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Res 195-90 11/20/1990r Resolution No. 195-90 A RESOLUTION APPROVING A NON-ANNEXATION CONTRACT WITH CERTAIN- TEED CORPORATION, GUARANTEEING ITS IMMUNITY FROM ANNEXATION FOR A PERIOD OF SEVEN YEARS WHEREAS, by Resolution No. 1835, the Board of Aldermen of the City of Wichita Falls designated Lot 1 of Certain-Teed Products Addition to Wichita Falls, Texas, according to the plat of said addition recorded in Volume 22, pages 21-22 of the Plat Record of Wichita County, Texas, being a part of the area located in the extraterritorial jurisdiction of the City, as an industrial district in accordance with the provisions of Section 42 . 044 of the Texas Local Government Code; such resolution also approved a non- annexation agreement with Certain-Teed Corporation, guaranteeing the continuation of the extraterritorial status of said property; and, WHEREAS, by Resolution No. 227-83, the City Council of the City of Wichita Falls extended the non-annexation agreement with Certain-Teed Corporation for an additional seven (7) years; and, WHEREAS, such non-annexation agreement expires on December 31, 1990 and the City Council deems it in the best interest of the City to enter into a new non-annexation contract with Certain-Teed Corporation covering such property. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS, THAT: That certain contract, a copy of which is attached hereto between the City of Wichita Falls and Certain-Teed Corporation, whereby the City guarantees the continuation of the extraterri- torial status of the said Lot 1 of Certain-Teed Products Addition and its immunity from annexation by City for a period of seven years from January 1, 1991, is hereby approved, and the City Manager is authorized to execute the same for the City of Wichita Falls. illi PASSED AND APPROVED THIS THE 20 - day of Nova 6 '0. Agir M A 6 R ATTEST: JJ CITY CLERK STATE OF TEXAS COUNTY OF WICHITA NON-ANNEXATION CONTRACT WITH CERTAINTEED CORPORATION This contract made and entered into by and between the City of Wichita Falls, Texas, a municipal corporation, hereinafter called City", and CertainTeed Corporation, hereinafter called "CertainTeed" . WITNESSETH: WHEREAS, CertainTeed is the owner of a certain tract of land, hereinafter called "Subject Property") located in Wichita County, Texas, said land being more fully described in Exhibit A, which is attached hereto and incorporated herein, and which includes land located within the City's extraterritorial jurisdiction. WHEREAS, the Subject Property comprises land upon which is located an existing facility described in Exhibit B (hereinafter the "Existing Facility") and land upon which will be constructed anew facility as described in Exhibit C (hereinafter called the "New Facility") . NOW, THEREFORE, for and in consideration of the mutual covenants hereinafter contained to be performed by the parties hereto, City and CertainTeed do hereby agree as follows: 1. City guarantees the continuation of the extraterritorial status of Subject Property, and its immunity from annexation by City, for a period of seven (7) years from January 1, 1991. 2 . City will furnish water service to CertainTeed for that portion of the Subject Property described in Exhibit B (the Existing Facility) at rates equal to 100% of the rates charged to users located within the City limits throughout the term of this contract. City will 2- furnish water services to CertainTeed for that portion of the Subject Property described in Exhibit C (the New Facility) at rates equal to 150% of the rates charged to users located within the City limits throughout the term of this contract. CertainTeed and the City agree that the Existing Facility and the New Facility will be separately metered for this purpose. 3 . City will furnish sewer service to CertainTeed for the Existing Facility at rates equal to 100% of the rates charged to users located within the City limits throughout the term of this contract. City will furnish sewer services to CertainTeed for the New Facility at rates equal to 150% of the rates charged to users located within the City limits throughout the term of this contract. CertainTeed and the City agree that the Existing Facility and the New Facility will be separately metered for this purpose, provided that in the event the sewer service cannot be separately metered, the use of the sewer service shall be allocated between the Existing Facility and the New Facility on the basis of the water service utilized by, and separately metered for, the Existing Facility and the New Facility under Section 2 hereof. 4 . City will furnish solid waste collection service to CertainTeed for the Existing Facility at rates equal to 100% of the rates charged to commercial and business establishments within the City limits throughout the term of this contract. City will furnish such collection services to CertainTeed for the New Facility at rates equal to 125% of the rates charged to users located within the City limits throughout the term of this contract. However, CertainTeed shall have no obligation to utilize such solid waste collection service. 3- 5. City will furnish fire protection service to CertainTeed on Subject Property throughout the term of this contract. 6. CertainTeed shall not allow the sale of fireworks on Subject Property. 7 . CertainTeed will pay to City each year during the seven (7) years of this contract, as payment in lieu of all taxes, an amount in cash, or cash equivalents acceptable to City, equal to a certain percentage, as specified below, of the amount that its normal City taxes would have been for that year had it been within the City limits. Each annual payment shall be made within the later of: (i) between November 1 and November 30; or (ii) within thirty (30) days after the receipt by CertainTeed of the bills therefor. In computing the amount payable to the City each year during this contract, the following rules shall be applied: a) The appraised value of the land comprising the Subject Property shall, throughout the term of this contract, be in the amount equal to 100% of the January 1, 1990 appraised value of such land made by Wichita County Appraisal District. b) The appraised value of the buildings and other improvements existing on the Subject Property as of January 1, 1990 shall, throughout the term of this contract, be in the amount equal to 100% of the January 1, 1990 appraised value (less depreciation allowances) of such buildings and improvements made by the Wichita County Appraisal District. c) The appraised value of all buildings and other improvements constructed on the Subject Property (including improvements to both the Existing Facility and the New Facility) after January 1, 1990 and not considered a "replacement" (as defined below) of assets existing as of 4- January 1, 1990 will be separately identified and shall be in the amount equal to 100% of the initial appraised value (less depreciation allowances) of such buildings and improvements made by the Wichita County Appraisal District. Construction in progress shall be appraised for purposes of this contract in compliance with Section 23 . 01 of the Property Tax Code and in conformance with generally accepted appraisal techniques. This same appraisal method shall be used for subsequent years of this contract. For purposes of this contract, " replacement" shall mean an asset which (i) is intended to be utilized in substitution for an obsolete asset, (ii) which CertainTeed does not expense in accordance with generally accepted accounting principles, and (iii) is capitalized as of January 1, 1990. d) The appraised value of any buildings and other improvements acquired after January 1, 1990 and considered as a "replacement" (as defined above) of a portion of the Existing Facility will be separately identified and shall be in the amount equal to 100% of the initial appraised value (less depreciation allowances) of such buildings and improvements made by the Wichita County Appraisal District. Construction in progress shall be appraised for purposes of this contract in compliance with Section 23 . 01 of the Property Tax Code and in conformance with generally accepted appraisal techniques. This same appraisal method shall be used for subsequent years of this contract. e) The appraised value of the machinery, equipment and other personal property (except for inventory) existing as of January 1, 1990 shall, throughoutghout the term of this contract, be in the amount equal to 100% of the January 1, 1990 appraised value (less depreciation allowances) of such machinery, equipment and other personal property 5- made by the Wichita County Appraisal District. The same appraisal method shall be used for subsequent years of this contract. f) The appraised value of machinery, equipment and other personal property (except for inventory) acquired after January 1, 1990 and not considered a "replacement" (as defined above) of assets existing as of January 1, 1990 will be separately identified and shall be in the amount equal to 100% of the initial appraised value (less depreciation allowances) of such machinery, equipment and other personal property made by the Wichita County Appraisal District. This same appraisal method shall be used for subsequent years of this contract. g) The appraised value of machinery, equipment and other personal property (except for inventory) acquired after January 1, 1990 and considered as a "replacement" of a portion of the Existing Facility will be separately identified and shall be in the amount equal to 100% of the initial appraised value (less depreciation allowances) of such machinery, equipment and other personal property made by the Wichita County Appraisal District. This same appraisal method shall be used for subsequent years of this contract. h) The appraised value of the inventory shall be determined in the same manner that the inventory of other firms in the City are appraised, less the freeport exemption. i) By August 1 of each contract year, CertainTeed shall furnish to the City Tax Collector a detailed list of all neW construction, equipment purchased, and related equipment replaced for the preceding calendar year. Such reports so furnished shall show segregation between Existing Facility and New Facility and shall, if pertinent, identify the applicable subsection of this Section 7 covering such 6- ert . For the first year of the contract, CertainTeed shall prop Y this contract.furnish beginning values for all property covered by ' CertainTeed shall also furnish the City Tax Collector with the value of the inventory and the portion of that inventory that will be subject to the freeport exemption. The City recognizes that portions of such reports will contain proprietary information. Accordingly,the City agrees not to disclose such reports to any third parties for purposes other than this contract without the prior written consent of CertainTeed. j ) Each year, the then-current assessment ratio established by the City Council shall be applied to the appraised value (as determined under (a) through h9h above) in order to obtain the assessed value; the then-current tax rate as established by the City Council shall be applied to such assessed value to obtain the amount that the normal City taxes would have been for that year had the property been located within the City limits. CertainTeed's payment in lieu of taxes shall be 100% of the amount so computed under Sections 7 (a) , (b) , (d) , (e) , g) , and (h) above and 25% of the amount so computed under Sections 7 c) and (f) above. The parties acknowledge that the intent of this Section 7 is to provide for a 100% payment in lieu of taxes on property which is a replacement of assets existing as of January 1, 1990 and this contract shall be so interpreted. k) Disputes between the City of Wichita Falls and CertainTeed Corporation pertaining to the proper distinction of taxability set forth in Section 7 of this contract shall be resolved by negotiation between the City' s authorized representative and CertainTeed's Plant Manager for the Subject Property. If these individuals cannot resolve the matter, it shall be referred for negotiation and resolution by the 7- President of CertainTeed's Fiber Glass Reinforcements Division and the City manager. If the parties fail to reach agreement by direct negotiation within 60 days from the commencement of negotiation, the parties shall submit the dispute to arbitration by a committee appointed and mutually approved by both parties, with the cost of any such arbitration being split equally between the parties. 8. This contract does not release or waive any obligation to the City in connection with any paving, curb and gutter, or other improvement liens which may be assessed against Subject Property. 9. In the event CertainTeed should breach any of the provisions of this contract, and it fails to remedy such breach within 30 days after having been notified in writing by City to do 'so, then City shall have the right to terminate this contract, and to proceed to annex Subject Property, provided that City shall not have the right to so terminate this contract if CertainTeed has in good faith disputed any alleged breach. 10. City shall initiate proceedings to annex Subject Property into the City limits early enough to be able to complete %such proceedings by December 31, 1997, and Subject Property shall be included on the tax rolls of the city on January 1, 1998 . City shall notify CertainTeed in writing 30 days prior to initiating such proceedings. 11. This contract shall be effective as of January 1, 1991. 12 . Nothing in this contract shall limit or in any way restrict CertainTeed's ability to appeal any appraisal made by the Wichita County Appraisal District. This contract shall inure to the benefit of CertainTeed's assigns or successors in interest to Subject Property. g_ IN WITNESS WHEREOF, the parties hereto have caused this contract to be executed by their duly authorized officers on this the , A724/Lday of LL44,2_,) 1990. CITY OF ICH TA FALLS t BY: ...111/1 7iF I i '7i4[ James Bernina C'Ey Manager ATTEST: 4ity Cler AP".VED AS TO FORM: 1 Lick__AllorneyCity CERTAI CORPORATION By: i Vice-President tJona(d S. /-/um/ ATTEST: Assistant 7 /2_ Secretary Co r..H s on t2