Res 052-97 3/18/1997RESOLUTION NO. S---)- -1
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
WICHITA FALLS, TEXAS; AUTHORIZING THE MAYOR TO
EXECUTE A TAX ABATEMENT AGREEMENT BETWEEN THE
CITY OF WICHITA FALLS AND CUSTOM METAL SERVICES,
INC.; FINDING AND DETERMINING THAT THE MEETING AT
WHICH THIS RESOLUTION WAS PASSED WAS OPEN TO THE
PUBLIC AS REQUIRED BY LAW.
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF
WICHITA FALLS, TEXAS:
SECTION 1. That the Mayor be and is hereby authorized to execute a
Tax Abatement Agreement with Custom Metal Services, Inc., in accordance with
the terms and conditions of said agreement, attached hereto and made a part hereof
for all purposes.
SECTION 2. It is hereby found and determined that the meeting at
which this resolution was passed was open to the public as required by law.
PASSED AND APPROVED this the 18th day of March, 1997.
(- l
M A Y O/ R
ATTEST:
LAW OFFICES
SHERRILL, CROSNOE & GOFF
A PROFESSIONAL CORPORATION
JOSEPH N. SHERRILL JR. 2301 KELL BOULEVARD, SUITE 200
R. CAVEN CROSNOE P. O. DRAWER 97511
ROBERT W. ,OFF JR.
R. KEN HINES WICHITA FALLS, TEXAS 76307-7511
RICHARD K. BOWERSOCK (817) 322 -3145
WILLIAM F. SMITH FACSIMILE (817) 322 -8324
April 15, 1997
Mr. Kenneth L. Webb, President
Custom Metal Services, Inc.
P.O. Box 8129
Wichita Falls, TX 76307
Re: Custom Metal Services, Inc.
Tax Abatement Agreement
Our File: 3146.4
Dear Mr. Webb:
Pursuant to Mr. Hines, request, enclosed is the
originally filed Tax Abatement Agreement between the City of
Wichita Falls and Custom Metal Services, Inc. recorded in Volume
1923 at Pages 376, et seq. of the Official Public Records of
Wichita County, Texas.
Thanking you, we are,
Very truly yours,
SHERRILL, CROSNOE & GOFF
Chris Smith, Secretary to
R. Ken Hines, Esq.
/ccs
Enclosure
C: \M0VE \CUST0M.L1
cc: The Honorable Nick Gipson,
County Judge
(with copy of enclosure)
✓Gregory D. Humbach, Esq.
(with copy of enclosure)
1►
M • I.y' 'lt M.
This Tax Abatement Agreement (this "Agreement ") is
entered into by and between the City of Wichita Falls, Texas (the
"City "), a home rule city and municipal corporation of Wichita
County, Texas, duly acting herein by and through its Mayor, and
Custom Metal Services, Inc. ( "Owner "), a Texas corporation.
Recitals
WHEREAS, on March 13 , 1997 the City Council of the
City (the "City Council ") passed Resolution No. 52 -97 (the
"Enabling Resolution ") establishing certain guidelines and criteria
for the designation of reinvestment zones and the entering into of
tax abatement agreements pursuant to the Texas Property
Redevelopment and Tax Abatement Act, as contained in Chapter 312 of
the Local Taxation Title of the Tax Code of the State of Texas (the
"Code "); and
WHEREAS, the Enabling Resolution constitutes appropriate
guidelines and criteria governing tax abatement agreements to be
entered into by the City as contemplated by the Code; and
WHEREAS, the Enabling Resolution included a statement by
the City that it elects to be eligible to participate in tax
abatement; and
WHEREAS, the Texas Department of Commerce designated the
City of Wichita Falls East Enterprise Zone (the "Zone ") on June 27,
1991; and
WHEREAS, the designation of an area as an enterprise zone
under the Texas Enterprise Zone Act (Article 5190.7, Vernon's Texas
Civil Statutes) constitutes designation of the area as a
reinvestment zone for purposes of the Code without further hearing
or other procedural requirements other than those provided by the
Texas Enterprise Zone Act; and
WHEREAS, it is in the beat interest of the City and its
taxpayers, in order to maintain and enhance the commercial and
industrial economic and employment base of the Wichita Falls area,
to enter into this Agreement in accordance with the Enabling
Resolution and the Code; and
WHEREAS, the City Council finds that the contemplated use
of the Premises (as hereinafter defined), the contemplated
improvements to the Premises in the description and amount as set
forth in this Agreement and the other terms hereof, are consistent
with encouraging development of the Zone in accordance with the
purposes for its creation and are in compliance with the Enabling
Y o L 1-1)23r-Ar2'A 77
Resolution, the Enabling Resolution and similar guidelines and
criteria adopted by the City and all applicable law; and
WHEREAS, a copy of this Agreement has been furnished in
the manner prescribed by the Code to the presiding officers of the
governing bodies of each of the taxing units in which the Premises
to be subject to this Agreement are located;
NOW, THERRFO E , KNOW ALL MEN BY THESE PRESENTS:
That the City, for good and valuable consideration, the
adequacy and receipt of which are hereby acknowledged, which
consideration includes the expansion of primary employment and the
attraction of major investment in the Zone, which contributes to
the economic development of the City and the enhancement of the tax
base in the City and Wichita County, Texas, and the Owner, for good
and valuable consideration, the adequacy and receipt of which are
hereby acknowledged, which consideration includes the tax abatement
set forth herein as authorized by Sections 312.201 through 312.209
of the Code, as amended, do hereby contract, covenant and agree as
follows:
1. General Provisions
1.1: The Owner is the owner of that parcel of land described
on Exhibit A, attached hereto and made a part hereof for all
purposes (such parcel shall hereinafter be referred to as the
"Premises "). The Premises are located entirely within the city
limits of the City and within the Zone.
1.2: The Premises are not in an improvement project financed
by tax increment bonds.
1.3: This Agreement is entered into subject to the rights of
the holders of outstanding bonds of the City.
1.4: The Premises are not owned or leased by any member of
the City Council or by a member of any zoning or planning board or
commission of the City or by any member of the governing body of
any taxing unit joining in or adopting this Agreement.
2. Improvements
2.1: The Owner intends to expand its existing facility and
operations by: (i) constructing a 12,500 square foot addition to
owner's existing building on the Premises; and (ii) acquiring
certain additional equipment and tools. The Owner currently
estimates that the building addition will cost approximately
$150,000. The Owner intends to acquire an industrial laser, a
rotary bending machine and a robotic welder for approximately
$886,000. In addition, the Owner expects to spend approximately
$100,000 - $600,000 for tools and related equipment. Although the
Owner anticipates it may spend more than $2,000,000 within the next
3 years, the Owner is committed to spend more than $1,000,000 by
2
4cL 1923FAC 'x'8
the end of 1997. As a result of this expansion, the Owner expects
to add approximately 10 new employees, which should increase the
Owner's annual payroll by approximately $200,000.
3. Rate and Duration of Tax Abatement
3.1: The period of tax abatement pursuant to this Agreement
shall commence on January 1, 1998 and shall continue for a period
of 10 years. Improvements constructed on the Premises, and
tangible personal property located thereon, shall be exempt from
taxation by the City in accordance with this Section 3.1, provided
that such exemption shall only be applicable to the extent that the
value of the Premises, and any tangible personal property located
thereon, for the applicable year exceeds the value of the Premises,
and any tangible personal property located thereon, on January 1,
1997 (as such values are established for ad valorem tax purposes).
The percentage of the increased value of the Premises and tangible
personal property which will be exempt from ad valorem taxes during
each year of the tax abatement period pursuant to this Agreement is
as follows:
Year Percentage
1
100%
2
90%
3
80%
4
704
5
60%
6
50%
7
40%
8
30%
9
20%
10
10%
3.2: Notwithstanding anything in this Agreement which might
be deemed to be to the contrary, the Owner shall have the right to
protest and contest any appraisal or assessment of the Premises, or
any improvements or tangible personal property or both located
thereon and the tax abatement provided for herein for such
improvements and /or tangible personal property shall be applied to
the amount of taxes finally determined, as a result of such protest
or contest to be due for such property.
4. Records and Cost
4.1: The kind, number and location of all proposed
improvements are described in Section 2.1. In addition,
construction plans and an equipment list for the Premises will be
delivered to the City and shall be deemed to be incorporated by
reference herein and made a part hereof for all purposes. The
Owner shall have the right to make changes in the plans and
equipment list during the construction process so long as the
revised improvements are not materially different from those
described in this Agreement. After completion of the project, the
p
'ictlf'23rhfj,,, 379
Owner shall deliver a copy of the "as built" plans for the
improvements and shall certify in writing to the City the costs of
construction and of tangible personal property located thereon.
Such certification shall be signed by all parties to this Agreement
and shall be deemed to be incorporated by reference herein and made
a part hereof for all purposes.
4.2: At all times during the term of this Agreement, the City
shall have access to the Premises by City employees for the purpose
of inspecting the Premises to insure that the improvements are
constructed in accordance with the specifications and conditions of
this Agreement; provided, however, that such inspections shall not
interfere with the construction or normal business operations of
the Owner on the Premises.
4.3: The Premises and the improvements constructed thereon
shall at all times during the term of this Agreement be used in a
manner that is consistent with the City's general purpose of
encouraging development of the Zone and the City's comprehensive
zoning ordinance, as amended.
4.4: If the Owner fails to make the improvements to the
Premises as provided by this Agreement, the Owner shall repay all
property tax revenue lost by the City as a result of this
Agreement, subject to any and all lawful offsets, settlements,
deductions or credits to which the Owner may otherwise be entitled.
5. Sale, Assignment or Lease of Property
5.1: The tax abatement provided for herein shall vest in the
Owner upon completion of the project, but, except as hereinafter
provided, such tax abatement is not assignable to any new owner or
lessee of all or any portion of the Premises without the prior
written approval of the City, which approval will not be
unreasonably withheld. Notwithstanding the foregoing, the tax
abatement provided for herein shall be assignable without prior
approval by the City to any parent, affiliate, subsidiary or other
entity in which the Owner has direct or indirect control or in
connection with any sale of the Premises, or a portion thereof,
which are then leased back (for a period at least equal to the
remaining term of this Agreement) by the Owner or a parent,
affiliate, subsidiary or other entity in which the Owner is in
control. For purposes of this Article 5, the term "control" means
either: (i) the ownership of 50%L or more of the beneficial or
economic interest or voting power of the appropriate entity or (ii)
the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of the controlled
entity.
6. Miscellaneous Provisions
6.1: All notices or other communications required or
permitted by this Agreement shall be in writing and shall be deemed
to be properly given when delivered personally to any of the
4
�eL IC2Tr AU, rL380
hereinafter designated addressees or the named representatives
thereof, or when mailed by prepaid certified mail, return receipt
requested, addressed to such party at the respective addresses set
forth below:
If to the City:
City of Wichita Falls
P.O. Box 1431
Wichita Falls, TX 76307 -1431
Attentions City Manager
If to the Owner:
Custom Metal Services, Inc.
P.O. Box 8129
Wichita Falls, TX 76307
Attention: Mr. Kenneth A. Webb, President
6.2: This Agreement was authorized by resolution of the City
Council approved at its Council meeting on March 18 , 1997
authorizing the Mayor to execute this Agreement on behalf of the
City.
6.3: This Agreement was entered into by the Owner acting by
and through one or more duly authorized officers of Owner.
6.4: In the event any section, subsection, paragraph,
sentence, phrase or word herein is held invalid, illegal or
unconstitutional, the balance of this Agreement shall stand, shall
be enforceable and shall be read as if the parties intended at all
times to delete said invalid section, subsection, paragraph,
sentence, phrase or word.
6.5: Any party hereto may request an estoppel certificate
from another party hereto so long as the certificate is requested
in connection with a bona fide business purpose. The certificate
shall include, but not necessarily be limited to, statements that
this Agreement is in full force and effect without default if such
is the case, the remaining term of this Agreement, the levels of
tax abatement then in effect, and such other matters reasonably
requested by the parties to receive the certificate.
6.6: The Owner, as a party to this Agreement, shall be deemed
a proper and necessary party in any litigation questioning or
challenging the validity of this Agreement or any part hereof or
any of the underlying ordinances, resolutions, or City Council
actions authorizing the same, and the Owner shall be entitled to
intervene in any such litigation.
6.7: After the Owner has satisfied the conditions set forth
in this Agreement, the tax abatement provided for herein shall
continue for the duration of this Agreement and shall not be lost
through force majeure events such as acts of God, fire, tornado,
5
ucL 1 -' ,rAPU 'r 381
earthquake or other events or circumstances beyond the Owner's
reasonable control.
6.8: This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas. Venue for any
action pursuant to this Agreement shall be in a state district
court in Wichita County, Texas. This Agreement is fully
performable in Wichita County, Texas.
6.9: An executed copy of this Agreement in recordable form
shall be recorded in the Deed. Records of Wichita County, Texas.
6.10: Other taxing units in which the Premises are located
may join in the execution of this Agreement by executing a
signatory page acknowledging the joinder of such taxing unit and
granting tax abatement by such taxing unit in accordance with the
terms and conditions hereof; an executed and acknowledged copy of
each such signatory page shall be attached to this Agreement.
ATTEST:
J-Ud b ��CD
Ly " Torres, City Clerk
APP VEI} AS TO FORD:
f 7>-. �2, --1
Gre . , City
Atf6irney
ATTEST:
Richard L. Grant, Secretary
6
CITY OF WICHITA FALLS, TEXAS
Rig
By
uct 1J43rAc.382
THE STATE OF TEXAS
COUNTY OF WICHITA
BEFORE ME, the undersigned authority, a notary public in
and for the State of Texas, on this day personally appeared Ray
Yeager, Mayor of the City of Wichita Falls, Texas, a mun; ipal
corporation, known to me to be the person and officer whose name is
subscribed to the foregoing instrument and acknowledged to me that
the same was the act of the said City of Wichita Falls, Texas, a
municipal corporation, that she was duly authorized to perform the
same by appropriate resolution of the City Council of the City of
Wichita Falls, and that she executed the same as the act of the
said city for the purpose and consideration therein expressed and
in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of
March, 1997.
NOTARY PUBLIC'S SEAL:
RONALD P. GONZALES
Notary Public, State of Texas
My Commssion Expires May 17, 2000
C 0 00 ON
THE STATE OF TEXAS
COUNTY OF WICHITA
Pryl-0-k P G711,
Notary Public for the
State of Texas
BEFORE ME, the undersigned authority, a notary public in
and for the State of Texas, on this day personally appeared Kenneth
A. Webb, President of Custom Metal Services, Inc., a Texas
corporation, known to me to be the person and officer whose name is
subscribed to the foregoing instrument and acknowledged to me that
the same was the act of the said corporation, and that he executed
the same as the act of said corporation for the purpose and
consideration therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this ,?-7 day of
March, 1997.
NOTARY PUBLIC'S SEAL:
CIJRiS SMITH 1
Notary Public, State of Texas
MyCwA EVlres 5-19.96
c: \M=\CUSTOM.TAX
7
Notary Public for the
State of Texas
MYMTHTT A ucL 1IOMPAC1383
Beal Property Description
A tract of land out of the M. Carbajal Survey, A-44, Wichita
County, Texas, said tract being further identified as being out of
Block 3, Arrowhead Industrial District, Unit Two, an Addition to
the City of Wichita Falls, Wichita County, Texas, said tract being
more specifically described by metes and bounds as follows:
BEGINNING at a 3/8 inch iron rod at a fence corner, the Southeast
corner of the herein described tract, said corner also being the
Southeast corner of the above mentioned Block 3 of the Arrowhead
Industrial District, Unit Two, said 3/8 inch iron rod bears South
22° 35' 11" East 3,924.00 feet from the Northwest corner of the
above mentioned M. Carbajal Survey, said 3/8 inch iron rod lies in
the West right -of -way line of Burkburnett Road, a dedicated
street, for the place of BEGINNING of this description;
THENCE South 710 50, 54" West along a fence line, a distance of
450.71 feet to a 1/2 inch iron rod in the West line of a certain
24 foot wide utility easement for the Southwest corner of this
tract;
THENCE along said West line of a certain 24 -foot utility easement,
North 200 15, 16" West 584.92 feet to a 1/2 inch iron rod lying in
the South line of Block 1, Arrowhead Industrial District, Unit
Two, an Addition to the City of Wichita Falls, Texas, for the
Northwest corner of this tract;
THENCE along said South line of Block 1, Arrowhead Industrial
District, Unit Two, North 810 25, 30" East 427.29 feet to a 3/8
inch iron rod in said West right -of -way line of Burkburnett Road,
for the Northeast corner of this tract, said 3/8 inch iron rod
also being the Southeast corner of said Block 1;
THENCE along said West right -of -way line of Burkburnett Road,
South 230 48' 22" East 515.95 feet to the place of BEGINNING and
containing 5.47 acres of land, more or less.
yC-L 11,J 2W 33
r F % i•,-4
14*1 $9174 ' it,
�kp V4W 1:W ve�-
THE STATE OF TEXAS
COUNTY OF WICHITA
Wichita County, the undersigned taking unit, having
jurisdiction over the Premises (as defined in the hereinafter
described Tax Abatement Agreement), joins in the execution of the
Tax Abatement Agreement between the City of Wichita Falls, Texas
and Custom Metal Services, Inc. for the purpose of granting
abatement of ad valorem taxes in the mannAr, and in accordance with
the terms and conditions set forth in such Tax Abatement Agreement
and authorizes this page to be affixed to said Agreement. This
joinder to the Tax Abatement Agreement was authorized by the
Commissioners' Court of Wichita County, Texas at its meeting on the
24th day of March, 1997 whereupon it was duly determined by
appropriate order that the County Judge would execute this joinder
on behalf of Wichita County, Texas.
COUNTY OF WICHITA, TEXAS
By
Nick Gipson, Cbunty Judge
ATTEST:
Vernon 'Cannon, County Clerk
B
Deputy Clerk
TM,4 TZ, tW'- TEXAS
CO OF WICHITA
BEFORE ME, the undersigned authority, a notary public in
and for the State of Texas, on this day personally appeared Nick
Gipson, County Judge, Wichita County, Texas, known to me to be the
person and officer whose name is subscribed to the foregoing
instrument and acknowledged to me that the same was the act of the
said County of Wichita, Texas, that he was duly authorized to
perform the same by appropriate resolution of the Comma sioners,
Court of Wichita County, Texas, and that he executed the same as
the act of the said county for the purpose and consideration
therein expressed and in the capacity therein stated.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this day of
March, 1997.
NOTARY PUBLIC'S SEAL.-
Notary Public for the
GERALDINE BAKER State of Tex"
c:1 IP MY COMMISSION EXPIRES
December 9, 2DOO