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2003T13-TAX ABATEMENTORDINANCE NO./~3 '~'-/.~ AN ORDINANCE THE CITY OF SCHERTZ, TEXAS, APPROVING A TAX ABATEMENT AND A TAX ABATEMENT AGREEMENT BY THE CITY COUNCIL FOR AND WITH TADCO/TRI-COUN'I~ LTD., A PROPERTY OWNER IN THE CITY OF SCHER3~. WHEREAS, Section 312 of the Texas Property Tax Code allows municipalities to abate ad valorem taxes under specffic Guidelhaes and Criteria, and the City of Schertz has adopted specific Guidelines and Criteria under these provislons; and, WHEREAS, the City Council finds that the application for abatement of ad valorem taxes by TADCO/Tri-County Ltd., meets those Guidelines and Criteria, and further fhnds the terms of the tax abatement agreement l~sted at Exhibit 1 are acceptable; and, WHEREAS, the property, 14.07 acres, is owned by TADCO/Tri-County Ltd., described as described as .9198 acre out of Lot 8, 2.290 acres out of Lot 9 and 1.~85 acres out of Lot 14, Block ,5 of the Tri-County Business and Industrial Park Unit 2 Subdivision, Comal County, Texas and Lots 15, 16, 17, 18, 1~, Block ,5 of the Tri-County Buslness and Industrial Park Unlt Three Subdlvislon, Guadalupe County, Texas; and, WHEREAS, a public hearing was held on ~Z-/_ ~5 public comment on the creation of TADCO Park II Zone; and , to receive WHEREAS, the terms of the tax abatement agreement will cause no substantial long term adverse effect on the provision of the City's serm'ces 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 TADCO/Tri- County Ltd., is approved. The approved rate is 53.3% for ten(10) years. Taxes shall be abated on capital improvements only. THAT, the City Manager is authorized to enter into an agreement, shown as Exhibit 1, with TADCO/Tri.-County Ltd. Approved on first reading the /./ of/]/~A,'/~ ogOod , PASSED, APPROVED AND ADOPTED is the/~day of ayor, City of Schertz, Texas ,2003. ATFEST: dit~ Secretary, City of Schertz (SEAL OF CITY) Exhibit 1 Tax Abatement Agreement 1. Parties. This agreement is made and entered into by and between the City of Schertz, Texas (hereinafter called the "City"), and TADCO/Tri-County II Ltd. (hereinafter called the "Company"}. 2. Authorization and Findings. a. This agreement is entered into pursuant to' (1) Section 312 of the Texas Property Tax Code. (2) City of Schertz Ordinance, 03-T-02 that establishes the City of Schertz Guidelines and Criteria for Tax Abatement and Reinvestment Zones (hereinafter referred to as the "Guidelines and Criteria"l. (3) City of Schertz Ordinance 03-T-12 that establishes a Reinvestment Zone for the Property to receive Tax Abatement under the Guidelines and Criteria. (4) City of Schertz Ordinance 03-T-14, which approves this tax abatement and agreement and authorizes the execution thereof. b. The City, by approval of this agreement, hereby finds the terms of this agreement and the property subject to it, to meet the "Guidelines and Criteria" as adopted, and further finds there will be: (1) No substantial long-term adverse affect on the provision of City services or tax base; and, (2) no hazard to public safety, health, or morals the planned use of the property. as the result of 3. Property a. The property, (hereinafter called the Property, 14.07 acres, is owned by TADCO/Tri-County II Ltd., described as .9198 acre out of Lot 8, 2.290 acres out of Lot 9 and 1.985 acres out of Lot 14, Block 5 of the Tri-County Business and Industrial Park Unit 2 Subdivision, Comal County, Texas and Lots 15, 16, 17, 18, 19, Block $ of the Th-County Business and Industrial Park Unit Three Subdivision, Guadalupe County, Texas. b. Abatements approved will be based on the value of improvements set out on the real property roll of the Guadalupe County Appraisal District for the Property. The 2002 base year value established by the Guadalupe County Appraisal District is $245,103.89. c. The Project has recently been platted, but not recorded, so no tax account of the Property has been established. d. A general description of the improvements to be made by the Company is set out in the basic abatement application and attachments. 4. Company Representations and Estimates. a. The Company represents they are the owners in fee simple of the Property. The Property is located within the City of Schertz, Tri-County Business Park, and within Comal and Guadalupe County. b. The Company represents that the use of the Property is to be as follows: Wholesale distribution and Office Space. c. The Company estimates it will make capital improvements ("Improvements"} to the Property, which will cost approximately $6,388,733.00. d. The Company represents that no interest in the Property is presently held by or leased by and covenants that it shall not sell or lease any interest 'in the Property to, a member of the City Council of the City, the Planning and Zoning Commission of the City, the Economic Development Department, or any other City officer or employee as long as this agreement is in effect. 5. Terms of the Agreement. This Agreement is conditioned on the Company making the following improvements to the Property (hereinafter referred to as the "Improvements)" and fulfilling the following covenants: a. Construction of approximately 264,300 feet in two buildings, including office spaces. The Company represents that the Improvement to the Property will cost approximately $6,388,733.00 and will be completed during the term of the abatement. b. The location of the Improvements is more particularly described in a site plan approved by the City of Schertz Planning and Zoning Commission. c. The Company covenants and agrees that all Improvements shall at all times comply with all applicable City building codes and ordinances, including, but not limited to, flood, subdivision, building, electrical, plumbing, fh'e and life safety codes and ordinances, as amended. Further, the Company covenants to maintain the Improvements in compliance with all such building codes and ordinances, and in a neat attractive condition with the landscaped area described in the site plan approved by the Planning and Zoning Commission of the City. d. The Company agrees to pay all ad valorem taxes on the Property and on peraonal property in a timely manner, whether assessed by the City or any other tax jurisdiction. e. The Company agrees to furnish the Chief Tax Appraiser of Guadalupe County with information outlined in Chapter 22, V.A.T.$. Tax Code, as amended, as may be necessary for tax abatement and for appraisal purposes. f. The Company agrees to allow inspection of the Property by the City Manager, or a designee. Such inspection shall be to determine if the terms and conditions of the Agreement are being met and for the purpose of assuring compliance with applicable City Codes and ordinances. Inspections will be made only after giving a minimum of 24 hours notice and will be conducted in such a manner as to not unreasonably interfere with the operation of the Property. g. The Company agrees annually to certify in writing its compliance with the terms of this Agreement, which certification shall be fried by January 115 to the City of Schertz of each year during the Term of the Abatement and by ,January 15 of the year following the Term of the Abatement. h. In the event the Company leases all or part of the improvements to a third party, the Company agrees that all benefits accrued from this abatement are to be passed on to the lessee{s} in a pro rata share. 6. Terms for the Tax Abatement. a. Provided that the Company complies with its obligations under Section 5 of this Agreement throughout the period of the abatement, 53.3% of the entire assessed value of the Capital Improvements located on the Property shall be exempt from ad valorem taxation for a period of 10 years. b. No abatement of taxes shall be granted as to personal property of the Company installed or maintained within the Property. c. The abatement shall be for a 10 year period (the "Term of this Agreement") commencing on January 1, 20015 (the "Commencement Date"), and expiring on the 31 December, :2014 {lOth} anniversary of the Commencement Date. Additionally, during the Term of this ^gre~ment, the City agrees not to impose any other taxes or assessments that are intended to be in lieu of ad valorem taxes on the Company, the Property, or the improvements. d. The Company shall pay all ad valorem taxes due on the assessed value of the Property prior to the beginning of the tax abatement. e. The Company and/or lessee shall have the right to protest and contest any or all appraisals or reaasessments of the Property, or the Improvements, and the tax abatement provided for herein for such property shall be applied to the amount of taxes finally determined, as a result of such protest or contest, to be due for such property. 7. Default/Recapture. a. If the Company refuses or neglects to comply with any of the terms of this agreement or, if any representation made by the Company in the Application for 'lax Abatement {or this agreement} is false or misleading in any material respect and such refusal or default is not cured within sixty {60} days after notice, this Agreement may be terminated by the City. b. In the event the Company allows ad valorem taxes on the Property to become delinquent and fails to timely and properly follow the legal procedures for their protest and/or contest, this agreement may be terminated by the City. c. In the event the City determines the Company to be in default of this Agreement, the City will notify the Company in writing at the address stated in Section 8 of this agreement, and if the defaults specified with reasonable particularity in such notice are not cured within sixty days from the date of such notice, then this Agreement may be terminated upon written notice to the Company. If the City terminates this agreement, taxes without abatement will be due for the year in which termination occurred and shall accrue without abatement for all tax years thereafter. However, there shall be no recapture of prior years' taxes abated by virtue of this Agreement. d. If during the Abatement Period the Company should discontinue all operations in Schertz, Texas, then the City shall by Ordinance adopted by the City Council have the right to {i) recapture 100% of the taxes abated in prior years and the year in which such discontinuance occurs; and (ii) terminate this agreement. · e. A total bill for any amounts due under Section 7c. or Section 7d. hereof will be sent to the Company and the Company agrees to pay the total amount within sixty days after receipt. Penalty and interest will not begin to accrue until the company has failed to pay any of the amount placed back on the tax roll within sixty days after receipt of the bill, unless arrangements satisfactory to the City and the Guadalupe County Tax Assessor/Collector has been made. 8. Notice. All notices shall be in writing, addressed to the Company or the City at the following addresses. If mailed, any notice or communication shall be deemed to be received three days after the date of deposit in the United States Mail, certified mail, return receipt requested, postage prepaid and properly packaged for delivery. Unless otherwise provided in this agreement, all notices shall be delivered to the following address: To the Company: If mailed or delivered: Robert Hunt Trinity Asset Development Company 100 NE Loop 410, Suite 900 San Antonio, TX 78209 With copy to: To the City: If mailed or personally delivered: City of Schertz Attn' City Manager P.O. Drawer I Schertz, Texas 78154 9. Agreement Approved by City Council. The City represents that this Agreement has been approved by affirmative vote of a majority of the members of the Schertz City Council at a regularly scheduled meeting. 10. Assignment. This agreement may be assignable to a new owner only with prior City Council approval as reflected in a duly adopted City Ordinance. 11. General Provisions. This agreement is entered into subject to the fights of the holders of outstanding bonds of the City. If the holders of outstanding bonds of the City exercise any of their rights so as to diminish the effects or benefits of this Agreement, the City agrees to work with the Company toward establishing an alternative agreement with terms similar to this Agreement and considering any bondholders' rights. 12. Severability. In the event any section, subsection, paragraph, subparagraph, sentence, phrase or word herein is held invalid, illegal, or unenforceable, the balance of the Agreement shall stand, shall be enforceable and shall be read as if the parties intended at all times to delete said invalid section, subsection, paragraph, subparagraph, sentence, phrase or word. In such event there shall be substituted for such deleted provision a provision as similar in terms and in effect to such deleted provision as may be valid, legal and enforceable. 13. Estoppel Certificate. Either party hereto may request an estoppel certificate from another party hereto so long as the certificate is requested in connection with a bona fide business purpose. The certificate, which if requested, will be addressed to a subsequent purchaser or assignee of the Company, shall include, but not necessarily be limited to, statements that this Agreement is in full force and effect without default, if such is the case, the remaining term of this Agreement, the levels of tax abatement in effect, and such other matters reasonably requested by the party{les) to receive the certificate. 14. Applicable Law. This Agreement shall be construed under laws of the State of Texas and is performable in Comal County and Guadalupe County, Texas. 15. Binding on Successors and Assigns. This agreement will be binding on and inure to the benefit of the parties hereto and their respective successors and permitted assigns. 16.- Date. This agreement has been executed by the parties in multiple ~~~~als, each having full force and effect on this the~~' day of /zld~ For The Company County of Guadalupe Tinstrument was acknowledged before me on /~,z~Y ~.~~, 2003, by~ ~, ,/'/U,~/~-' , of TADCO/Tri-County II Ltd., a /~'.~,~' ~-r~. ]~~'~r.d,9/// corporation, on behalf of said corporation. (SEAL) Notary Public in and for the State of Texas (Printed Name of Nota~l My commission expires: ~F~ ~/~ ATTEST: For the CITY OF SCHERTZ City Manager Norma Althouse City Secretary Seal of the City THE STATE OF TEXAS COUNTY OF GUADALUPE This instrument was acknowledged before me on ~a~/ ~ , 2003, by Mark Marquez, City Manager of the City of Schertz, l~ex/as, a municipality and body politic formed under the laws of the State of Texas, on behalf of said municipality. (SEAL) ~ ~ Not~r lgublic ilft/and for the MARYLYBARRA ~ Notary Public, State of Texas :~ State of Texas (~nted Nme of Not~] My commission expires: ~-/-~.~ PUBLISHER'S AFFIDAVIT THE STATE OF TEXAS, County of Guadalupe Before me, the undersigned authority, on this date personally appeared ~r,,,,,,? c~-n~ , known to me, who, being by me duly sworn, on his oath deposes and says that he is the Publisher of The Seguin Gazette- Enterprise, a newspaper of general circulation, published in said county; that a copy of the within and foregoing notice was published in said newspaper / ~ time(s) before the return day named therein, such publications being on the following dates: and a newspaper copy of which is hereto attached. . TAX,. , ,.~A'I~MENT AI3~ BY,THE TADCO/TRI-COUNTY ROVEO the 1Sth' ... Sworn 'and subscribed before me this .. , A.D., 2003. day of Nota~/Public, Guadalupe County, Texas PUBLISHER'S AFFIDAVIT THE STATE OF TEXAS, County of Guadalupe Before me, the undersigned authority, on this date personally appeared ~'~n,,,, C,-o,~ , known to me, who, being by me duly sworn, on his oath deposes and says that he is the Publisher of The Seguin Gazette- Enterprise, a newspaper of general circulation, published in said county; that a copy of the within and foregoing notice was published in said newspaper ~ time(s) before the return day named therein, such publications being on the following dates: ADril 4~ 2003 and a newspaper copy of which is hereto attached. Sworn t nd subscribed before me this _ . , A.D., 2003. 1 CAROL ANN AVERY Notary Public Sram · Texas My Commission Expires 08-31-2004 day of ,, Notary Public, Guadalupe County, Texas