollars ($19,000,000) on or before December 31. 2000, representing the "Primary Installation" and the Owner will make an additional installation of Personal Property and additional improvements to the Real Property, also as set forth on Exhibit "B," in an amount determined by the Collin County Appraisal District ofapproximalely 29 million dollars ($29,000.000) on or before 200 I, representing 5805863/sp~m22lI01 U5101l0820oo 2 06/08/00 16:49 FAX 214 651 4330 STRASBURGER & PRICE IIJ 004/014 -- the "Secondary Installation," for a total installation of Personal Property and for total improvements to the Real Property, thc combined value of which, as determined by the Collin County Appraisal District, will be an arnotmt approximately equal to 48 million dollars ($48,000,000); provided, however, that the Owner shall have such additional time to complete the installation as may be required if (i) Owner or any affiliate thereof is delayed or prohibited from completing either installation in the event of "force m~ieure" or (ii) ifin the reasonable opinion of the City, the Owner or any affiliate thereofhas made substantial progy-ess toward completion of the installation. For pUlposes of this Agreement, "force majeure" shall mean any contingency or cause beyond the reasonable control of Owner or any affiliate thereof, including, without limitation, acts of God or the public enemy, war, riot, civil commotion, instUTection, governmental or de facto governmental action (unless caused by acts or omissions of Owner or any affiliate thereof), fire, explosion or flood, and strikes. 2. Tax Abatement Subject to the terms and conditions of this Agreement, and subject to the rights of holders of any bonds of the City outstanding as of the date of this Agreement, a portion of ad valorem property taxes on the Property that is the subject of this Agreement, and that are otherwise owed to the City will be abated. For the year 2000, said abatement shall be in an amount equal to 40 percent (40%) of the taxes assessed upon the value of the Real Property and upon the value of the Personal Property that is the subject of the Primary Installation; for years 2001, 2002, 2003, and 2004, the abatement will be in an amount equal to 40 percent (40%) of the taxes assessed upon the value of the Real Property and upon value of the Personal Property that is the subject of the Primary and the Secondary Installation; for the year 2005, the abatement will be in an amount equal to 40 percent (40%) of the taxes assessed upon the value of the Personal Property Ulat is the subject of the Secondary Installation; provided that the Owner shall have the right to protest and/or contest any " assesSment of the Property and said abatement shall be applied to the amount of taxes tlnally determined to be due as a result of any such protest and/or contest. The tax abatement will extend for a total period of six (6) years beginning January I, 2000, and ending December 31, 2005. 5RlJ5~ 31Sl'31717.2 JlO J OY06OIlZOOO 3 06/08/00 16:50 FAX 214 651 4330 STRASBURGER & PRICE llJ 005/014 3. Owner's Good F.litb in Construction The Owner agrees and covenants that it will diligently, faithfully, and in a good and workmanlike manner, pursue the completion of the Primary Installation and the Secondary Installation, as good and valuable consideration for this Agreement. The Owner further covenants and agrees that all construction will be in substantial compliance with applicable federal, state and local laws, codes, and regulations or valid waiver thereof. 4. Limitation OD Use of the Real Property. During the period of tax abatement, the Owner agrees that its use of the Real Property will be consistent with the development or redevelopment of the Real Property in accordance with its designation as Reinvestment Zone No.2. 5. Inspection The Owner agrees that the City, its agents and employees, shall have reasonable right of access to inspect the Property in order to ensure that the improvements, construction and/or location of the Property are in accordance with this Agreement and all applicable state and local laws and regulatiuns or valid waiver thereof After completion of the Primary Installation and the Secondary Installation, the City shall have the continuing right, subject to the Owner's reasonable security requirements, to inspect the Property to ensure that the Real Property and Personal Property are maintained, operated and occupied in accordance with this Agreement. It is also provided that any inspection of the Property by the City shall only occur after prior notification to the Owncr and at a time mutually agreed upon by the City and the Owner. It is further provided that any inspection by the City should attempt to minimize interference with nonnal business operations of the Owner. 6. Mutual Assistance The City and the Owner shall do all things necessary or appropriate to earry out the terms and provisions of this Agreement and to aid and assist each other in carrying out such terms and provisions. S8\l;!l63/SI'317122 1/0 J 051060K7.000 4 06/08/00 16:50 FAX 214 651 4330 STRASBURGER & PRICE flJ006/014 7. Counterparts This Agreement may be executed in multiple counterparts, each of which shaH constitute an original, but all of which in the aggregate shall constitute one agreement. 8. Invalidity or Illegality of Agreement If any provision contained in this Agreement is held to be invalid, i1legal, or unen1'Orceable in any respect, such invalidity, illegality or uncnforceability shall not affect any other provision. In lieu of each invalid, illegal or unenforceable provision, there shall be added a new provision by agreement of the parties as similar in temlS to such invalid, illegal or unenforceable provision as may be possible and yet be valid, legal and enforceable. 9. Entire Agreement This Agreement contains the entire agreement between the parties with respect to the transaction contemplated herein. 10. Amendment This Agreement may only be amended, altered, or revoked by written instrument signed by both the Owner and the City. 11. Det'ault by Owner (a) Specific Default. In the event that the Owner fails to complete the Primary Installation and the Secondary InstaHation according to the tenus set forth in Section 1 of this Agreement (a "Specific Default"), the City shall give the Owner written notice of such Specific Default. If the Owner halt not materially cured such Specific Default within sixty (60) days of written notice, or, ifthc Specific Default cannot with due diligence be materially eured within a 60- day period and the Owner has not commenced and proceeded diligently to cure the Specific Default, then, as its sole remedy, the City shall (1) tenninate this Agreement and (2) receive as liquidated damages all previously abated taxes which otherwise would have been paid to the City without the benefit of tax abatement. The liquidated damages will become a debt to the City and shall be due, owing and paid to the City within sixty (60) days of the expiration of the Cure period. In the event that the previously abated ta.xes are not paid within the time period provided in the previous 58058G.31SI'JI71221/010S~O~OOO 5 06/08/00 16:51 FAX 214 651 4330 STRASBURGER & PRICE ~ 007/014 sentence, penalties and interest, at the prevailing prime interest rate at Bank of Amelica, N .A, or its successor, shall be charged as authorized by the Texas Property Ta." Code. (b) General Default. In the event that the Owner defaults in its perfonnance of this Agreement, other than as set forth above ill Section Il(a) of this Agreement with respect to a Specific Default, (a "General Default"), the City shall give the Owner written notice of such General Default If the Owner has not materially cured such General Default within sixty (60) days of written notice, or, if the General Default cannot with due diligence be materially cured within a 60-day period and the Owner has not commenced and proceeded diligently to cure the General Default, then, as its sole remedy, the City may (1) terminate or modify this Agreement and/or (2) receive as liquidated damages all previously abated taxes which otherwise would have been paid to the City without the benefit of abatement. The liquidated damages will become a debt to the City and shall be due, owing and paid to the City within sixty (60) days of the eXpiration of the cure period. In the event the previously abated taxes are not paid within the time period provided in the prevIOUS sentence. penalty and interest, at the prevailing prime interest rate at Bank of America, N.A.. or its successor. shall be charged as authori~ed by the Texas Property Tax Code. 12. Default by City In the event that the City defaults in performance of this Agreement, the Owner shall give the City written notice of default. If the City has not materially cured the default within sixty (60) days written notice, Or, if the default cannot with due diligence be materially cured within a 60-day period and the City has not commenced and proceeded diligently to cure the default, then the Owner, as its sole remedy, may either seek specific performance of this Agreement or seek damages resulting from the City's default. 13. Notice Notices required to be given to any party to this Agreement shall be given personally or by certified mail. return receipt requested, postage prepaid. addressed to the party at its address as set forth below, and, if given by mail, shall be deemed delivered as of the date deposited in the United States mail: 580586 3/:SP~I7l22 /10 105fO~08:WOO 6 06/08/00 16:51 FAX 214 651 4330 STRASBURGER & PRICE ~008/014 For the City by notice both to the City Attorney and the City Manager: City Manager City of Wylie 2000 Highway 78 North Wylie, Texas 75098 City Attorney City of Wylie P.O. Box 1210 McKinney, Texas 75070 For the Owner by notice to Sanden International (U.S.A.), Inc.: Sanden International (U.S.A), Inc. Attn: 601 SOUtll Sanden Boulevard Wylie, Texas 75098 Any party may change the address to which notices arc to be sent by giving the otJler parties written notice in the manner provided in this paragraph. 14. Applicable Law This Agreement is made, and shall be construed and interpreted under the laws of the State of Texas and venue fOT any co\.u1 action relating to this Agreement shall lie in Collin County, Texas. 15. Successors and Assigns TIns Agreement shall vest in Owner and shall be assignable to each new owner of aU or a portion of the Premises or any improvements situated thereon so long as such new owner is all Affiliate of Owner (as hereinafter defmed), upon written approval of such assignment by the City. Such new owner must expressly assume all of the obligations of the Owner under this Agreement for the balance of the term of this Agreement. Approval of assignment to such Affiliate of Owner shall be promptly considered by the City and shall not he unreasonably withheld. For purposes of SS05KhJ/SP3nl:nIIO!05/0601l1000 7 06/08/00 16:51 FAX 214 651 4330 STRASBURGER & PRICE III 009/014 _ this Agreement, an "Affiliate of Owner" means (a) any entity directly or indirectly holding an ownership interest in or controlling the outstanding securities of the Owner, both by vote and by value; (b) any entity whose ownership interest or outstanding securities are directly or indirectly controlled by the Owner; and (c) any entity directly or indirectly controlling, controlled by, or under conunon control or ownership with the Owner. In determining whether the requisite amount of control is present, any entity who owns, either directly or indirectly one hundred percent (100%) of the outstanding securities of or ownership interest in another entity by vote and by value, shall be preswned to control such entity. 16. Certification Ibe Owner shall certify annually, in writillg, to the City that the Owner is incompliance with each telm of the Agreement. Executed and made effective as of the day of ,2000. ATTEST: CITY OF WYLIE By: Mindy Manson, Acting City Manager Barbara Salinas, City Secretary APPROVED AS TO FORM: SANDEN INTERNATIONAL (U.S.A.), INC. By: Its: Richard Abemathy. City Attorney S 105116. J/SP3/71:!Z 110 1 05/060KZOOO 8 06/08/00 16:52 FAX 214 651 4330 ~ Il\)S K6 .1/SP3f71 !! 1 ro I 051060H2000 STRASBURGER & PRICE ~010/014 EXHIBIT A Descl"iptioD of Real Pr-operty [see attached] 06/08/00 16:52 FAX 214 651 4330 - --.-...---- --.-- .arT _STRASBURGER & PRICE flJOll/014 {f lU ft! lUlU H III 'mt il! ~~ili nn UI ~; fHm~ ! ! !! 1{\ I~ ~;iIH d ~tl i~~! hI ~!t~~ JH~ m h ;!fili ~ ~ d f;, i.; 'V'I' I: 'I' liJ~ '1'1 hI:! ('I': Irq tl 1'1',1 t ~!- if of: I:S i,t, ; fl. ,I ihr ~:. rui '. hI l~ ~a I, . '.: il' I!~'! I. .' I"~ lit -'I" ~h t'_ I, II'," " · h W at;', if :: ~t~1 >11 lllf 1'1 'n II ,.!.., I ! 111l!1 ~i!l ij ~ Hlill ~~ 1111~ II ~~! I r ... i' rllJ, I, 'iI ~.I, h,' {(It .1, ~I, I. 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[ ~ t: I I . tIII!'_....~_.....lIM 06/08/00 16: 53 FAX 21.4 651 4330.. STRASBURGER & PRICE flJ014/014 EXHIBIT B Description of Personal Property 1. Primary Installation Construction of Die Cast Facility and installation of related machinery and equipment. 2. Secondary Installation Final installation of machinery and equipment related to Die Cast Facility and installation of machinery and equipment related to PXF -18 Facility, as well as installation of certain other unrelated machinery and equipment. ~80Sti6JISl'JI7I ~~ I/OlUSI06011100U r!'IIE WYLIE NEWS fA~verlnK \1/ylle, Slle"~e, ftillrl,hy llIfl tile lurrlllllllllnK IIrell 110 N. I1nlln,d Sl. 1'.0. Blllt :l1l9 Wylil'. Tcltn!l 75lJ9R (972) 442-5515 rllX (972) 442-4~ I R STATE OF TEXAS C()UNTY OIl' COLLIN IJerol'e me, the undersigned authority, on tbls day personally appeared Cbad Engbrock, of THE WYLIE NEWS, n ne\l'spaper regulnrly publlsbed In Collin County, Texas and having general clrculnUon In Collin Count)', 'Ie~as, who being by me duly sworn deposed and says Ulal the foregoing attached Ondinance No. 2000-8 "'ns published In sold newspaper 01* tbe followhlg dates, to-wit! Au~tt6t 30 , 2000, and Wt~k , 2000. Subscribed nnd sworn to before me tbls Ule 7 to certify \l'hlch witness my '.and and sea' or on1ce. day of Septemben . 2000, N tary Public In aud for The State of 'texas My Comndssfon Expires