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Res 122-2001 10/16/2001RESOLUTION NO.1.- BOO RESOLUTION APPROVING A THIRD GENERATION NON - ANNEXATION AGREEMENT WITH MIRANT WICHITA FALLS, L.P., GUARANTEEING ITS IMMUNITY FROM ANNEXATION FOR A PERIOD OF SEVEN YEARS BEGINNING JANUARY 1, 2002; FINDING AND DETERMINING THAT THE MEETING AT WHICH THIS RESOLUTION WAS PASSED WAS OPEN TO THE PUBLIC AS REQUIRED BY LAW. WHEREAS, the City of Wichita Falls entered into a second generation non - annexation agreement with Mirant Wichita Falls, L.P. (formerly Southern Energy), which owns and operates a co- generation facility on a part of the plat of "Certainteed Products Addition ", for a period of seven years from January 1, 1995; and WHEREAS, the City of Wichita Falls desires to enter into a third generation non - annexation agreement with Mirant Wichita Falls, L.P., for a period of seven years from January 1, 2002. NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF WICHITA FALLS, TEXAS, THAT: SECTION 1. The City Manager is hereby authorized to enter into a third generation non - annexation agreement with Mirant Wichita Falls, L.P., a copy of which is attached hereto. SECTION 2. It is hereby officially 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 16th day of October 2001. MAYOR kto ANate-2.6o STATE OF TEXAS § COUNTY OF WICHITA § NON-ANNEXATION CONTRACT WITH MIRANT WICHITA FALLS, L.P. This contract, made and entered into by and between the City of Wichita Falls, Texas, a municipal corporation, hereinafter called "City," and Mirant Wichita Falls, L.P., hereinafter called "Company," WITNESSETH: WHEREAS, Company is the Lessee 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 land is located within City's extraterritorial jurisdiction; and, WHEREAS, Subject Property is a part of a larger tract of land owned by Vetrotex CertainTeed Corporation (formerly known as CertainTeed Corporation), which larger tract of land is described as Lot 1 of Certain-Teed Products Addition to Wichita Falls; said Lot 1 of Certain-Teed Products Addition was designated as an industrial district by the City Council of City by their Resolution No. 1835; and, WHEREAS, Company has built a cogeneration facility in the immediate proximity of the City, and the City Council has found that such facility will bring a number of economic benefits to City; and, WHEREAS, the City Council, by Resolution No.122-2001 has authorized and approved this contract, which it deems to be in the best interest of City. NOW, THEREFORE, for and in consideration of the mutual covenants hereinafter contained to be performed by the parties hereto, City and Company 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, 2002. 2. City will furnish water service to Company on Subject Property for (i) the production of steam by Company ("Steam Water") for the generation of electricity and sale of steam to Vetrotex CertainTeed Corporation or any successor in interest to the plant located at 4515 Allendale Road in Wichita Falls, Texas, and (ii) domestic uses such as lavatory, toilet and periodic cleaning ("Domestic Water"). The City will charge and Company will pay for both Steam Water and Domestic Water rates equal to 115% of the rates charged to users located within the City limits throughout the term of this contract, unless City's City Council completely eliminates the standard out-of-city additional charge established by ordinance, in which event Company shall thereafter pay the same rates charged to users within the City limits. The use of Steam Water and Domestic Water by Company shall be measured by separate water meters. 3. City will furnish sanitary sewer service to Company on Subject Property for disposal of wastewater at rates equal to 115% of the rates charged to users located within the City limits computed on the basis of the calculated sewage use by Company as determined by engineering data and certification satisfactory to City as follows: a. Throughout the term of this contract, Company may place an average of 24 gallons per minute of water in the sanitary sewer of City servicing Subject Property. Although the average discharge of Steam Water shall not exceed 24 gallons per minute, the maximum peak discharge of Steam Water shall not exceed 34 gallons per minute. City will furnish sanitary sewer service to Company for disposal of Domestic Water on Subject Property at rates equal to 115% of the rates charged to users located within the City limits throughout the term of this contract, unless City's City Council completely eliminates the standard out-of-city additional charge established by ordinance, in which event Company will thereafter pay the same rates charged to users within the City limits. 4. City will furnish solid waste collection and removal service to Company on Subject Property at rates equal to 115% of the rates charged to commercial and business establishments within the City limits throughout the term of this contract, unless City's City Council completely eliminates the standard out-of-city additional charge established by ordinance, in which event Company shall be charged the same rates charged to users within the City limits. Company may use this service at its option. 5. The water service, sanitary sewer service and solid waste collection service provided to Company by City shall be subject to the ordinances of City as presently existing and as may be hereinafter amended. 6. City will furnish fire protection service to Company on Subject Property. 7. Company shall not allow the sale of fireworks on Subject Property. 8. Company will pay to City each year during this contract, as payment in lieu of taxes, an amount in cash, or cash equivalents acceptable to City, equal to 65% of that amount that their normal City taxes would have been that year had they been in the City limits. Each annual payment shall be made between October 15 and December 31 of each year; the first such payment in lieu of taxes shall be payable between October 15 and December 31 of 2002. In computing the amount that their normal City taxes would be each year during this contract, the following rules shall be applied: a. The appraised value of the land shall be determined in the same manner that other land in the City is appraised. b. The appraisal of the buildings shall be determined in the same manner that other buildings in the City are appraised. c. The appraised value of the machinery, equipment and other personal property, except for inventory, shall be appraised in the same manner that machinery, equipment and other personal property are appraised in the City. d. The appraised value of the inventory shall be determined in the same manner as the inventory of other firms in the City are appraised, less the freeport exemption. e. Each year the then-current tax rate as established by the City Council shall be applied to the assessed value (as determined under a. through d. above) to obtain the amount that the normal City taxes would have been that year had the property been located within the City limits. The payment in lieu of taxes shall be 65% of the amount so computed. 9. This contract does not release nor 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. 10. Company shall not assign this contract, nor assign nor sublet the lease or any part thereof on Subject Property without the written consent of City; except no consent shall be required for any mortgage or collateral assignment in connection with financing the purchase of improvements located on Subject Property. Company shall not, without written consent of City, construct any improvements on Subject Property which are not related to the cogeneration facility. This contract shall be binding upon and inure to the benefit of the successors and assigns (as permitted) of each party hereto. 11. In the event Company should breach any of the provisions of this contract, and it fails to remedy such breach within thirty (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. 12. City shall initiate proceedings to annex Subject Property into the City limits early enough to be able to complete such proceedings by December 31, 2008, and Subject Property shall be included on the tax rolls of City on January 1, 2009. 13. This contract shall be effective as of January 1, 2002. IN WITNESS WHEREOF, the parties hereto have caused this contract to be executed by their duly authorized officers on this the 16th day of October, 2001. - i y o Wichita Falls, Texas i Y mes Berzi , City Map�q�r ATTEST: ()) Uha ) hOkeiJ) City Clerk ti Approved as to Form: — ;% — City Attorney Mira Wichita Fall , .P. By: /1'''A 10 I`i lei gr-sident ATTEST: Secretary . s EXHIBIT A WICHITA COGENERATION FACILITY PROPERTY DESCRIPTION COGENERATION SITE AND TESCO SUBSTATION STATE OF TEXAS § COUNTY OF WICHITA § That part of the plat of "CertainTeed Products Addition" described as: Commencing at the intersection of the Northwest right-of-way line of the Fort Worth and Denver Railroad and the North right-of-way line of Farm-Market Highway No. 369 which is the southerly Southeast corner of said plat; Thence North 1,045.34 feet; Thence East 643.92 feet to the point of beginning; Thence North 330 feet; Thence East 420 feet; Thence South 330 feet; Thence West 188.15 feet; Thence South 177 feet; Thence West 153 feet; Thence North 177 feet; Thence West 78.85 feet to the place of beginning, containing 3.80 acres, more or less.