Res 129-2005 9/20/2005RESOLUTION NO. lam'
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF WICHITA
FALLS, TEXAS, AUTHORIZING AN ECONOMIC DEVELOPMENT
INCENTIVE AGREEMENT WITH SAINT GOBAIN, VETROTEX
AMERICA AND AMENDING THE 2004 -2005 BUDGET OF THE WICHITA
FALLS ECONOMIC DEVELOPMENT CORPORATION; FINDING AND
DETERMINING THAT THE MEETING AT WHICH THIS RESOLUTION
WAS PASSED WAS OPEN TO THE PUBLIC AS REQUIRED BY LAW.
WHEREAS, The Wichita Falls Economic Development Corporation did meet on
January 3, 2005 to consider an Economic Development Incentive Agreement with Saint
Gobain, Vetrotex America; and
WHEREAS, The Wichita Falls
recommended approval of the Incentive
provide funding for said agreement.
Economic Development Corporation
Agreement and a budget amendment to
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF WICHITA FALLS, TEXAS, THAT:
SECTION 1 . An Economic Development Incentive Agreement between the
Wichita Falls Economic Development Corporation and Saint Gobain, Vetrotex America
is hereby approved.
SECTION 2 . The Wichita Falls Economic Development Corporation Fiscal Year
2004 -2005 is hereby amended in the amount of $1,620,000 to provide for the Unifilo
project.
SECTION 3 . 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 20th day of September, 2005.
ATTEST:
City Clerk
MAYOR
Memorandum of Understanding
September 20, 2005
This is a Memorandum of Understanding (MOU) between Saint Gobain, Vetrotex
America (Vetrotex) and the Wichita Falls Economic Development Corporation
( WFEDC).
1. The WFEDC recommends the Wichita Falls City Council approve the use of 4(A) Sales Tax
proceeds in the following manner.
2. By definition, the Unifilo Project is an expansion of Vetrotex's existing manufacturing
operations in Wichita County, Texas that will result in up to $18,300,000 in new capital
investment. The new capital investment will include both the expansion of Vetrotex's real
property, as well as the addition of new personal property needed to conduct manufacturing
operations currently not being performed at Vetrotex's manufacturing facility in Wichita
County, Texas.
3. By definition, — a "qualifying job" is a new full -time position filled by an employee of
Vetrotex that has been created as a result of the Unifilo Project at Vetrotex's Wichita County,
Texas location, is benefit eligible, and has been in place for a minimum of 6 months.
4. The use of economic development sales tax proceeds will be contingent on the following:
A. Vetrotex's presentation to the WFEDC describing their intent to expand operations in
Wichita County as a result of the Unifilo Project that will in turn result in up to
$18,300,000 in new capital investment and that will create in excess of 30 new jobs at
Vetrotex's location in Wichita County, Texas.
B. The WFEDC's recommendation to the Wichita Falls City Council and the Council's
subsequent approval of economic development sales tax proceeds being used to
encourage the location of the Unifilo Project in Wichita County, Texas versus other
locations.
C. The WFEDC agrees to pay Vetrotex a development grant equal to 5% of the capital
investment associated with the Unifilo Project. The total amount of the grant by the
WFEDC shall not exceed $915,000.00. This payment will be made in two installments.
The first payment of one -third of the development grant will be made after a presentation
by Vetrotex to the WFEDC evidencing the anticipated value of the new capital
investment and that construction is underway. The second payment of two - thirds of the
development grant will occur at the same time the Cash for Jobs is reconciled. The
formula for final reconciliation of the development grant will be:
(Actual real anti personal property investment X 5.0 %) — (First payment) = Final Amount
In the event the "final amount" is a negative number, Vetrotex will owe the
WFEDC 100% of this amount in a refund.
D. At a date to be determined by Vetrotex but prior to January 1, 2008, apresentation will be
made to the WFEDC evidencing the creation of qualifying jobs. Upon completion of this
presentation, a payment will be made to Vetrotex of $6,000 per "qualifying job ".
Additionally, A one -time payment of 5% of annual salary will be paid at the same time
the cash for jobs is reconciled for each qualifying job that pays a base salary of at least
$50,000 and not more than $100,000 before benefits.
E. Upon the final reconciliation of incentives, if the Texas legislature has not provided a
discount from Franchise Taxes, the WFFDC will pay Vetrotex an offsetting incentive not
to exceed $465,000.
F. In the event that the Vetrotex Unifilo Project ceases operations in Wichita County, Texas
prior to five years from the date of receipt of any incentives paid, Vetrotex shall within
sixty (60) days of the date of cessation o f operations repay the WFEDC the full amount of
all Sales Tax proceed incentives received by Vetrotex for the Unifilo Project.
G. This MOU and Vetrotex's commitment to locate the Unifilo Project at their Wichita
County, Texas location is contingent upon the Saint Gobain Vetrotex Board of Directors'
approval.
Wichita Falls Economic
Development Corporation
By:
Gary Shores
Chairman
Saint Gobain Vetrotex America
By:
Ron Lane
President, North American Operations