R2021-045 2021-03-22 RESOLUTION NO. R2021-45
A Resolution of the City Council of the City of Pearland, Texas, updating
and approving the City's guidelines and criteria for granting tax
abatements within a reinvestment zone created in the City of Pearland,
Brazoria County, Fort Bend County, and Harris County, Texas; providing a
savings clause; providing a severability clause; and providing for an
effective date.
WHEREAS, the Texas Legislature has passed and approved the Property
Redevelopment and Tax Abatement Act, codified in the Texas Tax Code as Sections 312.001
through 312.402, as amended (hereinafter referred to as the "Act"); and
WHEREAS, pursuant to Section 312.002(a) of the Act, a taxing unit may not enter into a
tax abatement agreement under the Act or designate an area as a reinvestment zone unless it
has elected to become eligible to participate in tax abatement, and has established guidelines
and criteria governing tax abatement agreements by the taxing unit; and
WHEREAS, the City of Pearland, Texas (the "City") has previously elected to participate
in tax abatement agreements pursuant to the Act and intends to continue to participate in tax
abatements pursuant to the Act; and
WHEREAS, the creation and retention of job opportunities that bring economic
growth is one of the highest civic priorities for the City; and
WHEREAS, new jobs and capital investment will benefit the area economy, provide
needed opportunities, strengthen the real estate market and generate tax revenue to support
local services; and
WHEREAS, the City must compete with other localities across the nation currently
offering tax inducements to attract new eligible projects; and
WHEREAS, any tax incentives offered in the City may reduce needed tax revenue
unless strictly limited in application to those new and existing industries that bring new wealth
to the community; and
WHEREAS, any tax incentives should not adversely affect the competitive position of
existing companies operating in the City; and
WHEREAS, the abatement of ad valorem property taxes levied by the City, when
offered to attract primary jobs in industries which bring job creation and capital investment from
outside a community instead of merely circulating dollars within a community, has been shown to
be an effective method of enhancing and diversifying an area's economy; and
WHEREAS, effective September 1, 1987, Texas law requires any eligible taxing
jurisdiction to establish Guidelines and Criteria as to eligibility for tax abatement agreements
prior to granting of any future tax abatement, said Guidelines and Criteria to be unchanged for a
two (2) year period unless amended by a three-quarters vote of the City Council; now therefore,
Resolution No. R2021-45
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF PEARLAND, TEXAS,
Section 1. That the foregoing recitals are hereby found to be true and correct findings
of the City of Pearland, Texas, and are fully incorporated into the body of this Resolution.
Section 2. The City Council of the City of Pearland, Texas, hereby establishes and
adopts the "City of Pearland, Texas, Tax Abatement Policy, Guidelines and Criteria" attached
hereto as Exhibit A, which is incorporated herein for all purposes. These guidelines and criteria
adopted are effective for two (2) years.
Section 3. Savings Clause. All rights and remedies which have accrued in favor of the
City hereunder and amendments thereto shall be and are preserved for the benefit of the City of
the Pearland.
Section 4. Severability Clause. It is hereby declared to be the intention of the City
Council that the phrases, clauses, sentences, paragraphs and sections of this Resolution are
severable, and if any phrase, clause, sentence, paragraph or section of this Resolution shall be
declared unconstitutional by the valid judgment or decree of any court of competent jurisdiction,
such unconstitutionally shall not affect any of the remaining phrases, clauses, sentences,
paragraphs and sections of this Resolution, since the same would have been enacted by the
City Council without the incorporation of this Resolution of any such unconstitutional phrase,
clause, sentences, paragraph or section.
Section 5. Effective Date. This Resolution shall become effective from and after its
passage.
PASSED, APPROVED and ADOPTED this the 22nd day of March, A.D., 2021.
EVIN COLE
MAYOR
ATTEST:
°oF p EA ,,,,
Y TAL OAN, TRMC, CMC
CITY SECRETARY -��
APPROVED AS TO FORM: 07:
DARRIN M. COKER
CITY ATTORNEY
Page 2
Exhibit A
City of Pearland, Texas
Tax Abatement Policy
Guidelines and Criteria
Resolution No. R2021-45
Section 1. DEFINITIONS.
(a) "Abatement" means the full or partial exemption from ad valorem taxes of certain
real property in a reinvestment zone designated by the City for economic
development purposes.
(b) "Abatement Agreement" and "Agreement" mean a contractual agreement
between a property owner and/or lessee and the City for the purposes of
permitting abatement of a portion of ad valorem property taxes assessed to the
Premises and Improvements as defined herein and otherwise owed to the City.
(c) "Base Value of Premises" means the assessed value of property located at the
Premises at the time of execution of the Agreement, which shall consist of the
assessed value of the Premises as of January 1 immediately preceding the
execution of the Agreement plus the agreed upon value of Improvements made
thereafter, but before the execution of the Agreement.
(d) "Deferred Maintenance" means labor and materials necessary for continued
operations which are scheduled or periodic in nature.
(e) "Distribution Center Premises" means buildings and structures, including
machinery and equipment, used or to be used primarily to receive, store, service
or distribute goods or materials owned by the Premises operator where a
majority of the goods or services are distributed to points located outside of the
City of Pearland.
(f) "Company" means the party receiving the benefit of the abatement of ad valorem
property taxes levied by the City pursuant to an Abatement Agreement for which
this Resolution shall govern and may include a corporation, limited liability
company, partnership, limited partnership, sole proprietorship, joint venture,
natural person(s) or any other form of business association that may be formed
or is recognized by the State of Texas.
(g) "Employment Positions" means new full-time equivalent employment positions of
at least 2,000 hours per employee in the City with the Company at the Premises
averaged over a (12) month period, with such hours also to include any vacation
and sick leave, with a specified average annual gross compensation (excluding
benefits) and for which medical benefits must be provided.
(h) "Expansion" means the addition of buildings, structures, machinery or equipment
for purposes of increasing production capacity.
(i) "Headquarters Facility" means Premises used primarily as the executive
offices for a Company the primary purpose of which is to provide support
services to other entities affiliated through common ownership with the
Company.
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Resolution No. R2021-45
(j) "Improvements" means Fixed Improvements which shall be limited to real
property and/or leasehold improvements.
(k) "Funding Conditions" means capital Improvements and job creation conditions
outlined in the Agreement. The capital improvements conditions shall specifically
set forth value of the Improvements which must be made by the Improvement
Completion Date. The job creation conditions shall specifically set forth the
number and quality of Employment Positions.
(I) "Hotel and Convention Premises" means buildings and structures, including
machinery and equipment, the primary purpose of which is to provide a
destination conference facility with 250 or more hotel rooms and more than
25,000 square feet of contiguous conference space. This shall also include
facilities with 25,000 square feet or more of contiguous conference space without
the requirement of a related hotel.
(m) "Improvement Completion Date" means the date upon which the Improvements
shall be substantially completed by the Company.
(n) "Manufacturing Premises" means buildings and structures, including machinery
and equipment, the primary purpose of which is or will be the manufacture of
tangible goods or materials or the processing of such goods or materials by
physical or chemical change.
(o) "Modernization" means the replacement and upgrading of existing facilities which
increases the productive input or output, updates the technology or substantially
lowers the unit cost of the operation. Modernization may result from the
construction, alteration or installation of building, structures, machinery or
equipment. Modernization shall not be for the purpose of reconditioning,
refurbishing or repairing including scheduled and periodic maintenance of real
property or Tangible Personal Property.
(p) "New Premises" means a property previously undeveloped which is placed into
service by means other than or in conjunction with Expansion or Modernization.
(q) "Office Premises" means one or more multi-level office buildings each one of
which consists of 50,000 square feet of office space no more than twenty percent
(20%) of which is dedicated to retail industry.
(r) "Other Basic Industry" means buildings and structures including Tangible
Personal Property machinery and equipment not elsewhere described, used or to
be used for the production of products or services which serve a market primarily
outside the City and result in the creation of new permanent jobs and create new
wealth in the City.
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Resolution No. R2021-45
(s) "Premises" means property Improvements completed or in the process of
construction which together comprises an integral whole and which are the
subject of the Agreement and shall be designated in that Agreement by metes
and bounds or other substantially similar description.
(t) "Productive life" means the number of years a property improvement is expected
to be in service.
(u) "Regional Entertainment Premises" means buildings and structures, including
machinery and equipment, used or to be used to provide entertainment through
the admission of the general public where the majority of users reside at least 50
miles from its location in the City.
(v) "Research Premises" means building and structures, including machinery and
equipment, used or to be used primarily for research or experimentation to
improve or develop new tangible goods or materials or to improve or develop the
production processes thereto.
(w) "Regional Service Premises" means buildings and structures, including
machinery and equipment, used or to be used to service goods where a majority
of the goods being serviced originate at least 50 miles from the Premises'
location in the City.
(x) "Tangible Personal Property" means (i) personal property that can be seen,
weighed, measured, felt, or otherwise perceived by the senses, (ii) that is owned
for its role in contributing directly to the business's ability to generate profit but
does not include, furniture and fixtures such as laptop computers, desktop
computers, printers, chairs, desks, decorations, reprographics devices,
machinery and equipment, inventory, supplies and other similar appurtenances
which may indirectly contribute to the business' ability to generate a profit.
Tangible Personal Property also does not include: intangibles which shall include
a document or other perceptible object that constitutes evidence of a valuable
interest, claim, or right and has negligible or no intrinsic value, and Tangible
Personal Property that was located within the reinvestment zone prior to
execution of the Agreement with the City or located in the reinvestment zone
subsequent to the execution of the Agreement with the City but not specifically
identified in the Agreement.
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Resolution No. R2021-45
Section 2. ABATEMENT AUTHORIZED.
(a) Eligible Premises. Premises may be eligible for abatement if it is a Hotel and
Convention Premises, Manufacturing Premises, Office Premises, Research
Premises, Distribution Center Premises, Headquarters Premises, Regional
Service Premises, Regional Entertainment Premises or Other Basic Industry.
(b) Creation of New Value. Abatement may only be granted for the additional value
of eligible Improvements incorporated into the Premises subsequent to and
specified in an Abatement Agreement between the City and the property owner,
lessee or member of an affiliated group which includes the property owner and
the lessee in which a controlling interest (more than 50%) is owned by a common
owner, subject to such limitations as the City Council may require.
(c) New and Existing Facilities at the Premises. Abatement may be granted for new
Improvements to existing facilities at the Premises for purposes of Modernization
or Expansion.
(d) Eligible Property. Abatement shall be limited to all or a portion of the value of the
Improvement, as defined herein, located at the Premises.
(e) Ineligible Property. The following types of property shall be ineligible for
abatement: land; tools; furnishings, machinery and equipment, inventory,
supplies, computers and other forms of movable personal property which meet
the definition of Tangible Personal Property set forth above; vehicles; vessels;
aircraft; housing and dwellings; retail facilities and Deferred Maintenance.
(f) Leased Facilities. Leasehold Interest: Abatement may be granted to the owner of
a leasehold interest in real property, including tax-exempt real property, located
in a reinvestment zone designated to exempt all or a portion of the value of the
leasehold interest in the real property Tax Code, Section 312.402 (a-1).
Lessee Interest. Abatement may be granted to a lessee of taxable real property
located in a reinvestment zone to exempt from taxation all or a portion of the
value of Improvements that meet the criteria of Eligible Property set forth above
owned by the lessee and located on the property that is subject to the lease.
(g) Owned/Leased Facilities. If a leased facility is granted abatement, the agreement
shall be executed with the lessor and the lessee. The Lessee shall be required to
submit, with its abatement application, a copy of the executed lease agreement
with the lessor demonstrating a minimum lease term of five (5) years. Under no
circumstance will the term of the abatement be longer than the term of the lease.
Publicly owned land leased to private entities shall be eligible if otherwise
qualified.
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Resolution No. R2021-45
(h) Value and Term of Abatement. Abatement from ad valorem property taxes levied
by the City shall be granted effective with the January 1 valuation date
immediately following the date of execution of the Agreement. Up to one hundred
percent (100%) of the value of new eligible property may be abated for up to two
(2) years during the period of construction and for up to eight (8) years thereafter.
The abatement may be extended through an initial agreement and a subsequent
agreement as may be required to comply with state law regarding the term of a
reinvestment zone. If the period of construction exceeds two (2) years, the
Premises shall be considered completed for purposes of abatement and in no
case shall the period of abatement inclusive of construction and completion
exceed ten (10) years. If it is determined that the abatement period would better
benefit the City and the applicant by deferring the commencement date beyond
the January 1st following the City's authorization of the abatement, the City may
defer the commencement date of the abatement period to a future date certain.
The deferral of the commencement date will not allow the duration of the
abatement period to extend beyond ten (10) years. Tax Code 312.007. If a
project includes facility replacement, the abated value shall be the value of the
new unit(s) less the value of the old unit(s).
(i) Economic Qualification. In order to be eligible for designation as a reinvestment
zone and receive tax abatement, the planned improvement:
(1) Must be reasonably expected to increase the value of the property in the
amount of $500,000 or more if the planned improvements are for the
expansion of facilities already located in the City, or a minimum of
$1,000,000 for new facilities in the City; and
(2) Must be expected to retain or create employment positions for a minimum
of ten (10) positions in the City if the planned improvements are for the
expansion of facilities already located in the City, or for a minimum of
twenty (20) positions for new facilities in the City; and
(3) Must not be expected to solely or primarily have the effect of transferring
employment from one part of the City to another part of the City; and
(4) Must be necessary because capacity cannot be provided efficiently
utilizing existing improved property.
(j) Taxability. From the execution of the Abatement Agreement until its termination,
taxes shall be payable as follows:
(1) The value of ineligible property as provided herein shall be fully taxable;
(2) The Base Value of Premises, as determined herein, shall be fully taxable;
and
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Resolution No. R2021-45
(3) Only the additional value of new eligible property specifically identified
within the Abatement Agreement shall be subject to abatement under the
Abatement Agreement.
Section 3. APPLICATION.
(a) Any present or potential owner of taxable property in the City may request the
creation of a reinvestment zone and tax abatement by filing a written request with
the Pearland Economic Development Corporation.
(b) The application shall consist of a completed application, provided by the
Pearland Economic Development Corporation and shall be accompanied by: a
general description of the proposed use and the general nature and extent of the
Modernization, Expansion or new Improvements to be incorporated at the
Premises; a descriptive list of the Improvements which will be a part of the
Premises; a map and property description; and a time schedule for undertaking
and completing the planned Improvements. In all cases a statement of the
assessed value of the Premises, separately stated for real and personal
property, shall be given for the tax year immediately preceding the application.
The application form may require such financial and other information as the City
Council deems appropriate for evaluating the financial capacity and other factors
of the applicant.
(c) Upon receipt of a completed application, the City Manager or his designee shall
notify in writing the presiding officer of the legislative body of each affected
jurisdiction of the application and give written notice of a public hearing, not less
than seven (7) days prior to the hearing. Notice of the public hearing shall also
be properly posted and published in the City's official newspaper not less than
seven (7) days prior to the hearing. Before acting upon the application, the City
shall, through public hearing, afford any interested party an opportunity to show
cause why the abatement should, or should not, be granted.
(d) After receipt of an application for creation of a reinvestment zone and application
for abatement, a feasibility study shall be prepared setting out the impact of the
proposed reinvestment zone and tax abatement. The feasibility study shall
include, but not be limited to, an estimate of the economic effect of the creation
of the zone, the abatement of taxes, and the proposed benefit to the affected
jurisdiction and the property to be included in the zone.
(e) The City Council shall not establish a reinvestment zone for the purpose of
abatement if it finds that the request for the abatement was filed after the
announcement or the commencement of construction, alteration, or installation of
Improvements related to a proposed Modernization, Expansion, or new
Premises.
(f) Variance. Requests for variance from the provisions of Section 2 must be made
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Resolution No. R2021-45
in writing to the City Manager of the City, or his designee, provided, however, the
total duration of abatement shall in no instance exceed ten (10) years. The
applicant shall include in the variance request a complete description of the
circumstances the applicant believes supports the requested variance. Approval
of a request for variance requires a majority vote of the City Council.
(g) Pursuant to Section 2264.051 of the Texas Government Code any Company
entering into an Abatement Agreement with the City will be required to certify that
the Company, or a branch, division, or department of the Company, does not and
will not knowingly employ an undocumented worker. Further, the Abatement
Agreement will contain a provision specifying the rate and terms of repayment of
the public subsidy plus interest should the Company be convicted of knowingly
employing an undocumented worker, in violation of 8 U.S.C. Section 1324a(f).
Section 4. PUBLIC HEARING.
(a) Should any party be able to show cause in the public hearing why the granting of
a tax abatement will have a substantial adverse effect on the City, that showing
shall be reason for the City Council to deny designation of the reinvestment
zone, the granting of Abatement, or both.
(b) Neither a reinvestment zone nor Abatement Agreement shall be authorized if it is
determined that:
(1) There would be a substantial adverse effect on the provision of
government service or tax base;
(2) The applicant has insufficient financial capacity to fulfill all of the terms
and obligations of an Abatement Agreement; or
(3) Planned or potential use of the property would, in the sole discretion of
City Council, constitute a hazard to public safety, health, morals, and/or
violation of other applicable codes or laws.
(c) In order for the reinvestment zone to be created, the City must make the
following findings:
(1) find that the Improvements sought are feasible and would be of benefit to
the zone after expiration of the Agreement;
(2) that the zone is reasonably likely to contribute to the retention or
Expansion of primary employment or to attract major investment in the
City; and
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Resolution No. R2021-45
Section 5. AGREEMENT.
1 . City shall provide at least 30 days public notice of a meeting where the approval
of a tax abatement agreement is considered. The notice shall be given in the
manner prescribed by the Open Meetings Act. Among other requirements, the
notice must contain: 1) the property owner's name and the applicant's name in
the agreement; 2) the name and location of the reinvestment zone subject to the
agreement; 3) a general description of the nature of the improvements or repairs
in the agreement and 4) the estimated cost of the improvements or repairs.
2. At least seven (7) days before the City Council grants a tax abatement, it must
deliver written notice of its intent to enter into the Abatement Agreement to the
presiding officer of the legislative body of each affected jurisdiction pursuant to
Chapter 312 of the Texas Tax Code. Said notice must include a copy of the
proposed Abatement Agreement.
(a) After proper notice has been given to the affected jurisdictions, the City Council
shall, at a regularly scheduled meeting, cast a vote concerning the adoption of
the Abatement Agreement, which may be adopted only by a majority vote of the
City Council. If adopted, the City Council shall then authorize the City Manager to
execute the Abatement Agreement with the owner of the Premises and/or
lessee, as required. The Abatement Agreement may include any of the optional
provisions allowed in accordance with Chapter 312 of the Tax Code. The
Abatement Agreement shall:
(1) Include a list of the kind, number, and location of Improvements to the
property;
(2) Authorize inspection of the property to ensure compliance with the
agreement;
(3) Limit the use of the property consistent with the City's development goals;
(4) Require the filing of an annual compliance report with the City containing
all relevant information necessary for the City's evaluation of Applicant's
compliance with the terms of the Abatement Agreement; and
(5) Provide for recapturing property tax revenues that are lost if the owner
fails to make the Improvements or comply with annual compliance
reporting requirements.
(b) If the City Council fails to adopt the Abatement Agreement, the City shall notify
the applicant of the disapproval, such notification to be in writing and to be sent
within 60 days of the City Council's decision.
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Resolution No. R2021-45
(c) An Abatement Agreement approved by City Council shall be executed by the
City Manager within 60 days after the applicant has forwarded all necessary
information and documentation to the City.
(d) No later than 90 days after a reinvestment zone has been designated or an
Abatement Agreement has been executed or July 1, whichever occurs first, the
City shall notify the Comptroller of the State of Texas as required by law. Upon
execution of an Abatement Agreement, a copy of the agreement shall be
provided to the Chief Appraiser of Appraisal District with jurisdiction over the
reinvestment zone.
(e) The City Manager shall have administrative authority to extend the initial
deadlines ("Extensions"), contained in an Abatement Agreement, for obtaining a
Certificate of Occupancy, Operation of a Facility, and Job Creation/Retention, for
a period not to exceed one (1) year. In the event of an Extension pursuant to this
section, the effective date of the abatement shall be adjusted accordingly. Any
additional Extensions to an Abatement Agreement must be presented to the City
Council for approval.
(f) Annual Abatement Filings. The Company is required to make additional filings
with the appropriate County Appraisal District, or other state or local offices or
agencies, annually or from time to time, in order for the Abatement Agreement to
have full force, effect and applicability. These filings shall be the responsibility of
the Company and in no way shall the City, it's elected officials, officers,
employees or assigns, including the Pearland Economic Development
Corporation, be responsible for the timely filing of any form or documents, except
those set forth by law, on behalf of the Company. These filings may include, but
are not limited to, the "Application for Property Tax Abatement Exemption"
Comptroller Form No. 50-116 which must be filed with the appropriate County
Appraisal District between January 1st and April 30th for property owned as of
January 1st of the year in which the abatement is to be applied. Failure of the
Company to meet any filing obligation with the appropriate County Appraisal
District, or other state or local offices or agencies shall not be grounds for
extension of the term of the Agreement.
(g) The Abatement Agreement will contain a provision specifying the rate and terms
of the repayment of the public subsidy plus interest should the Company be
convicted of knowingly employing an undocumented worker, in violation of 8
U.S.C. Section 1324 a (f).
Section 6. RECAPTURE.
In the event an Abatement Agreement is approved by City Council, the Agreement shall
include recapture provision substantially similar to the following:
(a) If a Company fails to meet the capital improvements funding conditions of an
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Resolution No. R2021-45
Abatement Agreement by the agreed upon improvement completion date, the
City may, at its discretion, terminate the Abatement Agreement and require the
Company to immediately repay the entirety of any amounts abated under the
Agreement plus interest at the rate of four percent (4%) plus prime, as published
in the Wall Street Journal, per year, compounded annually from January 1 of the
year following the execution of the Abatement Agreement to the date of
repayment.
(b) If after the end of a calendar year a Company fails to provide any annual
compliance reports related to a funding condition, to the City or the Pearland
Economic Development Corporation, required under the Abatement Agreement
by the deadline for that year, the abatement for the year for which verification
was not timely provided according to the terms of the Abatement Agreement may
be forfeited, at the discretion of the City, and the Company shall have thirty (30)
days to pay the City any outstanding damages for failure to provide verification. If
the Company does not make payment to the City during the thirty (30) day
period, this Abatement Agreement shall terminate.
(c) If a Company fails to meet a funding condition required under the Abatement
Agreement by the deadline for that year, the abatement for the year for which the
funding condition was not met according to the terms of the Abatement
Agreement may be forfeited, at the discretion of the City, and the Company shall
have thirty (30) days to pay the City any outstanding damages for failure to meet
the Funding Condition. If the Company does not make payment to the City during
the thirty (30) day period, this Abatement Agreement shall terminate.
(d) In the event a Company allows its ad valorem taxes owed to any taxing
jurisdiction to become delinquent and fails to timely and properly follow the legal
procedures for protest and/or contest of any such ad valorem taxes then the
Abatement Agreement shall be in default. In the event that the Company defaults
in this manner and has not cured such default within sixty (60) days of said
default, the abatement may be modified or terminated by the City. If ,at its
discretion, the City modifies or terminates an Abatement Agreement because a
Company allows its ad valorem taxes owed to any taxing jurisdiction to become
delinquent and fails to timely and properly follow the legal procedures for protest
and/or contest of any such ad valorem taxes the City may, at its discretion
require that the Company immediately repay the part or the entirety of any
amounts abated under this Abatement Agreement plus interest, at the rate of
four percent (4%) plus prime as published in the Wall Street Journal, per year,
compounded annually from January 1st of the year following the execution of the
Abatement Agreement to the date of repayment.
(e) In the event a Company shall move the Employment Positions or Improvements
outlined in an Abatement Agreement from the Premises during the term of the
Agreement then all abatements of tax previously earned under the Abatement
Agreement may be refundable to the City by the Company and the Abatement
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Resolution No. R2021-45
Agreement may terminate at the discretion of the City. After notice, the Company
shall have thirty (30) days to pay outstanding damages to the City for failure to
meet any of the requirements in this Section. If the Company does not make
payment to the City during the thirty (30) day period, the Abatement Agreement
may terminate at the discretion of the City
(f) No party shall be required to perform any obligation under an Abatement
Agreement or be liable or responsible for any loss or damage resulting from its
failure to perform so long as performance is delayed by force majeure or acts of
God, including but not limited to strikes, lockouts or labor shortages, embargo,
riot, war, revolution, terrorism, rebellion, insurrection, flood, natural disaster, or
interruption of utilities from external causes.
(g) Should the City determine that a Company is subject to any recapture provision
according to the terms and conditions of its Abatement Agreement, the City
Manager or his designee need not provide any written notice to the Company of
the fact that it is subject to a recapture provision. Any notice of recapture
provided by the City may be made via electronic mail.
(h) All taxes abated shall be deemed due and owing to the City at any point that the
Company cannot pay its bills as they come due. if after a Company is no longer
able to pay its bills as they come due, it files for protection from its creditors by
any chapter of the bankruptcy code the City may, at its discretion, pursue the
abated taxes as a creditor in the bankruptcy for unpaid property taxes subject to
any and all tax liens applicable thereto.
Section 7. ADMINISTRATION.
(a) The Abatement Agreement shall stipulate that employees and/or designated
representatives of the City will have access to the reinvestment zone during the
term of the abatement to inspect the Premises to determine if the terms and
conditions of the Abatement Agreement are being met. All inspections will be
made only after the giving of twenty-four (24) hours prior notice and will only be
conducted in such manner as to not unreasonably interfere with the construction
and/or operation of the Premises. All inspections will be made with one or more
representatives of the Company and in accordance with its safety standards.
(b) Upon completion of construction, the City, or its designee, shall annually
evaluate each Premises and prepare a written report of possible violations to the
Abatement Agreement to the City Council, the City Manager, and the City
Attorney and provide written notice of the report to the applicant that such report
has been submitted.
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Section 8. ASSIGNMENT.
The terms and conditions of an Abatement Agreement are binding upon the successors
and assigns of all parties hereto. An Abatement Agreement may be transferred or
assigned by the Company only upon written permission by the City in accordance with
these Guidelines, which permission shall not be unreasonably withheld. No assignment
shall be approved if the assignor or assignee is indebted to the City for ad valorem
taxes or other obligations. The Company, or any legal successor thereto or prior
assignee thereof, may assign its rights and obligations under this Abatement
Agreement, including by merger or operation of law, to any legal successor or any
person or entity that acquires all or substantially all of its business and operations. In
addition, with the prior written consent of the City, which consent shall not be
unreasonably withheld or delayed, the Company, or any legal successor company
thereto or prior assignee thereof, may assign its rights and obligations under this
Abatement Agreement to any parent or wholly owned subsidiary that it currently has in
place or later establishes, if it is constituted as a separate legally recognized business
entity. Any such assignment will be made without additional consideration being
payable to the City. An Abatement Agreement shall survive any sale, change of control
or similar transaction involving the Company, any successor thereto or prior assignee
thereof and no such transaction shall require the consent of the City. The Company
shall provide the City written notice of any assignment, sale, change of control or
similar transaction pursuant to this section as soon as possible and in no event not later
than thirty (30) calendar days following such event.
Section 9. SUNSET PROVISION.
These 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 to determine whether the goals have been achieved. Based on that review, the
Guidelines and Criteria will be modified, renewed or eliminated providing that such
actions shall not affect existing Abatement Agreements.
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