10-APPROVE ABATEMENT REQUEST OF T&K MACHINESubmittal Date:
10/18/2012
Council Date:
11/12/2012
CITY COUNCIL AGENDA ITEM BRIEFING SHEET
Originating Department: � Presented By:
PEDC
Steve Gilbert, Executive Director
RECOMMENDED MOTION:
Approve abatement request of T&K Machine, Inc.
Agenda Item No.:
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POLICY ISSUE�S�:
This abatement request complies with the abatement policies, guidelines and criteria approved by the
Paris City Council on August 13, 2012 in Resolution 2012-072. This tax abatement helps 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 of Paris and its citizens.
BACKGROUND:
T&K is a long-time Paris aerospace parts manufacturing company, currently employing 65 people. The
aerospace industry is very active for the foreseeable future based on a number of factors. T&K must
position itself to expand. T&K currently sub-contracts some work out to Dallas suppliers due to a lack
of capacity at the existing facility. This work can come back in-house with the expansion.
Year 1 plans are to construct a new 5,000 sq. ft. building and to purchase and install three new CNC
machines, employing an additional 15 employees. Five year plans for which this abatement is
requested, are:
5-Year Proiect Plans
New Jobs: 44
New Machines: 15
CapitalInvestment: Buildings:
Equipment:
$ 160,000 (New 5,000 sq. ft. expansion)
4,056,000
$4,216,000
BOARD�COMMISSION RECOMMENDATION:
Approve abatement request as proposed.
EXHIBITS:
Resolution
ACTION:
❑ Financial Report
❑ Department Report
❑ Presentation
� Public Hearing
❑ Minute Order
� Resolution
❑ Ordinance
❑ Other
BUDGET INFO:
Expense $
Budgeted Amt. $
YTD Actual $
Acct. Name
Acct. Number
City of Paris , � � 6 Revised 2/04/08
Draft
RESOLUTION NO.
A RESOLUTIOIV OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS;
APPROVING AND AUTHORIZING A TAX ABATEMENT AGREEMENT WITH T
& K MACHINE, INC.; MAKING OTHER FINDINGS AND PROVISIONS RELATED
TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE.
WHEREAS, the City Council of the City of Paris has been presented a proposed
agreement by and between the City of Paris, Texas and T&K Machine, Inc., 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 "Agreement";
and,
WHEREAS, a public hearing was held before the City Council on November 12, 2012, to
allow interested persons to be heard regarding any matter related to the Tax Abatement
Agreement; and,
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 thereof
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 ineet the City's Guidelines and Criteria for Tax Abatement adopted by the City of
Paris by Resolution No. 2012-072.
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 welfare.
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.
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DULY PASSED AND APPROVED this 12� day of November, 2012.
ATTEST:
Janice Ellis, City Clerk
APPROVED AS TO FORM:
W. Kent McIlyar, City Attorney
A.J. Hashmi, M.D., Mayor
THE STATE OF TEXAS )
)
COUNTY OF LAMAR )
TAX ABATEMENT AGREEMENT
This agreement is entered into by and between the CITY OF PARIS, 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 T& K MACHINE,
INC., a Texas corporation, 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, Texas, did heretofore, on the 13th day
of August, 2012, in Resolution No. 2012-072, (1) 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 (2) 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;
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; and pursuant to the 2010 United States Government Census, the
IMPROVEMENTS which are the subject of this AGREEMENT situated upon the Land
(hereinafter defined) within City of Paris, Texas, are included within an ENTERPRISE ZONE,
as is shown in the print-out of such ENTERPRISE ZONE from the Office of the Governor of the
State of Texas on its website, as shown in Exhibit A, attached hereto and made a part hereof for
all purposes; and
WHEREAS, the use of the IMPROVEMENTS, the addition by the OWNER of
additional employees as is herein described, 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
WHEREAS, the City of Paris, Texas, is on this date entering into this Tax Abatement
Agreement with the OWNER to abate the taxes assessed by the City of Paris over a period of
seven (7) years, commencing January l, 2013, and ending December 31, 2019, under the
provisions of the CITY's Guidelines and Criteria for Tax Abatements pertaining to the
IMPROVEMENTS to be made to the OWNER's existing plant located at 2220 West Park Street
in Paris, Lamar County, Texas;
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NOW, THEREFORE,
The Parties hereto do mutually contract and agree as follows:
I.
Term
The effective date of this AGREEMENT is the 12th day of November, 2012, with tax
abatement beginning with the tax year commencing January 1, 2013, and expiring on December
31, 2019, for a total tax abatement term of seven (7) years, as is hereinafter described in an
Exhibit attached to this AGREEMENT, which abatement term complies with the Guidelines and
Criteria for Tax Abatements in effect in the CITY.
II.
Area to be Improved
TBEI, L.P. a Texas limited partnership ("Taylor") is the owner of the real property (the
"Land") upon which the IMPROVEMENTS are situated. Taylor, as landlord, has leased the
land under the provisions of a long-term lease of 5 years (such lease terminating in the year,
2017), to T& K MACHINE, INC., as tenant (defined above as the OWNER for purposes of
convenience in documenting this AGREEMENT). The Land is described in Exhibit B,
attached hereto and made a part hereof for all purposes. Under the terms of the lease OWNER
is and has been in possession of the Land and OWNS all buildings and other improvements on
the Land, and will continue to do so during and exceeding the term of this AGREEMENT,
unless otherwise agreed to by all parties. OWNER is the party conducting the business on such
Land.
The PROJECT which is the subject of this AGREEMENT will consist of the OWNER
constructing one additional building upon the Land, installing some of the new
IMPROVEMENTS within said additional building and adding additional employees to its
workforce in Paris, Lamar County, Texas, extending over a period of FIVE (5) YEARS,
commencing on the date of this AGREEMENT. The IMPROVEMENTS will be located within
the first additional building to be constructed at the location shown on the drawing attached
hereto as Exhibit C. OWNER will initially construct one 5,000 square foot additional building
at its existing facility on the Land at a cost of $160,000.00 to house the production of precision-
machined parts to be supplied to the aerospace industry. OWNER'S existing facility at the time
of execution of this AGREEMENT consists of a 27,000 square foot group of buildings
composed of 15,000 square feet of production space and 12,000 square feet of office and
support space. OWNER will over the first five (5) years of the term of this AGREEMENT
purchase and install eight (8) new machining centers at a total cost of $1,400,000.00, which will
be placed within the additional 5,000 square foot building to be constructed. A possible
additional seven (7) machining centers may later be purchased and placed within a
contemplated second additional building not included within this tax abatement, to be
constructed on the Land. In addition, during the initial 5-year term of this AGREEMENT,
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OWNER contemplates hiring twenty-two (22) new personnel as full-time employees of
OWNER to work at OWNER'S facility in Paris, Texas. The additional building of 5,000 square
feet and the 8 new machining centers which are the subject of this Abatement Agreement shall
be called the "IMPROVEMENTS".
III.
Improvements
3.1 The construction and installation of the IMPROVEMENTS will require
engineering and design work, procurement of equipment, infrastructure and utilities
modifications and electrical and mechanical installations on the Land. The IMPROVEMENTS
are being made to enable the OWNER to increase its capability to manufacture precision
machined parts for the aerospace industry. The IMPROVEMENTS are more specifically
described as follows, and are to be located as is shown in Exhibit C attached hereto:
A. To the Land, building modifications to add 5,000 new square feet of building
space to house the new machining centers and employees.
B. New machining centers to be placed within the new building described as follows:
1) YCM NSV-156A 3 axis CNC machining center — Cost: $175,000.00.
2) YCM NSV-156A 3 axis CNC machining center— Cost: $175,000.00.
3) YCM NSV-156A 3 axis CNC machining center— Cost: $175,000.00.
4) YCM NSV-156A 3 axis CNC machining center— Cost: $175,000.00.
5) YCM NSV-156A 3 axis CNC machining center— Cost: $175,000.00.
6) YCM NSV-156A 3 axis CNC machining center— Cost: $175,000.00.
7) YCM NTV-156A 3 axis CNC machining center — Cost: $175,000.00.
8) YCM NTV-156A 3 axis CNC machining center — Cost: $175,000.00.
The IMPROVEMENTS will be described in the CITY'S Certificate of Completion prepared
after the completion and installation of the above described building modifications and
improvements, personal property, machinery and equipment. The description shall be furnished
to and filed with the Chief Appraiser of the Lamar County Appraisal District. Said Certificate
shall be duly executed by the Mayor of the City of Paris in the form attached hereto as Exhibit
D. The IMPROVEMENTS will be at a cost equal to or in excess of $1,560,000.00 to OWNER,
and shall be substantially completed over the five (5) year term as shown in the tax abatement
schedule attached hereto as Exhibit E, and made a part hereof for all purposes; provided, 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
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IMPROVEMENTS shall be reflected in the Certificate of Completion issued by the City of
Paris, Texas, referred to above.
IV.
Consideration
(Improvements)
4.1 The OWNER agrees and covenants that it will diligently and faithfully, in a good and
workmanlike manner, pursue the completion of 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 all applicable state and local laws, codes
and regulations or will procure a valid waiver thereof. In further consideration, OWNER shall
thereafter, from the date a Certificate of Completion is issued, or that the IMPROVEMENTS are
completed as agreed, until the expiration of this AGREEMENT, continuously operate and
maintain the PROPERTY, including the specific units of new machinery and equipment as
identified herein, as a food production plant.
V.
Consideration
(Jobs)
5.1 OWNER is adding twenty-two (22) new full-time jobs to its employment base
over the first five (5) years of the term of this tax abatement, and may hire more employees as
OWNER'S customer demands require. OWNER currently employs sixty-five (65) persons at an
annual payroll of $2,542,000.00.
5.2 The OWNER agrees to retain sufficient employment levels to efficiently
operate and support its plant operations during the term of this Tax Abatement Agreement.
The City has provided in its Guidelines and Criteria far 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 PROPERTY 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 equipment,
such as that to be constructed by OWNER herein within the PROPERTY), 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.
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VI.
Default
6.1 In the event that (a)(1) the IMPROVEMENTS for which an abatement has been
granted are not completed in accordance with this AGREEMENT, (2) the expenditure for the
IMPROVEMENTS does not meet the amount required herein, or (3) OWNER does not hire at
least twenty-two (22) new employees over the first five (5) years of the term of this
AGREEMENT, as is represented herein; or (b) OWNER allows its ad valorem taxes owed to
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.
If 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.
6.2 Notwithstanding the foregoing provisions of Section 6.1 above, the parties hereto
understand that compliance with Section 6.1(a) (1), (2) and (3), above is to a large degree
dependent upon the demands for parts such as are manufactured by OWNER, by the aerospace
industry. At the time of signing this AGREEMENT such demand is very high. However,
should the demands of the industry substantially decline during the term hereof such that
OWNER cannot comply with the employment of personnel and construction of
IMPROVEMENTS requirements of this AGREEMENT, OWNER may apply to the CITY for
an amendment to this AGREEMENT to reduce the requirements upon it in an effort to avoid a
default by OWNER hereunder due to a significant downturn in the market for parts in the
aerospace industry.
VII.
Personal Property Tax Abatement
7.1 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 the ad valorem property
taxes assessed upon the IMPROVEMENTS and otherwise owed to the CITY shall be abated
as is provided for in the Property Tax Abatement Schedule attached hereto as Exhibit E. Said
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abatement shall be an amount equal to one hundred percent (100%) of the taxes assessed upon
the completed value of the IMPROVEMENTS on January 1, 2013, with this tax abatement
continuing at such rate of one hundred percent (100%) for the years 2013 through and
including 2015, and then declining by 20% in each year thereafter, commencing in year, 2016,
to 0% in year 2020, with this tax abatement terminating on December 31, 2019 (i.e. at the end
of year seven (7). Exhibit E attached hereto demonstrates the schedule of this tax abatement.
This tax abatement shall be in accordance with all applicable state and local regulations or
valid waiver 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 property of the OWNER that is not subject to
tax abatement AND WHICH DOES NOT INCLUDE THE IMPROVEMENTS (as defined
herein) shall be deemed to be the values as shown on the tax rolls of the Lamar County
Appraisal District as of January 1, 2012, which values are stipulated to be $291,860.00 for
Land and Buildings, and $3,125,790.00 for tangible Personal Property.
7.2 The abatement granted herein shall be subject to and governed by the POLICY
STATEMENT CRITERIA AND GUIDELINES for TAX ABATEMENT, a copy of which is
attached hereto as Exhibit F. OWNER shall comply with the requirements of Exhibit F in the
performance of this AGREEMENT, save and except that, in the event of a conflict between
the requirements of Exhibit F and this AGREEMENT, this AGREEMENT shall control.
VIII.
No Conflict of Interest
8.1 The OWNER represents and warrants that neither the PROPERTY nor the
IMPROVEMENTS include any real or personal 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.
IX.
Conditions
9.1 The terms and conditions of the AGREEMENT are binding upon the successors
and assigns of all parties hereto.
9.2 It is understood and agreed between the parties 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.
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X.
Compliance Provisions
10.1 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 notice at least
fourteen (14) days in advance 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 December 31, 2012. The Asset Report will provide 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.
10.2 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 are 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 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
facility. Representatives of the CITY inspecting the PROPERTY 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 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.
XI.
Initial and Annual Reporting
111 The OWNER further agrees that it will, within thirty (30) days of completion
of the IMPROVEMENTS (being at least once each year following January 1, during each of
the years 2013 through 2017), provide CITY with a sworn report, written on OWNER'S
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 the PROPERTY prior to the construction of the
IMPROVEMENTS;
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(b) Detailed description of the IMPROVEMENTS;
(c) Detailed description of any miscellaneous items of office equipment and the
actual cost of such added office equipment;
(d) 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) Detailed list of and actual cost of added machinery and equipment;
( fl Actual cost of capital IMPROVEMENTS; and,
(g) Date of substantial completion of the IMPROVEMENTS for the year, 2017,
as defined in paragraph 3.1 hereof.
11.2 The OWNER further agrees that it will provide the CITY with an annual,
sworn report which shall certify, in writing, that it is in compliance with each applicable tertn
of this AGREEMENT. Such annual report shall be furnished on the forms provided by the
City.
11.3 In addition to the annual report required under Section 11.2 hereof, the
OWNER further agrees that it will provide CITY a copy of its Texas Workforce Commission
Employer's Quarterly Report within thirty (30) days of its filing of the same with the Texas
Workforce Commission.
XII.
Authority to Contract
12.1 This AGREEMENT was authorized by resolution of the City Council at its
regularly scheduled meeting on this date of November 12, 2012, authorizing the Mayor to
execute the AGREEMENT on behalf of the CITY.
122 This AGREEMENT was entered into by OWNER 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.
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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:
T & K Machine, Inc.
Attn: Corey C. Campbell, Vice President, Operations
2220 W. Park St
Paris, TX 75460 (core��tkparis.co�n)
With a copv to•
T & K Machine, Inc.
Attn: David Landrith, Controller
2220 W. Park St
Paris, TX 75460 (davidl(cr�tkparis.com) AND TO:
TBEI, L.P.
3003 Stanford Ave.
Dallas, TX 75225
CITY:
City of Paris, Texas
Attn: City Manager
P. O. Box 9037
Paris, TX 75461-9037
With a copv to•
City Clerk, 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
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of said AGREEMENT shall not be affected thereby, and to this end the terms and provisions
of said 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.
WITNESS our hands this 12th day of November 2012.
ATTEST:
Janice Ellis, City Clerk
APPROVED AS TO FORM:
W. Kent McIlyar, City Attorney
CITY OF PARIS, PARIS, TEXAS
:
A. J. Hashmi, M. D., Mayor
T & K MACHINE, 1NC.
By:
Marshall Taylor, President
f[I7
LIST OF EXHIBITS TO THIS AGREEMENT:
A= 2010 Designation of Enterprise Zone which includes OWNER'S PROPERTY, and
Land of OWNER in Paris, Texas
B= Land Description of OWNER'S facility in Paris, Lamar County, Texas
C= Drawings showing the new building and the location of the IMPROVEMENTS
within the new building.
D= CITY'S Certificate of Completion
E= Property Tax Abatement Schedule
F= CITY'S Guidelines and Criteria for Tax Abatements
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L�ST OF EXHIBITS TO THIS AGREEMENT:
A= 2010 Designation of Enterprise Zone w�ic� includes OWNER'S PRUPERTY, an�d
� Land of OWNER in Paris, Texas
B= Land Description of OWNER'S facility in Paris, Lamar County, Texas
C= Drawings showing the new building and tb�e locaiion of the IMPROVEMENTS
within the new building.
D= CITY'S Certifcate of Completion
E= Property Tax Abatement Scheduie
F= CITY'S Guidelines and Criteria for Taa Abatements
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EXHIBIT B
-� 53
Nelson
Survey�ng Company
92Q North Main Street Paris, Texas 75460
903-785-3551 fax 903-T85-3399
J. M. Helson, R+egisfered Professional Laod Sttrveyor of TeXas, #4023
T8K Disk-111 Park St. {West of 19th N.W. } JHerringtorr/f436
� � �
Situated within the Corporate Lirnits of the City of Paris, County af Lamar, and State of
iexas, a part of the .iohn Herrington Survey #436, and being a called 2.967 acre tract of iand
conveyed Thomas E. Westbrooks and Frances L. Wesbrooks by deed recorded in Vol. 642,
Page 269, and a called 3.683 acre tract of land conveyed Thomas �. Westbroaks and Frances L.
Wesfbroaks by deed recorded in Vol. 599, Page 838, of the Deed Records ot said County and
State.
Beginning af an iron pin (fl far comer in ihe North Boundary Line of Park St. at the Southeast
comer of said 3.683 acre tract, sa[d point being the Southwest comer of a calied 8.488 acre tract
of land canveyed Flex-O-Lite, lnc., by deed recorded in Vol. 157, Page 31, of the Real Property
Records af said County and State, said poini being South 89 Deg. 35 Min. 25 Sec. West a
distance of 692.77 ft. from the intersection of the North Boundary Line of said Park St. and fhe
West Boundary Line of 19fh N.W. (Farm Road 79).
Thence North 0 Deg. 25 Min. 39 Sec. West a distance of 501.5 ff. to an iron pin {s) for comer
at the Northeast comer of said 3.683 acre tract and the Narthwest comer of said 8.496 acre trad;
7hence along the North Soundary l.ine of said 3.fi83 acre tract and said 2.967 acre tract as
follows: Souih 67 Deg. 43 MEn. 35 Sec. West a distance af 839.16 fi. to an iron pin (�; South 60
Deg. 59 Min. 18 Sec. West a distance of 188.31 ft. to an iron pin (#} for comer at the Northwes#
comer of said 2.967 acre tract, said poir►t being #he Nartherfy Northeast comer of a called 16.66
acre tract of land conveyed Thomas E. Weskbrooks and Frances L. Westbrooks by deed
recorded in Vol. 'E92, Page 89, of said Real Property Records;
Thence South 0 Deg_ 16 Min. 44 Sec. �ast a distance of 105.19 ft. to an iron pin {fj #or corner
at the Southwest comer of sa9d 2.96i acre tract and an el comer of said 16.66 acre tract;
Thence North 89 Deg. 47 Min. 57 Sec. East a distance of 550.04 ft. to an iron pin {f} for
comer at the Southeast comer of said 2.967 acre tract, the Southwest comer of said 3.683 acre
tract, the Easterly Northeast comer af said 16.F6 acre trac#, and the Northwest comer of said
Park St.;
7hence North 89 Deg. 43 Min. 26 Sea. East along the North Bonndary Line of said Parlt St_ a
distance of 376.75 ft. to the place of beginning and confaining 6.650 acres of land.
l, J.M. Nelson, Registered Pro€essional Land Surveyor of Texas, #4025, cerfrfy to
Thomas E. Wes#brooks and Frances L. Westbrooks (sellers), to TBEI, L.P., a Texas limifed
partnership (purchaser), and to Stone Title Co., lne., that the above depic#ed and described tract
of land was faken from an actual survey made on the ground and compfeted by me on the 10th
day of September, 1998, that this survey is a Category 1A, Condition lf, Land Titfe Survey in
accordance with the Standards for Land Surveys for the Texas Society of Professiona!
Surveyors, #hat alt visibfe buildings, improvements, fences, encumbrances, encroachmenfs,
conflicts, protrusions, and uses -- including fhe location of all highways, streets, road, easments,
alleys, and rights-of-way upon o� adjacent to the land are accurateiy shown thereon, that this
tract of land corrtains 6.650 acres of tand, and that #his tract of fand does not appear to [ie in a
flood zone as indicated by Communi#y Partel #48089'i 0008 A and Communiiy Panel #480427
0001 B of the �ederal Fioad fnsurance Maps.
.i.M. �felson, RPLS of Texas, #4025 date
.- 54
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EXHIBIT D
EXHIBIT D
CERTIFICATE OF COMPLETION
STATE OF TEXAS
COUNTY OF LAMAR
CITY OF PARIS
The Ciiy of Paris, Texas (the "City"), has executed and delivered a Tax Abatement
Agreement with T& K MACHINE, INC., a Texas cozporation, for the abatement of ad valorem
taxes to be collected for the City upon certain new equipment (the "Improvements"} io be
installed at the corporation's plant in Paris, Texas.
T& K MACHINE, INC. has complied with the tax Abatement Agreennent, and the City,
acting herein hy and through the its duly elected Mayor, verifies that the Improvements agreed
to be built, instalied and used have in fact been completed as provided fQr in the T� Abatement
Agreement.
NOW THEREF4RE, the City authorizes that the Praperty described in the Tax
Abatement Agreement shall receive an abatement of City taxes of 100% of such ta�ces assessed
upon the increased value of the Improvements so installed over the value in the year in which the
Tax Abatement Agxeement was executed, for a duration of three (3) years, be�iz�ning January 1,
2013, with such tax abatement then declinin� by 20% in each year thereafter, to 80% in 2016 and
to 0% in the year, 2020.
APPROVED this day of , 20_.
Mayor of the City of Paris, Texas
APPROVED AS TO FORM:
City Attorney
�- 59
EXHIBIT E
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EXHIBIT F
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Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
1. 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 infirastructure 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 and
personal property for projects that stimulate economic growth and diversification in the City.
T� abatement bene�ts may be made available to industrial, manufacturing, distrihution, and
service facilities, ar any "primary jobs" creating industry as defined by the Economic
Development Act of the State of Texas. The facility must be currently in the City or locating in
the City, and 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 infozxnation provided in
the tax abatement application. Hawever, the City, Lamar County and Aaris Junior College are
under no obligation to provide tax abatement to any applicant.
The Paris City Council acts as the lead entity for projects located in the city limits. The Lamar
County Board of Commissioners and the Paris Junior Callege Board of Regents have also
adopted this policy and will consider tax abatement request that qualify under these policies.
II. Definitions.
Definitions are provided as an Appendix A.
III. 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 RedeveIopnnent and Tax Abatement Act, Texas
Tax Code Chapter 312.
IV. Tax Abatement Authorized.
The City, through its elected City Councii, may agree in writing with the owner and/or lessee of
ta�cable real and/or personal properiy that is located in a reinvestment zone, but that is not in an
improvement project financed by tax increment bonds, ta exempt from taxation a portion of the
value of t�e real pzoperty, or of personal property Iocated 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 properly. An agreement may provide for the
exemption of the real praperty in each year covered by the agreernent only to the extent its value
for that year exceeds the base year value. An agreement may pzovide for the exemption of
personal property located on the real property in each year covered by the agreement ofher 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 personaI property.
-� 63
Aaris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
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 vaiue of other property of the owner already on the tax role with the
jurisdiction of the City. Change in appraised value daes not qualify for abatement except in an
instance where a previously vacant authorized facility is utilized. Value added to the tax roils
must come from actual capital expenditures.
The negotiation of tax abatement agreements will be conducted by the Paris Economic
Development Corporation (Paris EDC} 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 (e.g, capital investrnent).
V. Eligibility Criteria for Tax Abatement for Real and Persanal Property
A property owner andlor lessee shall be eligible for tax abatement only upon the following
criteria.
Eli 'bili Criteria for Tax Abatement
Authorized t. An authorized facility is used for manufacturing, research, ragional distribution, regional
Facility tourist entertainment, other basic industry, or any primary jobs creating industry. (See
Appendix A for detailed definitions.)
2. A new authorized faeility must be created, or an existing authorized facility must be
improved, modernized or expanded.
3. If a Ieased authorized faciliry 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
uarantee com liance with the terms of the a reement.
Eligible 1_ The property involved must be a newly created or improvements to an existing authorized
Property facility
2. Eligible property for which abatement may be granted includes nonresidentiaE real property
and/or Tangible personal property not located on the real property at any time before the
abatement agreement becomes effective.
3. 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 opetation and administration of the authoriaed facitity.
4. Invento or su lies shall not be eli ible for abatement
Historic I. lf the property invoIved is a historic properly in the Gity's Historic Districts there are certain
Property commercial and residential tax exemptions allowed.
Located in 2. Exterior improvements in the historic districts are allowed at 100% for seven {7) years with a
Historic minimum investment of $5,000 €or residential property and $10,000 for commercial property_
District 3. New residential construction requires a minimum investment of $100,000 to be considered for a
three (3) year ] 00% exemption.
4. New commercial construction requires a minimum investment of $200,000 for a 100°/a tax
exem iion for three (3) ears.
Value and ]. The City will decide whether to grant tax abatement to an applicant, and the amount, if any, of
Term of such abatement, on a case-by-case basis and in accordance with these Criteria and Guidelines.
Ahatement 2. Theterm ofabatementgranted underany agreement may not exceed that permitted by
a licable state law.
• �
Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
3. The amount of the abatement shall be based upon a percentage (0 to l00%} of all ar a
portion of the eligible property within the authorized facility.
4. Abatements may only be granted for the additional value of eiigible real and personal
property improvements made pursuant to and Gsted in the agreement between the City and
proper[y owner and/or lessee, subject to such limitaiions as the City may require.
S. Real property tax abatement may be granted only to the extent that its value far each year of
the agreement exceeds its value for the year in which the agreement is executed.
6. If a modernization project includes the rep]acement 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 re laced unit(s}.
Abatement The criteria used to evaluate a proposed project application for abatement includes, but is not
Evaluation limited to:
Criteria 1. The dollar amount of the increase in the tax roll.
2. The number of jobs created or retained by the employer invoived.
3. The possible effect on attracting other ta�cable improvements into the City,
4. The nature of, and overall effect on the City.
5. The effect on the safety, health, and morals ofthe City's residents.
6. Any substantia[ long-term adverse effect on the provision of City services or its tax base.
7. Meeting all relevant zoning requirements.
8. Consistent with the comprehensive plan of the City or County of Lamar.
9. The types and cost of public improvemenu and services (water and sewer main extensions,
streets and roads, etc.) required of the City.
10. The es and values of ublic im rovements to be furnished b the a licant.
Economic To be eligible to receive tau abatement, the planned improvements:
Qualification 1. Must be reasonably expected to increase the appraised value of the property.
2. Must be expected to prevent the (oss of employment, or assist in 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 inerely transferring existing
employment from one part of the City to another without demonstration of increased future
investmeni (dollars or jobs) or unusual circumstances whereby wiihout such a move
employment is likely to be reduced.
4. Must be necessary because capacity cannot be provided efficientty utilizing existing improved
property when reasonable allowance is made necessary improvements or relevant
overnmental actions.
Taxability During the term of the agreement, taxes shall be payable as follows:
1. The base year of eligible property as determined each yeaz by the Lamar Counry Appraisal
District, shall be fully taxable.
2. The additional value of eligible properry above the base year value sha11 be taxable in the
manner described in the agreement.
3. The Chief Appraiser of the Lamar Counry Appraisal District shall annually determine an
assessment of the real and personal property comprising the reinvestment zone.
4. Each year, tha employer, the company or individual receiving abatement pursuant to an
agreement shall fumish the asssssor with such information as may be necessary to determine
the amount of any abatement.
5. Once such value has been established, the Chief Appraiser shall notify the affected
jurisdictions, which levy taxes on such property and also notify tha Paris EDC.
6. The employer, owaer 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 namber af jobs,
ar annual a oll as further defined below.
65
Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES F�R TAX ABATEMENT
Capital Investment, Payroll and Job Creation Criteria
A tax abatement may be made available to employers who are creating jobs and increasing new capital investment
with respect to an authorized facility located anywhere within the City or its extra territorial jurisdiction based on
the following criteria.
To be eligible for any ta�c abatement, there must be a minimum capital investment in the authorized facility of
$250,000 and at Ieast ten (]0) new jobs added to the employer's labor force. T'he chart below provides
2. When an abatement percentage has been agreed upon it shall be granted based on the following schedule. This
chart does not impty that 100% of the vaivation will be abated. ]t refers to the ratio of the agreed-to
abatement.
Timeframe Percent of Abatement reed 1'0
Year I 100%
Yeal' 2 100%
Year 3 roo�ro
Year 4 80%
Year 5 60%
Yeer 6 4b%
Year 7 20%
Year 8 Valuation full back on tax rolls) 0%
3. Any project with a capital investment of more than ten million dotlars ($] 0,000,004), accompanied by a
newly created minimum annual payroll of two and one-halfmillion dollars ($2,500,000), or creating more
than two hvndred twenty-five (225) jobs will be individually negotiated.
4, No abatement will be granted for more than specified in state law.
S. If a newly created business is located or will locate within an en#erprise zone, an additional 10 to 20%
abatement may be available as individually negotiated, with total abatement not to exceed 100%.
6. The City recognizes a significant dif%rence in the valuation of real property and persona[ property. Because
of depreciation schedu[es, often the abatement of personal properiy is basically a t� exemption. For this
reason, the abatement schedule for personal property versus real property may he different.
7. If persona] property should become obsolete and be replaced while under an abatement agreement, the
replacement versonal property is not eligible for abatement.
VI. Tax Abaternent for Existing Employers Regarding Real or Personal Property.
The City recognizes the value of its existing ennployers to the wellbeing of the community. The
City desires to encourage existing emplayers to remain in the City and to improve their
respective businesses and industries, as well as their profitability.
��
Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
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 andlor adding new personal
properry to its authorized facility which qualify for tax aba#ement under these Criteria and
Guidelines, such employer may be eligible for taac abatement with respect to such improvements
to its real property or its new personal property under the provisions of Article V above, even if
no new jobs or newly created minimum annual payroll are created.
In projects involving existing employers, the criteria for ta�� abatement for improvements to real
property and for new persQnal 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). The City encourages existing employers to retain as many jobs and as much existing
annual payroll as is economically feasible for the existing employer, while remain competitive
in its industry.
VII. Ap lication Process
A lication Process
Eligibility Any present or potential owner of taxable property in the City may request tax abatement by
fil ing a written request with the City Manager or County Judge, with a copy of the application
forwarded b the a licant to the Executive Director of the Paris EDC.
�'orm The application shaU consist of a completed application form accompanied by the following:
i. 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 lisi of the improvements for which abatement is requested.
3. A list of the kind, number, and location of alf proposed improvements of the property.
4. A list of the number and type of jobs created, including information pertaining to anticipated
job transfers (if any).
5. A metes and bounds description and plat of the proposed reinvestment zone thak 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.
8. Any other information about the proposed project as may be required by the City or as deemed
desirable b the Ci .
Review 1. The application will be reviewed by members of the Tax Abatement Committee.
2. The application will be distributed to the appropriate department heads and t�ing entities for
review and comment.
3. No tax abatement application shall be considered for further processing by the governmental
entities unless �rst approved by the governing board of the Paris EDC.
4. Upon approval by the Paris EDC Board the application will processed through the approval
rocess of the ovemin bodies for their consideration.
Public l. The City will comply with certain public notices and hearings required as mandated by state
Hearing law under tbe Property Redevelopment and Tax Abatement Act prior to the designation of a
reinvestment zone and execution of a tax abatement agreement.
2. The City may adopt an ordinance designating a tax abatement reinvestrnent zone only after
notice of a public hearing has been published at least seven (7) days before the clate of the
hearing, and all other procedural requirements of Chapter 312 of the Texas Tax Code have
been satisfied.
Findings In order to enter into an agreement, the Ciry must find that:
1. The terrns ofthe proposed agreement comply with these Guidelines and Criteria.
2, There will be no substantial adverse affect on the provisian of City services or tax base.
3. That the lanned use of the ro e will not constitute a hazard to ublic safe , health or
6(
Paris, Texas Economic Development Corporation
POLTCY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
morals.
4. Incident to approval ofany ordinance designating a reinvestment zone, the City shall find thaY
the improvements sought are feasible and practical and would be a benefit to the land to be
included in the reinveshnent zone and to the Ci after the ex iration of the a reement.
Variances Requests for variance from the provisions of these Guidelines and Criteria may be made in wridng
to the City; provided, however, that in no event shall the tern► of any abatement exceed the period
authoriaed by applicable state law. Such request shafl inclucfe a complete description of the
circnmstances requiring a variance. Approval of a request for variance shall require the
affirmative vote of three-fourths (3/4 of the members of the Ci Council.
Proposed The adoption of these Guidelines and Criteria by the City does not [imit the discretion of the City
Agreements Council to decide whether to enter into a specific tax abatement agreement, or limit the discretion of
Decided on the City Council to delegate to iis employees the authority to determine whether or not the Ciry
Individuat should consider a particular appiication or request for ta�c abatement, or create any property,
Basis contract, or other legaf right in any person or entity to have the City Council consider or grant a
s ecified a lication or re uest for tax abatement.
VIII. Abatement Agreement Terms and Conditions.
Appendix B provides many of the terms and conditions to be included in any formal abatement
agreement.
TX. Amendments to GuideIines and Criteria
These Guidelines and Criteria 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
1125 Bonham Street
Paris, Texas 75460
903-7846964
Fax 903-784-2503
��na��<<, 8n nsc�XilSUSd.COlil
Email: parisedc�rtl�ariste�sus�cum
•:
Paris, Texas Ecorzomic Developnnent Cozporation
FOLICY STATEMENT
CRITERIA AND GUIDELINES F�R TAX ABATEMENT
APPENDIX A
. Term p . , �efin�rion , '
� ,W e. _�_
Abatement or Tax The fuli or partial exemption from ad valorem taxes of certain real and tangible personal
Abatement ro e in a Reinvestment Zone desi nated for economic develo ment u oses.
Agreement or The written legal agreement for tax abatement between a property owner and/or lessee and
A reements the Ci of Paris, and also between Lamar Coun and Paris Junior Colle e.
Authorized A facility may be eligible for abatement if it is a facility used for manufacturing, research,
Cammercial or regionat distribution, regional tourist entertainment, other basic industry, or any primary jobs
Industriaf Facility creating industry {a11 #erms are defined below}. Al! authorized facility definitions inelude
buildings and structures, including fixed machinery and equipment used in operating the
facility; AND/OR if the faciliry is a Historic Aroperty defined in Section ]V (b) within a City
of Paris �-Iistorical District.
Authorized The City of Paris may also designate areas of the City where residential properties may be
Residential Facility considered for abatement. The City of Paris will approve their residential abatement
olicies, criteria and uidelines se arate from these olicies. See Section IV (b).
Manufacturing The purpose of which is or will be the manufacture of tangible goods or materials or
Facility 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 manufacturin faci[ities.
Regional Used primarily to receive, store, service, or distribute goods or maYeriais where a
Distribution majority of the goods or services are distributed to points at least ] 00 miles from its
Facili location in the Ci of Paris.
Regional Used in providing amusement/entertainment through the admission of the general public
Tourist where the majority of users reside at least 100 miles from the City and where the
Entertainment majority of users are likely to stay in the City for more than one day and will therefore
Faciti likel utilize Iacal restaurants and hoteUmotel accommodations.
Research Used primazi[y for research or experimentation to improve or develop new tangible
Facili oods or materials or to im rove or develo the roduction rocesses thereto.
Other Basic Not elsewhere described, used for the production of products or services which resu[t in
lndus the creation of new jobs and brin new wealth into the Ci .
Primary Jobs Any industry creaTing "primary jobs" defined as a job that is available at a company for
Creating which a majority of the products or services of that company are ultimately exported to
Industry regional, statewide, national, or intemational markets infusing new dollars into the
IocaE economy, and that meets any one of certain enumerated sector numbers of the
North American Tndustry Classification System (NA1CS) found in the Development
Cor oration Act of the State of Texas.
Base Year 'i'he assessed value of eligible property as of January 1, preceding the date of execution of the
Value agreement plus the agreed upon value of eligible properiy unprovements made af3er January
1, but before the execution of the agreement. The Base Year Value may be adjusted either up
or down from ear to ear as er renditions b the Lamar Coun A raisal District.
Employer The owner or lessee of property, who is applying for tax abatement and who wi11 provide
'obs and ca ital investment within the Reinvestment Zone or within the Enie rise Zone.
Reinvestment An area where the CiYy or County has decided to influence development pattems and
Zone attract major investments that will contribute ta the development of the area through the
use of talc abatement for specified improvements. These statues are found in Chapter
312 of the Texas Tax Code.
Ente rise Zone An area of land desi ated as such under Cha ter 2343 ofthe Texas Government Code.
Job or Jobs A position of full-time employrr►ent for an individual to work 32 hours or more per
week for an employer, in which position the individual is provided the benefits
normal[y offered by the employer, such as health insurance, vacation and some farm of
retirement beneftt. A job is not a position filled for the employer as a worker or
employee of an employment agency or service. "7obs" also includes "Full-time
E uivalent Jobs" defined below.
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Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
Ful[-time A number of part-time jobs where the hours worked in each such job is less than 32 hours
Equivalent per week, made available by one employer and added together. For example, sixteen
(F7'E) Jobs (IG) part-time jobs made available by one emp(oyer where all such part-time jobs added
together require a tota] 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) FTE jobs (352
hours divided by 32 hours per week equal ] l). FTE jobs do not require the employee to
receive benefits from the em lo er.
Modemization 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
reconditionin , refurbishin , re airin , or deferred maintenance.
Personal MacE�inery, equipment, tools, shelving or materials eligible under applicable law for ta�c
Property abatement, which can be removed from an authorized facility described in Section IV
a.
Pro e Real Pro e or Personal Pro e defined herein that is eli ible for tax abatement.
Real Property The land within an Enterprise Zone or a Reinvestment Zone, together with ali
im rovements and fixtures constructed or otherwise siivated thereon.
Tax Abatement The committee af persons designated from time to time by the Paris Economic
Committee Development Corporation to study, review and recommend tax abatement to the
applicable taxing entities in the community. The Tax Abatement Committee wiU 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 (tEte President or
designee), the Chief Appraiser of the Lamar County Appraisai District, and the
Executive Director of the Paris Economic Develo ment Co oration.
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Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
APPENDIX B
Abatement Agreement Terms and Conditions
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 and conditions:
Contract Terms & Conditions
Project The following project speci�cs will be inc[uded:
Description 1. The base year value.
2. Percent of increased value to be abated each year.
3. The commencement date and the termination date of abatement.
4. Amount of investment and average number of jobs invoived during the term of the
agreement.
5. The proposed use of the authorized facility, nature of construction, time schedule, plat,
properry description, and improvement list, as provided in the application.
6. A listing of the kind, number, location, and costs of all proposed improvements of the
property.
7. A statemeni limiting the uses of the propercy consistent with the general purpose of
encouraging developmeni or redeve]opment of the reinvestment zone during the period that
property tax abatement is in effect.
8. 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.
9. 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.
l0. Each term agreed to by the owner of the property.
l 1. A requirement that ihe owner of the property shall certify annuaily to the City that the owner is
in compliance with each applicable term of the agreement.
12. 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.
13. That the City may cancel or modify the agreement if the property owner faiis to comply with
the a eement.
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 Ciry shall notify the company ar individuai in
writing at the address stated in the agreement, and if such default is not cured within a reasonable
time specifed in such notice ("cure period"), then the agreament 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 ali or part of the taxes abated.
At any time before the expiration, any tax abatement agreement may be terminated by mutua[
consent of aIl arties involved in the same manner that the a eement was executed.
Confidentiality Infarmation that is provided to a ta�cing unit in connection with an applicaiion or request for tax
of Proprietary abatement under these Guidelines and Criteria and that describes the specific processes or business
Information activities to be conducted or the equipment or other property to be located on the property for
which tax abatement is sought is eonfidential 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 hereunder.
Tnspections The agreement shaIl stipulate that employees and/ or designated representatives of the City will
have access to the reinvestrnent zone durin the term of the reement to ins ect the authorized
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Paris, Texas Economic Development Corporation
POLICY STATEMENT
CRITERIA AND GUIDELINES FOR TAX ABATEMENT
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 wil I
oniy be conducted in such a manner as to not unreasonably interfere with the
construction and/or operation of the authorized faciiity. All inspections will be made with one ar
mare 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 abateroent to ensure compliance with the agreement and report possible vio[ations of the
a reement to the Ci Council.
Modifications At any time before the expiration of an agreement made under these Guidelines and Criteria, the
of Agreement 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
origina] 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 term of the agreement or the term of the abatement granted therein
be ond the time ermitted b State law.
Assignment An agreement may be assigned to a new owner or lessee of the authorized facility only with the
prior written consent of ihe City. Any assignment shall provide that the assignee shall
irrevocably and unconditionally assume alI the duties and obligations of the assignor upon the
same terms and conditions as seE out in the agreement, and the City's approval shaIl 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 e�ctent 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 an event of default under the a reement remains uncured.
Administration, 1. The Paris EDC shall be primarily responsible for the administration, review, and monitoring
Contract of t� abatement agreements authorized by the City under these Guidelines and Criteria.
Review, These responsibilities sha11 include verifying that participants in tax abatement agreements
Monitoring and are in full compliance with the terms of the agreement.
Reporting 2. The Paris EDC shall expeditiously advise the City in writing of any instances of contract
non-compliance by tax abatement participants. In addition, the Paris EDC shall, on an
annual basis, conduct a performance review of the activities of each ta�c abatement
participant and report the findings of such review to the City Council_
3. The City shall retain the right to independently review and audit the activities of tax
abatement participants.
4. The City shall be responsible for enforcement of the terms of any tax abatement agreement
authorized hereunder.
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