1997T22-TAX ABATEMENT WITH INTERPLASTIC CORPORATION
ORDINANCE NO. '11- r- ,'K,2
AN ORDINANCE
BY THE CITY COUNCIL OF THE CITY OF
SCHERTZ, TEXAS, APPROVING A TAX ABATEMENT
AND A TAX ABATEMENT AGREEMENT FOR AND WITH
INTERPLASTIC CORPOPORATION. A PROPERTY
OWNER IN THE CITY OF SCHERTZ.
WHEREAS, Section 312 of the Texas Property Tax Code
allows municipalities to abate ad valorem taxes under specific
Guidelines and criteria, and the City of Schertz has adopted
specific Guidelines and Criteria under these provisions; and
WHEREAS, the City Council finds that the application for
abatement of ad valorem taxes by Interplastic Corportation
meets those Guidelines and criteria, and further finds the
terms of the tax abatement agreement listed at Exhibit 1 are
acceptable; and
WHEREAS, the property owned by Interplastic Corporation
is described as Lot 20, Block 5, (1.488 acres) in Tri-County
Business and Industrial Park Unit 3, as recorded on pages 7a
&7b, plat records of Guadalupe County, and is within a Texas
Enterprise Zone as approved by the Texas Department of
Commerce 11 April, 1995.
WHEREAS, the terms of the tax abatement agreement will
cause no substantial long term adverse effect on the provision
of the City's services or tax base, and the planned use of the
property will not constitute a hazard to public safety, health
or morals; NOW THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS:
THAT, the request for abatement of ad valorem taxes by
the Interplastic Corporation is approved. The approved rate
is 35.66% for a five (5) year period beginning 1 January,
1998. Taxes shall be abated on capital improvements only.
THAT,
agreement,
Corporation.
the City Manager is authorized to enter into an
shown as Exhibit 1, with the Interplastic
Approved on first reading the IYrHday of
PASSED, APPROVED AND
-<'
A: f'Tc/ll {'Ii! /!... , 1997.
ADOPTED
August, 1997.
the cJ.,p day
of
~ ~
. ~ I :',
-.. "f I. .(~,<.""-
Mayor, City of Schertz, Texas
ATTEST:
';J;Vr..IX/'L-/ (lic-4-U2~
city Secretary, city of Schertz
(SEAL OF CITY)
ORDINANCE NO. 11- j- Il.
AN ORDINANCE
BY THE CITY COUNCIL OF THE CITY OF
SCHERTZ, TEXAS, APPROVING A TAX ABATEMENT
AND A TAX ABATEMENT AGREEMENT FOR AND WITH
INTERPLASTIC CORPOPORATION. A PROPERTY
OWNER IN THE CITY OF SCHERTZ.
WHEREAS, Section 312 of the Texas Property Tax Code
allows municipalities to abate ad valorem taxes under specific
Guidelines and Criteria, and the City of Schertz has adopted
specific Guidelines and Criteria under these provisions; and
WHEREAS, the City Council finds that the application for
abatement of ad valorem taxes by Interplastic Corportation
meets those Guidelines and Criteria, and further finds the
terms of the tax abatement agreement listed at Exhibit 1 are
acceptable; and
WHEREAS, the property owned by Interplastic Corporation
is described as Lot 20, Block 5, (1.488 acres) in Tri-County
Business and Industrial Park Unit 3, as recorded on pages 7a
&7b, plat records of Guadalupe County, and is within a Texas
Enterprise Zone as approved by the Texas Department of
Commerce 11 April, 1995.
WHEREAS, the terms of the tax abatement agreement will
cause no substantial long term adverse effect on the provision
of the City's services or tax base, and the planned use of the
property will not constitute a hazard to public safety, health
or morals; NOW THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS:
THAT, the request for abatement of ad valorem taxes by
the Interplastic Corporation is approved. The approved rate
is 35.66% for a five (5) year period beginning 1 January,
1998. Taxes shall be abated on capital improvements only.
Mark ;-vlarquc/. Dircctor
JUlle 18,1997
Page Two
4. Sales Tax. Sales taxes are collected on the sale by Interplastic of resin and related products,
lnterplastic will collect approximately $25,000 of sales taxes from this facility each year.
5. Tax ID Number. The tax identification number of [he property is lG-3325-3005-02-000.
6. Site Plan. We are in the process of obtaining a site plan for the lot (induding the building
footprint, landscaping, security lighting, fencing, etc.). A copy of our site plan will be sent as
soon as it is available.
In addition to the "standard abatement" just described, Interpiastic Corporation also requests
OPTIONAL ABATEMENT ADDITIVES pursuant to ~ 7 of the Tax Abatement Guidelines.
This request is based on the "jobs" and "other revenues" described above.
On the other hand, Interplastic is NOT requesting any SPECIAL ABATEMENrS pursuant to
~ 8 of the Tax Abatement Guidelines. After reviewing the applicable requirements, Interpiastic
believes that it does not meet the "foreign trade zone" or "enterprise zone" criteria.
Based on the above, it is my understanding that Interpiastic qualifies for a tax abatement of
48.16% of the taxes on our capital improvements. The term of the abatement would be for five (5)
years. Our abatement percentage is calculated as follows:
Capital Improvements
Employment
Other Revenue
TOTAL
21.66%
14.00%
12.50%
48.16%
Interplastic looks forward to becoming a member of the business community in the City of
Scb.et1z. Thank you very much for helping us with this tax abatement process.
MID/iml
cc: James 0, Wallenfetsz
Robert A, DeRoma
[van M, Levy
Word.ABATEMENT-let
- 1400 SCHERTZ PARk.'WAY
P. O. DRAWER I
SCHERTZ, TEXAS 78154-0890
AC (210) 658-3510
FAX (210) 659-3204
~-~~~~___r,,-=....",-,
KERRY R. SWEATT
CITY MANAGER
7 August, 1997
Honorable James E. sagebie1
Guadalupe County Judge
Guadalupe County Courthouse
307 West Court, Suite 200
Seguin, Texas 78155
Judge Sagebiel
This letter is to advise you that an application for tax
abatement has been received from Interplastic Corporation. The
application meets the basic criteria of our ordinance on Tax
Abatement. I have enclosed a copy of their application and our
evaluation for your review.
The Schertz Economic Development
application on 19 July, 1997.
recommended approval to City
Capital Improvement ad valorem
period of five (5) years.
Commission met to review this
The Commission unanimously
Council, a tax abatement on
taxes (only) of 35.66% for a
The basis of the abatement is $600,000.00 of capital
improvements with a payroll of approximately $350,000.00 for
seventeen (7) employees. Interp1astic Corporation has
purchased property in the Tri-County Business and Industrial
Park located on IH-35 in the City of Schertz.
Please consider this letter as notification under the
provisions of Section 312.2041 of the Texas Property Tax Code.
We are in the process of perfecting the Tax Abatement Agreement
with Interp1astic Corporation. The Schertz City Council will
consider action on the tax abatement on 13 August, 1997. The
meeting will be at 7 pm in the Schertz Municipal Complex. You
are invited to attend should your schedule permit. You will be
advised by phone if the time or date are changed.
Evaluation of Tax Abatement Request By Interplastics Inc.
On 23 June, 1997, a tax abatement request by Interplastics
Corporation was received. The abatement request was accepted
on 11 July, 1997, after receipt of additional documentation
and discussion of Sales Tax Revenues.
Interplastics had requested a 12.5% abatement credit based on
Sales Tax of $25,000 being collected. While our program gives
credit for Sales Tax, it is based on revenues received by the
City as opposed to what is collected. In this case city
revenues would be $250.00 or 1% of $25,000.00. This has
resulted in reducing the abatement request from 48.16% to
35.66%.
Interplastics Corporation is a wholesale distributor of all
types of plastic resins. Resins are used in the manufacture
of products such as sinks and shower stalls, synthetic marble
counter tops, bowling balls, and boat hulls.
Interplastics Corporation plans to build a 15,000 sq ft
building (3000 office space) in the Tri-County Business Park
at an estimated value of $600,000. Equipment and tools,
appraised as Personal Property for tax purposes is estimated
at $100,000.00.
The basis of the request is $600,000.00 of capital
improvements to property in the City of Schertz and job
creation in Schertz with a payroll value of $350,000.00. The
company expects to employ approximately 7 employees.
The proposed
Tri-County.
$65,000.00.
site is a 1.488 tract on Corridor Parkway
Current value of the property is estimated
The property is located in Guadalupe County.
in
at
An evaluation of this abatement request based on our
guidelines and criteria is as follows:
Abatement Percentages
Capital Improvements of $600,000.00
First $75,000
Remaining $525,000 @ 1% per $45,000
10.0%
11.66%
Payroll
$350,000 @ 1% per $25,000
14.00%
Total Percentage Authorized
35.66%
Recommend Approval of a 5 year abatement of ad valorem taxes
on Capital Improvements for Interplastics Corporation at a
rate of 35.66% for a period of 5 years, beginning 1 January,
1998.
- 1400SCIIERTZPARKWAY
P. o. DH.AWER I
SCHERTZ, TEXAS 78154-0890
AC (210) 658-3510
FAX (210) 659-3204
- .,".""""""_.,,,~.;
KERRY R. SWEATl
CITY MANAGER
7 August, 1997
Honorable James E. Sagebiel
Guadalupe County Judge
Guadalupe County Courthouse
307 West Court, Suite 200
Seguin, Texas 78155
Judge Sagebiel
This letter is to advise you that an application for tax
abatement has been received from Interplastic Corporation. The
application meets the basic criteria of our ordinance on Tax
Abatement. I have enclosed a copy of their application and our
evaluation for your review.
The Schertz Economic Development
application on 19 July, 1997.
recommended approval to City
Capital Improvement ad valorem
period of five (5) years.
Commission met to review this
The Commission unanimously
Council, a tax abatement on
taxes (only) of 35.66% for a
The basis of the abatement is $600,000.00 of capital
improvements with a payroll of approximately $350,000.00 for
seventeen (7) employees. Interplastic Corporation has
purchased property in the Tri-County Business and Industrial
Park located on IH-35 in the City of Schertz.
Please consider this letter as notification under the
provisions of Section 312.2041 of the Texas Property Tax Code.
We are in the process of perfecting the Tax Abatement Agreement
with Interplastic Corporation. The Schertz City Council will
consider action on the tax abatement on 13 August, 1997. The
meeting will be at 7 pm in the Schertz Municipal Complex. You
are invited to attend should your schedule permit. You will be
advised by phone if the time or date are changed.
page 2
Judge Sagebiel
Mark Marquez and I are available at your convenience to discuss
this important matter, or provide assistance as required.
Please let us know of your plans or intentions and if we may
provide other information. It is our hope you will support our
economic development efforts by granting a similar abatement.
Thank you.
Sincer~
t .C21
Ker~. Sweatt
City Manager
KRS/mm
Enclosures: Application from Interplastic Corporation.
Evaluation of Tax Abatement Request By Interplastics Inc.
On 23 June, 1997, a tax abatement request by Interp1astics
Corporation was received. The abatement request was accepted
on 11 July, 1997, after receipt of additional documentation
and discussion of Sales Tax Revenues.
Interplastics had requested a 12.5% abatement credit based on
Sales Tax of $25,000 being collected. While our program gives
credit for Sales Tax, it is based on revenues received by the
City as opposed to what is collected. In this case city
revenues would be $250.00 or 1% of $25,000.00. This has
resulted in reducing the abatement request from 48.16% to
35.66%.
Interplastics Corporation is a wholesale distributor of all
types of plastic resins. Resins are used in the manufacture
of products such as sinks and shower stalls, synthetic marble
counter tops, bowling balls, and boat hulls.
Interplastics Corporation plans to build a 15,000 sq ft
building (3000 office space) in the Tri-County Business Park
at an estimated value of $600,000. Equipment and tools,
appraised as Personal Property for tax purposes is estimated
at $100,000.00.
The basis of the request is $600,000.00 of capital
improvements to property in the City of Schertz and job
creation in Schertz with a payroll value of $350,000.00. The
company expects to employ approximately 7 employees.
The proposed
Tri-County.
$65,000.00.
site is a 1.488 tract on Corridor Parkway
Current value of the property is estimated
The property is located in Guadalupe County.
in
at
An evaluation of this abatement request based on our
guidelines and criteria is as follows:
Abatement Percentages
Capital Improvements of $600,000.00
First $75,000
Remaining $525,000 @ 1% per $45,000
10.0%
11.66%
Payroll
$350,000 @ 1% per $25,000
14.00%
Total Percentage Authorized
35.66%
Recommend Approval of a 5 year abatement of ad valorem taxes
on Capital Improvements for Interplastics Corporation at a
rate of 35.66% for a period of 5 years, beginning 1 January,
1998.
Dollar Values of Interplastics Project
Current Values
Projected Values
Land
Improvements
Personal Property
Total
$65,000.00
$0.00
$0.00
$65,000.00
$65,000.00
$600,000.00
$100,000.00
$765,000.00
Tax Rate
$0.3719
$0.3719
Tax Revenue
Land
Improvements
Personal Property
Total Ad Valorem
$241. 74
$0.00
$0.00
$241.74
$241.74
$2,231.40
$371.90
$2,845.04
Additional Revenues
Payroll
Multiplier @ 1%
Sales Tax
$0.00
$0.00
$0.00
$350,000.00
$3,500.00
$250.00
Total Annual Revenues to the City
$241.74
$6595.03
Minus Abatement of Capital Improvements
at 35.66 percent.
$795.72
$5799.32
Difference From Current Values
Total Annual Cost of Abatement
$795.72
Total Revenues to the City over the 5 Year Term
Minus the Cost of Abatement over the 5 Year Term
Minus Current Revenues over the 5 Year Term
Total Net Revenues to the City over the 5 Year Term
$32975.18
$3978.59
$1208.68
$27787.91
Total Net Revenues cover the cost of the abatement by a ratio of:
6.98 to 1
Ad Valorem Revenues cover the cost of the abatement by a ratio of:
3.58 to 1
Annual Cost Per Job
$113.67
7 August, 1997
To: Mayor and City Council
[3~~
From: Kerry R. Sweatt, City Manager
Subject: Tax Abatement, Interplastic Corporation
On 19 July, 1997, the City of Schertz Economic Development
Commission met to consider a request for tax abatement by
Interplastic Corporation. The request met all the requirements
of our Guidelines and Criteria.
Interp1astic Corporation is a distributor of resins used in the
plastics industry. These resins are used in the production of
a wide variety of products from sinks to bowling balls. The
company is currently in leased space in San Antonio.
The commission, after reviewing the request,
recommended approval of a 35.66% tax abatement
improvements for a five year period.
unanimously
on capital
Please note the Interplastic Corporation package does not
include a reinvestment zone. The reason is they will be
locating in the Tri-County Industrial Park, which is a part of
the State Enterprise Zone. The creation of a State Enterprise
Zone automatically creates a Reinvestment Zone.
Attached to this memo is, the Interplastic application, the
draft ordinance approving the tax abatement, the advisement to
Guadalupe County Commissioners Court, and an evaluation by
staff. We are in the process of perfecting the abatement
agreement.
,....'.'.~........
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INTERPLASTIC
CORPORATION
;3Ci,)L:~ ,~Fi,-I
:;,".i:,' :'AUL :>:1' :;';:,1.;"
:('1;;':,81-6860 - FAX \0'2) 4W-983,:
MarkJ. Brost
Vice President
Finance & Administration
June 18. 1997
Mark Marquez. Director
Management Services
1400 Schertz Parkway
P.O. Drawer I
Schertz, TX 78154
VIA FAX and MAIL
(1-210-659-3204)
RE:
Request for Tax Abatement
(Our File No. 9076.3)
Dear Mr. Marquez:
The owner of Interplastic Corporation ("Interplastic"), James D. Wallenfelsz, is now in the
process of buying land in the Tri-County Business Park in Schertz, Texas. We will also be
constructing a warehouse and office facility on those premises for our distribution business.
Interplastic hereby requests TAX ABATEMENT for this project from the City of Schertz.
Pursuant to ~ 10 of the City of Schertz Guidelines and Criteria for Tax Abatement and Reinvestment
Zones (the "Tax Abatement Guidelines"), The following information is submitted in support of our
request:
1. General Description. The land will consist of 1.488 acres of land legally described as "Lot 20,
Block 5, Tri-County Business and Industrial Park TIrree" in Guadalupe County, Texas,
The following building will be constructed:
. The building will be a 15,000 square foot facility conslStmg of approximately
12,000 square feet of warehouse and 3,000 square feet for offices,
. The building will be of concrete tip-up or masonry block construction. It will have
a pre-engineered steel roof, and be fully sprink1ered.
2. Estimated Values. The purchase price of the land is fIxed by our Purchase Agreement. The other
values are our estimates, Those values are as follows:
. Capital Improvements: $600,000
. Personal Property: $100,000
. Land Purchase Price: $65,000
. Inventory Value: $300.000
3. Jobs and Payroll. We anticipate creating 7 new jobs in the City of Schertz (2 sales people,
I customer service, I warehouse worker, I administration manager, and 2 drivers). The annual
cost to Interplastic for those 7 employees will be approximately $350,000,
Mark Marquez, Director
June] 8, 1997
Page Two
4. Sales Tax. Sales taxes are collected on the sale by Interplastic of resin and related products.
lnterplastic will collect approximately $25,000 of sales taxes from this facility each year.
5. Tax lD Number. The tax identification number of the property is IG-3325-3005-02-000,
6. Site Plan. We are in the process of Obtaining a site plan for the lot (including the building
footprint, landscaping, security lighting, fencing, etc,), A copy of our site plan will be sent as
soon as it is available,
In addition to the "standard abatement" just described, Interplastic Corporation also requests
OPTIONAL ABATEMENT ADDITIVES pursuant to ~ 7 of the Tax Ab01ement Guidelines,
This request is based on the "jobs" and "other revenues" described above.
On the other hand, Interplastic is NOT requesting any SPECIAL ABATEMENTS pursuant to
~ 8 of the Tax Ab01ement Guidelines. After reviewing the applicable requirements, Interplastic
believes that it does not meet the "foreign trade zone" or "enterprise zone" criteria.
Based on the above, it is my understanding that Interplastic qualifies for a tax abatement of
48.16% of the taxes on our capital improvements. The term of the abatement would be for five (5)
years. Our abatement percentage is calculated as follows:
Capital Improvements
Employment
Other Revenue
TOTAL
21.66%
14,00%
12.50 %
48.16%
Interplastic looks forward to becoming a member of the business community in the City of
Schertz. Thank you very much for helping us with this tax abatement process,
MJB/iml
cc: James D. Wallenfelsz
Robert A, DeRoma
Ivan M, Levy
Word.ABATEMENT.lct
THAT,
agreement,
Corporation.
the City Manager is authorized to enter into an
shown as Exhibit 1, with the Interplastic
Approved on first reading the IYTHday of August, 1997.
PASSED, APPROVED AND
-<"
:J1:'PTE/11/"? 12- , 1997.
ADOPTED
the ;?<,'V day
of
;41 /l4k~
Mayor, City of Schertz, Texas
ATTEST:
'i:k-1- IJ( t't.- (2Lr 4.u <2~
City Secretary, City of Schertz
(SEAL OF CITY)