2018-028 Resolution Terminating Tax Abatement Agreement with Essent PRMC L.P. dba Paris Regional Medical CenterRESOLUTION NO. 2018-028
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS;
TERMINATING A TAX ABATEMENT AGREEMENT WITH ESSENT PRMC
L.P. d/b/a/ PARIS REGIONAL MEDICAL CENTER; MAKING OTHER
FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND
DECLARING AN EFFECTIVE DATE.
WHEREAS, on October 8, 2012, by Resolution No. 2012-088, the City Council of the
City of Paris approved an agreement by and between the City of Paris, Texas and Essent
PRMC L.P. d/b/a Paris Regional Medical Center, a Limited Partnership ("PRMC") providing
for a commercial and industrial tax abatement for certain improvements; and
WHEREAS, said Tax Abatement Agreement ("Agreement"), a copy of which is
attached hereto as Exhibit A and incorporated by reference as if fully setout herein, was
executed by the parties on October 8, 2012; and
WHEREAS, said Agreement related to capital improvements to be made at both
PRMC's Northward Bound Campus and it's South Campus, located in the downtown area of
the City; and
WHEREAS, said Agreement contains a recital, to wit:
"WHEREAS, the contemplated use of the improvements located and to be placed
at the South Campus at a cost to the Owner [PRMC] of at least $100,000.00 will
enable the South Campus to continue to be used as an operational and viable
hospital and health care facility in the City of Paris, Lamar County, Texas, for its
residents and for others; and this is consistent with encouraging development of
said Enterprise Zone in which the South Campus is located in accordance with the
purposes for which it was created and is in compliance with the City's policy on tax
abatement incentives and the ordinance creating the Enterprise Zone adopted by
the City of Paris, Texas, and all applicable laws;"
[Emphasis added.]; and
WHEREAS, paragraph 5.1 of said Agreement provides, to wit:
"5.1 The Owner agrees and covenants that it will diligently and faithfully, in a
good and workmanlike manner, pursue the completion of the Improvements
described in Sections III and IV, above ... As good and valuable consideration for this
AGREEMENT, Owner further covenants and agrees that all construction of the
Improvements will be in accordance with all applicable state and local laws, codes
and regulations, or Owner will procure a valid waiver thereof. In further
consideration, Owner shall thereafter, from the date a Certificate of
Occupancy is issued or the Improvements are completed as agreed, until the
expiration of this AGREEMENT, continuously operate and maintain the real
properties and the Improvements thereon, including the specific units of new
property and equipment as identified herein, as acute care hospitals serving
persons seeing hospitalization services and care."
[Emphasis added.]; and
WHEREAS, paragraph 6.2 of said Agreement provides, to wit:
"6.2 The Owner agrees to retain sufficient employment levels to efficiently
operate and support its Northward Bound and South Campus hospitals during the
term of this Tax Abatement Agreement."
[Emphasis added.]; and
WHEREAS, consequently, continuous operation of the South Campus as an acute
care hospital is a material term of the Agreement; and
WHEREAS, PRMC closed the inpatient geriatric psychiatric unit at the South
Campus in 2017; and
WHEREAS, in May of 2018, the third -party company operating the long-term acute
care hospital on the South Campus announced its decision to no longer rent space from
PRMC, thereby ending all patient services at the South Campus; and
WHEREAS, PRMC has since closed its license to operate the South Campus as a
hospital; and
WHEREAS, accordingly, PRMC has committed a material breach of the Agreement,
including but not limited to Sections 5.1 and 6.2 and is in default thereof, and
WHEREAS, the City sent PRMC a Notice of Default on or about September 5, 2018
thus triggering the sixty (60) day cure period set forth in Section 7.1 of the Agreement; and
WHEREAS, said sixty (60) day cure period has elapsed, and PRMC has not come into
compliance with the terms of the Agreement;
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
PARIS, TEXAS, THAT:
Section 1. The findings set out in the preamble to this resolution are hereby in
all things approved.
Section 2. That pursuant to Section 7.1 of the Agreement, the City Council
hereby terminates said Agreement effective immediately.
Section 3. That as a consequence of termination of the Agreement, pursuant to
Section 7.1 thereof and in accordance with Texas Tax Code Sec. 312.205(a)(4), all taxes
which otherwise would have been paid to the City without the benefit of the abatement,
together with interest to be charged at the statutory rate for delinquent taxes as
determined by Section 33.01 of the said Tax Code, with all penalties allowed by law, shall
be recaptured and will become a debt due, owing, and paid to the City within sixty (60)
days of the expiration of the sixty (60) day cure period referred to herein, said cure period
having expired November 5, 2018.
DULY PASSED AND APPROVED this 10th day of December, 2018.
Stev( ) „'Clifford, D., Mayor
ATTEST:
nice Ellis, City Clerk
APPROVED AS TO FORM:
J, fill,
W- ' I ame H.1- arris, City Attorney
i "�
THE STATE OF TEXAS )
)
COUNTY OF LAMAR )
TAX ABATEMENT AGREEMENT
This Tax Abatement Agreement (the "Agreement") is entered into by and between
the CITY OF PARIS, TEXAS, a municipal corporation, situated in Lamar County, Texas,
acting by and through its authorized officer whose signature appears below (hereinafter
called "City"), and ESSENT PRMC, L.P., a limited partnership (d/b/a Paris Regional
Medical Center), acting by and through its authorized officer whose signature appears
below (hereinafter referred to as "Owner").
WITNESSETH:
Recitals Re ardinnNorthward Bound Projec,t
WHEREAS, the City Council of the City of Paris did heretofore, on the 22nd day of
August, 2011, pass Ordinance No. 2011-035, (hereinafter referred to as the
"ORDINANCE") authorizing the City of Paris to participate in the Texas Enterprise Zone
Program under the Texas Enterprise Zone Act, Chapter 2303 of the Texas Government
Code (the "Act''); providing tax incentives; nominating ESSENT PRMC, L.P. (d/b/a Paris
Regional Medical Center) to the Office of the Governor Economic Development and
Tourism through the Economic Development Bank for Designation as a qualified Enterprise
Project under the Act; designating a liaison for overseeing Enterprise Projects and
communicating with interested parties; making other findings and provisions related to the
subject; and declaring an effective date; and
WHEREAS, the Enterprise Project described in the ORDINANCE and above, in
this Agreement (hereinafter called the "Northward Bound Project"), qualified as an
Enterprise Zone Project by verbal communication from the Office of the Governor of the
State of Texas (Economic Development & Tourism), made to the City of Paris, Texas, and
to the Owner, in January, 2012, which Enterprise Project covered the real property and
improvements in Paris, Lamar County, Texas, described in Exh""'
ibiA attached hereto and
made a art hereof, as is shown in the U.S. Census Bureau website on Exhibit B, attached
hereto and made a part hereof for all purposes; and _.-..-
WHEREAS, under the Texas Enterprise Zone Act (Texas Government Code
Chapter 2303), the designation of an area as an Enterprise Zone also constitutes designation
of the area as a reinvestment zone (the "Reinvestment Zone"); and the City of Paris, Texas,
ordained in Section 8 of the ORDINANCE that the Enterprise Zone areas within the City
(in which this Project is located) are Reinvestment Zones under the provisions of the Texas
Tax Code, Chapter 312; and
WHEREAS, the City Council of the City of Paris did heretofore, on the 13" day of
August, 2012, in Resolution No. 2012-072, pass and adopt appropriate Guidelines and
Criteria governing tax abatement agreements to be entered into by the City as required by
the Property Redevelopment and Tax Abatement Act, as amended; and
WHEREAS, the City Council of the City of Paris did find in the ORDINANCE that
the Owner meets the criteria for designation as an enterprise project under the Act on the
following grounds: a) that it is a "qualified business" under Section 2303.402 of the Act for
it is engaged in the active conduct of a trade or business at a qualified business site and at
least 25% of its new employees at the qualified business site will be residents of an
enterprise zone in this State, or are economically disadvantaged individuals, b) the Owner is
engaged in an "expansion, renovation, or new construction" to be completed within a
predetermined period of time not to exceed five years after August 21, 2011; and c) Paris
Regional Medical Center ("PRMC') is a wholly owned subsidiary of RegionalCare
Hospital Partners, Inc., for which separate books and records are kept; d) there has been and
will continue to be a high level of cooperation between public, private and neighborhood
entities within the jurisdiction of the City of Paris, Texas; and e) the designation of Essent
PRMC, LP Northward Bound as an enterprise project will contribute significantly to the
achievement of the plans of the City for development and revitalization of the area in which
the enterprise project will be located; and
WHEREAS, the Northward Bound Project is situated within a Reinvestment Zone
described or referred to in the ORDINANCE; and the contemplated use of the Northward
Bound Project, and the improvements to be installed therein in the amount of
$27,100,000.00, and the other terms hereof are consistent with encouraging development of
said Reinvestment Zone in accordance with the purposes for which it was created and are
in compliance with the City's policy on tax abatement incentives and the ORDINANCE
creating such Reinvestment Zone adopted by the City and all applicable laws.
Recitals Rardln. Ess,ent PRMC South Cam pus
WHEREAS, under the Texas Enterprise Zone Act (Government Code Chapter
2303), the designation of an area as an Enterprise Zone also constitutes designation of the
area as a reinvestment zone (the `Reinvestment Zone"); and pursuant to the 2010 U.S.
Census, the real property and improvements thereon known as the South Campus of the
Paris Regional Medical Center Hospital belonging to Owner (the "South Campus")
described in Exhibit C, attached hereto and made a part hereof, located within the City of
Paris, in Lamar County, Texas, is included within an ENTERPRISE ZONE, as is shown in
the website of the U.S. Census Bureau in Exhibit D, attached hereto and made a part hereof
for all purposes; and
WHEREAS, the contemplated use of the improvements located and to be placed at
the South Campus at a cost to the Owner of at least $100,000.00 will enable the South
Campus to continue to be used as an operational and viable hospital and health care facility
in the City of Paris, Lamar County, Texas, for its residents and for others; and this is
consistent with encouraging development of said Enterprise Zone in which the South
Campus is located in accordance with the purposes for which it was created and is in
compliance with the City's policy on tax abatement incentives and the ordinance creating
such Enterprise Zone adopted by the City of Paris, Texas, and all applicable laws; and
WHEREAS, the Owner, in connection with the hearing in which the ORDINANCE
was enacted by the City of Paris, Texas, on August 22, 2011, did request of the City an
abatement of the taxes to be assessed on the new improvements to be constructed by it
as a part of the Northward Bound Project and at the South Campus; and
WHEREAS, this AGREEMENT is executed by the City and the Owner to evidence
in writing the abatement of City taxes upon the improvements herein described, with the
effective date of this AGREEMENT being the effective date of the ORDINANCE of
August 22, 2011, when the tax abatement herein described was authorized by the City of
Paris, Texas;
NOW, THEREFORE,
The Owner and the City do mutually contract and agree as follows:
I.
Term
1.1 The term of this Agreement shall begin on the 22nd day of August, 2011, with
tax abatement granted herein beginning with the tax year beginning January 1, 2013, and
expiring on December 31, 2022.
II.
The "Property" - Area to be Improved
2.1 The Improvements (defined in paragraph III and IV, below) which are the
subject of this Agreement shall be located within the portions of the Northward Bound
Project and the South Campus, both being located in Paris, Lamar County, Texas, owned by
the Owner and described in Exhibit E (with respect to the Northward Bound Project) and in
ExhibitF (with respect to the South Campus), both of which exhibits are attached hereto (all
of which property is w�h the Reinvestment Zones and the Enterprise Zones referred to in
the recitals above). a Improvements will be at a cost equal to or in excess of
$27,200,000.00 in the aggregate for cost and installation of the building modifications,
machinery and equipment, and shall be substantially completed by December 31, 2012,
provided, however, that Owner shall have such additional time to complete the
improvements as may be required in the event of "force majeure" if Owner is diligently and
faithfully pursuing completion of the installation of the Improvements. For this purpose,
"force majeure" shall mean any contingency or cause beyond the reasonable control of
Owner, including, without limitation, acts of God, or the public enemy, any natural disaster,
war, riot, civil commotion, insurrection, governmental or de facto governmental action,
unless caused by acts or omissions of Owner, fires, explosions, accidents, floods and labor
disputes or strikes. The date of completion of the Improvements shall be reflected in the
Certificate of Completion issued by the City referred to above.
III.
The Northward Bound Improvements upon which Taxes are to be Abated
3.1 The Owner's Northward Bound property consists of land, buildings, and
other structural improvements; and the improvements to be constructed there by Owner with
respect to which the taxes to be assessed thereon are to be abated, are actually located as is
shown in the drawings attached hereto as Exhibit E. and made a part hereof. The Owner
pspecifically - ibit E, in the amount of
shall make the improvements descnbed in said Exh
$27,100,000.00.
IV.
The South Campus Improvements upon which Taxes are to be Abated
4.1 The Owner's South Campus property consists of land, buildings, and other
structural improvements; and the improvements to be made there by Owner with respect to
which the taxes to be assessed thereon are to be abated, are located in the South Campus area
as are described in Exhibit F attached hereto and made a part hereof. The Owner shall make
the improvements specifically described in said Exhibit F, in the amount of $100,000-00.
V.
Consideration - Improvements
5.1 The Owner agrees and covenants that it will diligently and faithfully, in
a good and workmanlike manner, pursue the completion of the Improvements described in
Sections III and N, above, and in the Exhibits referred to in said Sections which are
attached hereto (hereinafter collectively described as the "Improvements"). As a good and
valuable consideration for this AGREEMENT, Owner further covenants and agrees that all
construction of the Improvements will be in accordance with ail applicable state and local
laws, codes and regulations, or Owner will procure a valid waiver thereof, In further
consideration, Owner shall thereafter, from the date a Certificate of Occupancy is 'issued or
the Improvements are completed as agreed, until the expiration of this AGREEMENT,
continuously operate and maintain the real properties and the Improvements thereon,
including the specific units of new property and equipment as identified herein, as acute
care hospitals serving persons seeking hospitalization services and care.
5.2 All of the Improvements will be described in the City's Certificate of
Completion prepared after the completion and installation of the above described land
and building modifications and improvements, personal property, computers, medical and
other equipment and machinery. The detailed description of the Improvements which are
the subject of this Tax Abatement Agreement will be furnished to and filed with the Chief
Appraiser of the Lamar County Appraisal District. Such Certificate shall be duly
executed by the Mayor of the City of Paris, Texas, in the form attached hereto as Exhibit
VI.
Consideration - Jobs
6.1 The City has provided in its Guidelines and Criteria for Tax Abatements,
for tax abatement for the benefit of its existing employers, such as the Owner herein, to
improve their respective businesses and industries, as well as their profitability, even
though no new jobs are created as a result thereof. The Guidelines and Criteria provide
substantially as follows in this regard: If an existing Employer owns or leases an
Authorized Facility (such as the Northward Bound Project and the South Campus of the
Owner herein), and it has plans to improve such property by constructing new
improvements on its real property or to add new personal property (which includes
structures and equipment, such as that to be constructed by Owner herein as a part of the
Northward Bound Project and the South Campus), such existing employer may be
eligible for tax abatement with respect to such improvements to its real property or its
new personal property even though no new jobs or newly created minimum annual
payroll are created. In such cases, however, the Owner is encouraged to retain as many
jobs and as much existing annual payroll as is economically feasible for the existing
employer to do and remain competitive in its industry.
6.2 The Owner agrees to retain sufficient employment levels to efficiently
operate and support its Northward Bound and South Campus hospitals during the term of
this Tax Abatement Agreement.
VII.
Default
7.1 In the event that (a) the Improvements for which an abatement has been
granted are not completed in accordance with this AGREEMENT or the expenditure for
the Improvements does not meet the amount required herein; or (b) Owner allows its ad
valorem taxes owed the City to become delinquent and fails to timely and properly follow
the legal procedures for protest or contest of any such ad valorem taxes; or (c) Owner
materially breaches any of the other terms and conditions of this AGREEMENT, then this
AGREEMENT shall be in default. In the event the Owner defaults in its performance of
either (a), (b) or (c) above, then the City shall give the Owner written notice of such
default and if the Owner has not cured such default within sixty (60) days of said written
notice, this AGREEMENT may be modified or terminated by the City. Notice shall be in
accordance with paragraph 13.3. As liquidated damages in the event of default, and in
accordance with the requirements of Section 312.205 (a)(4) of the Property Tax Code of
the State of Texas, all taxes which otherwise would have been paid to the City without the
benefit of abatement, together with interest to be charged at the statutory rate for
delinquent taxes as determined by Section 33.01 of the Property Tax Code of the State of
Texas, with all penalties permitted by the Property Redevelopment and Tax Abatement Act
and the Property Tax Code of the State of Texas, shall be recaptured and will become a
debt to the City and shall be due, owing, and paid to the City within sixty (60) days of the
expiration of the above-mentioned applicable cure period as the sole remedy of the City,
subject to any and all lawful offsets, settlements, deductions, or credits to which Owner may
be entitled. The parties acknowledge that actual damages in the event of default and
termination would be speculative and difficult to determine.
VIII.
Tax Abatement
8.1 Subject to the terms and conditions of this AGREEMENT, and subject to
the rights and holders of any outstanding bonds of the City, a portion of ad valorem
Property taxes from the Property otherwise owed to the City shall be abated. Said
abatement shall be an amount equal to one hundred percent (100%) of the taxes assessed
upon the increased value of the Improvements made by Owner to the Property described in
Sections III and IV of this AGREEMENT, over the value stated below as of January 1. 2012,
and all applicable state and local regulations or valid waivers thereof; provided that the
Owner shall have the right to protest or contest any assessment of the Property and said
abatement shall be applied to the amount of taxes finally determined to be due as a result of
any such protest or contest. For the purposes of this AGREEMENT, the initial value of the
existing real property and improvements (not subject to abatement) shall be deemed to be
the value as shown on the tax rolls of the Lamar County Appraisal District as of January 1,
2012, such amount being $21,200,361, and an additional $13,610,470, as of such date for
tangible personal property, as is more specifically shown in Exhibit )K attached hereto.
The current abatement which is the subject of this AGREEMENT shall extend for a period
of ten (10) years beginning January 1, 2013.
8.2 The abatement granted herein shall be subject to and governed by the Guidelines
and Criteria for Tax Abatements, a copy of which is attached hereto as Exhibitl, and Owner
shall comply with the requirements of Exhibit I in the performance of this AGREEMENT, save
and except that, in the event of a (onflicC between the requirements of Exhibit I and this
AGREEMENT, this AGREEMENT shall control.
8.3 Owner covenants and agrees that subsequent to the date of this AGREEMENT,
any application by Owner for a new tax abatement for equipment or real property located within
the properties described herein and the Reinvestment Zone applicable to this AGREEMENT shall
be subject to and governed by the City's Criteria and Guidelines for Tax Abatement in effect at the
time of the new application.
DL
No Conflict of Interest
9.1 The Owner represents and warrants that the properties described herein do not
include any property that is owned or leased by a member of the Planning and Zoning
Commission of the City of Paris, nor by a member of the City Council approving, or having
responsibility for the approval of, this AGREEMENT.
9
X.
Conditions
10.1 The terms and conditions of this AGREEMENT are binding upon and enforceable
against the parties hereto the successors and assigns of all parties hereto.
10.2 It is understood and agreed between the parries that the Owner, in performing its
obligations hereunder, is acting independently, and the City assumes no responsibility or liability
in connection therewith to third parties; and Owner agrees to indemnify and hold harmless the City
therefrom. It is further understood and agreed among the parties that the City, in performing its
obligations hereunder, is acting independently, and the Owner assumes no responsibility or
liability in connection therewith to third parties and, to the extent permissible by law, the City
agrees to indemnify and hold harmless the Owner therefrom.
XI.
Compliance Provisions
11.1 The Owner agrees that the City, its agents and employees, shall have the
reasonable right of access to the properties and records of Owner and concerning the Owner's
investment in the Improvements for the purpose of conducting audits of the projects' Improvements and
projects' costs. Any such audits shall be made only after giving the Owner notice at least fourteen
(14) days of notice in writing in advance and will be conducted in such a manner as to not
unreasonably interfere with the operation of the facilities. Upon request, the Owner will
provide the City with a detailed Asset Report with an itemized list of assets placed into
service from and after August 22, 2011 to the date of completion of all Improvements
described or referred to herein. The Asset Report will provide for each asset a unique serial
and/or other identification number (if available), the date on which the asset was capitalized,
the acquisition amount, and the accumulated depreciation amount. At the City's request, the
Owner will provide actual invoices to support the amounts shown on the Asset Report.
11.2 The Owner further agrees that the City, its agents and employees, shall have
reasonable right of access to the real properties of Owner to inspect the Improvements 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. After"' letion of the Improvements, the City shall have the continuing right to
inspect the Owner's properties to insure that they are thereafter maintained and operated in
accordance with this AGREEMENT during the term of the AGREEMENT. All inspections
will be made only after giving the Owner notice at least seventy-two (72) hours in advance
and such inspections shall be conducted in such a manner so as not to interfere with the
operation of the facilities. Representatives of the City inspecting the properties and
improvements shall be accompanied by one (1) or more representatives of the Owner and shall
sign an AGREEMENT promising to maintain the confidentiality of any information they
obtain in connection therewith except for the purposes of assessing and collecting ad valorem
taxes and verifying or enforcing compliance with this AGREEMENT. Said representative
shall also be required to observe any facility rule and regulation applicable to either property.
Nothing herein shall be construed as limiting the City's ability to perform inspections or to
enter the properties of Owner, which are the subject of this AGREEMENT.
7
DCII.
Initial and Annual Reporting
12.1 The Owner further agrees that it will, within thirty (30) days of completion
of the Improvements, provide City with a sworn report, written on company letterhead and
signed by a designated representative of Owner, which contains the following information:
a) Copy of the printout from the Lamar County Appraisal District showing the
market value of each real property and the improvements thereon prior to
the construction of the Improvements;
1/(b) Detailed description of Improvements;
//'
LC) Copy of or identification of. plans and specifications of constructed
Improvements and the location of the same for inspection by City's
certification team;
f
d) Actual cost of capital Improvements; and,
/e) Date of substantial completion of the Improvements as defined in paragraph
3.1 hereof.
12.2 The Owner further agrees that it will provide City with an annual, sworn
report which shall certify, in writing, that it is in compliance with each applicable term of
this AGREEMENT. Such annual report shall be furnished in such form as the City shall
require.
12.3 In addition to the annual report required under Section 12.2 hereof, the
Owner further agrees that it will provide City a copy of the Employer Reference summary
page of its Texas Workforce Commission Employer's Quarterly Report within thirty (30)
days of its filing of the same with the Texas Workforce Commission. The Owner will
provide an affidavit signed by an authorized Officer of the Owner certifying that the
information provided in the summary page is a true and valid report filed with the Texas
Workforce Commission.
DCIII.
Authority to Contract
13.1. This AGREEMENT was authorized by resolution of the City Council at its
regularly scheduled meeting on the 8'h day of October, 2012, authorizing the Mayor to
execute the AGREEMENT on behalf of the City.
13.2 This AGREEMENT was entered into by Owner pursuant to the authority
granted to the authorized official whose signature appears below.
13.3. This AGREEMENT shall constitute a valid and binding AGREEMENT
between the City and Owner when executed in accordance herewith, regardless of whether
any other taxing unit executes a similar AGREEMENT for tax abatement.
XIV.
Legal
14.1 No officer, official or agent of the City has the power to amend, modify or
alter this AGREEMENT or waive any of its conditions or to bind the City by making any
promise or representation not contained herein.
14.2 This AGREEMENT, except by operation of law, shall not be assigned or
transferred by Owner, without the prior written consent of City, which consent shall be at
the sole discretion of the City.
14.3 Any written notice required or permitted under the terms of this
AGREEMENT shall be given and be deemed to have been duly served if either (1) delivered
in person, or (2) deposited. certified mail, return receipt requested, postage prepaid in the
United States mail, addressed to the designated representative of the respective parties which
are designated as follows:
Owner
Essent PRMC, L.P.
d/b/a Paris Regional Medical Center
865 Deshong (Northward Bound Project)
820 Clarksville St. (South Campus)
Paris, Texas 75460
Leo Sierra, CPA
10,000 N. Central Expressway
Suite 400
Dallas, Texas 75231
City
City Manager
City of Paris
P.O. Box 9037
Paris, Texas 75461-9037
City Clerk
City of Paris, Texas
P.O. Box 9037
Paris, Texas 75461-9037
14.4 If any term or provision of this AGREEMENT shall be declared
unconstitutional or void by any court of competent jurisdiction, the constitutionality and
validity of the remainder of said AGREEMENT shall not be affected thereby, and to this end
the terms and provisions of said AGREEMENT are declared to be severable.
E
14.5 This AGREEMENT sets forth the entire understanding between the parties, and
any other understandings or agreements shall be canceled and superseded by this
AGREEMENT upon the date of execution hereof. None of the terms of this AGREEMENT
shall be waived, discharged, altered or modified in any respect, except by an AGREEMENT
in writing signed by both parties and specifically referring to this AGREEMENT. The
captions in this AGREEMENT are included for convenience only and shall not be taken into
consideration in any construction or interpretation of this AGREEMENT or any of its
provisions. This AGREEMENT is performable in Lamar County, Texas, and shall be
governed by, construed and enforced in accordance with, the laws of the State of Texas. The
provisions of this AGREEMENT shall apply to, bind and inure to the benefit of the City,
Owner, and their respective successors, and permitted assigns, if any.
14.6 Venue for any actions arising under this AGREEMENT shall lie exclusively in
the courts of Lamar County, Texas, for any state court action, and in the U.S. District Court
for the Eastern District of Texas for any Federal Court action.
WITNESS our hands this 8"' day of October, 2012, but this AGREEMENT is
effective from and after August 22, 2011, as first authorized by the ORDINANCE.
its Elis, City Clerk
ATT
t
LIM
CITY :IF PAR''', TEXAS
A. J. Hasmj;,K.11 , Mayor
..,.
w_
Dent McIlyar, City TMAttorney
ESSENT PRMC, L.P.
(d/b/a Paris jpun io al Medical Center)
y
6 __..._
, President
A= Legal description of Northward Bound real estate.
B = Enterprise Zone in which Northward Bound Project is located.
C = Legal description of South Campus real estate.
D = Enterprise Zone in which South Campus is I
E = Detailed description of Northward Bound Improvements to be constructed
and Drawings showing location of Northward Bound improvements on
which taxes are to be abated under this Agreement
F = Listing describing location of South Campus improvements on which taxes
are to be abated under this Agreement.
G = City's Certificate of Completion.
H = Tax rolls of properties of Owner as of September 30, 2010.
1 = City of Paris, Texas Guidelines and Criteria for Tax Abatements.
i
#: F '' i,,
Paris, Regional Medical Center - NORTH Hospital: 865 DeShpn Dr Paris, TX. 75460
City of Paris, Block 306, Lot IC, Acres 33.27, and
City of Paris, Block 306, Lot 1 E, Acres 7.8127, and
Equipment, computers, furniture and fixtures and inventory.
AMERICAN
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865 Deshong Dr., Paris, TX. 75460
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1 of 1 0912512012
Texas Governor's Office, Economic Development Bank
Texas Enterprise Zones by Census Tract and Block Group (2010 Census)
Lamar County, Texas
Census
Block
Total Pop.
Poverty
County
Tract
... Group
Total Pop.
In Poverty
Rate
Lamar
700
1
... 1583m
_ 505
31.901%
Lamar
800
1
1066
431
40.432%
Lamar
800
4
1237
404
32.660%
Lamar
1000
3
1545
339
21.942%
Lamar
600
3
1073
461
42.964%
Lamar
500
1
556
283
50.899% PRMC-North
Lamar
1000
2
1183
263
22.232%
Lamar
500
4
1449
595
41.063%
Lamar
800
3
327
91
27.829%
Lamar
500
2
812
305
37.562%
Lamar
500
3
1089
411
37.741%
Lamar
600
1
458
157
34.279%
Lamar
1000
1
1036
282
27.220% PRMC-South
Lamar
200
2
763
224
29.358%
Lamar
401
1
886
203
22.912%
Lamar
600
2
1054
367
34.820%
Lamar
101
1
1120
257
22.946%
Lamar
101
2
1813
418
23.056%
I
Panms�al Medical Center SOUTH Hospital:„820 Clarksville St. Paris, TX.,.,,, 75460
City of Paris, Block l 10, Lot 5, and
City of Paris, Block 110, Lot 3, and
Equipment, computers, furniture and fixtures and inventory.
VafetFindier
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820 Clarksyffie St., Patis, TX. 75460
-.WC . Group 1' Census Tract 10, Lamar County, Texas
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Texas Governor's Office, Economic Development Bank
Texas Enterprise Zones by Census Tract and Block Group (2010 Census)
Lamar County, Texas
Census
Block
Total Pop.Poverty
County
Tract
Group �
Total Pop.
In Poverty
Rate
������_31.90196
Lamar
8_00
1
1066
431
40,432%
Lamar
800
4
1237
404
32.660%'
Lamar
1000
3
1545
339'
21.942%
Lamar
600`
3
1073
461
42.964%
Lamar
500
1
556
283
50.899% PRMC-North
Lamar
1.0002
_
11_83
_ -1449
263
22.232%
Lamar
500
4
595
41.063%
Lamar
800
3
327
91
27.829%
Lamar
500
2
812
305
37.362%
Lamar
500
3
1089
411'
37.741%
Lamar
600
1
458
157
34.279%
Lamar
1000
1
1036
282
27.220% PRMC-South
Lamar
200
2
763
224
29.358%
Lamar
401
1
886
203
22.912%
Lamar
600
2
1054
367.
34.820%
Lamar
101
1
1120
257
22.946%
Lamar
101
2
1813
418j
23.056%
C
ESSENT PRMC, L.P.
dba Paris Regional Medical Center
Northward Bound Prosect Descntion-NORTH Cam us
PRMC is committed to contributing to the health of the Paris community by maintaining its
position as the leading provider of healthcare services for the region. In order to do that, PRMC
must continually invest and upgrade its equipment and facilities. Listed below is a detailed
description of the Northward Bound improvements to the NORTH campus:
1) Nein construction and renovations to North Campus:
a. Renovate Admitting, Financial Counselors Area
b. Renovate Main Lobby Waiting
c. Create a Pre Admit Testing Area for Patients
d. Relocate the Cardio Diagnostic Area to the First Floor
e. Relocate Outpatient PT/OT Speech Area to the First Floor
f. Relocate Imaging to the First Floor
g. Create an Emergency Triage and Fast Track Exam Area
h. Provide Connector from Women's Lobby to Main Hospital
i. Provide a New Surgery, PACU, Prep/Holding Unit
j. Renovate Central Sterile Supply Area
k. Renovate for CCU Waiting and Support Spaces
1. Renovate Pharmacy and Provide an IV 797 Room
m. Renovate Vacant Patient Room Floor Finishes
n. Ground breaking ceremony held on August 4, 2011.
2) Additional renovations to North Campus by RegionalCare Hospital Partners:
a. Renovate Area for New CVICU Unit.
b. Provide New Oversized Patient Elevator.
c. Renovate Kitchen and Dining Area.
d. Provide Physician Lounge/Dictation/Chart.
e. Relocate Endo Suite to New Tower.
f Renovate Patient Room Floor Finishes.
g. Relocate Administration Suite.
h. Provide New Nurse Call System.
i. Provide New Code Blue System.
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ESSENT PRMC, L.P.
dba Paris Regional Medical Center
Northward Bound Protect DescrtionSOUTII Camus
PRMC is committed to contributing to the health of the Paris community by maintaining its
position as the leading provider of healthcare services for the region. In order to do that, PRMC
must continually invest and upgrade its equipment and facilities. Listed below is a detailed
description of the Northward Bound improvements to the SOUTH campus:
1) Renovations to South Campus:
a. Endoscopy has moved from the 5th floor to the newly renovated 4th floor.
b. Endoscopy waiting area has been remodeled.
c. Geropsych has moved to the South Campus.
d. Construction is complete on Sth floor to accommodate the relocation of
Geropsych.
2) Additional renovations to South Campus by RegionalCare Hospital Partners:
a. Relocate Rehab Beds and Therapy Area.
b. Relocate LTAC Unit System to ba' floor (Dubuis Health System).
Rom
!
STATE OF TEXAS j
COUNTY OF LAMAR
The City of Paris, Texas, has included the Property described in Exhibit A attached hereto into
two Enterprise Zones, and has executed and delivered a Tax Abatement Agreement dated October 8,
2012 with ESSENT PRMC, L.P., a limited partnership, for certain improvements and other equipment
(the "Improvements") to be installed at the Partnership's two hospital facilities located in Paris, Lamar
County, Texas.
Pursuant to letter dated March 13, 2013 from Steve Wylie, Senior Vice President, Financial
Operations, Regional Care Hospital Partners, ESSENT PRMC, L.P. has completed all Improvements set
forth in the Tax Abatement Agreement and has complied with all other terms in the Tax Abatement
Agreement.
NOW THEREFORE, the City of Paris authorizes that the Property described in Exhibit "A"
attached hereto shall receive a tax abatement of 100% of the taxes assessed upon the increased value of
the Improvements so installed over the value in which the property was last determined as of
September 30, 2010, as recited in the Tax Abatement Agreement, for a duration of ten (10) years, with
the tax abatement for the Improvements beginning January 1, 2013.
APPROVEDhi_ day of 2013
A.J. Hashmi, M" ' :, M,1W61
ATTEST:
ice Ellis, City Clerk
APPROVED AS TO FORM:
W. Kent Qyar, pity Attorney
EXHIBIT "A"
Paris ReEionalmmMedical Center NORTH Hosfwital:_865mDeShon Dr„ Paris TX 75460
City of Paris, Block 306, Lot 1C, Acres 33.27, and
City of Paris Block 306, Lot 1E, Acres 7.8127, and
Paris Regional Medical Center —SOUTH Hospital: 820 Clarksville St.,.Paris TX 75460
City of Paris, Block 110, Lot 5, and
City of Paris, Block 110, Lot 3, and
Paris Regional
MedicalCenter
March 13, 2013
Mr. John Godwin VIA EMAIL „jjigdwin(cr7paristehas,1loy
City Manager
City of Paris
135 SE 1" St.
Paris, Texas 75460
RE: Essent PRMC, LLC Tax Abatement Agreement - Initial Reporting Requirements
Dear Mr. Godwin:
Essent PRMC, LLC (dba Paris Regional Medical Center) is in full compliance with the initial
reporting requirements of Section XII, Paragraphs 12.1 through 12.3, and with each of the
applicable terms of the Tax Abatement Agreement, dated October 8, 2012 (hereinafter referred to
as "TAA") between Essent PRMC, LLC and the City of Paris, Lamar County, Texas.
Attached are the following documents fulfilling our initial repoiling requirements and supporting
Essent PRMC, LLC's tax abatement for the 2013 tax year, as stated in Section 12.1 of the above
mentioned TAA:
Exhibit A — copy of printout from Lamar County Appraisal District showing market
values for each property described in the TAA (property #15720; #22290;
4119288; #119296; #401630; #403982; #404015).
Exhibit B — detailed description of the Improvements.
Exhibit C — copy of plans of constructed Improvements.
Exhibit D — actual costs of capital Improvements.
Exhibit E — Employer Summary, Texas Workforce Commission Employer's Quarterly
Report for 4'h Quarter, 2012.
Based on the information provided and per Section XII of the TAA, Essent PRMC, LLC certifies
that it is in compliance with each applicable terms of the TAA and has met the initial reporting
requirements of the TAA.
If you have any questions or require any additional information, please contact me at (615) 312-
5107.
Sincerely,
Steve Wylie
Senior Vice President, Financial Operations, RegionalCare Hospital Partners
Enc 1.
cc: Leo Sierra, CPA
820 Clarksville tit. B Paris. 'li:xas 75460 , (9W) 737-3232
11,11,14;PaY.&rnrc. co1n
cc: Leo Sierra, CPA
Mr. Ken Miller, Paris Regional Medical Center
Ms. Janice Ellis, City Clerk, City of Paris, Texas oellis@paristexas.gov)
Mr. Shawn Napier, Director of Engineering, City of Pans, Texas (snapier@paristexas.gov)
Mr. Steve Gilbert, Paris Economic Development Corp. (sgilbert@paristexasusa.com)
Ms. Shannon Barrentine, Paris Economic Development Corp. (shannon@paristexasusa.com)
NNTER'S /APPRAISED VALUES
PARIS REGIONALMEDICAL CE
Property ID # and Descnptlon
Local ID
wv Description
Assessed Value 01/01/2012 w
"' mm LAMAR COUNTY
4o1s3o
Essent PRMC LP
820 Clarksville St,
Real Property
$
187,470.00
City of Paris, Block 306
Hospital
Improvements
Lot IC, Part of 2nd Floor Only
Paris TX 7546D
119288
Essent PRMC LP
820 Clarksville SL
Real Property
$
337,150.00
Block 110. Lot 5
Hospital
Improvements
Paris TR 75460
. . �w. ......
.�_. .... .
�...... .........�
157;10.1)15500-9 A DDD -0030
Essent PRMC LP
820 Clarksville St.
Real Property
$
7,131,100.00
City of Paris, Block 110
Hospital
Improvements
Lot 4,820 Clarksville
Paris 6 75460
119296
Essent PRMC LP
865 DeShong Dr.
Real Property
$
2.460,640.00
City of Paris, Block 306
Hospital
Improvements
Lot 1C
Deshong Drive
Narita TX5460. _.. ,µ ._....... _
_ __....... �
......_
...mm .,
22290
Essent PRMC LP
865 DeShong Dr.
Real Property
$
11,064,001.00
block 306 Lot 1C
Hospital
Improvements
Deshong Drive
Paris, TX 75460
TOTAL REAL PROPERTY IMPV.
$
21 >nn -A61.00
PARIS REGIONAL
MEDICAL CENTERS APPRAISED
VALUES
Propek4 !D #and Description
Local 1D
Descnption
Assessed Value 0110112012
i AMAR COUNTY
Tangible Personal
Property: equiment,
computers, W,
Essent PRMC LP
865 DeShong Dr.
inventory
$
3,208,310.00
Personal Property at 865 Deshong
Pans TX 75460
403982
Tangible Personal
Property. equiment,
computers, W.
Essent PRMC LP
820 Clarksville St.
inventory
$
10,402,160.00
Personal Property at 820 Clarksville
Paris TX 75460
TOTAL TANGIBLE PERSONAL PROP.
$ w,,,, T ,„T,
mmm13 610 470.00
CITY OF PARIS, TEXAS
POLICY STATEMENT
CRITERIA AND GUIDELINES
FOR TAX ABATEMENT
I. General Purpose and Objectives.
The City of Paris, Texas (herein called the "City") is committed to enhancing the
competitiveness and the expansion potential of the City's manufacturing industry; to attracting and
encouraging new manufacturing industry and investment; to improving the City and its
infrastructure which attracts and supports development; and, to expanding the tax base,
employment opportunities, and the overall quality of life for its citizenry. Therefore, the City will
give consideration, on a case-by-case basis, to providing tax abatement according to state law to
the owners of real property for projects which stimulate economic growth and diversification in
the City.
Tax abatement benefits may be made available to industrial, manufacturing, distribution,
and service facilities currently in the City or locating in the City if located in a designated
Enterprise Zone or Reinvestment Zone. New facilities and structures as well as the expansion
and modernization of existing facilities and structures, will be considered. Evaluation of a tax
abatement request will be based on the information provided in the tax abatement application.
However, the City is under no obligation to provide tax abatement to any applicant.
II. Definitions
a) "Abatement" or "abatement" means "tax abatement", which is the full or partial
exemption from ad valorem taxes of certain real and tangible personal property in a
Reinvestment Zone designated for economic development purposes.
b) "Agreement" means the written agreement for tax abatement between a property
owner and/or lessee and the City.
c) "Authorized Facility". A facility may be eligible for abatement if it is a
Manufacturing Facility, a Research Facility, a Regional Distribution Facility, a Regional Tourist
Entertainment Facility or Other Basic Industry (all of which terms are defined below); or if the
facility is a Historic Property defined in Section IV (b) below within a City of Paris Historical
District.
d) "Base Year Value" means the assessed value of eligible property as of January 1,
preceding the date of execution of the agreement plus the agreed upon value of eligible
property improvements made after January 1, but before the execution of the agreement. The
Base Year Value may be adjusted either up or down from year to year as per renditions by the
Lamar County Appraisal District.
e) "Employer" means the owner or lessee of Property who provides .lobs within the
Reinvestment Zone or within the Enterprise Zone, applying for tax abatement.
0 "Enterprise Zone" means an area of land designated as such under Chapter 2303 of
the Texas Govemment Code.
g) "Jobs" or "a Job" as used herein means a position of full-time employment for an
individual to work 32 hours or more per week for an Employer, in which position the individual
is provided the benefits normally offered by the Employer, such as health insurance, vacation
time and some form of retirement benefit. A Job is not a position filled for the Employer as a
worker or employee of an employment agency or service. "Jobs" as used herein includes "Full-
time Equivalent Jobs", as defined below.
h) "Full-time Equivalent Jobs" means a number of pari -time jobs where the hours worked
in each such job is less than 32 hours per week, made available by one Employer and added
together. For example, sixteen (16) part-time jobs made available by one Employer where all
such part-time jobs added together require a total of 352 hours of work per week (but no such
part-time job requires 32 hours of work or more per week), will equal eleven (11) Full-time
Equivalent Jobs (352 hours divided by 32 hours per week equal 11). Full-time Equivalent Jobs
do not require the employee to receive benefits from the Employer.
i) "Manufacturing Facility" means buildings and structures, including fixed machinery
and equipment, the 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. Facilities
primarily engaged in assembling component parts of manufactured products are also considered
manufacturing facilities.
j) "Modem ization " 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 operation. Modernization may result from the construction, alteration or
installation of buildings, structures, fixed machinery or equipment, but shall not be for the
purpose of reconditioning, refurbishing, repairing, or deferred maintenance.
k) "Other Basic Industry" means buildings and structures, including fixed machinery and
equipment, not elsewhere described, used, or to be used for the production of products or
services which result in the creation of new Jobs and bring new wealth into the City.
1) "Personal Property" means machinery, equipment, tools, shelving or materials eligible
under applicable law for tax abatement, which can be removed from an authorized facility
described in Section IV (a) below,
m) "Property" means Real Property or Personal Property defined herein, as is applicable
according to the context where used herein, that is eligible for tax abatement.
n) 'Rea] Property" means the land within an Enterprise Zone or a Reinvestment Zone,
together with all improvements and fixtures constructed or otherwise situated thereon.
o) "Regional Distribution Facility" means buildings and structures, including fixed
machinery and equipment, used or to be used primarily to receive, store, service, or distribute
goods or materials where a majority of the goods or services are distributed to points at least 100
miles from its location in the City.
p) "Regional Tourist Entertainment Facility" means buildings and structures, including
fixed machinery and equipment, used or to be used in providing amusementlentertainment
through the admission of the general public where the majority of users reside at least 100 miles
from the City and where the majority of users are likely to stay in the City for more than one day
and will therefore likely utilize local restaurants and hotel/motel accommodations.
q) "Reinvestment Zone" is an area where the City or County has decided to influence
development patterns and attract major investments that will contribute to the development of the
area through the use of tax abatement for specified improvements.
r) "Research Facility" means buildings and structures, including fixed 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.
s) "Tax Abatement Committee" means the committee of persons designated from time
to time by the Paris Economic Development Corporation to study, review and recommend tax
abatement to the applicable taxing entities in the community. The Tax Abatement Committee
will be composed of one person from each of the City (the City Manager or designee), the
County of Lamar (the County Judge or designee), Paris Junior College (the President or
designee), the Chief Appraiser of the Lamar County Appraisal District, and the Executive
Director of the Paris Economic Development Corporation.
Ili. Designation of a Reinvestment Zone.
The City or County may designate an area as a Reinvestment Zone in accordance with
the criteria and procedural requirements set forth in the Property Redevelopment & Tax
Abatement Act, as amended (Texas Tax Code Sec. 312.401 (b)).
For any area within the jurisdiction of the City to be eligible for tax abatement it must
meet the criteria for designation as a tax abatement Reinvestment Zone as set forth in the
Property Redevelopment and Tax Abatement Act, Texas Tax Code Chapter 312.
iv. Tax Abatement Authorized.
The City, through its Council, may agree in writing with the owner and/or lessee of
taxable Real Property that is located in a Reinvestment Zone, but that is not in an improvement
project financed by tax increment bonds, to exempt from taxation a portion of the value of the
Real Property, or of Personal Property located on the Real Property, or both. The period of the
abatement granted under the agreement shall not exceed the term authorized by law. Such
agreement will be based on the condition that the owner or lessee of the Property makes
specific improvements or repairs to the Property. An agreement may provide for the exemption
of the Real Property in each year covered by the agreement only to the extent its value for that
year exceeds the Base Year Value. An agreement may provide for the exemption of Personal
Property located on the Real Property in each year covered by the agreement other than Personal
Property that was located on the Real Property at any time before the period covered by the
agreement. Inventory or supplies cannot be abated as Personal Property.
Tax abatement may only be granted for additional value of eligible Property
improvements made subsequent to and specified in an abatement agreement between the City and
the property owner or lessee subject to such limitation as the City may require. The additional
value must exceed any reduction in the fair market value of other property of the owner already
on the tax role with the jurisdiction of the City. Change in appraised value does not qualify for
abatement except in an instance where a previously vacant Authorized Facility is utilized. Value
added to the tax rolls must come from actual capital expenditures.
The negotiation of tax abatement contracts will be conducted by the Paris Economic
Development Corporation, in conjunction with the City Manager or designee to the Tax
Abatement Committee. In determining where and how tax abatement will be utilized, the Tax
Abatement Committee will examine the potential return on the public's investment. Return on
public investment will be measured in terms of (i) Jobs created, (ii) Jobs retained in cases of
existing Employers within the City, and (iii) broadening of the tax base, and expansion of the
economic base.
A property owner and/or lessee shall be eligible for tax abatement only upon the
following terms and conditions:
a) If the Property involved is an Authorized Facility.
b) If the Property involved is a Historic Property. In the City Historic Districts there are
certain commercial and residential tax exemptions allowed. Exterior improvements in the historic
districts are allowed at 100% for seven (7) years with a minimum investment of $5,000 for
residential property and $10,000 for commercial property. New residential construction requires
a minimum investment of $100,000 to be considered for a three (3) year 100% exemption. New
commercial construction requires a minimum investment of $200,000, for a 100% tax exemption
for three (3) years.
c) If there will be the creation of new value. Abatements may only be granted for the
additional value of eligible Real and Personal Property improvements, subject to such
limitations as the City may require. Real Property tax abatement may be granted only to the
extent that its value for each year of the agreement exceeds its value for the year in which the
agreement is executed.
d) if there will be new Authorized Facilities created, or if existing Authorized
Facilities will be improved for purposes of modernization or expansion.
C) Eligible Property. Abatement may be extended to the value of buildings, structures,
fixed machinery and equipment, site improvements, tangible personal property, and that office
space and related fixed improvements necessary to the operation and administration of the
Authorized Facility; provided, however, that inventory or supplies shall not be eligible for
abatement. Eligible property for which abatement may be granted includes nonresidential real
property and/or tangible personal property not located on the real property at any time before the
abatement agreement becomes effective.
f) Leased Authorized Facilities. if a leased Authorized Facility is granted abatement,
the agreement may be executed with the lessor and/or lessee, depending upon the particular
circumstances of the proposed project. If the agreement is with the lessor, lessor shall
demonstrate binding contracts with the lessee to guarantee compliance with the terms of the
agreement.
g) Value and Term of Abatement. The City will.decide whether to grant tax abatement
to an applicant, and the amount, if any, of such abatement, on a ease -by -case basis and in
accordance with these Criteria and Guidelines. The term of abatement granted under any
agreement may not exceed that permitted by applicable state law. The amount of the
abatement shall be based upon a percentage (0 to l 00%) of all or a portion of the eligible property
within the Authorized Facility. Abatement may only he granted for the additional value of
eligible property improvements made pursuant to and listed in the agreement between the City
and property owner and/or lessee subject to such limitations as the City may require. If a
modernization project includes the replacement of improvements within an Authorized Facility,
the value eligible for abatement shall be the value of the new unit(s), less the value of the replaced
unit(s). The criteria that will be used in evaluating a particular application for abatement will
include, but not be limited to:
1) The dollar amount of the increase in the tax roll for the proposed project;
2) The number of Jobs created or retained by the Employer involved;
3) The possible effect the proposed project will have on attracting other taxable
improvements into the City;
4) The nature of the proposed project and its overall effect on the City;
5) The proposed project's effect on the safety, health, and morals of the City's
residents;
6) Whether the proposed project will have any substantial long-term adverse effect
on the provision of City services or its tax base;
7) Whether the project meets all relevant zoning requirements;
8) Whether the project is consistent with the comprehensive plan of the City or
County of Lamar; and
9) The types and cost of public improvements and services (water and sewer main
extensions, streets and roads, etc.) required of the City and the types and values of
public improvements to be furnished by the applicant.
h) Economic Qualification. In order to be eligible to receive tax abatement, the
planner] improvements:
l) Must be reasonably expected to increase the appraised value of the Property;
2) Must be expected to prevent the loss of employment, or the retention or
creation of Jobs in the City during the term of the agreement;
3) Should not be expected to solely or primarily have the effect of merely
transferring existing employment from one part of the City to another
without demonstration of increased future investment (Dollars or Jobs) or
unusual circumstances whereby without such a move employment is likely to
be reduced;
4) Must be necessary because capacity cannot be provided efficiently utilizing
existing improved Property when reasonable allowance is made necessary
improvements or relevant governmental actions.
i) Taxability. During the term of the agreement, taxes shall be payable as follows:
1) The Base Year of eligible property as determined each year by the Lamar
County Appraisal District shall be fully taxable; and
2) The additional value of eligible property above the Base Year Value shall be
taxable in the manner described in the agreement.
The Chief Appraiser of the Lamar County Appraisal District shall annually determine an
assessment of the Real and Personal Property comprising the Reinvestment Zone. Each year, the
Employer, the company or individual receiving abatement pursuant to an agreement shall furnish
the assessor with such information as may be necessary to determine the amount of any
abatement. Once such value has been established, the Chief Appraiser shall notify the affected
jurisdictions which levy taxes on such Property and the Paris Economic Development
Corporation.
The Employer, owner or lessee of eligible Property requesting tax abatement within a
Reinvestment Zone shall, prior to the commencement of eligible property improvements, agree
to expend a designated sum of money and to create or retain a certain number of Jobs, or annual
payroll as further defined below.
V. Tax Abatement for Real Property; Creation of Jobs:
Tax abatement may be made available to Employers creating Jobs with respect to an
Authorized Facility located anywhere within the City or its extra territorial jurisdiction based
on the following:
a) To be eligible for any tax abatement, there must be a minimum capital investment in the
Authorized Facility of $250,000 and at least ten (10) new Jobs added to the Employer's labor
force.
b) When an abatement percentage has been agreed upon it shall be granted for years
one (1) through three (3); thereafter, there will be a 20% reduction in the original amount abated
beginning with year four (4) and a similar reduction of 20% in each of the next three years until
100% of the Real Property valuation is added to the tax rolls.
c) Criteria for qualification for tax abatement are as follows:
d) Any project with a capital investment of more than ten million dollars ($10,000,000),
accompanied by a newly created minimum annual payroll of two and one-half million dollars
($2,500,000), or creating more than two hundred twenty-five (225) Jobs will be individually
negotiated. No abatement will be granted for more than specified in state law.
e) if a newly created business is located or will locate within an Enterprise Zone, an
additional 10 to 20% abatement may be available as individually negotiated, with total
abatement not to exceed 100%.
VI. Tax Abatement for Personal Property; Creation of Jobs:
The City recognizes a significant difference in the valuation of real property and
personal property. Because of depreciation schedules, often the abatement of personal property is
basically a tax exemption. For this reason, the abatement schedule for personal property versus real
property is significantly different. if personal property should become obsolete and be replaced
while under an abatement agreement, the replacement personal property is not eligible for
abatement.
a) To be eligible for any tax abatement on Personal Property, there must be a minimum
capital investment of $250,000 in Personal Property and at least ten (1O) new Jobs added to the
Employer's labor force.
b) When an abatement percentage has been agreed upon it shall be granted for years
one (1) through three (3); thereafter, there will be is 20% reduction in the original amount abated
beginning with year four (4) and a similar reduction of 20% in each of the next three years until
100% of the Real Property valuation is added to the tax rolls.
c) Criteria for qualification for tax abatement are as follows:
d) Any project with a capital investment in personal property of more than three million
dollars ($3,000,000), accompanied by a newly created minimum annual payroll of two and one-
half million dollars ($2,500,000), or creating more than two hundred twenty-five (225) new Jobs
will be individually negotiated. No abatement will be granted for more than specified in state
law,
e) If a newly created business is located or will locate within an Enterprise Zone, an
additional 10 to 20% abatement may be available as individually negotiated, with total
abatement not to exceed 100%.
VII. Tax Abatement for Existing Employers Regarding Real or Personal Property,
The City recognizes the value of its existing Employers to the well-being of the
community and desires to encourage existing Employers to remain in the City and to improve
their respective businesses and industries, as well as their profitability. Accordingly, if an
existing Employer (as opposed to a newly created business or industry moving into the City),
owns or leases an Authorized Facility and has plans to improve such Property by constructing
new improvements on its Real Property and/or adding new Personal Property to its Authorized
Facility which qualify for tax abatement under these Criteria and Guidelines, such Employer
may be eligible for tax abatement with respect to such improvements to its Real Property or its
new Personal Property under the provisions of Article V and IV above, even if no new Jobs or
Newly Created Minimum Annual Payroll are created. In these cases involving existing
Employers, the criteria for tax abatement for improvements to Real Property at Authorized
Facilities are identical to that set forth in Article V above (except that no new Jobs or Newly
Created Minimum Annual Payroll are required); and the criteria for tax abatement for new
Personal Property added to Authorized Facilities are identical to that set forth in Article VI
above (except that no new Jobs or Newly Created Minimum Annual Payroll are required). In
this regard, however, the City encourages existing Employers to retain as many Jobs and as
much existing Annual Payroll as is economically feasible for the existing Employer to do and
remain competitive in its industry.
VIII. Application.
a) Eligibility. Any present or potential owner of taxable property in the City may
request tax abatement by filing a written request with the City Manager or County Judge, with a
copy of The said application to be forwarded by the applicant to the Executive Director of the
Paris Economic Development Corporation.
b) Form. The application shall consist of a completed application form accompanied by
the following items:
l) A general description of the improvements to be undertaken together with the
projected new value to the Property and the type of business operation proposed;
2) A detailed descriptive list of the improvements for which abatement is
requested;
3) A list of the kind, number, and location of all proposed improvements of the
Property;
4) A list of the number and type of Jobs created, including information
pertaining to anticipated job transfers;
5) A metes and bounds description and plat of the proposed Reinvestment Zone that
shows all roadways within 200 feet of the Reinvestment Zone and all existing zoning and
land uses within 200 feet of the Reinvestment Zone;
6) A time schedule for undertaking and completing the proposed
improvements;
7) The type and value of any economic development incentives requested; and
8) Any other information about the proposed project as maybe required by the City or
as deemed desirable by the City.
c) Review. Once the application has been received, the information submitted will be
reviewed by the Tax Abatement Committee for completeness and accuracy. The Committee will
then distribute the application to the appropriate department heads and taxing entities for review
and comment. In addition, no tax abatement application shall be considered for further
processing by the governmental entities unless first approved by the governing board of the
Paris Economic Development Corporation.
d) Public Hearing. The City will comply with certain public notices and hearings
required as mandated by state law under the Property Redevelopment and Tax Abatement Act
prior to the designation of a Reinvestment Zone and execution of a tax abatement agreement. The
City may adopt an ordinance designating a tax abatement Reinvestment Zone only after notice of
a public hearing has been published at least seven (7) days before the date of the hearing, and all
other procedural requirements of Chapter 312 of the Texas Tax Code have been satisfied.
e) Findings. In order to enter into an agreement, the City must find that the terms of he
proposed agreement comply with these Guidelines and Criteria, that there will be no
substantial adverse affect on the provision of City services or tax base, and that the planned use of
the Property will not constitute a hazard to public safety, health or morals. Incident to approval of
any ordinance designating a Reinvestment Zone, the City shall find that the improvements sought
are feasible and practical and would be a benefit to the land to be included in the Reinvestment
Zone and to the City after the expiration of the agreement,
f) variances. Requests for variance from the provisions of these Guidelines maybe
made in writing to the City, provided, however, that in no event shall the term of any
abatement exceed the period authorized by applicable state law. Such request shall include a
complete description of the circumstances requiring a variance. Approval of a request for
variance shall require the affirmative vote of three-fourths (3/4) of the members of the City
Council.
IX. Agreement.
After approval, the City shall formally pass an order or resolution and authorize the
execution of an agreement with the owner and/or lessee of the Authorized Facility which shall
include, but not be limited to the following terms:
a) The Base Year Value;
b) Percent of increased value to be abated each year;
c) The commencement date and the termination date of abatement;
d) Amount of investment and average number of jobs involved during the term of the
agreement;
e) The proposed use of the Authorized Facility, nature of construction, time schedule,
plat, property description, and improvement list, as provided in the application;
f) A listing of the kind, number, location, and costs of all proposed improvements of the
Property;
g) A statement limiting the uses of the property consistent with the general purpose of
encouraging development or redevelopment of the Reinvestment Zone during the period
that property tax abatement is in effect;
h) That access to the project is provided to allow for the inspection by City inspectors
and officials in order to ensure that the improvements or repairs are made according to
the specifications and conditions of the agreement;
i) That property tax revenue lost as a result of the tax abatement agreement will be
recaptured by the City if the owner of the Property fails to make the improvements or
repairs as provided by the agreement;
j) Each term agreed to by the owner of the Property,
k) A requirement that the owner of the Property shall certify annually to the City that
the owner is in compliance with each applicable term of the agreement;
1) Contractual obligations in the event of default, violation of terms or conditions,
delinquent taxes, recapture, administration and assignment, or other provisions that
may be required by state law, or in the discretion of the City Council; and
m) That the City may cancel or modify the agreement if the Property owner fails to
comply with the agreement.
X. Default.
If the City determines that the person or entity receiving an abatement is in default
according to the terms and conditions of its agreement, the City shall notify the company or
individual in writing at the address stated in the agreement, and if such default is not cured within
a reasonable time specified in such notice ("Cure Period'), then the agreement may be modified
or terminated without further notice. In the event the company or individual allows its ad
valorem taxes owed to the City to become delinquent and fails to timely and properly follow the
legal procedures for their protest and/or contest, or violates any of the terms and conditions of the
agreement and fails to cure during the Cure Period, the agreement then may be modified or
terminated without further notice, and the agreement may provide a formula for recapture of all
or part of the taxes abated. At anytime before the expiration, any tax abatement agreement may
be terminated by mutual consent of all parties involved in the same manner that the agreement
was executed.
XI. Confidentiality of Proprietary Information.
Information that is provided to a taxing unit in connection with an application or request for
tax abatement under these Guidelines and that describes the specific processes or business
activities to be conducted or the equipment or other property to be located on the Property for
which tax abatement is sought is confidential and not subject to public disclosure until the
agreement is executed. Such information in the custody of the City after the agreement is
executed is not confidential under these Guidelines.
XII. Proposed Tax Abatement Agreements to be decided on an Individual Basis.
The adoption of these Guidelines by the City does not limit the discretion of the City
Council to decide whether to enter into a specific tax abatement agreement, or limit the discretion
of the City Council to delegate to its employees the authority to determine whether or not the
City should consider a particular application or request for tax abatement, or create any property,
contract, or other legal right in any person or entity to have the City Council consider or grant a
specified application or request for tax abatement.
XIII. Inspections.
The agreement shall stipulate that employees and/ or designated representatives of the City
will have access to the Reinvestment Zone during the term of the agreement to inspect the
Authorized Facility to determine if the terms and conditions of the agreement are being met. All
inspections will be made only after the giving of at least twenty-four (24) hours' prior notice
and will only be conducted in such a manner as to not unreasonably interfere with the
construction and/or operation of the Authorized Facility. All inspections will be made with one
or more representatives of the company or individual and in accordance with its safety standards.
Upon completion of construction, the City shall annually evaluate each Authorized
Facility receiving abatement to ensure compliance with the agreement and report possible
violations of the agreement to the City Council.
XIV. Modifications of Agreement.
At any time before the expiration of an agreement made under these Guidelines, the
agreement may be modified by the parties to the agreement to include other provisions that could
have been included in original agreement or to delete provisions that were contained in the
original agreement. The modification must be made by the same procedure by which the
original agreement was approved and executed. The original agreement, however, may not be
modified to extend the tern of the agreement or the term of the abatement granted therein
beyond the time permitted by state law.
XV. Assignment.
An agreement may be assigned to a new owner or lessee of the Authorized Facility only
with the prior written consent of the City. Any assignment shall provide that the assignee shall
irrevocably and unconditionally assume all the duties and obligations of the assignor upon the
same terns and conditions as set out in the agreement, and the City's approval shall be subject to
the determination of the financial capability of such assignee. Any assignment of an agreement
shall be to an entity that contemplates the same improvements or repairs to the property, except
to the extent such improvements or repairs have been completed. No assignment shall be
approved if the assignor or the assignee is indebted to the City for ad valorem taxes or other
obligations, or if any event of default under the agreement remains uncured.
XVI. Administration, Contract Review and Monitoring, and Reporting.
a) The Paris Economic Development Corporation shall be primarily responsible for the
administration, review, and monitoring of tax abatement agreements authorized by the City
under these Guidelines. These responsibilities shall include verifying that participants in tax
abatement agreements are in full compliance with the terms of the agreement.
b) The Paris Economic Development Corporation shall expeditiously advise the City in
writing of any instances of contract non-compliance by tax abatement participants. In addition,
the Paris Economic Development Corporation shall, on an annual basis, conduct a performance
review of the activities of each tax abatement participant and report the findings of such review
to the City Council.
c) The City shall retain the right to independently review and audit the activities of tax
abatement participants.
d) The City shall be responsible for enforcement of the terms of any tax abatement
agreement authorized hereunder.
XVII. Amendments.
These Guidelines are effective for a two (2) year period from the date of their adoption,
unless amended or repealed by the affirmative vote of three-fourths (3/4) of the members of the
City council.
For a tax abatement application or additional information contact:
Paris Economic Development Corporation l 125 Bonham Street
Paris, Texas 75460
903-7846964
Fax 903-784-2503
Email parisedc@paristexasusa.com