Loading...
RE 2006-0124.2RESOLUTION NO. 2006-0124.2 A RESOLUTION OF THE CITY OF COPPELL, TEXAS, APPROVING THE TERMS AND CONDITIONS OF A TAX ABATEMENT AGREEMENT BY AND BETWEEN THE CITY OF COPPELL, TEXAS AND HISTORIC COPPELL PROPERTIES, LTD.; AUTHORIZING ITS EXECUTION BY THE MAYOR; AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council has been presented a proposed Tax Abatement Agreement by and between the City of Coppell, Texas and Historic Coppell Properties, Ltd., a copy of which is attached hereto and incorporated herein by reference; and WHEREAS, upon full review and consideration of the Agreement, and all matters related thereto, the City Council is of the opinion and finds that the terms and conditions thereof should be approved, and that the Mayor should be authorized to execute the Agreement on behalf of the City of Coppell, Texas; NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF COPPELL, TEXAS, THAT: SECTION 1. The Agreement attached hereto having been reviewed by the City Council of the City of Coppell, Texas, and found to be acceptable and in the best interest of the City and its citizens, be, and the same is hereby, in all things approved, and the Mayor is hereby authorized to execute the Agreement on behalf of the City of Coppell, Texas. SECTION 2. The City Council finds that the improvements proposed to be built upon the Premises described in the Agreement will enhance the economic vitality of the community through a combination of new capital investment, increased sales tax revenues, and the creation of additional job opportunities. SECTION 3. The tax abatement to be granted by the Agreement will not include inventory, and supplies. SECTION 4. The improvements proposed for the Premises will accomplish the tax abatement guidelines of the City of Coppell, Texas. 62981 SECTION 5. The City Manager delivered to the presiding officer of the governing body of each taxing unit in which the property subject to the Agreemem is located, a written notice that the City of Coppell, Texas, intends to enter into the Agreement. The notice given by the City Manager included a copy of the Agreement approved by this Resolution. SECTION 6. This Resolution and the Tax Abatement Agreement are hereby approved by the affirmative vote of the majority of the members of the City Council of the City of Coppell, Texas, at a regularly scheduled meeting of the City Council. SECTION 7. This Resolution shall become effective immediately from and after its passage. DULY RESOLVED AND ADOPTED by the City Council of the City of Coppell, Texas, on this the ~_~tay~ 2006. D6U~LAS ~. ST(SVER, MAYOR ATYEST: crr (POS/si 01/13/06) ~/ 2 62981 STATE OF TEXAS § COUNTY OF DALLAS § TAX ABATEMENT AGREEMENT This Tax Abatement Agreement (the "Agreement") is entered into by and between the City of Coppell, Texas (the "City"), and Historic Coppell Properties, Ltd., a Texas limited partnership ("Owner"), acting by and through their authorized representatives. WITNESSETH: WHEREAS, the City Council of the City of Coppell, Texas passed an Ordinance (the "Ordinance") establishing Tax Abatement Reinvestment Zone No. 48 (the "Zone"), for commercial/industrial tax abatement, as authorized by the Property Redevelopment and Tax Abatement Act, Chapter 312 of the Texas Tax Code, as amended (the "Tax Code"); and WHEREAS, the City has adopted guidelines for tax abatement (the "Tax Abatement Guidelines"); and WHEREAS, the Tax Abatement Guidelines contain appropriate guidelines and criteria governing tax abatement agreements to be entered into by the City as contemplated by the Tax Code; and WHEREAS, the City has adopted a resolution stating that it elects to be eligible to participate in tax abatement; and WHEREAS, in order to maintain and enhance the commercial and industrial economic and employment base of the Coppell area, it is in the best interests of the taxpayers for the City to enter into this Agreement in accordance with said Ordinance, the Tax Abatement Guidelines and the Tax Code; and WHEREAS, Owner owns or is under contract to purchase the real property described in Exhibit "A" attached hereto ("Land") and intends to construct certain Improvements (hereinafter defined) on the Land; and WHEREAS, Owner's development efforts described herein will create permanent new jobs in the City; and WHEREAS, the City Council finds that the contemplated use of the Premises (hereinafter defined), the contemplated Improvements thereto in the amount set forth in this Agreement, and the other terms hereof are consistent with encouraging development of the Zone in accordance with the purposes for its creation and/or in compliance with the Tax Abatement Guidelines, the Ordinance adopted by the City, the Tax Code and all other applicable laws; and WHEREAS, the City Council finds that the Improvements sought are feasible and practicable and would be of benefit to the Premises to be included in the Zone and to the City after expiration of this Agreement; and 3 62981 WHEREAS, a copy of this Agreement has been furnished, in the manner prescribed by the Tax Code, to the presiding officers of the governing bodies of each of the taxing units in which the Premises is located; and WHEREAS, the City desires to enter into an agreement with Owner for the abatement of taxes pursuant to Chapter 312 of the Tax Code as amended. NOW, THEREFORE, in consideration of the mutual benefits and promises contained herein and for good and other valuable consideration, the adequacy and receipt of which is hereby acknowledged, including the expansion of primary employment, the attraction of major investment in the Zone, which contributes to the economic development of Coppell and the enhancement of the tax base in the City, the parties agree as follows: Article I Definitions Wherever used in this Agreement, the following terms shall have the meanings ascribed to them: "Base Year Taxable Value" shall mean the Taxable Value for the Land for the year in which the Tax Abatement Agreement is executed (2006). "Commencement of Construction" shall mean (i) the construction plans for the Improvements have been prepared and all approvals thereof required by applicable governmental authorities have been obtained; (ii) all necessary permits for construction of the Improvements pursuant to the respective plans therefore having been issued by all applicable governmental authorities, and (iii) the contractor shall have executed a construction contract with Owner, mobilized, and made a presence on the Land with a job shack, equipment and materials. "Completion of Construction" shall mean (i) the substantial completion of the exterior building shell, public areas and life safety requirements and supporting site improvements such as fire lanes; and (ii) a final certificate of occupancy has been issued for occupancy of the Improvements by HCP. "Event of Bankruptcy or Insolvency" shall mean the dissolution or termination of a party's existence as a going business, insolvency, appointment of receiver for any part of a party's property and such appointment is not terminated within ninety (90) days after such appointment is initially made, any general assignment for the benefit of creditors, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against such party, and such proceeding is not dismissed within ninety (90) days after the filing thereof. "First Year of Abatement" shall mean January 1 of the calendar year immediately following the date of issuance of the final certificate of occupancy for the Improvements, unless otherwise agreed by the parties. 4 62981 "Force Majeure" shall mean any contingency or cause beyond the reasonable control of a party including, without limitation, acts of God or the public enemy, war, riot, civil commotion, insurrection, government or de facto governmental action unless caused by acts or omissions of such party, fires, explosions or floods, strikes, slowdowns or work stoppages and rain delays and other weather related delays caused by temperatures that are too cold to permit construction activities. "Improvements" shall mean an office building whose tenants are involved in the medical profession or other licensed profession, as well as tenants whose services are in support of such professions, to be constructed on the Land containing approximately 16,697 square feet of space and other ancillary facilities such as reasonably required parking and landscaping more fully described in the submittals filed by the Owner with the City from time to time in order to obtain a building permit. "Land" means the real property described in Exhibit A. "Premises" shall collectively mean the Land and Improvements, but excluding Tangible Personal Property. "Related Agreements" shall collectively mean the Tax Abatement Agreement and the Restriction Agreement. "Restriction Agreement" shall mean that certain restriction agreement between the Owner and the Coppell Economic Development Foundation effective as of the date of the Company's closing of the purchase of the Land from the Coppell Economic Development Foundation. "Tangible Personal Property" shall mean tangible personal property, equipment and fixtures owned by or leased by Owner, other than inventory or supplies, located on the Premises subsequent to the execution of this Agreement. "Taxable Value" means the appraised value as certified by the Appraisal District as of January 1 of a given year. Article II General Provisions 2.1 Owner is under contract to purchase or is the owner of the Land, which Land is located within the city limits of the City and within the Zone. Owner intends to construct the Improvements on the Land and to locate Tangible Personal Property on the Premises. 2.2 The Premises are not in an improvement project financed by tax increment bonds. 2.3 This Agreement is entered into subject to the rights of the holders of outstanding bonds of the City. 5 62981 2.4 The Premises are not owned or leased by any member of the Coppell City Council or any member of the Coppell Planning and Zoning Commission, or any member of the governing body of any taxing units joining in or adopting this Agreement. Article III Tax Abatement Authorized 3.1 This Agreement is authorized by the Tax Code and in accordance with the City Tax Abatement Guidelines, and approved by resolution of the City Council. 3.2 Subject to the terms and conditions of this Agreement, the City hereby grants Owner an abatement of seventy-five percent (75%) of the Taxable Value of the Improvements and seventy- five percent (75%) of the Taxable Value of the Tangible Personal Property for a period of five (5) consecutive years beginning the First Year of Abatement. The actual percentage of Taxable Value of the Improvements subject to abatement will apply only to the portion of the Taxable Value of the Improvements that exceeds the Base Year Taxable Value. The actual percentage of Taxable Value of the Tangible Personal Property subject to abatement will only apply to the Tangible Personal Property located on the Premises after this Agreement is executed. 3.3 The period of tax abatement herein authorized shall be for a period of five (5) consecutive years. 3.4 During the period of tax abatement herein authorized, Owner shall be subject to all taxation not abated, including but not limited to, sales tax and ad valorem taxation on land, inventory and supplies. Article IV Improvements Owner owns, or is under contract to purchase, the Land and intends to construct or caused to be constructed thereon the Improvements. Owner intends to locate Tangible Personal Property on the Premises. Nothing in this Agreement shall obligate Owner to construct the Improvements on the Land or to locate Tangible Personal Property on the Premises but said actions are a condition precedent to Owner's tax abatement pursuant to this Agreement. Article V Construction of Improvements 5.1 As a condition precedent to the initiation of Owner's tax abatement pursuant to this Agreement, Owner will diligently and faithfully, in good and workmanlike manner, subject to events of Force Majeure cause Commencement of Construction of the Improvements to occur on or before one hundred fifty (150) calendar days after the date Owner closes its purchase of the Land from the Coppell Economic Development Foundation and to cause Completion of Construction of the Improvements to occur on or before fifteen (15) calendar months thereafter. 6 62981 5.2 Owner agrees to maintain the Improvements during the term of this Agreement in accordance with all applicable state and local laws, codes, and regulations. Owner agrees that the Improvements shall be used only for the purposes stated herein for a period of five (5) years commencing on the date the final certificate of occupancy is issued for Owner's occupancy of the Improvements. 5.3 The City, its agents and employees shall have the right of access to the Premises during construction to inspect the Improvements at reasonable times and with reasonable notice to Owner, and in accordance with Owner's visitor access and security policies, in order to insure that the construction of the Improvements are in accordance with this Agreement and all applicable state and local laws and regulations (or valid waiver thereof). Article VI General Requirements 6.1 Construction plans for the Improvements constructed on the Land will be filed with the City, which shall be deemed to be incorporated by reference herein and made a part hereof for all purposes. 6.2 After completion of the Improvements, Owner shall certify in writing to the City the construction cost of the Improvements. Owner shall before May 1 of each calendar year that the Agreement is in effect, certify in writing to the City that it is in compliance with each term of the Agreement. 6.3 The Premises shall at all times be used in the manner (i) that is consistent with the City's Comprehensive Zoning Ordinance, as amended, and (ii) that, during the period taxes are abated hereunder, is consistent with the general purposes of encouraging development or redevelopment within the Zone. 6.4 Owner agrees, subject to events of Force Majeure or ("Casualty"), to continuously own, and occupy the Improvements for a period of at least five (5) consecutive years beginning the First Year of Abatement. Article VII Default: Recapture of Tax Revenue 7.1 In the event Owner: (i) fails to complete the Improvements in accordance with this Agreement or in accordance with applicable State or local laws, codes or regulations; (ii) has delinquent ad valorem or sales taxes owed to the City (provided Owner retains its right to timely and properly protest such taxes or assessment); (iii) has an "Event of Bankruptcy or Insolvency"; or (iv) breaches any of the terms and conditions of this Agreement or the Related Agreements, then Owner after the expiration of the notice and cure periods described below, shall be in default of this Agreement. 7.2 As liquidated damages in the event of such default, the Owner shall, within thirty (30) days after demand, pay to the City all taxes which otherwise would have been paid by the 7 62981 Owner to the City without benefit of a tax abatement for the Owner's property the subject of this Agreement, with interest at the statutory rate for delinquent taxes as determined by Section 33.01 of the Tax Code as amended but without penalty. 7.3 The parties acknowledge that actual damages in the event of default termination would be speculative and difficult to determine. 7.4 The parties further agree that any abated tax, including interest as a result of this Agreement, shall be recoverable against the Owner, its successors and assigns and shall constitute a tax lien against the Owner's property, the subject of this Agreement, and shall become due, owing and shall be paid to the City within thirty (30) days after termination. 7.5 Upon breach by Owner of any obligations under this Agreement, the City shall notify the Owner in writing, who shall have thirty (30) days from receipt of the notice in which to cure any such default. If the default cannot reasonably be cured within a thirty (30) day period, and the Owner has diligently pursued such remedies as shall be reasonably necessary to cure such default, then the City may extend the period in which the default must be cured. 7.6 If the Owner fails to cure the default within the time provided as specified above or, as such time period may be extended, then the City at its sole option shall have the right to terminate this Agreement, by written notice to the Owner. 7.7 Upon termination of this Agreement by the City, all tax abated as a result of this Agreement, shall become a debt to the City as liquidated damages, and shall become due and payable not later than thirty (30) days after a notice of termination is made. The City shall have all remedies for the collection of the abated tax provided generally in the Tax Code for the collection of delinquent property tax. The City at its sole discretion has the option to provide a repayment schedule. 7.8 The computation of the abated tax for the purposes of the Agreement shall be based upon the full Taxable Value of the Improvements and the Tangible Personal Property, without tax abatement for the years in which tax abatement hereunder was received by the Owner, as determined by the Appraisal District, multiplied by the tax rate of the years in question, as calculated by the City Tax Assessor-Collector. The liquidated damages shall incur penalties as provided for delinquent taxes and shall commence to accrue after expiration of the thirty (30) day payment period. Article VII Miscellaneous 8.1 Annual Application for Tax Exemption. It shall be the responsibility of the Owner pursuant to the Tax Code, to file an annual exemption application form with the Chief Appraiser for each Appraisal District in which the eligible taxable property has situs. A copy of the exemption application shall be submitted to the City upon request. 8 62981 8.2 Notice. All notices required by this Agreement shall be addressed to the following, or other such other party or address as either party designates in writing, by certified mail, postage prepaid, or by hand or overnight delivery: If intended for Owner, to: Historic Coppell Properties, Ltd. Attn: Steven A. Swaldi, M.D. 301 Meadow Creek Road Coppell, Texas 75019 If intended for City, to: Attn: City Manager City of Coppell, Texas P.O. Box 9478 Coppell, Texas 75019 With copy to: Peter G. Smith Nichols, Jackson, Dillard, Hager & Smith, L.L.P. 1800 Lincoln Plaza 500 N. Akard Dallas, Texas 75201 8.3 Severabilitv. In the event any section, subsection, paragraph, sentence, phrase or word herein is held invalid, illegal or unconstitutional, the balance of this 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, sentence, phrase or word. 8.4 Applicable Law. This Agreement shall be construed under the laws of the State of Texas. Venue for any action under this Agreement shall be the State District Court of Dallas County, Texas. The parties agree to submit to the personal and subject matter jurisdiction of said court.. 8.5 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original and constitute one and the same instrument. 8.6 Entire Agreement. This Agreement embodies the complete agreement of the parties hereto, superseding all oral or written previous and contemporary agreements between the parties and relating to the matters in this Agreement, and except as otherwise provided herein cannot be modified without written agreement of the parties to be attached to and made a part of this Agreement. 8.7 Recordation of Agreement. A certified copy of this Agreement shall be recorded in the Deed Records of Dallas County, Texas. 9 62981 8.8 Incorporation of Recitals. The determinations recited and declared in the preambles to this Agreement are hereby incorporated heroin as part of this Agreement. 8.9 Exhibits. All exhibits to this Agreement are incorporated herein by reference for all purposes wherever reference is made to the same. 8.10 Chamber of Commerce. During the term of this Agreement, Owner agrees to maintain continuous corporate membership in the Coppell Chamber of Commerce. 8.11 Conditions Precedent. This Agreement and the parties respective obligations, are subject to and contingent upon (i) Owner closing its purchase of the Land from the Coppell Economic Development Foundation on or before March 1, 2006; and (ii) the Coppell Economic Development Foundation closing its purchase of the Land from the City. EXECUI~D in duplicate originals the ..~d~4a~ 6~e~~~ City of C~ . By: Doff ~J~q. Stox/~{, ~ By: Ci~mey EXECUTED in duplicate originals the __ Attest: day of ,2006. By: Historic Coppell Properties, Ltd.. By: Grapevine Sprint, LLC, the General By: Steven A. Swaldi,' I~l.~., President Partner Ti~x Abatement Aereement/Pdstoric Covoell Properties. Ltd. Lot 1, Block 1 -PAGE 8 75264 City's Acknowledgment State of Texas § County of Dallas § This instrument was acknowledged before me on the 2006, by Douglas Stover, Mayor of the City of Coppell, Texas, said municipality. My Commission Expires: Notary PubUc State of Texas Comm. Expires 06-11-2008 Owner's Acknowledgment State of Texas § County of Dallas § This instrument was acknowledged before me on the ~ day of~L(~/, 2006, by Steven A. Swaldi, M.D., being the President of Grapevine Springs Management, L/EC, the general partner of Historic Coppell Properties, Ltd. a Texas limited partnership on behalf of said limited partnership. My Comm. Exiares Cc~ 18, 2cOa My Commission Expires: obY~ary~ublic, State of Texas Tax Abatement Aereement/Historic Coppell Properties. Ltd. Lot 1~ Block 1 -PAGE 9 75264 Exhibit "A" LEGAL DESCRIPTION Lot 1, Block 1 of the Historic Coppell Properties Addition Description for a tract of land in the James Simmons Survey, Abstract Number 1296, City of Coppell, Dallas County, Texas, and being a portion of that tract of land described in a deed to the City of Coppell, recorded in Volume 99203, Page 3079, Deed Records, Dallas County, Texas, and being more particularly described as follows: BEGINNING at a 3/8" iron pin found in the south line of Bethel Road for the most northerly northwest corner of said City of Coppell tract, from which a lA" iron pin found with cap marked, "BRITTAIN & CRAWFORD" bears 0.21 of a foot, North 01 degree 19 minutes 54 seconds East; THENCE South 85 degrees 25 minutes 51 seconds East a distance of 115.20 feet along the proposed south line of Bethel Road to a lA" iron pin set with cap marked, "AREA SURVEYING" for the beginning of a curve, concave to the north, having a radius of 685.00 feet, and a long chord which bears 34.44 feet, South 86 degrees 45 minutes 55 seconds East; THENCE Easterly, continuing along the proposed south line of Bethel Road and along said curve, a distance of 34.44 feet to a lA" iron pin set with cap marked, "AREA SURVEYING" at the end of said curve; THENCE South 88 degrees 12 minutes 20 seconds East a distance of 110.51 feet, continuing along the proposed south line of Bethel Road to a lA" iron pin set with cap marked, "AREA SURVEYING"; THENCE South 01 degree 47 minutes 40 seconds West a distance of 275.00 feet to a lA" iron pin set with cap marked, "AREA SURVEYING"; THENCE North 88 degrees 12 minutes 20 seconds West a distance of 254.35 feet to a lA" iron pin set with cap marked, "AREA SURVEYING"; THENCE North 00 degree 27 minutes 20 seconds East, at 86.22 feet passing a lA" iron pin found for a northwest corner of said City of Coppell tract, in all, a total distance of 281.52 feet to the POINT OF BEGINNING, said described tract containing 1.636 acre of land. 12 62981