Ordinance No. 16,315 (Item 9.p.)ORDINANCE NO. 16,315
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,
APPROVING THE ASSIGNMENT OF A TAX ABATEMENT AGREEMENT
BETWEEN PORT 10 LOGISTICS, LLC AND BASS CAPITAL, LLC; AND
PROVIDING FOR THE EFFECTIVE DATE THEREOF.
WHEREAS, via Ordinance No. 14,866, the City of Baytown, Texas and Port 10 Logistics, LLC
("Port 10") entered into a Tax Abatement Agreement for Certain Taxable Property Located in the Port 10
Logistics Reinvestment Zone ("Agreement") on October 13, 2021; and
WHEREAS, Section X of the Agreement allows Port 10 to assign its rights and obligations under
this Agreement to a new owner with the consent of the City Council, which shall not be unreasonably
withheld. NOW, THEREFORE
BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section 1: That the City Council of the City of Baytown, Texas, hereby authorizes and directs
the City Manager to execute, and the City Clerk to attest to, an Assignment of Tax Abatement Agreement
("Assignment") with Port 10. A copy of said Assignment is attached hereto as Exhibit "A" and incorporated
herein for all intents and purposes.
Section 2: This ordinance shall take effect immediately from and after its passage by the City
Council of the City of Baytown.
INTRODUCED, READ and PASSED by the affirmative u to of City Coun 'I of the City of
Baytown this the 13"' day of November, 2025. l i
i O+IfA; CIIARLES J
GE CKS[ON; IritylerlN
City Attorney
R:.Ordmances and Resolutions- Ordinance Drafts 2025-11-13 Ord -Assignment of Port 10 Tax Abatement Agt S L docx
EXHIBIT "A"
ASSIGNMENT OF TAX ABATEMENT AGREEMENT
(Building 8)
WHEREAS, PORT 10 LOGISTICS, LLC ("Assignor") entered into a Tax Abatement
Agreement for Certain Taxable Property Located in the Port 10 Logistics Reinvestment Zone
with the City of Baytown, Texas (the "City") dated October 14, 2021 (the "Tax Abatement
Agreement"), attached hereto as Exhibit "A"; and
WHEREAS, the Assignor is the Owner of the New Facility under the Tax Abatement
Agreement, has completed the Improvements contemplated thereunder, and is not in default
under the terms of the Tax Abatement Agreement; and
WHEREAS, pursuant to Article X of the Tax Abatement Agreement, Owner may assign
its rights and obligations to a new owner of the New Facility with the prior written consent of the
City Council, which consent shall not be unreasonably withheld; and
WHEREAS, Assignor wishes to assign all of its rights, obligations, duties, title, and
interest in, under and to the Tax Abatement Agreement to BASS CAPITAL, LLC, a California
limited liability company or a related affiliate ("Assignee"), and Assignee, as the new Owner of
the New Facility, wishes to accept such assignment and assume all of Assignor's rights,
obligations, duties, title, and interest in, under, and to the Tax Abatement Agreement.
NOW THEREFORE,
1. Assignor hereby assigns all of its rights, obligations, duties, title, and interest in,
under, and to the Tax Abatement Agreement to Assignee.
if. Assignee, the new Owner of the New Facility, hereby accepts such assignment
and hereby irrevocably and unconditionally assumes all of Assignor's rights, obligations, duties,
title, and interest in, under, and to the Tax Abatement Agreement upon the same conditions as set
out in the Tax Abatement Agreement,
Ill. Assignor and Assignee represent that they are not indebted to the City for delinquent
ad valorem taxes or other obligations.
IV. Upon transfer of title of the New Facility, Assignee will provide to the City written
notice of its address and proper party for notice.
IV. The City Council consent to the Assignment is attached hereto as Exhibit "B".
I
V. This Assignment may be executed by the parties in multiple originals, each having
full force and effect.
Effective as of the day of , 2025.
Assignment of Agreement- Building 81
4907-6428-5474 v.1
"ASSIGNOR"
PORT IO LOGISTICS, LLC, a Delaware
limited liability company
By:
Name:_
Title;
"ASSIGNEE"
BASS CAPITAL, LLC, a California limited
liability company [or its related affiliate]
Name:_
Title:
Assignment of Agreement- Building $ 1
4907-6428-5474 v i
Exhibit "A"
Tax Abatement Agreement for Certain Taxable Property located in the Port 10 Logistics
Renivestment Zone
Assignment of Agreement- Building 8 i
4907-6428-3474 v.i
City of Baytown
Tax Abatement Agreement for Certain Taxable Property
located in the
Port 10 Logistics Reinvestment Zone
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(111) Ordinance No I ?.709 of the {•11N. {'uEmcil 111'the Raytown. I exas. providing It1r the
de.,ignallull nt'lhc RclnNesttnclll /tine.
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nr the 1111r) O %C nt'lhls Agw meal. the detinil"lls scl 1'01-111 in Rcsultlllun No 2726 (It, tile
0t). luuncll nl, [Ile City 111' 13ay1nu11. I'Cx,I-,. 11h1jh Is attilOICd 11Cl'CIn as Lxhihit "A" and
nlCurllur sled llcreln tier all Intents and )un-Ilnsc. 011c ""LlIdditICS"), shall govern unless It is
Apparent firom the context that the term as usC(f Ilcrcl11 11"S a dtf fcrclll nleanln>; ur unless such word
IS rg)CCO'Cally (Ietilled in this arllele All whet t„ntl. shall he given 111161 L01111nnll. urdmar).
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IIl IhC Itet111'Ctitlllellt Xullc dCSignrlled for CCutlurlllc duk CIU)llllent put-I11,CCs
h. I14111VlkIn1 Pcrl / means the 11010d tit' mile commencing January 1. 2023. and ending upon
the Sooller of (1) the fifth anlllver:eary of Elie I:fTcclirc Date ul' Ahalelllcnt or lily the
ICrinnlntiun 14 thlc Ags-cement 11tlnuanl 10 Ills 11ru1 isluns ul' Amele V I I hereof
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C. RPplicaliun means the Owner's Application for Tax Abatement in Baytown, Texas, which
is attached hereto as Exhibit "B and incorporated herein for all intents and purposes.
d. Base Year Value means the appraised value of the property within the Reinvestment Zone
as certified by the Harris County Appraisal District as of January 1, 2021, plus the agreed -
upon value of eligible property improvemNts made after such January 1 but before the
execution of the Agreement.
e. Consn'uction Phase means a material and substantial improvement of the property which
represents a separate and distinct construction operation undertaken for the purpose of
erecting the Improvements.
I: Effective Date of,4batement means January 1, 2023.
g. Eligible Property means the buildings, structures, fixed machinery, equipment and process
units, site improvements, and that office space and related fixed improvements necessary
to the operation and administration of the New Facility as hereinafter defined.
h. lmprovemenis means the buildings or portions thereof and other improvements, including
fixed machinery, equipment and process units, used for commercial or industrial purposes
that are erected by the Owner on the property after the execution of this Agreement.
1. Ineligible• Prcperly means that property described in Section 2(e) of the Guidelines.
j. New Eligible Property means Eligible Property, the construction of which commences
subsequent to the date of execution of this Agreement. A list of the New Eligible Property
is set forth in the A pplication. During the Construction Phase of the New Eligible Property,
the Owner may make such change orders to the New Eligible Property as are reasonably
necessary to accomplish its intended use.
k. New Facility has the meaning given to that term in Article VI hereof
1. Subject Property has the meaning given to that teen in Article III hereof.
III
property
operty
The Reinvestment Zone is an area within Hams County, Texas, more fully described in
Exhibit "C," which is attached hereto and made a part hereof for all intents and purposes. The
property subject to this Agreement (the "Subject Property") is comprised of a tract of land totaling
approximately 8.5845 acres of land, which is located within the Reinvestment Zone, assigned
Harris County Appraisal District Account Number 1408570010001 and more fully described in
the Application.
Tax 6batement,Aereement, Page 2
The values hereinafter established for tax year 2021 by the Harris County Appraisal
District, plus $0.00 , representing the agreed -upon value of Improvements made after
January 1, 2021, but before the execution of this Agreement- shall he the Base Year Values for
Purposes of this Agreement.
IV
Value and Term of Agreement
Abatement on the Improvements shall be permitted only for the value of New Eligible
Property as defined in Article II of this Agreement and as specifically listed in Exhibit "B." This
Abatement shall be granted effective January I, 2023 (the "Effective Date of Abatement"). The
portion of New Eligible Property value to be abated shall be in accordance with the following
schedule:
- 2023
- -
-- 100%
2024
—� _ � 80%
---- _ 2025 - - - -
-
-2026
— -- --70%
60%
2027
50%
The abated value shall be the value of New Eligible Property, as adjusted each year.
V
Taxabilitv
During the Abatement Period. taxes shall be payable as fellows:
(1) The value of Ineligible Property shall be fully taxable;
(2) The Base Year Value of Eligible Property existing prior to the cxecution of this
Agreement, as the same may be adjusted each year, shall be fully taxable; and
(3) The additional value of New Eligible Property shall be taxable in the manner as
described in Section 2(g) of the Guidelines and in accordance with Article IV of
this Agreement. The estimated value of the New Eligible Property to be abated
pursuant to the Agreement is $5,500,000.
The City shall enter into only one tax abatement agreement for the New Facility described
in this Agreement during the existence of the Reinvestment Zone as designated by Ordinance No.
13,709.
Tax Abatement Agreement. Page 3
VI
Contemplated Improvements
Asset forth in the Application, the Owner represents that it will construct a 102,814 square -
foot, front -load distribution/warehouse facility, that it reasonably expects will cost approximately
$5,500,000 which shall be used for commercial or industrial purposes ("New Facility").
The New Facility, as well as any other Improvements within the Subject Property, shall
be completed in accordance with all applicable laws, ordinances, rules or regulations, including
the City's zoning ordinance. The Owner herein agrees to construct or cause the New Facility to
be constructed so that the New Facility will comply with the masonry and the articulation and
relief standards specified in Section 3.10 of the Code of Ordinances, Baytown, Texas, The New
Facility is expected to initiate or further the active conduct of a trade or business within the
Reinvestment Zone.
The Owner further agrees that construction of the Improvements will begin on or before
December 31, 2021, with completion on or before December 31, 2022.
vil
Em Io nenl
It is contemplated that this construction project will result in the creation of five (5) jobs
and approximately fifty (50) construction jobs during the Construction Phase of the New Facility.
The project is not expected solely to transfer, or primarily have the effect of transferring,
employment from one part of the City of Baytown to another.
The Owner, on or before March Ist of each year of this Agreement, shall submit to the
Harris County Appraisal District and the City a January cmployee count for the New Facility which
corresponds to the employment count reported in the Owner's Employer's Quarterly Report to the
Texas Workforce Commission. The Owner shall also on or before March I st of each year submit
a separate notarized letter certifying the number of jobs created or retained as a direct result of the
abated improvements and the number of employees in other facilities located within the City.
These submissions shall be used to determine abatement eligibility for that year and shall be
subject to audit if requested by the City. The Owner's failure to submit the counts and notarized
letter shall result in the ineligibility to receive an abatement for that year and the termination of
the tax abatement agreement and any abated taxes subject to recapture pursuant to Article Vlll.
Vill
Event of Default
A. In the event the New Facility is completed and begins operations as a service and
distribution facility, but subsequently discontinues such operations for any reason
excepting fire, explosion or other casualty, accident or natural disaster, for a period of one -
Tax Abaiernont Agreement, Page 4
year during the Abatement Period, then this Agreement shall be automatically terminated_
In the event of termination pursuant to the provisions of this paragraph, the Abatement of
taxes and payments for the calendar year during which the New Facility discontinues
operations shall terminate, but there shall be no recapture of prior years' taxes and payments
abated by virtue of this Agreement. The taxes and payments otherwise abated for the
calendar year during which the New Facility no longer produces shall be paid to the City
prior to the delinquency date for such year or within sixty (60) days from the date of
termination, whichever occurs first. The Owner shall notify the City at the address in
Article XI within ten (10) days of any discontinuation, stating the reasons for the
discontinuation and the projected length of the discontinuation. Should Owner fail to
comply with this subsection, this Agreement shall be terminated immediately and all taxes
previously abated by virtue of this Agreement shall be recaptured and paid within sixty
(60) days of the termination. Any and all recaptured taxes not paid within the 60-day period
Prescribed hereinabove shall accrue interest and penalties as set forth in Section B of this
Article.
B. If the Owner is in default of any term or condition of this Agreement or of the Guidelines
during the Abatement Period covered by this Agreement, the Owner must notify the City
in writing at the address stated in Article XI hereof within ten (10) days from the default
and cure such default within sixty (60) days from the date of such default ("Cure Period").
If the City determines that Owner has failed to comply with this subsection, the Agreement
shall be terminated immediately and all taxes previously abated by virtue of the Agreement
may he recaptured together with interest at 6% per annum calculated from the effective
date of the Agreement and paid within sixty (60) days of the termination. If the City does
not receive full payment within said sixty (60) days, a penalty of 15% of the total amount
abated shall be added.
C. In the event that Owner (i) allows its ad valorem taxes owed the City to become delinquent
and fails to timely and properly to follow the legal procedures for their protest and/or
contest or (ii) violates any of the terms and conditions of this Agreement and fails to cure
during the Cure Period, this Agreement will terminate automatically with no further notice
to the Owner or opportunity to cure the default being necessary. If this Agreement is
terminated, all taxes previously abated by virtue of this Agreement will be recaptured and
paid within sixty (60) days of the termination, and penalties and interest shall be assessed
as set forth in Section B of this Article.
IX
Administration
This Agreement shall be administered on behalf of the City by the City Manager or his
designee pursuant to the direction of the City Council. The Owner shall allow employees and/or
representatives of the City who have been designated by the City Manager to have access to the
New Facility during the term of this Agreement to inspect the New Facility to determine
compliance with the terms and conditions of this Agreement. All inspections required herein will
be made only after giving of twenty-four (24) hours' prior notice and will only be conducted in
Tax A terse t A rz eat, Pagc 5
such manner as will not unreasonably interfere with the construction and/or operation of the New
Facility. All inspections required herein will be made with one or more representatives of the
Owner and in accordance with the Owner's safety standards.
Upon completion of the contemplated construction, the City Manager or his designee shall
annually evaluate the New Facility to ensure compliance with the terms and provisions of this
Agreement and shall report possible defaults to the City Council and the City Attorney.
The Chief Appraiser of the Harris County Appraisal District shall annually determine (i)
the taxable value after giving effect to the terms ofthis Agreement of the real and personal property
located on the Subject Property and (ii) the full taxable value without Abatement of the real and
personal property located on the Subject Property. The Chief Appraiser shall record both the
abated taxable value and the full taxable value in the appraisal records. The full taxable value
figure listed in the appraisal records shall be used to compute the amount of abated taxes that are
required to be recaptured and paid in the event this Agreement is terminated in a manner that
results in recapture. Each year the Owner shall furnish the Chief Appraiser with such information
outlined in Chapter 22 of the Texas Tax Code, as may be necessary for the administration of the
Abatement specified herein.
The Owner must certify annually to the governing body of each taxing unit with taxing
jurisdiction over the Property that the Owner is in compliance with each applicable term of this
Agreement.
X
Assignment
The Owner may assign its rights and obligations under this Agreement to a new owner of
the New Facility with the prior written consent of the City Council, which consent shall not be
unreasonably withheld. 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 this Agreement. Any assignment of this Agreement shall be to an entity
that contemplates the same Improvements to the property, except to the extent such Improvements
have been completed. No assignment shall be approved i f the assignor or the assignee is indebted
to the City for delinquent ad valorem taxes or other obligations.
Xl
Notice
Any notice required to be given under the provisions of this Agreement shall be in writing
and shall be duly served when (i) it is personally delivered or (ii) it is deposited, enclosed in a
wrapper with the proper postage prepaid thereon, and duly registered or certified, return receipt
requested, in a United States post office, addressed to the City or the Owner, as appropriate, at the
following addresses, if mailed, any notice or communication shall be deemed to be received three
Tax Abatement Agreement; Page 6
% }Trp-i
days after the date of deposit in the United States mail. Unless otherwise provided in this
Agreement, all notices shall be delivered to the following addresses:
Owner: Port 10 Logistics, LLC
1885 S. lames Place, Suite l 10()
Houston, Texas 77056
Attention: Alan D. Fcinsilvcr
City: City of Baytown
P. O. Box 424
Baytown, Texas 77522-0424
Attention: City Manager
Either party may designate a different address by giving the other pally ten (10) days'
written notice.
X11
Non -waiver
Failure of the City to insist on the strict performance of any of the agreements herein or to
exercise any rights or remedies accruing thereunder upon default or failure of performance shall
not be considered a waivcr of the right to insist on, and to enforce by an appropriate remedy, strict
compliance with any other obligation hereunder to exercise any right or remedy occurring as a
result of any future default or failure of performance.
XI11
Venue
This Agreement shall in all respects be interpreted and construed in accordance with and
governed by the laws of the State of Texas, regardless of the place of its execution or performance.
The place of making and the place of perfornance for all purposes shall be Baytown, Harris
County, Texas.
XlV
Severabi lity
All parties agree that should any provision of this Agreement be determined to be invalid
or unenforceable, such determination shall not affect any other term ofthis Agreement, which shall
continue in full force and effect.
Yax Abasement Aerecment. ?age 7