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2015-036 - Turner Industries tax abatementRESOLUTION N0. 2015 -036 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS; APPROVING AND AUTHORIZING A TAX ABATEMENT AGREEMENT WITH TURNER INDUSTRIES GROUP, L.L.C.; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE. WHEREAS, on May 11, 2015, the City Council of the City of Paris enacted City Ordinance No. 2015 -016 creating Reinvestment Zone No. 2015 -2 over property owned by Turner Industries Group, L.L.C. in Paris, Lamar County, Texas; and WHEREAS, the City Council of the City of Paris has been presented a proposed agreement by and between the City of Paris, Texas and Turner Industries Group, L.L.C., providing for a tax abatement for a proposed new office building in Reinvestment Zone 2015 -2, a copy of which is attached hereto as Exhibit "A ", and incorporated herein by reference hereinafter called "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 meet the City's Guidelines and Criteria for Tax Abatement adopted by the City Council by Resolution No. 2015 -023. 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. DULY PASSED AND APPROVED this 14th day of September, 2015. ATTEST: Q�WL 1 nice Ellis, City Clerk APPROVED AS TO FORM: - - - 2RX-2, - - W. Kent M a , ty Attorney THE STATE OF TEXAS ) COUNTY OF LAMAR ) TAX ABATEMENT AGREEMENT This agreement is entered into by and between the CITY OF PARIS, TEXAS, a home - rule municipal corporation, situated in Lamar County, Texas, acting by and through its authorized officer whose signature appears below (hereinafter called "City "), and TURNER INDUSTRIES GROUP, L.L.C., acting by and through its authorized officer whose signature appears below (hereinafter referred to as "Owner "). WITNESSETH: WHEREAS, on May 11, 2015, following notice and a public hearing, the City Council of the City of Paris, Texas enacted Ordinance No. 2015 -016 creating Reinvestment Zone No. 2015 -2 on land owned and occupied by Turner Industries inside the city limits of the City of Paris, Texas as further described in a copy of said Ordinance attached hereto and incorporated herein as Exhibit A in accordance with Chapter 312 of the Texas Tax Code; and WHEREAS, on May 11, 2015, the City Council of the City of Paris, Texas approved Resolution No. 2015 -023 reaffirming the City's intent 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, through Resolution No. 2015 -023, the City Council also approved and adopted new Guidelines and Criteria for commercial and industrial Tax Abatement in the City of Paris, Texas as required by the Property Redevelopment and Tax Abatement Act, Chapter 312, Texas Tax Code; and WHEREAS, the Improvements to be constructed by Owner in Reinvestment Zone No. 2015 -2, in the capital amounts referenced in this Agreement and attached Exhibits and upon and within the Property (the Improvements and the Property together herein called the "Project ") and the other terms hereof are consistent with encouraging development of said Reinvestment Zone in accordance with the purposes for which it was created and are in compliance with the City's policy on tax abatement incentives and the ordinance creating such Reinvestment Zone adopted by the City and all applicable laws. NOW, THEREFORE, The Parties hereto do mutually contract and agree as follows: 1 1, ll EXHISIT-A I. Term 1.1 The effective date of this AGREEMENT is the 14'' day of September, 2015, with tax abatement beginning with the tax year commencing January 1, 2016, and expiring on December 31, 2025. II. Area to be Improved 2.1 The Project consists of a new office building to be constructed on Owner's land inside Reinvestment Zone No. 2015 -2 as depicted in the Site Plan attached hereto as Exhibit B. The land and proposed building are hereinafter referred to as the "Property." III. Improvements 3.1 Owner shall construct a first class office building on the Property with appropriate office furnishings no less than 25,400 square feet in size, at a minimum capital investment of SIX MILLION AND NO 1100 DOLLARS ($6,000,000.00) (hereinafter "Improvements "). The office building will be constructed in compliance with all local, state and federal codes and regulations; all required permits shall be obtained by Owner prior to beginning construction of the Improvements and all required inspections shall be timely scheduled and completed by Owner in accordance with City Building Codes, International Building Codes and all other applicable state and federal laws and regulations. 3.2 The Office Building described herein as the "Improvements" shall be completed, furnished, and occupied within twenty -four (24) months of the effective date of this Agreement. Owner shall provide City with a Certificate of Completion along with supporting documents as described in Section 10.1 of this Agreement within sixty (60) calendar days of completion of the Improvements. IV. Consideration 4.1 Owner agrees and covenants that it will diligently and faithfully, in a good and workmanlike manner pursue the completion of the Improvements as described herein. As good and valuable consideration for this Agreement, Owner further covenants and agrees that all construction of the Improvements will be in accordance with all applicable state and local laws, codes and regulations or will procure a valid waiver thereof. In further consideration for this Agreement, Owner shall continue to operate an active and vibrant pipe fabrication, coating, design and engineering and construction plant at Owner's current location in Paris, Texas throughout the term of this Agreement. 2 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 capital expenditure for the Improvements does not meet the amount required herein; or (b) Owner fails to continuously maintain and operate a vibrant and active pipe fabrication, coating, engineering, design and construction plant in Paris, Texas during the term of this Agreement; or (c) 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 (d) Owner materially breaches any of the other terms and conditions of this Agreement, then Owner shall be in default of this Agreement. In the event the Owner defaults in its performance of either (a), (b), (c) or (d) 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 12.3. 5.2 As liquidated damages 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 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. VI. Real and Personal Property 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, one hundred percent (100 %) of the ad valorem property taxes which are assessed on the Improvements described herein and otherwise owed to the City for the tax years 2016 through and including 2025 shall be abated. Said abatement shall be one hundred percent (100 %) of the taxes assessed upon the completed value of the Improvements to be constructed in accordance with this Agreement. There shall be no abatement of City taxes on Owner's Real or Personal Property in existence prior to the effective date of this Agreement. 6.2 Subject, however, to Owner's rights to protest such value of Improvements and cause it to be adjusted as is provided for under the applicable laws of the State of Texas. The ad valorem taxes assessed against the Improvements described herein shall continue to be abated at 100% of their assessed value for each year of the ten (10) year term of this Agreement (i.e. calendar years 2016 through 2025). This tax abatement shall be implemented and enforced in accordance with all applicable state and local laws and regulations or valid 3 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. 6.3 The tax abatement granted herein is in compliance with the City's Guidelines and Criteria for Tax Abatement as amended by City Resolution No. 2015 -023, a copy of which is attached hereto as Exhibit C. In the event of a conflict between this Agreement and the City's Guidelines and Criteria for Tax Abatement, this Agreement shall control. VII. No Conflict of Interest 7.1 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. VIII. Conditions 8.1 The terms and conditions of this Agreement are binding upon the parties hereto and their successors and assigns. 8.2 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, it's elected officials, officers and employees 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. IX. Compliance Provisions 9.1 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 through the date that City issues a final certificate of occupancy to Owner for the Improvements. 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. 9.2 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 which is the subject of this Agreement. X. Initial and Annual Reporting 10.1 Owner shall within sixty (60) calendar days of completion of the Improvements, provide the City with a sworn report, written on Owner's letterhead and sworn to by an authorized officer of Owner, which contains the following information: (a) 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; (b) Owner's capital investment in the Improvements and all supporting spreadsheets and documentation setting out the cost of the Improvements; (c) Detailed description of the completed Improvements, including photos, architectural renderings, drawings, plans, specifications, appraisal reports or other documentation establishing the value of the completed Improvements; (d) A copy of the As -Built plans and specifications for the completed Improvements, or access to the location where said plans and specifications are maintained for inspection and /or copying by City's certification team and /or the Chief Appraiser for the Lamar County Appraisal District; (e) A detailed list of all furniture, office equipment and other taxable personal property purchased and placed in the office building, including documentation of the cost of the furniture and office equipment which is subject to personal property taxation by Lamar County Appraisal District; (f) The date of substantial completion of the Improvements and date that Improvements are occupied by Owner. G� 10.2 The Owner further agrees that it will provide City with an annual sworn report which shall certify, in writing, that Owner is in compliance with each applicable term of this Agreement. Such annual report shall be furnished to City by February 15 of each year during the term of this Agreement on forms provided by the City. The first annual report shall be due to the City on or before February 15th of the year following completion of the Improvements. 10.3 In addition to the annual report required under Section 10.2 hereof, 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 throughout the term of this Agreement. XI. Authority to Contract 11.1. This Agreement was authorized by resolution of the City Council at its regularly scheduled meeting on the 14th day of September, 2015, authorizing the Mayor to execute the Agreement on behalf of the City. 11.2 This Agreement was entered into by Turner Industries Group, LLC pursuant to the authority granted to the authorized official whose signature appears below. 11.3. 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. XII. Legal 12.1 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. 12.2 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. 12.3 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: Turner Industries Group LLC 1200 19'b Street S.W. Paris, Texas 75460 0 CITY: City of Paris, Texas Attn: City Manager P. O. Box 9037 Paris, TX 75461 -9037 12.4 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. 12.5 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. 12.6 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 14th day of September, 2015. THE CITY OF PARIS, TEXAS ATTEST: Janice Ellis, City Clerk APPROVED AS TO FORM: W. Kent McIlyar, City Attorney A. J. Hashmi, M. D., Mayor 7 By: Title: ATTEST: Secretary TURNER INDUSTRIES GROUP, L.L.C. LIST OF EXHIBITS TO THIS AGREEMENT: A = City Ordinance No. 2015 -016 creating Turner Industries Reinvestment Zone No. 2015 -2 B = Site Plan for Turner Industries Office Building C = City's Guidelines and Criteria for Tax Abatement as amended by City Resolution No. 2015 -023 01 ORDINANCE NO. 2015 -016 AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS CREATING A REINVESTMENT ZONE ENCOMPASSING THE TURNER INDUSTRIES PLANT PROPERTY IN PARIS, LAMAR COUNTY, TEXAS, MORE PARTICULARLY DESCRIBED AND DEPICTED IN EXHIBIT "A" ATTACHED HERETO IN ACCORDANCE WITH CHAPTER 312 OF THE TEXAS TAX CODE; MAKING OTHER FINDINGS RELATED THERETO AND PROVIDING AN EFFECTIVE DATE. WHEREAS, the City Council of the City of Paris, Texas, ( "City"), desires to promote the development or redevelopment of a certain contiguous geographic area within its jurisdiction through the extension and re- designation of a reinvestment zone for tax abatement, as authorized by V.T.C.A. Tax Code Chapter 312 (referred to as the "Property Redevelopment and Tax Abatement Act" or the "Act"); and, WHEREAS, On May 11, 2015, a public hearing was held by the City Council to consider the creation of a Reinvestment Zone encompassing the Turner Industries Plant property in Paris, Texas further described and depicted in Exhibit "A" attached hereto; and, WHEREAS, notice of the May 11, 2015 public hearing was published in The Paris News no less than seven (7) days prior to the public hearing; and, WHEREAS, notice of the public hearing was delivered to all taxing units overlapping the territory inside the proposed reinvestment zone; and WHEREAS, at the public hearing, the City invited all interested persons to appear for or against the creation of the reinvestment zone, the boundaries of the proposed reinvestment zone, and the concept of tax abatement in the proposed reinvestment zone. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS: SECTION 1. That the findings set out in the preamble to this ordinance are hereby in all things approved. SECTION 2. The Paris City Council, after conducting a public hearing, receiving evidence and testimony from all persons wishing to be heard, hereby makes the following findings and determinations: (a) That a public hearing on the creation of the Reinvestment Zone described herein has been properly called, held and conducted and that the required notice of such hearing has been given to the public and to all taxing units overlapping the territory inside the proposed reinvestment zone; Page 1 of 3 '�� 11 EXHIBIT (b) That the boundaries of the reinvestment zone shall be the area described and depicted in Exhibit "A" which is attached hereto and incorporated herein by reference; (c) That the creation of the reinvestment zone for tax abatement with boundaries as described and depicted in Exhibit "A" will result in benefits to the City and to the land included in the Reinvestment Zone and the improvements sought are feasible and practical; (d) That the Reinvestment Zone, as described and depicted in Exhibit "A ", satisfies the criteria for creation of a Reinvestment Zone as set forth in Section 312.202 of the Act, because it is reasonably likely that as a result of the designation, the area will contribute to the retention or expansion of primary employment or will attract major investment in the reinvestment zone that would be a benefit to the property and that would contribute to the economic development of the City of Paris; and (e) That the reinvestment zone as defined in Exhibit "A" meets the criteria for the establishment, extension and re- designation of a reinvestment zone as set forth in the City of Paris Guidelines and Criteria for Tax Abatement. SECTION 3. Pursuant to Chapter 312 of the Property Redevelopment and Tax Abatement Act, the City Council of the City of Paris hereby creates a Reinvestment Zone encompassing the Turner Industries Plant Property in Paris, Texas for commercial and/or industrial tax abatement encompassing the area as described and depicted in Exhibit "A" which shall be known as Reinvestment Zone No. 2015 -2 of the City of Paris, Texas. SECTION 4. Reinvestment Zone No. 2015 -2 shall have an initial term of five years beginning with the effective date of this Ordinance and shall automatically renew for an additional five -year term following the expiration of the initial term. SECTION 5. To be eligible for tax abatement within City of Paris Reinvestment Zone No. 2015 -2, a project shall: (a) Meet the standards set forth in the City of Paris Guidelines and Criteria for Tax Abatement; (b) Be located wholly within the reinvestment zone as established herein; (c) Not include property that is owned or leased by a member of the City Council of the City of Paris or by a member of the City Planning and Zoning Commission; (d) Conform to the requirements of the City's Zoning Ordinance and all other applicable laws and regulations pertaining to commercial development. SECTION 6. All agreements for abatement of taxes within Reinvestment Zone No. 2015 -2 shall comply with Section 312.205 (a) of the Act. Page 2 of 3 SECTION 7. All provisions of the ordinances of the City of Paris, Texas in conflict with the provisions of this ordinance are hereby repealed, and all other provisions of the ordinances of the City of Paris not in conflict with the provisions of this ordinance shall remain in full force and effect. SECTION 8. The repeal of any ordinance or part of ordinances affected by the enactment of this ordinance shall not be construed as abandoning any action now pending under or by virtue of such ordinance or as discontinuing, abating, modifying, or altering any penalty accruing or to accrue, or as affecting any rights of the municipality under any section or provisions of any ordinance at the time of passage of this ordinance. SECTION 9. That it is the intention of the City Council of the City of Paris that this ordinance and every provision hereof, shall be considered severable, and the invalidity or partial invalidity of any section, clause, or provisions of this ordinance shall not affect the validity of any other portion of this ordinance. SECTION 10. This Ordinance shall become effective from and after its passage and publication as required by law. PASSED AND ADOPTED this 11 th day of May, 2015. Matt Frierson, May ATTEST: gniVeEllis, City Clerk APPROVED AS TO FORM: W. Kent McIlyar,'C WAttorney Page 3 of 3 Base Map Legend t00 300 0 600 Fein f] LCAD 2074 PAT0816 Pens Gy Limb 1 inch a 600 feet a� Slrms 1/�`� ®. T DM 1pl a fw w#P&kw#- WPTIRIER Wr.2Trrq -LEMA �.}.— Relf0ad5 pyu�er, tP��Elb61bNG6NnbAefROnANANER110Je710Ei1ilY .RlRava�a PudcNAke&lWWMEAYPE.2W@d1 ETTEAr g EX%i br 11A,1f Reinvestment Zone & Tracts Reinvestment Zone 2015-2 m M x :i a: IM V z JA H H 1, ij if if 11 H 11 m it I 6/ 10 0 TURNER INDUSTRIES PARIS OFFICE 1200 19TH STREET SW 3. t� C= PARIS, TEXAS 75460 M m RESOLUTION NO. 2015 -023 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF PARIS, TEXAS AUTHORIZING THE CITY TO BE ELIGIBLE TO PARTICIPATE IN TAX ABATEMENT AND APPROVING GUIDELINES AND CRITERIA FOR GRANTING TAX ABATEMENTS IN THE CITY OF PARIS, TEXAS; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE. WHEREAS, Section 312.002 of the Texas Tax Code requires local taxing units to state their intent to participate in tax abatement agreements and to adopt guidelines and criteria for granting tax abatements every two years; and WHEREAS, the Paris City Council last adopted guidelines and criteria for industrial/commercial tax abatement on February 10, 2014, however, the City Council desires to amend these guidelines and criteria to clarify that existing industry may receive a tax abatement that is individually negotiated and need not comply with the eligibility criteria or matrix for "new industry" as set out in Article V of the Guidelines and Criteria for Tax Abatement; and WHEREAS, the City Council of the City of Paris, Texas hereby afiums its intent to be eligible to participate in tax abatement 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 Exhibit "A;" 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. 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 tax abatement program and approves and adopts the amended Guidelines and Criteria for Tax Abatement attached hereto and incorporated herein as Exhibit "A ". Section 3. This resolution shall become effective from and after the date of passage. PASSED AND APPROVED this 11th day of May, 2015 Matt Frierson, r ATTEST: nice Ellis, City Clerk APPRO D FORM: W. Kent r, City Attorney nmtrr PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) I. General Purpose and Objectives. The City of Paris (City), Lamar County Government (County) and Paris Junior College (PJC) (collectively, herein called the "Taxing Jurisdictions ") are committed to enhancing the competitiveness and the expansion potential of the local industry, to attracting and encouraging new manufacturing industry and investment; to improving the City of Paris, Lamar County and its infrastructure, which attracts and supports development; and, to expanding the tax base, employment opportunities, and the overall quality of life for its citizens. Therefore, the governing bodies of the Taxing Jurisdictions will give consideration, on a case -by -case basis, to providing tax abatements to the owners of real and personal property for projects that stimulate economic growth and diversification in the geographic areas served by the Taxing Jurisdictions, according to state law and consistent with these policies, criteria and guidelines. Tax abatements may be made available to industrial, manufacturing, distribution, service facilities, or any "primary jobs" creating industry as defined by the Economic Development Act of the State of Texas. The facility must be currently in, or locating in the areas served by the Taxing Jurisdictions, 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 information provided in the tax abatement application. However, the City of Paris, Lamar County and Paris 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 acts as the lead entity for projects in Lamar County, which are located outside of the City limits. All governing bodies of the three Taxing Jurisdictions have adopted this policy, criteria and guidelines and will consider tax abatement requests that qualify hereunder. II. Definitions. Definitions are provided as an Appendix A. III. Designation of a Reinvestment Zone. For any facility located within the area served by the Taxing Jurisdictions to be eligible for tax abatement it must meet the criteria for designation as a tax abatement reinvestment zone as set forth in the Property Redevelopment and Tax Abatement Act, Texas Tax Code Chapter 312.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)). IV. Tax Abatement Authorized. The Taxing Jurisdictions, through their elected governing bodies, may agree in writing with the owner and/or lessee of taxable real and/or personal property that is located in a reinvestment zone, but that is not in an improvement project financed by tax increment bonds, to exempt from taxation a portion of the value of the real property, or of personal property located on the real property, or both. The period of the abatement granted under the agreement shall not exceed the PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) term authorized by law. Such agreement will be based on the condition that the owner or lessee of the property makes specific improvements or repairs to the property. An agreement may provide for the exemption of the real property in each year covered by the agreement only to the extent its value for that year exceeds the base year value. An agreement may provide for the exemption of personal property located on the real property in each year covered by the agreement other than personal property that was located on the real property at any time before the period covered by the agreement. Inventory or supplies cannot be abated as personal property- Tax abatements may only be granted for additional value of eligible property improvements made subsequent to and specified in an abatement agreement between the Taxing Jurisdictions and the property owner or lessee subject to such limitation as the Taxing Jurisdictions may require. The additional value must exceed any reduction in the fair market value of other property of the owner already on the tax roll within the area served by the Taxing Jurisdictions. Change in appraised value does not qualify for abatement except in an instance where a previously vacant authorized facility is utilized. Value added to the tax rolls must come from actual capital expenditures. The negotiation of tax abatement agreements will be conducted by the Tax Abatement Advisory Committee, and facilitated by the Paris Economic Development Corporation. In determining where and how tax abatements will be utilized, the Tax Abatement Advisory 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 Taxing Jurisdictions, and (iii) broadening of the tax base, and expansion of the economic base (e.g. capital investment, payroll, local spending, etc.) V. Eligibility Criteria for Tax Abatement for Real and Personal Property A property owner and/or lessee shall be eligible for tax abatement only upon the following criteria. Authorized 1. An authorized facility is used for manufacturing, research, regional distribution, regional services, regional Facility tourist entertainment, other basic industry, or any primary jobs creating industry. (See Appendix A for definitions.) 2. A new authorized facility must be created, or an existing authorized facility must be improved, modernized or expanded. 3. If a leased authorized facility is granted abatement, the agreement may be executed with the lessor and/or lessee, depending upon the particular circumstances of the proposed project. If the agreement is with the lessor, lessor shall demonstrate binding contracts with the lessee to guarantee compliance with the terms of Eligible the agreement 1. The property involved must be a newly created or improvements to an existing authorized facility. Property 2. Eligible property for which abatement may be granted includes nonresidential real property and/or tangible personal property not located on the real property at any time before the abatement agreement becomes effective. 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 operation and administration of the authorized facility. 4. Inventory or supplies shall not be eligible for abatement. PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) Historic For historic property located in the City of Paris Historic District, see Chapter 30, Article N of the City of Property Paris Code of Ordinances — Tax Exemption for Historically Significant Sites. Contact the City of Paris, City Manager's Office for additional information on these and other programs offered by the City of Paris. Value and 1. The governing bodies of the local Taxing Jurisdictions will decide whether to grant a tax abatement to an Term of applicant, and the amount, if any, of such abatement, on a case -by -case basis and in accordance with these Abatement Policies, Criteria and Guidelines. 2. The term of abatements granted under any agreement may not exceed that permitted by applicable state law. 3. The amount of the abatement shall be based upon a percentage (0 to 100 %) of all or a portion of the eligible property within the authorized facility. 4. Abatements may only be granted for the additional value of eligible real and personal property improvements made pursuant to and listed in the agreement between the Taxing Jurisdictions and property owner and/or lessee, subject to such limitations as the Taxing Jurisdictions may require. 5. Real property tax abatement may be granted only to the extent that its value for each year of the agreement exceeds its value for the year in which the agreement is executed. 6. If a modernization project includes the replacement of improvements within an authorized facility, the value eligible for abatement shall be the value of the new unit(s), less the value of the replaced unit(s). Abatement The criteria used to evaluate a proposed project application for abatement includes, but is not limited to: Evaluation 1. The dollar amount of the increase in the tax roll. Criteria 2. The number of jobs created or retained by the employer involved. 3. The possible effect on attracting other taxable improvements into the Taxing Jurisdictions. 4. The nature of and overall effect on the Taxing Jurisdictions. 5. The effect on the safety, health, and morals of the Taxing Jurisdictions' residents. 6. Any substantial long -term adverse effect on the provision of the Taxing Jurisdictions' services or tax base. 7. Meeting all relevant zoning requirements. 8. Consistent with the comprehensive plan of the City of Paris and County of Lamar. 9. The types and cost of public improvements and services (water and sewer main extensions, streets and roads, etc.) required of the Taxing Jurisdictions. 10. The types and values of public improvements to be furnished by the applicant Economic To be eligible to receive tax 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 loss of employment, or assist in the retention or creation of jobs in the Taxing Jurisdictions during the term of the agreement. 3. Should not be expected to solely or primarily have the effect of merely transferring existing employment from one part of the Taxing Jurisdictions to another without demonstration of increased future investment (dollars or jobs) or unusual circumstances whereby without such a move employment is likely to be reduced. 4. Must be necessary because capacity cannot be provided efficiently utilizing existing improved property when reasonable allowance is made for necessary improvements or relevant governmental actions. Taxability During the term of the agreement, taxes shall be payable as follows: as determined each year by the Lamar County Appraisal District, shall 1. The base year of eligible property be fully taxable. 2. The additional value of eligible property above the base year value shall be taxable in the manner described in the agreement. 3. The Chief Appraiser of the Lamar County Appraisal District shall annually determine an assessment of the real and personal property comprising the reinvestment zone. 4. Each year, the employer, the company or individual receiving an abatement pursuant to an agreement shall furnish the assessor 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 Taxing Jurisdictions, which levy taxes on such property and also notify the Paris EDC. 6. The employer, owner or lessee of eligible property requesting tax abatement within a reinvestment zone shall, prior to the commencement of eligible property improvements, agree to expend a designated PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) sum of money and to create or retain a certain number of jobs, or annual payroll as further defined below. A tax abatement may be made available to employers who are increasing new capital investment and creating jobs with respect to an authorized facility located anywhere within the area served by the Taxing Jurisdictions based on the following criteria. 1. To be eligible for any tax abatement, there must be a minimum capital investment in the authorized facility of $1,000,000 and at least ten (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. 3. As 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 must 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 different. Each industrial account is looked at and valued on an individual basis by the Lamar County Appraisal District (LOAD). The typical depreciation used for industrial accounts by LCAD is as follows: a. Computers — 3 year life b. Furniture & Fixtures —10 year life c. Vehicles — 7 to 10 year life (depending on type) d. Machinery & Equipment —15 year life (maybe longer or shorter depending on the type) 6. For each abatement request the Abatement Committee will evaluate the equipment (personal property) investment and useful life separate from the real estate (real property) investment to determine the length of the abatement for each. 7. If personal property should become obsolete and be replaced while under an abatement agreement, the replacement personal property is not eligible for abatement. 8. The charts below provide capital investment guidelines to qualify for tax abatement and the related schedule and percentage of abatement. Poi W. Amount of Investment Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 $1,000,000 to $5,000,000 70% 60% 50% 40% 30% 20% 10% $5,000,001 to $20,000,000 80% 70% 60% 50% 40% 30% 20% $20,000,001 to $25,000,000 90% 80% 70% 60% 1 50% 40% 30% $25,000,001 and Above For projects with capital investment above $25MAND $2.5M in new annual payroU OR creating more than 225 new jobs, the term and percentage of the abatement are both negotiable, but cannot exceed 10 yealy or 100% PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) 9. An additional 20% abatement for new job creation is available based on the following requirements: a. A project that creates a minimum of 10 new jobs. b. The new job wages are equal to or greater than the current County average wage for all private sector jobs excluding retail trade and accommodation and food services ($41,158 annually for 2013. Source: Texas World'orce Commission via www.tracer2.com. (Note: This represents 547 companies, 10,470 jobs and 56% of all private sector employment in Lamar County.) c. The taxing jurisdictions and the company must agree to include measuring, tracking and annual reporting of the net job increases (existing jobs plus new jobs) for the entire term of the abatement agreement. For Net New Jobs (New Job Creation and Retention of Exi ing Jobs Net New Jobs Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 1. 10 new jobs minimum. *20% 20% 20% 20% 20% 20% 20% 2. New job wages = or > average annual wages for private sector jobs in Lamar County. (Excluding retail, accommodations, food service. see hem 9.b. above.) 3. Agree to maintain existing base and new jobs during the entire term of agreement. 4. *Year 1 cannot exceed 100 %. VI. Tax Abatement for Existing Industry/Employers Regarding Real or Personal Property. The Taxing Jurisdictions recognize the value of Existing Employers to the economic well -being of the City and County. The Taxing Jurisdictions desire to encourage existing employers to maintain and grow their facilities inside the City and County, grow their employment base and payroll and remain competitive and successful in their respective industry. Accordingly, if an existing employer (as opposed to a newly created business or industry moving into the Taxing Jurisdictions), owns or leases an authorized facility and has plans to improve such property by constructing new improvements on its real property and/or adding new personal property to its authorized facility which qualify for tax abatement under these Policies, Criteria and Guidelines, such employer may be eligible for tax abatement with respect to such improvements to its real property or its new personal property under the provisions of PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) Article V above, even if no new jobs or newly created minimum annual payroll are created. Recognizing the importance of Existing Industry and job retention, the Taxing Jurisdictions may individually negotiate tax abatement agreements with Existing Industry/Employers outside of the eligibility criteria and matrix set out in Article V above; provided, however, no tax abatement may exceed a ten -year term as provided by state law. V 11. h alMUVaa • } ,lu% S Eligibility Any present or potential owner of taxable property in the Taxing Jurisdictions may request tax abatement by filing a written request with the City Manager, County Judge, or PJC President, with a copy of the application forwarded by the applicant to the Executive Director of the Paris EDC. Form The application shall consist of a completed application form accompanied by the following: 1. A general description of the improvements to be undertaken together with the projected new value to the property and the type of business operation proposed. 2. A detailed descriptive list of the improvements for which abatement is requested. 3. A list of the kind, number, and location of all proposed improvements of the property. 4. A list ofthe 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 that shows all roadways within 200 feet of the reinvestment zone and all existing zoning and land uses within 200 feet of the reinvestment zone. 6. A time schedule for undertaking and completing the proposed improvements. 7. The type and value of any additional economic development incentives requested. 8. Any other information about the proposed project as may be required by the Taxing Jurisdictions or as deemed desirable by the Taxing Jurisdictions. Review 1. All applications will be initially reviewed by members of the Tax Abatement Advisory Process Committee. 2. An initial project briefing meeting will be conducted between the company's representatives and the Tax Abatement Advisory Committee. 3. The Committee will evaluate the request for tax abatement in accordance with these criteria and guidelines and will make its recommendation to the Paris City Council, Lamar County Commissioners Court and Paris Junior College Board for their review and approval. 4. After the Paris City Council has been briefed on the proposed tax abatement offer and they have directed the Committee to move forward, the Paris City Attorney will draft the initial tax abatement agreement for review by the Tax Abatement Committee, the PEDC Board and representatives of each Taxing Jurisdiction. 5. Electronic versions of the City's abatement agreement will be provided to the County and PJC so all agreements have consistent language, terms and conditions. 6. Following Tax Abatement Committee review of the draft agreement, it will be sent to the applicant's legal counsel for review and comment. Any changes requested by the tax abatement applicant will be reviewed and considered by the Committee and City Attorney. 7. Once the Agreement is finalized, it will be placed on the PEDC Agenda for review and action by the PEDC Board. 8. Once the Tax Abatement Agreement has been formally approved by the PEDC Board, the Agreement shall be forwarded to the Paris City Council, Lamar County Commissioner's Court and Paris Junior College Board of Regents for final consideration and action. Public A. The Taxing Jurisdictions will comply with certain public notices and hearings required as Hearing mandated by state law under the Property Redeve lo ent and Tax Abatement Act rior to PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) the designation of a reinvestment zone and execution of a tax abatement agreement. 2. The lead Taxing Jurisdiction (typically the City of Paris) may adopt an ordinance designating a tax abatement reinvestment zone only after notice of a public hearing has been published at least seven (7) days before the date of the hearing, and all other procedural requirements of Chapter 312 of the Texas Tax Code have been satisfied. Findings In order to enter into an agreement, the Taxing Jurisdictions must find that: 1. The terms of the proposed agreement comply with these Policies, Criteria and Guidelines. 2. There will be no substantial adverse effect on the provision of Taxing Jurisdictions' services or tax base. 3. That the planned use of the property will not constitute a hazard to public safety, health or morals. 4. Incident to approval of any ordinance designating a reinvestment zone, the Taxing Jurisdictions shall find that the improvements sought are feasible and practical and would be a benefit to the land to be included in the reinvestment zone and to the Taxing Jurisdictions after the expiration of the agreement. Variances Requests for variance firom the provisions of these Policies, Criteria and Guidelines may be made in writing to the Taxing Jurisdictions; provided, however, that in no event shall the term of any abatement exceed the period authorized by applicable state law. Such request shall include a complete description of the circumstances requiring a variance. Approval of a request for variance shall require the affirmative vote of three- fourths (3/4) of the members of each of the Taxing Jurisdictions' governing body. Proposed The adoption of these Policies, Criteria and Guidelines by the Taxing Jurisdictions does not limit Agreements the discretion of the Taxing Jurisdictions' governing bodies to decide whether to enter into a Decided on specific tax abatement agreement. Nor does it limit their discretion to delegate to their employees Individual the authority to determine whether or not the Taxing Jurisdiction should consider a particular Basis application or request for tax abatement, or create any property, contract, or other legal right in any person or entity to have the Taxing Jurisdiction consider or grant a specified application or request for tax abatement. VIII. Abatement Agreement Terms and Conditions. Appendix B provides many of the terms and conditions to be included in any formal tax abatement legal agreement. IX. 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 of three- fourths (3/4) of the members of each governing body (City, County, PJC). For a tax abatement application or additional information contact: Paris Economic Development Corporation 1125 Bonham Street Paris, Texas 75460 Phone: 903- 784 -6964 Fax: 903 - 784 -2503 Website: My naristexasusa -com Email: pansedc(a�naristexasusa.com PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) APPENDIX A Abatement or Tax The full or partial exemption from ad valorem taxes of certain real and tangible personal Abatement property in a Reinvestment Zone designated for economic development purposes. Agreement or The written legal agreement for tax abatement between a property owner and/or lessee and Agreements the City of Paris, Lamar County and Paris Junior College. Authorized A facility may be eligible for abatement if it is a facility used for manufacturing, research, Commercial or regional distribution, regional services, regional tourist entertainment, other basic industry, or Industrial Facility any primary jobs creating industry (see definitions below). All authorized facility definitions include buildings and structures, including fixed machinery and equipment used in operating the facility. Authorized The City Council of the City of Paris may also designate areas of the City where residential Residential Facility properties may be considered for abatement of City taxes only. The City of Paris will approve their residential abatement policies, criteria and guidelines separate from these licies. 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 manufacturing facilities. Regional Used primarily to receive, store, service, or distribute goods or materials where a Distribution majority of the goods or services are distributed to points at least 100 miles from its Facility location in the Taxing Jurisdictions of Paris and Lamar County. 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 Taxing Jurisdictions and Entertainment where the majority of users are likely to stay in the Taxing Jurisdictions for more than Facility one day and will therefore likely utilize local restaurants and hoteUmotel accommodations. Research Used primarily for research or experimentation to improve or dz<elop new tangible Facility goods or materials or to improve or develop the production processes thereto. Other Basic or Not elsewhere described, used for the production ofproducts or services which result in Service the creation of new jobs and bring new wealth into the Taxing Jurisdictions (e.g. Industry healthcare - related industries). Primary Jobs Any industry creating "primary jobs" defined as a job that is are ult le 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 international markets infusing new dollars into the local economy. The value of eligible property as of January 1, preceding the date of execution of the Base Year Value assessed agreement plus the agreed upon value of eligible property improvements made after January 1, but before the execution of the agreement. The Base Year Value may be adjusted either up or down from year to y ear as per renditions by the Lamar County A sisal District. Employer The owner or lessee of property, who is applying for tax abatement and who will provide jobs and capital investment within the Reinvestment Zone or within the Enterprise Zone. Reinvestment An area where the Taxing Jurisdictions have decided to influence development patterns Zone and attract major investments that will contribute to the development of the area through the use of tax abatement for specified improvements. These statues are found in Chapter 312 of the Texas Tax Code. Enterprise Zone An area of land designated as such under Chapter 2303 of the Texas Government Code. Job or Jobs A "job" is when an individual works 40 hours per week for an 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 osition filled for the employer as a worker or employee of as employment agency or PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) employment service. "Jobs" also includes "Full -time Equivalent Jobs" defined below. Full time The intention of the governing bodies is to provide a company the maximum flexibility in Equivalent running their business and making business decisions, especially related to staffing. The (FTE) Jobs following definition of FTE will be reflected in all incentive agreements. An FTE is: 1. An individual working 40 hours per week in a job defined above. 2. A number of part-time jobs where the hours worked in each such job is less than 40 hours per week, made available by one employer and added together to total 40 hours per week. For example, fourteen (14) part-time jobs made available by one employer where all such part-time jobs added together require a total of 380 hours of work per week (but no such part-time job requires 40 hours of work or more per week), will equal nine and one -half (9.5) FTE jobs (380 hours divided by 40 hours per week equals 9.5). 3. FTE jobs do not require the em to ee to receive benefits from the employer. Modernization The replacement and upgrading of existing facilities, which increases the productive input or output, updates the technology, or substantially lowers the unit cost of operation. Modernization may result from the construction, alteration or installation of buildings, structures, fixed machinery or equipment, but shall not be for the purpose of reconditioning, refurbishing, r airing, or deferred maintenance. p� Machinery, equipment, tools, shelving or materials eligible under applicable law for tax Property abatement, which can be removed from an authorized facility. Property Real Prop or Personal Pro defined herein that is eligible for tax abatement. Real Property The land within an Enterprise Zone or a Reinvestment Zone, together with all improvements and fixtures constructed or otherwise situated thereon. Tax Abatement The Tax Abatement Advisory Committee will be convened from time to time by the Advisory i Paris Economic Development Corporation to study, review and recommend tax Committee abatements to the applicable Taxing Jurisdictions in the City of Paris and Lamar 1 County, Texas. The Tax Abatement Advisory Committee will be composed of one i person from each of the Taxing Jurisdictions: the City of Paris (the City Manager or designee), the County of Lamar (the County Judge or designee), Paris Junior College (the President or designee), the Chief Appraiser of the Lamar County Appraisal District, and the Executive Director of the Paris Economic Development Corporation. Recommendations from the Tax Abatement Advisory Committee shall be decided by majority vote of the representatives from the three taxing entities referenced above. XAS ECONOMIC DEVELOPMENT CORPORATION PARIS, TE POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) APPENDIX B Abatement Agreement Terms and Conditions After approval, the Taxing Jurisdictions 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: Project The following project specifics will be included: 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 involved during the term of the agreement. 5. The proposed use of the authorized facility, nature of construction, time schedule, plat, property 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 statement limiting the uses of the property consistent with the general purpose of encouraging development or redevelopment of the reinvestment zone during the period that property tax abatement is in effect. 8. That access to the project is provided to allow for the inspection by Taxing Jurisdictions' 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 Taxing Jurisdictions if the owner of the property fails to make the improvements or repairs as provided by the agreement. 10. Each term agreed to by the owner of the property. 11. A requirement that the owner of the property shall certify annually to the Taxing Jurisdictions 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 Taxing Jurisdictions' governing body. 13. That the Taxing Jurisdictions may cancel or modify the agreement if the property owner fails to comply with the agre ement. Default If the Taxing Jurisdictions determine that the person or entity receiving an abatement is in default according to the terms and conditions of its agreement, the Taxing Jurisdictions shall notify the company or individual in writing at the address stated in the agreement, and if such default is not cured within a reasonable time specified in such notice ( "cure period "), then the agreement may be modified or terminated without further notice. In the event the company or individual allows its ad valorem taxes owed to the Taxing Jurisdictions to become delinquent and fails to timely and properly follow the legal procedures for their protest and/or contest, or violates any of the terms and conditions of the agreement and fails to cure during the cure period, the agreement then may be modified or terminated without further notice, and the agreement may provide a formula for recapture of all or part of the taxes abated. At any time before the expiration, any tax abatement agreement may be terminated by mutual consent of all parties involved in the same manner that the agreement was executed. Confidentiality Information that is provided to a Taxing Jurisdiction in connection with an application or request of Proprietary for tax abatement under these Policies, Criteria and Guidelines, and that describes the specific Information processes or business activities to be conducted or the equipment or other property to be located on the property for which tax abatement is sought is confidential and not subject to public disclosure until the agreement is executed. Such information in the custody of the Taxing Jurisdictions after 10 PARIS, TEXAS ECONOMIC DEVELOPMENT CORPORATION POLICY STATEMENT GUIDELINES AND CRITERIA FOR TAX ABATEMENT (Updated 5- 11 -15) 11 the agreement is executed is not confidential hereunder. Inspections The agreement shall stipulate that employees and/ or designated representatives of the Taxing Jurisdictions will have access to the reinvestment zone during the term of the agreement to inspect the authorized facility to determine if the terms and conditions of the agreement are being met. All inspections will be made only after the giving of at least twenty -four (24) hours' prior notice and will only be conducted in such a manner as to not unreasonably interfere with the construction and/or operation of the authorized facility. All inspections will be made with one or more representatives of the company or individual and in accordance with its safety standards. Upon completion of construction, the Taxing Jurisdictions shall annually evaluate each authorized facility receiving abatement to ensure compliance with the agreement and report possible violations of the agreement to the Taxing Jurisdictions governing bodies. Modifications At any time before the expiration of an agreement made under these Policies, Criteria and of Agreement Guidelines, the agreement may be modified by the parties to the agreement to include other that could have been included in the original agreement or to delete provisions that provisions were contained in the original agreement. The modification must be made by the same procedure by which the original agreement was approved and executed. The original agreement, however, may not be modified to extend the term of the agreement or the term of the abatement granted therein beyond the time permitted by 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 the Taxing Jurisdictions. Any assignment shall provide that the assignee shall irrevocably and unconditionally assume all the duties and obligations of the assignor upon the same terms and conditions as set out in the agreement, and the Taxing jurisdictions' approval shall be subject to the determination of the financial capability of such assignee. Any assignment of an agreement shall be to an entity that contemplates the same improvements or repairs to the property, except to the extent such improvements or repairs have been completed. No assignment shall be approved if the assignor or the assignee is indebted to the Taxing Jurisdictions for ad valorem taxes or other obligations, or if any event of default under the agreement remains uncured. Administration, I. The Paris EDC shall be primarily responsible for the administration, review, and monitoring Contract of tax abatement agreements authorized by the Taxing Jurisdictions under these Policies, Review, Criteria and Guidelines. These responsibilities shall include annually verifying participants in Monitoring and tax abatement agreements are in full compliance with the terms of the agreement. 2. The Paris EDC shall expeditiously advise the Taxing Jurisdictions in writing of any Reporting 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 tax abatement participant and report the findings of such review to the leadership and governing bodies of each taxing entity. 3. The Taxing Jurisdictions' governing bodies shall retain the right to independently review and audit the activities of tax abatement participants, and shall be responsible for enforcement of the terns of any tax abatement agreement authorized hereunder. 4. Annually the Paris EDC will report to each of the governing bodies on its monitoring and compliance activities and the status of all existing abatement agreements. 11