Resolution 2007-38 RESOLUTION NO. 2007-38(R)
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
WYLIE, TEXAS, ADOPTING GUIDELINES AND CRITERIA FOR
THE PROVISION OF TAX ABATEMENT AGREEMENTS,
ADOPTING A COMPREHENSIVE POLICY STATEMENT FOR
ECONOMIC DEVELOPMENT INCENTIVES; ESTABLISHING
OBJECTIVE AND SUBJECTIVE CRITERIA EVALUATING
INCENTIVE APPLICATIONS; ESTABLISHING MAXIMUM
INCENTIVES TO BE PROVIDED; ESTABLISHING PROCEDURAL
GUIDELINES FOR EVALUATING INCENTIVE APPLICATIONS;
AND PROVIDING GUIDELINES AND CRITERIA GOVERNING
TAX ABATEMENT AGREEMENTS.
WHEREAS, the City of Wylie, Texas ("Wylie") is committed to the long term economic
growth and vitality of the City of Wylie and desires to promote a balanced property tax base; and
WHEREAS, the City of Wylie realizes the positive benefits of job creation and
economic diversification; and
F
~ WHEREAS, the City of Wylie desires to attract and retain quality business and industry
which compliment the quality of life within the community; and
WHEREAS, the City of Wylie realizes the attraction of long term investment and the
establishment of new jobs in the area would enhance the economic base of the City of Wylie;
and
WHEREAS, the City of Wylie may from time to time wish to stimulate economic
development within the community through the provision of tax abatements and other economic
development incentives; and
WHEREAS, the City of Wylie realizes the abatement of taxes, when offered, will be an
effective method of enhancing and diversifying the local economy through the attraction of new
jobs and new wealth from outside the community; and
WHEREAS, the City of Wylie acknowledges the Texas Tax Code Chapter 312, the
Property Redevelopment and Tax Abatement Act (the "Act"), allows taxing units the ability to
provide tax abatement for limited periods of time as an inducement for the development or
redevelopment of a property and the City of Wylie elects to be eligible to participate in t~
abatement; and
WHEREAS, the City of Wylie acknowledges the Act requires any eligible taxing
jurisdiction to establish guidelines and criteria as to eligibility for taa~ abatement agreements prior
to the granting of any future tax abatements and the City of Wylie has established guidelines and
criteria attached hereto as E~ibit "A" and incorporated herein for all purposes.
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NOW, THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE
CITY OF WYLIE, TEXAS:
SECTION 1. Findin
s~Incorporated. The findings set forth above are incorporated into
the body of this Resolution as if fully set forth herein.
SECTION 2. Guidelines and Criteria Established. Wylie, pursuant to Section 312.002,
Texas Tax Code, hereby establishes the guidelines and criteria governing tax abatement
agreements, which are attached hereto as Exhibit "A" and incorporated as if fully set forth herein
for all purposes.
SECTION 3. Election to Participate. Wylie hereby elects to be eligible to participate in
tax abatement.
SECTION 4. Effective Date. This Resolution shall become effective immediately upon
its adoption.
DULY PASSED AND APPROVED by the City Council of the City of Wylie, Texas
this 13th day of November 2007.
`~~p o~Mayor
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Carole Ehrlich, Ci Secretary
APPROVED AS TO FORM:
Abernathy, Roeder, Boyd & Joplin, P.C.
Richard Abernathy, City Attorney
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EXHIBIT "A" - Economic Development Incentives
I. Purpose and Objective
The City of Wylie is committed to the promotion of quality development in all parts of the
City and to an ongoing improvement in the quality of life for its residents. These
objectives are generally served by the enhancement and expansion of the local economy.
The City of Wylie will, on a case by case basis, give consideration to providing incentives
as stimulation for economic development in Wylie. Nothing herein shall imply or suggest
that the City of Wylie is under obligation to provide any incentive to any applicant. All
applications shall be considered on a case by case basis.
II. Criteria for Economic Development Incentives:
Any request for tax abatement shall be reviewed by the City Council.
A. Subiective Evaluation: The Council's recommendation shall be based, in part,
upon a subjective evaluation of the following criteria which each applicant will be
requested to address in narrative format.
EmploVment Impact
How many jobs will be brought to Wylie?
What types of jobs will be created?
What will the total annual payroll be?
Fiscal Impact
How much real and personal property value will be added to the tax rolls?
How much direct sales tax will be generated?
How will this project affect existing businesses and/or office facilities?
What infrastructure construction would be required?
What is the total annual operating budget of this facility projected to be?
Communitv Impact
What effect would the proj ect have on the local housing market?
What environmental impact, if any, will be created by the project?
How compatible is the project with the City's comprehensive plan?
Impact on Services and Plannin~:
Is the project consistent with the comprehensive plan with or of the City
~ of Wylie?
What types and costs of public improvements and services (sewer main
extensions, streets, alleys, etc.) will be required of the City? What types
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and values of public improvements if any will be made by the
applicant?
B. Minimum Thresholds to be Eligible for Consideration (New Business): The
following threshold criteria shall also be used to determine whether any economic
development incentives shall be granted to new projects:
l. The proposed project must create at least ten (10) or more jobs by the end of
the abatement period.
2. The proposed project must provide for taxable assets within two (2) years
from the commencement of construction as evidence by a building permit
issued by the City of Wylie.
3. The project must meet all relevant zoning requirements.
4. Generally to be eligible, a project must consist of an industrial, commercial, or
warehouse use.
C. Minimum Thresholds to be Eligible for Consideration (Existin~ Businesses):
The City of Wylie recognizes the importance of expansion of the existing
businesses as a key element in the economic development of the City. Therefore,
different criteria for incentive eligibility have been developed for business
expansion. In order to be eligible for abatement, an expanding business must meet
the following criteria:
1. The project must create ten (10) or more jobs by the end abatement period.
2. The project must result in an addition of $500,000 in assessed value within the
first year of the abatement.
3. The project must also meet the criteria as stated previously in this section.
III. Types of Incentives
It is the intent of the City of Wylie to evaluate the offering of economic development
incentives on a case by case basis. This individualized design of a total incentive package is
intended to allow a maximum flexibility in addressing the unique concerns of each applicant
while enabling the City to better respond to the changing needs of the community. Below is
a chart which reflects the percentage amount to be abated:
MAXIMUM TAX ABATEMENT
NEWLY CREATED VALUE OVER 5 YEAR PERIOD
$3 million + 400%
$2 million - $2,999,999 300%
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$1 million• $1,999,999 200%
EXPANDED VALUE
$2.5 million + 400%
$1,500,000 - $2,499,999 300%
$500,000 - $1,499,999 200%
Abatements may be granted for terms from two to five (2 - 5) years but may be extended to
the limits as specified by state law. Abatements of greater than five (5) years may be
considered, only if it can be clearly demonstrated that it is economically beneficial to the
City to do so. Abatement periods in excess of five (5) years must be approved by a three-
quarter vote of the City Council. Should the City Council approve an abatement agreement
in excess of five (5) years, it is within its sole discretion to increase the maximum tax
abatement offered.
The above chart reflects the maximum tax incentive to be eligible for over a period not to
exceed five (5) years. No applicant may take a percentage greater than 100% in any given
year. For example, the qualified applicant may choose to take the 200% abatement over a two
(2) year period at 100% each year; or may extend it to 50% each year for four (4) years. The
same method would apply to the 300% and 400% abatement. Please keep in mind that the
percentages stated on the right are the maximum amounts.
Should the Wylie City Council hear supplementary evidence supporting a tax
abatement beyond those guidelines and criteria established by this Resolution, a three-
quarter vote of the City Council will be required. For example, should a 400%, five-
year tax abatement be sought by an applicant for a project having less than $3 million
in newly created value, a three-quarter vote of the City Council will be required.
IV. Application Procedures
Any person applying for economic development incentives will be required to comply
with several application procedures as determined by the Office of the City Manager or
its designee.
V. Recapture
The City of Wylie will have very specific performance standards that will be measured to
ensure that the qualified applicant is adhering to these guidelines and any abatement
agreement. In the event that the company or individual fails to keep current on ad
valorem or other taxes, or violates the terms and conditions of the abatement agreement
in any fashion; the City of Wylie will have the option along with the other taxing entities,
to recoup any tax monies that were abated.
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VI. Assignment
The abatement may be transferred and assigned by the holder to a new owner ar lessee of
the same facility upon approval of the City Council; subject to the financial capacity of
the assignee and provided that all conditions and obligations in the abatement agreement
are guaranteed by the execution of a new contractual agreement with the City of Wylie
and all performance criteria are being met.
VII. Sunset Provisions
The guidelines and criteria are effective upon the date of their adoption and will remain
in force for two (2) years. At which time all reinvestment zones and tax abatement
contracts created pursuant to its provisions, will be reviewed by the City Council of Wylie
to determine whether the goals of the abatement program has been achieved. Based upon
that review, the guidelines and criteria may be modified, renewed or eliminated.
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