23 - Tax Abatement Agreement for Lionshead Speciality Tire & WheelItem No. 23
TO: City Council
Gene Anderson, Interim City Manager
FROM: Stephanie H. Harris, City Attorney
SUBJECT: Tax Abatement Agreement for Lionshead Specialty Tire & Wheel, LLC
DATE: January 22, 2020
BACKGROUND: On December 9, 2019, the City Council directed me to prepare a tax abatement
agreement for a new tax abatement with Lionshead Specialty Tire & Wheel, LLC ("Lionshead").
Lionshead is an Indiana corporation new to Paris which plans to build an assembly and
warehousing plant for its business of assembling tire and wheel assemblies on property currently
owned by the Paris Economic Development Corporation in the Northwest Business Park on NW
Loop 286. PEDC will be entering a performance agreement with Lionshead as well by which
PEDC will be conveying the property to Lionshead subject to performance standards and claw
back provisions. The improvements, which will come in at a total cost of between approximately
$6,000,000.00 and $8,200,000.00, will necessitate the hiring of at least 18 employees in the first
three years of the agreement, and the agreement requires that those employees be retained
throughout the remainder of the agreement as well.
The abatement is for 7 years and will be granted on a de-escalating basis: 100% for the first two
years, 75% years 3 and 4, 50% for years 5 and 6, and 25% for year 7. The abatement expires on
December 31, 2027.
STATUS OF ISSUE: Pending City Council approval of tax abatement agreement.
BUDGET: Seven year abatement on the improvements set out in the Agreement.
RECOMMENDATION: Motion to adopt a resolution approving tax abatement agreement
between City of Paris and Lionshead Specialty Tire & Wheel, LLC in substantial conformance
with the attached agreement and authorize the mayor to execute same on behalf of the city.
RESOLUTION NO.
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS
APPROVING AND AUTHORIZING A TAX ABATEMENT AGREEMENT WITH
LIONSHEAD SPECIALTY TIRE & WHEEL, LLC; MAKING OTHER FINDINGS
AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN
EFFECTIVE DATE.
WHEREAS, the City Council of the City of Paris, Texas has been presented a proposed
agreement by and between the City and Lionshead Specialty Tire & Wheel, LLC providing for
a commercial and industrial tax abatement for certain improvements, a copy of which is
attached hereto as Exhibit A and incorporated herein by reference, hereinafter called the
"Agreement"; and,
WHEREAS, the City Council did heretofore, on the 131h day of January, 2020, in
Resolution No. 2020-001, reaffirm its election to be eligible to participate in tax abatement
agreements authorized by the Property Redevelopment and Tax Abatement Act, Texas Tax
Code Chapter 312, et seq. (the Act"), in order to maintain and enhance the commercial and
industrial economic and employment base of the Paris area for the long term interest and
benefit of the City and its citizens; and,
WHEREAS, under the Texas Enterprise Zone Act (Government Code Chapter 2303)
and Texas Tax Code Sec. 312.2011, the designation of an area as an enterprise zone also
constitutes designation of the area as a reinvestment zone (the "Reinvestment Zone"); and
WHEREAS, the property defined in the Agreement and improvements to be made
under the Agreement is situated within an enterprise zone, and thus a reinvestment zone, by
virtue of 2010 U.S. Census data related to poverty levels within the zone; and
WHEREAS, the contemplated use of the property, and the improvements to be
installed therein in the amounts set forth in the Agreement and the other terms therein 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 of tax
abatement incentives adopted by the City and all applicable laws;
WHEREAS, upon review and consideration of the Agreement, and all matters
attendant and related thereto, the City Council is of the opinion that the terms and conditions
therein meet the Guidelines and Criteria for Tax Abatement and should be approved, and
that the Mayor should be authorized to execute it on behalf of the City of Paris, Texas.
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 the terms of the Tax Abatement Agreement and the property the
subject thereof meet the City's Guidelines and Criteria for Tax Abatement adopted by the City
of Paris by Resolution No. 2020-001.
Section 3. That the terms and conditions of the proposed Agreement attached
hereto as Exhibit A, having been reviewed by the City Council of the City of Paris and found
to be acceptable and in the best interests of the City of Paris and its citizens, be, and the same
are hereby, in all things approved.
Section 4. That the Mayor is hereby authorized to execute the Agreement and all
other documents in connection therewith on behalf of the City of Paris substantially
according to the terms and conditions set forth in the Agreement attached hereto as Exhibit
A.
Section 5. That the planned use of the property the subject of the tax abatement
will not constitute a hazard to public safety, health, or morals.
Section 6. That this approval and execution of the agreement on behalf of the City
is not conditioned upon approval and execution of any other tax abatement agreement by
any other taxing entity.
Steven J. Clifford, M.D., Mayor
ATTEST:
Janice Ellis, City Clerk
APPROVED AS TO FORM:
Stephanie H. Harris, City Attorney
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 LIONSHEAD SPECIALTY TIRE & WHEEL, LLC, acting by and through its authorized
officer whose signature appears below (hereinafter referred to as "Owner").
WITNESSETH:
WHEREAS, the City Council of the City of Paris did heretofore, on the 13th day of
January, 2020, in Resolution No. 2020-001, elect to be eligible to participate in tax abatement
agreements in order to maintain and enhance the commercial and industrial economic and
employment base of the Paris area for the long term interest and benefit of the City and its
citizens; and,
WHEREAS, under the Texas Enterprise Zone Act (Texas Government Code Chapter
2303), and the Redevelopment and Tax Abatement Act (Texas Tax Code Sec. 312.2011) the
designation of an area as an Enterprise Zone also constitutes designation of the area as a
reinvestment zone (the "Reinvestment Zone"); and
WHEREAS, pursuant to the 2010 Census, the Property within City of Paris, Lamar
County, Texas, is included within an Enterprise Zone, as is shown in the print-out from the
Office of the Governor of the State of Texas on its website in Exhi it 1 attached hereto and
made a part hereof for all purposes; and
WHEREAS, Owner has agreed to make the Improvements specified herein, said
Improvements related to the construction of a manufacturing and warehousing facility for
the assembly and distribution of tires and wheel assemblies; and
WHEREAS, the Owner has agreed to create and maintain at least eighteen (18) full-
time equivalent employment positions; and
WHEREAS, the contemplated use of the Improvements, as hereinafter defined, in the
amount as set forth in this Agreement upon and within the Property, and the other terms
hereof are consistent with encouraging development of said Enterprise 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 Enterprise Zone adopted by the
City and all applicable laws; and
NOW, THEREFORE, pursuant to Chapter 312 of the Texas Tax Code and the
Guidelines and Criteria for Tax Abatement adopted in Resolution No. 2020-001, the parties
hereto do mutually contract and agree as follows:
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I.
Term
1.1 The effective date of this Agreement is the 28th day of January, 2020, with the
tax abatement being effective from and after January 1, 2021, and terminating on
December 31, 2027 (an abatement period of seven (7) years (the "Abatement
Period")). Said Abatement Period will terminate on December 31, 2027, regardless of when
Owner completes the Improvements described in Sections II and III herein below.
II.
The "Property" - Area to be Improved
2.1 The Improvements defined in paragraph III below and made the subject of this
Agreement shall be located on the Property located in Paris, Lamar County, Texas Plant and
described in Exhibit attached hereto and incorporated herein by reference, which
Property is within the Enterprise Zone.
III.
Consideration: Improvements
3.1 The Owner shall construct and operate an assembling and warehousing plant
to be used in its business of assembling tire and wheel assemblies (herein called the
"Improvements") at the Property located in Paris, Lamar County, Texas, which are more
particularly described in Exhibit 3. attached hereto and incorporated herein by reference.
Owner commits herein to invest no less than SIX MILLION AND NO/100 DOLLARS
($6,000,000.00) and up to EIGHT MILLION TWO HUNDRED THOUSAND AND NO/100
DOLLARS ($8,200,000.00) to construct the Improvements, which shall be completed prior
to December 31, 2020. All of said improvements shall be described in the City's Certificates
of Completion defined Section X, "Reporting Requirements." For the purposes of this the
default provision of this Tax Abatement Agreement (Section V), the Improvements will be
deemed completed upon the issuance by the City of Certificates of Occupancy for the
structures included in the Improvements. Once Owner has applied for said Certificates of
Occupancy, the City shall not unreasonably delay the issuance of same. Notwithstanding the
foregoing, however, 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 Improvements. For this purpose, "force majeure" shall mean any
contingency or cause beyond the reasonable control of Owner including, without limitation,
acts of God, 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.
3.2 The Owner agrees and covenants that it will diligently and faithfully, in a good
and workmanlike manner, pursue the completion of the Improvements. 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
2
laws, codes and regulations, or Owner will procure a valid waiver thereof. In further
consideration, Owner shall thereafter, from the date a Certificates of Occupancy for the
structures on the Property are issued or the Improvements are completed as agreed until
the expiration of this Agreement, continuously operate and maintain the Property and the
Improvements as a tire and wheel assembly and warehousing plant.
IV.
Consideration
Jobs
4.1 The City has provided in its Guidelines and Criteria for Tax Abatements, that
in order to be eligible for a tax abatement, a new employer must make a minimal capital
investment of $1,000,000.00 and create at least ten (10) new jobs. Owner herein has
committed to a minimum investment of $6,000,000.00, and has committed to creating at
least eighteen (18) new full-time equivalent with benefits positions with an estimated direct
payroll of approximately SIX HUNDRED AND SEVENTY THOUSAND AND NO/100 DOLLARS
($670,000.00). These eighteen (18) full-time equivalent with benefits positions will be
created on the following schedule:
By June 30, 2021:
Ten (10)
By June 30, 2022:
Five (5)
By June 30, 2023:
Three (3)
In order to qualify for the tax abatement provided for herein, Owner must both create said
full-time equivalent positions and retain those positions throughout the remaining years of
the abatement period.
V.
Default
5.1 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 fails
to create and retain the required full-time equivalent positions set forth herein and on the
schedule set forth herein; or (d) 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), (c), or (d) above, the City shall give the Owner
written notice of such default. 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. In the event of default, and in accordance with
the requirements of Section 312.205 (a)(4) of the 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 a determined by Section
33.01 of the Tax Code of the State of Texas, with all penalties permitted by the Property
C
Redevelopment and Tax Abatement Act and the Tax Code of the State of Texas, shall be
recaptured and will become a debt to the City and shall be due, owning, 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.
VI.
Tax Abatement
6.1 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 the following percentages of the taxes assessed upon the increased value of
the Improvements made by Owner to the Property described in Section III of this Agreement,
over the value in the year which this Agreement is executed (the "Base Value"), in accordance
with the terms of this Agreement 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:
Year 1
100%
Year 2
100%
Year 3
75%
Year 4
75%
Year 5
50%
Year 6
50%
Year 7
25%
For the purposes of this Agreement, the Base Value of the existing real property shall be
deemed to be the value as shown on the tax rolls of the Lamar County Appraisal District as
of January 1, 2020.
6.2 The abatement granted herein shall be subject to and governed by the Criteria
and Guidelines for Tax Abatement, a copy of which is attached hereto as Exhibit 4 and
incorporated herein by reference, save and except that, in the event of a conflict between the
requirements of ExhibilA and this Agreement, this Agreement shall control.
6.3 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 Property and the Enterprise 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.
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VII.
No Conflict of Interest
7.1 The Owner represents and warrants that the Property does 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.
VIII.
Conditions
8.1 The terms and conditions of this Agreement are binding upon and enforceable
against and with respect to the successors and assigns of all parties hereto.
8.2 It is understood and agreed between the parties that the Owner, in performing
its obligations hereunder, is acting independently; the City assumes no responsibility or
liability in connection therewith to third parties; and Owner agrees to indemnify and hold
the City harmless therefrom. It is further understood and agreed among the parties that the
City, in performing its obligations hereunder, is acting independently; 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.
IX.
Compliance Provisions
9.1 Ci 's Right of Access to Records: The Owner agrees that the City, its agents
and employees, shall have the reasonable right of access to records concerning the Owner's
investment in the Improvements for the purpose of conducting an audit of the Project
Improvements and Project costs. Any such audit shall be made only after giving the Owner
at least fourteen (14) days advance written notice and will be conducted in such a manner
as to not unreasonably interfere with the operation of the facility. Upon request, the Owner
will provide the City with a detailed Asset Report with an itemized list of assets placed into
service from the date of execution of this Agreement to the date of completion. 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.
9.2 City's Rights of Access to Pro erg The Owner further agrees that the City,
its agents and employees, shall have reasonable right of access to the Property to inspect the
Improvements in order to insure that the construction of the improvements is in accordance
with this Agreement and all applicable state and local laws and regulations or valid waiver
thereof. After completion of the Improvements, the City shall have the continuing right to
inspect the Property to insure that it is thereafter maintained and operated in accordance
with the Agreement during the term of the Agreement. All inspections will be made only
after giving the Owner written notice at least seventy-two (72) hours in advance, and such
5
inspections shall be conducted in such a manner so as not to interfere with the operation of
the facility. Representatives of the City inspecting the Property and Improvements shall be
accompanied and 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, or as otherwise required by law.
Said representative shall also be required to observe any facility rule and regulation
applicable to the Property. Nothing herein shall be construed as limiting the City's ability to
perform inspections or to enter the Property the subject of this Agreement.
X.
Reporting Requirements
10.1 Initial Reort The Owner further agrees that it will, by April 15, 2020,
provide the City with a sworn report, written on Owner's letterhead and signed by a
designated representative of Owner, which contains the following information relating to
the improvements completed in the year 2020:
(a) A copy of the printout from the Lamar County Appraisal District showing the
market value of the Property as of January 1, 2018, prior to the construction
of the Improvements;
(b) Detailed description of the Improvements;
(c) A detailed description of any miscellaneous items of office equipment and
the actual cost of such added office equipment;
(d) A copy of or identification of plans and specifications of constructed
improvements and the location of the same for inspection by City's
certification team;
(e) A detailed list of and the actual cost of added machinery and equipment;
(f) The actual cost of capital Improvements; and,
(g) The date of substantial completion of the Improvements as defined in
paragraph 3.1 hereof.
10.2 Annual Re rt on Compliance for Each Yegr of the Abatement Period:
In addition to the report required in Paragraph 10.1 hereinabove, Owner further agrees
that by Aril 15th of each year of this Agreement beginning in the year 2021, it will
provide the 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 the form attached hereto as Exhibit 5 and incorporated herein by reference
and shall reflect the prior fiscal year. Owner shall attach thereto copies of the employer
reference summary page of its Texas Workforce Commission Employer's Quarterly
Reports for the calendar year immediately preceding the date of the annual report
required by this section, and the report shall contain a sworn statement signed by the Plant
0
Manager or an Officer of the Company certifying that the information provided in the
summary page is a true and valid report filed with the Texas Workforce Commission.
10.3 The reporting requirements and deadlines set forth herein are an integral
and material part of this Agreement, and Owner acknowledges that failure to timely
submit any report or sworn statement required herein is a breach and default of this
Agreement as set forth hereinabove. Owner further agrees to timely submit said reports
and/or sworn statements without prompting by the City.
10.4 Owner shall submit all compliance reports required to by this section via
certified mail, return receipt requested, to:
City of Paris
c/o Office of the City Attorney
P.O. Box 9037
Paris, Texas 75461-9037
Alternatively, said reports may be delivered personally to the Office of the City Attorney at
135 SE 1st St., Paris, Texas 75460.
XI.
City's Certificate of Completion
11.1 Within thirty (30) days of receipt of each Annual Report on Improvements
required by paragraph 10.1 hereinabove, or as soon thereafter as practicable should the City
require additional information from the Owner, the City shall:
(a) review same for compliance with the terms of this Agreement;
(b) verify that the Improvements identified in the Report and required by the
terms of this Agreement have been completed;
(c) and, if the required Improvements have been made, deliver a Certificate of
Completion in the forms attached hereto as Exhibit 6 and executed by the
Mayor to the Chief Appraiser of the Lamar County Appraisal District. The City
shall attach to said Certificate of Completion a copy of the information
provided by Owner in its Annual Report on Improvements as an identification
of the Improvements upon which the tax abatement is to be granted.
11.2 In the event that the City requires additional information in order to conduct
the review and verification contemplated by paragraph 11.1 hereinabove, the City shall
notify the Owner of same as soon as is practicable, but no later than thirty (30) days after
receipt of the Annual Report on Improvements.
7
11.3 Nothing in this section shall prohibit the City from exercising its right to declare
Owner in default or Owner's right to cure same in accordance with the terms of Section V
hereinabove.
XII.
Authority to Contract
12.1 This Agreement was authorized by resolution of the City Council at its
regularly scheduled meeting on the 28th day of January, 2019, authorizing the Mayor to
execute the Agreement on behalf of the City.
12.2 This Agreement was entered into by Lionshead Specialty Tire & Wheel, LLC
pursuant to the authority granted to the authorized official whose signature appears below.
12.3 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.
XIII.
Legal
13.1 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.
13.2 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.
13.3 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:
Lionshead Specialty Tire & Wheel, LLC
Attn: Gary Graham and Galen Miller
305 Steury Ave.
Goshen, IN 46528
CITY:
CITY OF PARIS, TEXAS
Attn: City Manager
P.O. Box 9037
Paris, TX 75461-9037
With a co to:
City Clerk, City of Paris, Texas (address same as above)
City Attorney, City of Paris, Texas (address same as above)
13.4 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 this
Agreement are declared to be severable.
13.5 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.
13.6 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.
13.7 Owner and the City have both contributed to the drafting of this Agreement, and no
ambiguity, if any, contained in this Agreement shall be construed against either party.
IN WITNESS WHEREOF, the Parties hereto have executed this Agreement effective as
of the date set forth below.
WITNESS our hands this _ day of 2019.
THE CITY OF PARIS, TEXAS
Mayor
E
ATTEST:
Janice Ellis, City Clerk
APPROVED AS TO FORM:
Stephanie H. Harris, City Attorney
LIONSHEAD SPECIALTY TIRE & WHEEL, LLC
I:
ATTEST:
Title:
Title:
Date:
10
LIST OF EXHIBITS:
2010 Designation of Enterprise Zone which includes the Property
2. Map of the Property
Diagrams of Improvements
4. Resolution No. 2020-_; Criteria and Guidelines for Tax Abatement
5. FORM: Annual Certificate of Compliance
6. FORMS: Certificates of Completion
11
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1 RESOLUTION ' PARIS,
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AS, the City Council last adopted Criteria and Guidelines for Tax Abatement on
January 11, 2018; and
WHEREAS, after considering public comment, if any, at said public hearing, the City Council
of the City of Paris, Texas hereby reaffirms its intent to be eligible to participate in property tax
abatements in accordance with Chapter 312 of the Texas Tax Code and to adopt the Guidelines and
Criteria for Tax Abatement attached hereto and incorporated herein as ft • and
WHEREAS, a three-quarters majority vote of the City Council of the City of Paris, Texas is
required to amend the Guidelines and Criteria for Tax Abatement; and
WHEREAS, the City Council elects to readopt the Guidelines and Criteria for Tax Abatement
adopted on January 11, 2018 without amendment;
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. The City hereby elects to be eligible to participate in a property tax abatement
program and approves and adopts the Guidelines and Criteria for Tax Abatement attached hereto
and incorporated herein asit
:Fecr"o w 3. This resolutionbecome effective from and. date of
AiIVQ V i.liif r 11 Mayor
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(Readopted 01-13-2020)
POLICY STATEMENT
("IRITERIA AND GUIDELINES FOR TAX ABATEMENT
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1. To be eligible for any tax abatemenhere must be a minimum capital investment in the authorized facility of $ 1,000,000 and
at lent tan (10) new jobs added to the new employer's labor force.
2. Any project with a capital investment of more than, twenty-five million dollars ($25,000,000), AND 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.
specified in state law, no abatement will be granted for more than 10 years and the total abatement shall not exceed
100%.
4. A newly created business inust be (or will be) located within an enterprise zone or a designated reinvestment zone.
5. The taxing jurisdictions recognize a significant difference in the valuation of real property versus personal property.
Because of depreciation schedules, the abatement of personal property could result in a tax exemption. For this reason, the
abatement schedule for personal property versus real property may be rt. Each industrial account is looked at and
valued on an individual basis by the Lamar County Appraisal District (LCAD). Ile typical depreciation used for
industrial accounts by LCAD is as follows:
"I
In
a. Computers — 3 year life
b. Furniture & Fixtures — 10 year fife
c. Vehicles — 7 to 10 year life (depending on type)
(L 14 f' & Equipment — 15 yeu life (maybe longer or shorter depending on the type)
Fff r eacl4L,,iteiceat 3a(kuest tim—MC w -U ev2lulte tye, eXui-,A�pxt ilvestfuel t%li vmef-e We &-jqate
from the real estate (real property) investment to determine the length of the abaternent for each.
If personal property should become obsolete and be replaced while under an abatement agreement, the replacement
personal property is not eligible for abatement.
The charts below provide capital investment guidelines to qualify for tax abatement and the related schedule and
percentage of abatement.
I 2=1
11
oil
$20,000,001 to $25,0001
$25,000,001 and Above
Forpmjerb wifth caphal investment above $25MAND $25M in new annualpayrou OR
creadag more than 225 newjobs, the term andpercentage of the abahment are both
nego&hk but cannot exceed 10. or 00%
(ReadoM ted 01-13-2020)
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
. . . ......... —
9. An additional 20% abatement for newjob creation is available based on the following requirements:
a. A project that creates a minimum of 10 newjobs.
b. The newjob wages am equal to or greater than the current County average wage for all private sectorjobs excluding
retail trade and accommodation and food services ($41,158 annually for 2013. Source: Texas Workforce Commission
via www.tracer1c ' orr. (Note: This represents 547 companies, 10, 4 70johs and 56% of allprivate seaor employment in
Lamar County.)
c. The taxing jurisdictions and the company must agree to include fl" asurinp, tracidug and annual reporting of the not
job increases (existing jobs plus nowjobs) for ffie entire term of the abatement agreement.
V1. Tax Abatement for Existing Employers Regarding Real or Personal Property.
The Taxing Jurisdictions recogrfize, the value of its existing employers to the well-being of the
City and County. 'fhe Taxing Jurisdictions desire to encourage existing employers to remain in
the Taxing Jbrisdictions and to improve their respective businesses and industries, as well as thek
profitability.
Ai low IT4IV4111
property by 44 I' new improvements on its real property and/or adding new personal
property to its authorized facility which qualify for tax abatement under these Policies, Criteria
and Guidelines, such employer may be eligible for tax abatement with respect to such
im M NI � to i
MANI
rtt4141'Tz;MqT,pJJ
112 N I
6 MIMI
loologitly'Lall 11170TA M 0 tol I a U* ;�qwt'K6 -2�1;' a X 6) 11 # a I I Kro RIP
U14 raFA
Jilikk.-g .1 MAA4 1 , A *
(Readopted 01-13-2020)
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
existing annual payroll as is economically feasible for the existing employer, while remaining
competitive in its industry.
VH. Greenfield projects
In order to encourage the development of greenfield properties and also to be able to expedite
WAnro�jcts- tv-&j=*IR, r -g ?I'
911014 1 VWW 'fjlaf�fi;q
1W 1 41) 111"Wall"111 0 IN1,1116601 I LIAM
AM
6
II ,:"1 Wo
sit
1W 7=1 :1
#74 Fm 0
4
I's I rb- .16
6
Proposed "CI
Sr
Agreements
Decided on
Basis
VIU. Abatement Agreement Terms and Conditions.
Appendix B provides many of the terms and conditions to be included in any formal tax
abatement legal agrement.
M Amendments to Policies, Criteria and Guidelines
These Policies, Criteria and Guidelines are effective for a two (2) year period from the date of
their adoption, unless amended earlier by the affirmative vote ofthree-fouiths (3/4) of the
members of each governing body (City, County).
Paris, Texas 75460
Pbow 903-784-6964
Fax: 903-784-2503
Website: N,,vww, iaristexamm-coM
Email-
(Readopted 01-13-2020)
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
Agreement or
legalagreement for ', abatement between ;lee s property wal, " andlor� leme d
LTA!'I
t Paris,III ,r; and Paris Nrrio,qql�
Authorized
m ay be eligibleabatement .nt" ed research,
Commercialr
regional distribution, regional entertainment, other basic industry,
include buildings and structures, inclu`, (g fixed machinery and equipment used in operating
facility.the
the majority of users are likely to stay in the Taxing Jurisdictions for more than one day and
will therefore 4Xel utilize local restaurants and hotel/motel accommodations.
materials or to, 4!Mroye.or .4pelog the production,pro�esses thereto.
Not elsewhere described, used for the production of 3wroducts or ser -vices which result in the
creation of new jobs and bring new wealth into the Taxing Jurisdictions (e.g. healfficare-
ed industrie
Primary Jobs
Any industry creating "pritnary jobs" defined as a job that is available at a company for
Creating Industry
which a majority of the products or services of that company are ultimately exported to
regional, statewide, national, or X14.., markets infusing new doll= into the ,I' -c:
", ,;,A
An area where the Taxing Jurisdictions have decided to influence development patterm and
I",,h the,
attract major investments "IIe hat will contributedevelopment of the area through
of tax abatement for specified improvements. These statues are found in Chapter 312 of the
Texas Tax Code.
,e,' is when an individual w, ;,p 40 hours ,,r,", a week ",.21, employer, and in the position
the individual is provided the benefits normally offered by the employer, such as health
insurance, vacation and some form of retirement benefit. A job is not a position filled for the
employer as a workeremployee .; ,9, employment agencyor employment se
also includes
uIA t
r
(Readopted 01-13-2020)
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMEV"
9
M11114 4 IND 010 yalroto
v M Im
(1ll 11• 00,
I A
refurb deferred maintename,
Machi
(Readopted 01-13-2020)
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATETV.-FEVII
C
11
;to C -11M a I.Aie It
11
Modificatio
Kid- 1''.!
of Agreement
11-6--u=rlo '1"'+!l e'l11'1 or 1 c term ofRe abatement granted
tIl` icin beyond the time pqp#qq4 1State law.
mav be
0
1 ,►al -121, rc;Icn;' L 11101k1ATJPkj' Orr -
Contract
tax abatement agreements authorized by them Taxing Jurisdictions under these Policies,
Review,
Criteria and Guidelines. These responsibilities shall: f annually verifying participants in
Monitoring and
tax abatementagreements are in fiffl compliance with the terms of the agreement, including
Reporting
completion and submission of all required documents in a timely man=.
The Paris City Attorney shall expeditiously advise the Taxing Jurisdictions in writing of any
12.
MSU=es of contract non-compliance by tax abatement participants. In addition, the Paris city
Attorney shall, on an ammal basis, conduct a performarm review of the activities of each tax
abatement participant and report the findings of such review to the leadership andgoverning
bodies of each taxing entity.
I The Taxing Jurisdictions' governing bodies •, 1: retain the right to independently review and
audit the activities of tax abatement participants, and shall be responsible for '1 T' of
the term of any tax abatement agreement authorized hereunder.
4. Annually the Paris City Attorney shall report to each of the governing bodies on its
monitoring and compliance activities and the status of aH existing abatement agreements.
11
DO
1
'THE STATE OFTEXAS §
I XT1,111fl, Hilil,11! 11 1.11,11,
INITIAL WHERE APPROPRIATE:
M
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) By April 15, 202 1, the Company hired no fewer than ten (10) full -time -
employees to operate the Paris Facility and maintained those
employees. The total number of full-time employees working at the
Facility as of the date of this report is
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant
(4) The Company submits herewith and attaches hereto copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2021.
(6) All other terms and conditions of this Agreement have been complied
wift.
from MOW fratIMUM"114 Rim.
P11a11CC-VT1L11 [fit Let -771 or terms we
not met. Attach additional pages if necessary.
Certificate of Compliance/Non-Compliance
.Page 2
VE R.I.H.C.A112N
STATE OF TEXAS §
COUNTY OF LAMAR §
BEFORE ME, the undersigned notary, on this day personally appeared
, the affiant, a person whose identity is known to me. After I administered
an oath to affiant, afflant testified:
"My name is . I am capable of making this verification. I have read
the foregoing Certificate of Co mp liance/N on -Compliance. The facts stated in it are within
my personal knowledge and are true and correct, and I further certify that the Employer
Reference Summary pages are true and correct copies of those reports filed with the Texas
Wor
Sworn to and subscribed before me this the _,_ day of .. . ....... ._�� 20--
THE STATE OFTFXAS §
COUNTY OF LAMAR
INITIALWHERE APPROPRIATE,-,
-Lionshead Specialty Tire 8t Wheel, LLC (the "Company") hereby certifies thA
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) By April 1S, 2022, the Company hired no fewer than five (S) full-time
employees to operate the Paris Facility and maintained those
employees as well as the ten (10) employees hired in 2021. The total
number of full-time employees working at the Facility as of the date of
this report is �
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant.
(4) The Company submits herewith and attaches hereto copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2022.
(6) All other terms and conditions of this Agreement have been complied
with.
Please Circle the number
Ur
ggjo
Certificate cif Compliance/Non-Compliance
Page 2
Y E HIFICA if P.
STATE OFT §
COUNTY OF LAMAR §
BEFORE ME, the undersigned notary, on this day personally appeared
the afflant, a person whose identity is known to me. After I administered
an oath to affiant, affiant testified:
"My name is . I am capable of making this verification. I have read
the foregoing Certificate of Compliance/Non-Compliance. The facts stated in it are within
my personal knowledge and are true and correct, and I further certify that the Employer
Reference Summary pages are true and correct copies of those reports filed with the Texas
Workforce Commission."
�iM
Sworn to and subscribed beforeday of ............................................. ,,, ,20—.
Annual Certiflcate of Compliance/Non-Compliance Year 3-2023
Tax Abatement Agreement ("the Agreement")
Between the City of Paris, Texas
And Lionshead Specialty Tire & Wheel, LLC
Dated January 22, 2020
'HE STATE OF TE §
INITIAL WHERE APPROPRIATE-.
M,
.-Liorishead Specialty Tire & Wheel, LLC (the "Company") hereby certifies that:
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) By April IS, 202 3, the Company hired no fewer than three (3) full-time
employees to operate the Paris Facility and maintained those
employees as well as the twelve (12) employees hired in 2021 and
2023. The total number of full-time employees working at the Facility
as of the date of this report is _.
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant.
(4) The Company submits herewith and attaches hereto copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2023.
"6) All other terms and conditions of this Agreement have been complied
with.
Pleas
has failed to comply and state in what way compliance with the term or
not met. Attach additional pages if necessary.
Certificate of Compliance/Non-Compliance
Page 2
YE RIF.�ILAII.Q.2.9.
STATE OFTEXAS §
COUNTY OF LAMAR §
BEFORE ME, the undersigned notary, on this day personally appeared
' the affiant, a [,i�rerson whose identity is known to me. After I administered
an oath to afflant, affiant testified:
"My name is . I am capable of making this verification. I have read
the foregoing Certificate of Compliance/Non-Compliance. The facts stated in it are within
my personal knowledge and are true and correct, and I further certify that the Employer
Workforce Commission."
FVIT4TIaroV";,
Sworn to and subscribed before me this the day
'HE S"FATE OFTEXAS §
COUNTY OF LAMAR §
M
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) In 2024, the Company maintained no fewer than fifteen (15) full-time
employees to operate the Paris Facility. The total number of full-time
employees working at the Facility as of the date of this report is
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant.
(4) The Company submits herewith and attaches hereto copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2024.
(6) All other terms and conditions of this Agreement have been complied
with.
—Lionshead Specialty Tire & Wheel Company, LLC certifies that the company is
not in compliance with its agreement with City of Paris for the year _.
has failed to comply and state in what way compliance with the term or terms wela
not met- Attach additional pages if necessary.
Certificate of Compliance/Non-Compliance
Page
1H,
COUNTY OF LAMAR
identityBEFORE ME, the undersigned notary, on this day personally appeared
the affiant, a person whose
an oath to afflant, afflant testified:
"My name is . I am capable of making this verification. I have read
the ogo � � � � t� ce' facts stated
personal in it are within
my are 4"
of those reports filed with the Texas
Workforce Commission."
Sworn it subscribed before tday 0
THE STATE OF TEXAS §
COUNTY OF LAMAR
INITIALWHERE APPROPRIATE-.
KDA,
_—Lionshead Specialty Tire 81 Wheel, LLC (the "Company") hereby certifies that.
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) In 2025, the Company maintained no fewer than fifteen (15) full-time
employees to operate the Paris Facility. The total number of full-time
employees working at the Facility as of the date of this report
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant.
(4) The Company submits herewith and attaches hereto copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2025.
(6) All other terms and conditions of this Agreement have been complied
with.
Please Circle the n
has failed to comply and state in what way compliance with the term or terms were
iaot met. Attach additional pages if necessary.
Certificate of Compliance/Non-Compliance
Page 2
V.E R.,11I.E.1 MIDN
.. . .. . .... ....... . ....
STATE OFTEXA.S §
COUNTY OF LAMAR §
BEFORE ME, the undersigned notary, on this day personally appeared
Lhe affiant, a person whose identity is known to me. After I administered
an oath to affiant, affiant testified:
Um
,y ri,anie is .................................................................................. . ..................... _ .............. . I am capable of making this verification. I have read
the foregoing Certificate of Compliance/Non-Compliance. The facts stated in it are within
my personal knowledge and are true and correct, and I further certify that the Employer
Reference Summary pages are true and correct copies of those reports filed with the Texas
Workforce Commission."
MMAM
Sworn to and subscribed before me this the — day of .............................................................. ... �20 .............
'THE STATE OF TEXAS §
INITIAL WHERE APPROPRIATE.:
M
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) In 2026, the Company maintained no fewer than fifteen (15) full-time
employees to operate the Paris Facility. The total number of full-time
employees working at the Facility as of the date of this report is
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant.
(4) The Company submits herewith and attaches heret o copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2026.
'6) All other terms and conditions of this Agreement have been complied
with.
14VF
r.. 1114011 IJ O(j J Itt,1111CAM IN I's t IW "IN j _ V
, T I M11 USM' JOYM, BMW,
has failed to comply and state in what way compliance with the term or terms we
not met. Attach additional pages if necessary.
Certificate of Compliance/Non-Compliance
Page 2
V�, .......... E ........... R 1j', ATIO
........................... N.,
STATE OF TEXAS §
COUN'TYOFLAMAR §
BEFORE ME, the undersigned notary, on this day personally appeared
identity is known to me. After I administered
an oath to affiant, affiant testified:
"My naiaie I i s I am capable of making this verification. I have read
the foregoing Certificate of Compliance/ Non- Co mplian ce. The facts stated in it are within
my personal knowledge and are true and correct, and I further certify that the Employer
Reference Summary pages are true and correct copies of those reports filed with the Texas
Workforce Commission."
Sworn to and subscribed before me this the — day of
Specialty Tire & Wheel, LLC (the "Company") hereby certifies that:
(1) All ad valorem taxes have been paid to City and all other taxing entities.
(2) In 2027, the Company maintained no fewer than fifteen (15) full-time
employees to operate the Paris Facility. The total number of full-time
employees working at the Facility as of the date of this report is
(3) The Company has continuously operated the Property and
Improvements described in the Agreement as a tire and wheel
assembly and warehousing plant.
(4) The Company submits herewith and attaches hereto copies of the
Employer Reference summary page of its Texas Workforce
Commission Quarterly Reports for the Paris Facility for each quarter of
2027.
(6) All other terms and conditions of this Agreement have been complied
with.
I
has failed to comply and state in what way compliance with the term or terms were
not met. Attach additional pages if necessary.
Certificate of Compliance/Non-Compliance
Page 2
...................
STATE OF TEXAS
COUNTY OF L
BEFORE ME, ,,, undersignednotary, on this day personally p
the affiant, ; person whosei ! administered
affiant,an oath to Eitestified:
"My name is . I am capable of making this verification. I have read
the foregoing stated are within
my personal and are true and correct, and I further certify that the Employer
Workforce
�
Sworn ,o and subscribed e1rday
1
-i,TATE OF TEXAS ,,
COUNTYOF LAMAR,
CITY OF PARIS,
The City of Paris, Texas has executed and delivered a Tax Abatement Agreement (the
"Agreement") dated October 23, 2017, with LIONSHEAD SPECIALTY TIRE & WHEEL, LLC, for
certain improvements and other equipment (the "Improvements") to be installed on
property plant located in Paris, Lamar County, Texas, said Improvements described in
Exhibit A attached hereto, which property is located within an Enterprise Zone established
by the United States Census in 2010.
Based on information provided by Company and verified by the City, the City of Paris
herein verifies that the Improvements agreed to be built, installed and used in the calendar
year 2020 have in fact been completed as provided for in the Agreement and that the
Company has complied with all other terms of the Agreement including those related to
employment levels.
NOW, THEREFORE, the City of Paris authorizes that the property described in
Exhibit A attached hereto shall receive a tax abatement during each year through the end of
the term the Tax Abatement Agreement equal to 100% in years 2021 and 2022; 75% in years
2023 and 2024; 50% in years 2025 and 2026; and 25% in the year 2027, of the taxes
assessed upon the increased value of the real and personal property of the Company located
in Paris, Texas, over the value at which the property was last appraised on January 1, 2020,
which is the year in which the Tax Abatement Agreement was executed, as recited in the
Agreement. The tax abatement will extend for a duration of seven (7) years, with the tax
abatement beginning January 1, 2021, and ending December 31, 2027.
APPROVED this y
_.._. Mayor
Janice Ellis, City Clerk.mmmmmmmm..........mm,