2008T15-Tax Abatement-Prologis
ORDINANCE NO. 08-T-15
BY THE CITY COUNCIL OF THE CITY OF SCHERTZ, TEXAS,
REPEALING TAX ABATEMENT 04-T-39 AND TAX ABATEMENT
AGREEMENT FOR AND WITH 6413 TRI-COUNTY PARKWAY
LTD. AND ESTABLISHING A NEW TAX ABATEMENT
ORDINANCE AND TAX ABATEMENT BY THE CITY COUNCIL
FOR AND WITH PROLOGIS, 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 PROLOGIS, 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 PROLOGIS, described as 7.217 i. acres at
6413 TRI-COUNTY PARKWAY LTD., located in the City of Schertz, Comal
County, Texas; and,
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 PROLOGIS, is approved.
The approved rate is 90 percent for Two (2) 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 PROLOGIS,
Approved on first reading the 4th day of MARCH, 2008.
Lt.r-
PASSED, APPROVED AND ADOPTED this the ~h ay of March, 2008.
ATTEST:
~
(SEAL OF CITY)
"Exhibit 1"
Tax Abatement Agreement
ProLogis
1. Parties.
This agreement is made and entered into by and between the City of Schertz, Texas (hereinafter called the
"City"), and ProLogis. (hereinafter called the "Company").
2. Authorization and Findings.
a. The agreement is entered into pursuant to:
( I ) Section 3 12 of the Texas Property Tax Code.
(2) City of Schertz Ordinance, 06-T-09 that establishes the City of Schertz Guidelines and
Criteria for Tax Abatement and Reinvestment Zones (hereinafter referred to as the "Guidelines
and Criteria").
(3) City of Schertz Ordinance, 08- T -] 5, which approves this tax abatement and agreement
and authorizes the execution there of.
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:
(I) No substantial long-term adverse atTect on the provision of the City services or tax
base; and,
(2) No hazard to public safety, health, or morals as the result of the planned use of the
property.
3. Property.
a. The property, (hereinafter called the "PropeI1y") is owned by ProLogis described as Lot 7,
Block I, (7.75 acres), in the Tri-County Business Park Subdivision Unit 2. The Property is located in
Coma I County.
b. Abatements approved are based on value of improvements set out in the real property roll of the
Comal County Appraisal District established in 1998 as $9],168.00. A general description of the
improvements to be made by the Company is set out in the basic abatement application and attachments.
4. Company Representation 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 County.
b. The Company represents that the use of the Property is to be as follows: for Manufacture and
Distribution of food and retail products.
Tax Abatement Agreement
ProLogis
Page I of6
c. The Company estimates capital improvements (hereinafter referred to as "Improvements") to
the Property, were approximately 3,700,000.00 in 1999.
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, 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 and
fulfilling the following covenants:
a. Purchase of approximately 132,000 square foot facility for Manufacture and Distribution of
materials. The Company represents that the previous improvements to the Property cost approximately
$3,700,000.00 in 1999 and were completed during said year.
b. The location of the Improvements is more particularly described in a site plan approved by the
City of Schertz Planning and Zoning Commission in ] 999.
c. The Company covenants and agrees that all Improvements shall at all times comply with all
applicable City building codes and ordinances, including, but no limited to, flood, subdivision, building,
electrical, plumbing, fire and life safcty 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 valorcm taxes on the Property and on personal 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 Comal County with information
outlined in Chapter 22, V.A.T.S. Tax Codc, 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 twenty-four (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 filed by January I st to the City of Schertz of each year during
the Term of the Abatement and by January 1st 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
Tax Abatement Agreement
ProLogis
Page 2 of6
a. Provide that the Company complies with its obligation under Section 5 of the Agreement
throughout the period of the abatement, 90 % of the entire assessed value of the Capital Improvements
located on the Property shall be exempt from ad valorem taxation for a period of Five (5) years.
b. No abatement of taxes shall be granted as to personal property of the Company installed or
maintained with the Property.
c. The abatement shall be for a Five (5) year period (the "Term of the Agreement") commencing
on January], 2005 (the "Commencement Date"), and expiring on December 31, 2009, the fifth (5th)
anniversary of the Commencement Date. Additionally, during the Term of this Agreement, the City
agrees not to impose any other taxes or assessmcnts 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. Thc Company shall have the right to protest and contest any or all appraisals or reassessments
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 determ ined, as a result of such protest or contest, to be due for
such propel1y.
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 Tax 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 the Agreement, the City will
notify the Company in writing at the address stated in Section 8 of the Agreement, and if the defaults
specified with reasonable particularity in such notice are not cured within sixty (60) 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 th is Agreement.
d. If during the Abatement Period the Company should discontinue all operations 111 Schertz,
Texas, then the City shall by Ordinance adopted by the City Council have the right to:
(I) Recapture one hundred percent (100%) of the taxes abated in prior years and the year in
which such discontinuance occurs; and,
(2) 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 (60) days after receipt. Penalty
and interest will not begin to accrue until the Company has failed to pay any of the amount placed back
Tax Abatement Agreement
ProLogis
Page 3 of6
on the tax roll with sixty (60) days after receipt of the bill, unless arrangements satisfactory to the City
and the Coma I 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 (3) 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:
Ifmailed or personally delivered:
ProLogis
Attn: Market Officer
9535 Ball St., Ste. 1000
San Antonio, Texas 782] 7
To the City:
Ifmailed or personally delivered:
City of Schel1z
Attn: City Manager
1400 Schertz Parkway
Schertz, Texas 78154
9. Agreement Approved by City Council.
The City represents that this Agreement has been approved by affirmative vote ofa 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 rights of the holders of outstanding bonds of the City. If the
ho Iders of outstand ing bonds of the City exerc ise any of the rights so as to dim in ish the effects or benefits of th is
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 my be valid, legal and enforceable.
13. Estoppel Certificate.
Tax Abatement Agreement
ProLogis
Page 4 01'6
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(ies) to receive the certificate.
14. Applicable Law.
This Agreement shall be construed under laws of the State of Texas and is performable in 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 Agry~1]1ent has been exec~ by the parties in multiple originals, each having full force and effect on this
the If t--- day of tc b~ i..i../n'll 2008.
My commission expires:
For the Company: '7
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By: / ?ll /11/ >' (-;./ '(...,_/
-.' ) '~-,7 "
Title: h./[iC t-- Opl.'ll"'4
:Sr, l.-r /-71--- I / /l.~ //-c 5 dJ~ ,...j-
acknowledged before me on -rehr U?!ii 4-
, of ProLogis Development Services, a tJelo.. "('.J
Vnu ~a L dl (1b1lo
Notary Public in and for the State of Texas
)0 '5.1DID A tl\ 0 ~ A. CCl. be 1\0
(printed name of notary)
2008, by
corporation, on
County of Guadalupe
(SEAL)
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O<d II .....
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i\.<Ll ~ " !"~A/)
y: Brenda DennIs
Tax Abatement Agreement
ProLogis
Page 5 of6
The State of Texas
County of Guadalupe
This instrument was acknowledged before me on 7J? ~ /~ , 2008, by Don Taylor, City
Manager of City of Schertz, Texas a municipality and body politic formed under the laws of the State of Texas,
on behalf of said municipality.
(SEAL)
My commission expires: f'~!dlP/tJ /l7~4 L. !:IbA-ee..a-
, , (printed name of no ry)
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MARY L YBARRA
Notary Public
State of Texas
Commission Expires
05-01-2010
Tax Abatement Agreement
ProLogis
Page 6 of6