CC Resolution No. 2388RESOLUTION NO. 2388
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,
REPEALING RESOLUTION NOS. 2007 AND 2234 ADOPTED BY THE CITY
COUNCIL OF THE CITY OF BAYTOWN ON SEPTEMBER 24, 2009, AND MARCH 14,
2013, RESPECTIVELY; ESTABLISHING AN INDUSTRIAL DISTRICT POLICY
APPLICABLE TO COMPANIES THAT HAD AN INDUSTRIAL DISTRICT
AGREEMENT WITH THE CITY OF BAYTOWN IN EFFECT ON DECEMBER 10, 2015;
AND PROVIDING FOR THE EFFECTIVE DATE THEREOF.
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WHEREAS, orderly economic growth raises the standard of living and otherwise improves the quality
of life for the community as a whole; and
WHEREAS, the Baytown area has a number of industrial establishments; and
WHEREAS, it is to the mutual advantage of industries and municipalities to cooperate whenever
possible for the general advancement of the affected population; and
WHEREAS, it is generally recognized that industries within the City's Industrial Districts should
compensate the City of Baytown recognizing their limited use of municipal services, but realizing that
industries derive benefits, both direct and indirect, from municipal services; and
WHEREAS, the City Council, having previously created Industrial Districts, desires to continue with
contractual arrangements with Existing Companies situated in the Industrial Districts in the City's
extraterritorial jurisdiction, as provided for in the Texas Local Government Code, Section 42.044; and
WHEREAS, the industrial district policies included herein are designed to treat Existing Companies
engaging in like industries equally, to impose uniformly and consistently contractual provisions on all New
Companies engaging in like industries so as to generate equitable revenues and to set uniform standards and
regulations, and to provide New Companies a limited immunity from annexation; NOW THEREFORE,
BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS:
Section 1: That the facts and matters set forth in the recitals of this Resolution are hereby found
to be true and correct and are herein adopted by the City Council of the City of Baytown.
Section 2: That the City Council of the City of Baytown hereby repeals Resolution Nos. 2007
and 2075 adopted by the City Council of the City of Baytown on September 24, 2009, and March 14, 2013,
respectively, and declares said resolutions to be without force and effect.
Section 3: The following definitions apply to this policy, except where the context clearly
indicates a different meaning:
BASE YEAR VALUE means:
(1) if there is no planned improvement during the contract term, the fair market value as
determined by the City, of all of the Existing Company's land and all other tangible property,
real, personal or mixed, within the Industrial District:
(a) on January 1, 2009, or
(b) on January 1, 2016, or
(c) as specified and /or used in a previous Industrial District Agreement between the
Existing Company and the City, or
(d) as most recently certified by the chief appraiser of the appraisal district as of the date
of the Industrial District Agreement,
whichever is greater; or
(2) if there is a Planned Improvement during the contract term at the time of the execution of the
Industrial District Agreement, the greater of (1)(a) through (d) above plus an agreed upon
value based upon the value of any Planned Improvements throughout the term of the
Agreement.
EXISTING COMPANY means a company that owns Real Property within an Industrial District of the City
and that had an Industrial District Agreement with the City of Baytown prior to December 10, 2015.
EXISTING COMPANY means a company that owns Real Property within an Industrial District of the City,
which Real Property was subject to an Industrial District Agreement with the City of Baytown prior to
December 10, 2015.
IMPROVEMENT means:
(1) a building, structure, fixture, or fence erected on or affixed to land;
(2) a transportable structure that is designed to be occupied for residential or business purposes,
whether or not it is affixed to land, if the owner of the structure owns the land on which it is
located, unless the structure is unoccupied and held for sale or normally is located at a
particular place only temporarily; or
(3) for purposes of an entity created under Section 52, Article III, or Section 59, Article XVI,
Texas Constitution, the:
(a) subdivision of land by plat;
(b) installation of water, sewer, or drainage lines; or
(c) paving of undeveloped land.
INDUSTRIAL DISTRICT means that area in the City's extraterritorial jurisdiction designated by the City as
an industrial district.
INDUSTRIAL DISTRICT AGREEMENT means the agreement incorporated herein in Sections 7 or 8, as
applicable.
LOGISTICS means warehousing, distribution, logistics, storage and similar operations, including, but not
limited to, those associated with North American Industry Classification System ( "NAICS) Codes
493110, 493120, 493130, and 493190, whose value of Situs Inventory exceeds the value of the New
Company's Real Property subject to the Industrial District Agreement.
NON - LOGISTICS means not Logistics.
PERSONAL PROPERTY means property that is not Real Property.
PLANNED IMPROVEMENT means any taxable Real Property Improvement together with Existing
Company's Personal Property within the affected area having an assessed value of more than
$50,000,000.
REAL PROPERTY means:
(1) land;
(2) an improvement;
2
(3) a mine or quarry;
(4) a mineral in place;
(5) standing timber; or
(6) an estate or interest, other than a mortgage or deed of trust creating a lien on property or an
interest securing payment or performance of an obligation, in a property enumerated in
Paragraphs (1) through (5) of this definition.
SITUS INVENTORY means the value of the personal property and inventory stored or held on or within the
affected property not owned by the Property Owner as assessed by the applicable appraisal district in a
given contract year.
TAX RATE means the property tax rate per $100.00 of assessed valuation adopted by the City Council for the
City.
YEARLY PAYMENT RATE means 0.66.
Section 4: It is hereby provided that compensation shall be determined uniformly for each
Existing Company -- Non - Logistics as follows:
Property Owner agrees to pay the City of Baytown an Industrial District payment on or before
December 3151 of each year during the term of this Agreement, such payment to be calculated
on the basis of the below stated formula:
Industrial District Payment � Base Year Value x Tax Rate x Yearly Payment Rate
Section 5: It is hereby provided that compensation shall be determined uniformly for each
Existing Company - Logistics as follows:
Property Owner agrees to pay the City of Baytown an Industrial District payment on or before
December 3151 of each year during the term of this Agreement, such payment to be calculated
on the basis of the below stated formula:
Base Year Value x Tax Rate x Yearly Payment Rate
Industrial District Payment - +
Situs Inventory x .50 x Tax Rate x Yearly Payment Rate
Each Existing Company engaged in Logistics, who leases or otherwise provides space to another for
storage of Personal Property, shall file an information report with the City stating the name and address of each
person to whom the New Company leased or otherwise provided storage space on January 1 of each contract
year.
Section 6: If a New Company executes an Industrial District Agreement with the City, the
Existing Company's property within the area subject to the Industrial District Agreement should not be
annexed by the City unless otherwise necessary to annex property owned by third parties within an Industrial
District.
Section 7: That the City Council of the City of Baytown hereby approves the Industrial District
Agreement for Existing Company- Non - Logistics, which is attached hereto as Exhibit "A" and incorporated
herein for all intents and purposes, as the standard form of agreement to be used in conjunction with the policy
herein established.
Section 8: That the City Council of the City of Baytown hereby approves the Industrial District
Agreement for Existing Company - Logistics, which is attached hereto as Exhibit `B" and incorporated herein
for all intents and purposes, as the standard form of agreement to be used in conjunction with the policy herein
established.
Section 9: This resolution 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 vote of r ity Council of the City of
Baytown, this the 10th day of December, 2015.
ATTE
`2.ETICIA BRYSCH, City Clete
APPROVED AS TO FORM:
,L
NACIO RAMIREZ, SR., C ty ttorney
H. DONCARLOS,
;S
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R',Karen'liles';City Council\Resolutions\2015\December 10`. DAPolicy4ExistingCompanies20l5 .doc
4
Exhibit "A"
Industrial District Agreement
This Industrial District Agreement ( "Agreement ") is made and entered into between the
City of Baytown, Texas, a municipal corporation in Harris and Chambers Counties, Texas,
hereinafter also referred to as "Baytown" or "City," and , a
, hereinafter referred to as "Property Owner." In consideration of the
promises and of the mutual covenants and agreements herein contained, it is agreed by and
between the City and Property Owner as follows:
I.
Parties
This Agreement is made under the authority of Texas Local Government Code
Annotated §42.044 (Vernon 1993), article XI, §5 of the Texas Constitution and other
applicable law. The parties to the Agreement and their addresses are:
The "City"
City of Baytown
Attn: City Manager
P.O. Box 424
Baytown, TX 77522
Copy to:
City of Baytown
Attn: City Attorney
P.O. Box 424
Baytown, TX 77522
2. The "Property Owner" Tax Statement Address:
II.
Identification of Property and Industrial
District
This Agreement includes provisions concerning certain real estate and tangible personal
property owned or leased by the Property Owner. Real estate located outside the corporate
limits of the City is sometimes referred to herein as the "affected area," and it is described in
Exhibit A, which is attached to this Agreement and made a part hereof. Acting pursuant
to the above mentioned authority, the City Council of the City has by ordinance, designated the
affected area as an industrial district, the same to be known as Baytown Industrial District
No. _ (the "Industrial District ").
III.
Term
The term of this Agreement is seven tax years, from 20 through 20 , unless it is
sooner terminated under the provisions hereof. This Agreement shall be effective and
binding on the parties hereto upon execution hereof on behalf of the parties to this Agreement
and shall remain in effect for seven years. This Agreement supersedes any prior existing
agreements between the Property Owner and the City relating to the subject matter specific to
the term hereof.
IV.
Limited Immunity from Annexation by the City
In consideration of the obligations of the Property Owner herein set forth, the City
hereby guarantees for the term of this Agreement the immunity of the affected area from
annexation of any type by the City except for such parts of the affected property as may
be necessary to annex property owned by third parties within the Industrial District that the
City may decide to annex. Additionally, this Agreement shall not affect the continuation of
any limited purpose annexation status to which the affected area is now subject.
V.
Industrial District Payment
As part of the consideration for the City's undertakings as set forth above, the Property
Owner agrees to pay to the City on or before December 31 St of each year during the term
hereof a sum of money equal to:
(1) the fair market value as agreed to and stipulated by the parties to be as follows
for each year indicated:
Year
1
YEARLY
PAYMENT
RATE
Base Value
1
20
.66
1
.66
20
1
20
.66
20
.66
20
.66
1
hereinafter referred to as the "Base Value," multiplied by
(2) the property tax
Council for the
detailed below:
rate per $100.00 of assessed valuation adopted by the City
City, multiplied by the applicable Yearly Payment Rate as
TAX YEAR
YEARLY
PAYMENT
RATE
20
.66
20
.66
20
.66
20
.66
20
.66
20
.66
20
.66
VI.
Valuations and Collections
A.
Generally
The parties hereto recognize that said County Appraisal District is not
required to appraise for the City the land, improvements, and tangible property, real or mixed, in
the affected area, which is not within the corporate limits of the City, for the purpose of
computing the payments hereunder. For the purpose of providing a procedure for determining
and collecting the amounts payable by the Property Owner hereunder, there are hereby adopted
and made a part hereof all provisions of the Constitution and statutes of the State of Texas
pertaining to ad valorem taxation as amended throughout the term of this Agreement (including,
in particular, the Texas Property Tax Code), except, however, that (i) to the extent that any of
such provisions would require the assessment of the Property Owner's property on an equal
and uniform basis with property in the general corporate limits of the City, the provisions of
this Agreement will control where in conflict with the provisions of such laws and (ii) the
income method of appraisal as described in Section 23.012 of the Texas Property Tax Code
shall not be limited to only properties for which a rental market exists. Specifically, nothing
contained herein shall limit the income method of appraisal specified in Section 23.012 of the
Texas Property Tax Code to only properties for which a rental market exists, instead if such
method is used, the chief appraiser shall:
1. use income and expense data pertaining to the property, if possible and applicable;
2. make any projections of future income and expenses only from clear and
appropriate evidence;
3. use data from generally accepted sources in determining an appropriate
capitalization rate; and
4. determine a capitalization rate for income - producing property that includes a
reasonable return on investment, taking into account the risk associated with
the investment.
The parties agree that the fair market value of the Property Owner's land,
improvements, and tangible property subject to Subsections B and C of this section shall be
determined in accordance with the market value computation contemplated in the Texas
Property Tax Code for the purpose of calculating the Property Owner's payment under this
Agreement on properties annexed or disannexed subsequent to the commencement of this
Agreement. The City may choose to use the appraised value as finally determined by the
County Appraisal District (or through administrative or judicial appeal of the
County Appraisal District's determination), or by appraisal conducted by an
independent appraiser of the City's selection at the City's expense. The determination of fair
market values by the City shall be final and binding unless the Property Owner within thirty
(30) days after receipt of the City's determination petitions for a Declaratory Judgment to the
Civil District Court of County, Texas, as provided for by Section XIII
hereof. Nothing contained herein shall ever be construed as in derogation of the authority of
the County Appraisal District to establish the appraised value of land,
improvements, and tangible personal property in the annexed portion for ad valorem tax
purposes.
B.
Adiustment of Base Value for Property Inside the Corporate Limits but Subsequently
Disannexed
Land, improvements and tangible property, real or mixed, of the Property Owner, which
is disannexed from the corporate limits of the City during the term of this Agreement, shall
become part of the affected area immediately upon disannexation. The value for such
disannexed land, improvements and tangible property, real or mixed shall be determined as
described in Subsection A of this Section based upon the year in which the property is
disannexed and shall be added to the Base Value specified in Article V each year after the
disannexation for purposes of payment hereunder.
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C.
Adjustment of Base Value for Property Outside the Corporate Limits but Subsequently Annexed
Land, improvements and tangible property, real or mixed, of the Property Owner, which
is annexed into the corporate limits of the City during the term of this Agreement, shall be
removed from the affected area the year after the annexation. The value for such annexed
land, improvements and tangible property, real or mixed shall be determined as described in
Subsection A of this Section based upon the year in which the property is annexed and shall be
subtracted from the Base Value specified in Article V each year after the annexation for
purposes of payment hereunder.
D.
Statements
The City shall mail one statement to the Property Owner on or about December 1 of
each year showing the total amount due on December 31 of such year pursuant to this
Agreement. Such statement shall be mailed to the "Tax Statement Address" noted in this
Agreement. Any amounts due on December 31 that are not paid when due shall become
delinquent on January 1 of the following year. Provided, however, if the tax statement is
mailed after December 10, the delinquency date is postponed to the first day of the next
month that will provide a period of at least 21 days after the date of mailing for payment of
the amount due. Delinquent amounts shall be immediately subject to the same penalties,
interest, attorneys' fees and costs of collection as recoverable by the City in the case of
delinquent ad valorem taxes. The City shall have a lien upon the Property Owner's land within
the affected area upon any delinquency in the Industrial District Payment.
E.
Valuation Contests
If any differences concerning the appraised values shall not have been finally
determined by the due date of the Property Owner's payment hereunder and the Property
Owner is pursuing through a declaratory judgment action as specified in Subsection A, the
Property Owner shall, without prejudice to such action, pay to the City by December 31 of each
year (subject to the exception in the preceding paragraph for statements mailed after December
10), such amount as is provided in the Texas Property Tax Code, as amended throughout the
term of this Agreement, for payments made under such conditions by owners of property within
the general corporate limits of the City subject to ad valorem taxation. Any refund payable
by the City to the Property Owner hereunder shall be paid within 60 days after receipt by the
City of both County Appraisal District's form notification that the appraised
value of the property has been reduced and a written refund request by the Property Owner; if
not paid timely, the refund amount shall bear interest at the rate specified in Section 2251.025
of the Texas Government Code beginning 60 days after the City received both the Property
Owner's written refund request and the County Appraisal District's formal
notification that the appraised value of the property has been reduced.
s
VII.
Compliance with Law
The City and the Property Owner mutually recognize that the health and welfare of
Baytown residents require adherence to high standards of quality in the air emissions, water
effluents and noise, vibration and toxic levels of those industries located in the Industrial
District, and that development within the District may have an impact on the drainage of
surrounding areas. To this end, the Property Owner and the City agree that the same standards
and criteria relative to noise, vibration and toxic levels and drainage and flood control which are
adopted by the City and made applicable to portions of the City adjacent to the Industrial
District shall also be applicable to the affected area. The Property Owner agrees that any
industrial or other activity carried on within the affected area will be constructed in strict
compliance with all applicable valid state and federal air and water pollution control standards.
If the Property Owner's property within the affected area is subject to the Occupational Safety
and Health Act, 29 U.S.C. 65, et seq., as amended, then the Property Owner shall undertake to
ensure that its facilities and improvements in the affected area comply with the applicable fire
safety standards of such act and the resolutions from time to time promulgated hereunder (the
"OSHA Standards "), but there shall be no obligation to obtain any permits of any kind from the
City in connection with the construction, operation or maintenance of improvements and
facilities in the affected area not located within the corporate limits of the City. Nonetheless, the
Property Owner agrees that any structure built within the affected area shall be built in
accordance with the building code adopted by the City in effect at the time of construction.
The City and the Property Owner recognize that activities in the City's industrial
districts are subject to regulation by other governmental entities, including the state and federal
governments and their various departments and agencies. The City and the Property Owner
also recognize that the City may have an interest in activities in the City's industrial districts
that are regulated by other governmental entities. Nothing in this Agreement is intended to limit
the City's right and authority to communicate its interest in, or opposition to, those activities to
the applicable regulatory agencies or to participate, to the extent allowed by law, in any related
administrative or judicial proceeding.
VIII.
Inspections
The Chief Appraiser of the County Appraisal District and the City or its
independent appraiser shall have the same right to enter and inspect the Property Owner's
premises and the same right to examine the Property Owner's books and records to determine
the value of the Property Owner's properties as are provided in the Texas Property Tax Code as
amended.
IX.
Default
A.
Default by Property Owner
In the event of default by the Property Owner in the performance of any of the terms of
this Agreement, including the obligation to make the payments above provided for, the City
shall have the option, if such default is not fully corrected within sixty (60) days from the
giving of written notice of such default to the Property Owner to either (i) declare this
Agreement terminated or (ii) continue the term of this Agreement and collect the payments
required hereunder. Notwithstanding any to the contrary contained herein, should the City
determine the Property Owner is in default according to the terms and conditions of Section
VII hereof, the City shall notify the Property Owner in writing by U.S. Mail, certified return
receipt requested, at the address stated in this Agreement, and if such default is not cured within
sixty (60) days from the date of such notice (the "Cure Period ") then such failure to cure shall
constitute a material breach of this Agreement; provided that, in the case of a default under
Section VII for causes beyond the Property Owner's control that cannot with due diligence be
cured within such sixty (60) day period or in the event that the failure to cure results from
ongoing negotiations with federal or state officials, administrative proceedings or litigation
regarding the necessary cure steps, then the cure period shall be extended until such
negotiations, administrative proceedings or litigation are concluded.
B.
Default by City
In the event of default by the City, the Property Owner may, if such default is not fully
corrected within 60 days from giving written notice of such default to the City, terminate this
Agreement. Upon such termination, both the Property Owner and the City shall be relieved
of all further obligations hereunder, but the Property Owner shall not be relieved of the
obligation to pay any amounts that accrued prior to such termination. In the event of
termination, the City shall have the right to repeal the ordinance designating the affected area
as an industrial district. Provided, however, if the termination occurs as a result of the
City's exercising its option to terminate (as provided in the first sentence of this Section
IX), the City shall not have the right to annex the affected area into the general corporate
limits of the City so as to subject the affected area to ad valorem taxes for any part of the period
covered by the Property Owner's last payment hereunder.
X.
Notice
Any notice to the Property Owner or the City concerning the matters to which
the Agreement relates may be given in writing by registered or certified mail addressed to the
Property Owner or the City at the appropriate respective addresses set forth on the cover page of
this Agreement. Any such notice in writing may be given in any other manner. If given by
registered or certified mail, the notice shall be effective when mailed. With the exception of
annual bills for payments due herein, notice given in any other manner shall be effective when
received by the Property Owner or the City, as the case may be.
XI.
No Further Expansion of Taxing Jurisdiction
Nothing herein contained shall be construed to change or enlarge the jurisdiction, power
or authority of the City over or with respect to the affected area as prescribed by applicable law,
except as specifically provided in this Agreement. The Property Owner shall not be obligated
by virtue of this Agreement, or the establishment of the industrial district covering the affected
area not within the corporate limits of the City, to make any payments to the City in the
nature of a tax or assessment based upon the value of the Property Owner's property in the
affected area during the term of this Agreement other than the payments specified herein.
Specifically, the Property Owner shall not be liable for any City taxes within the affected area,
including, without limitation, City ad valorem taxes on taxable property within the affected area.
XII.
Reimbursement for Services
If the Property Owner requests and receives mutual aid firefighting assistance and
is a member of Channel Industries Mutual Aid organization ( "CIMA ") or similar
organization, the Property Owner shall reimburse the City for costs incurred by the City in
providing fire protection services to the Property Owner as shall be provided in the charter,
bylaws and agreements pursuant to which CIMA or such similar organization is organized and
operates. If the Property Owner requests and receives mutual aid firefighting assistance and is
not a member of CIMA or a similar organization, then the Property Owner shall be required to
reimburse the City for costs actually expended by the City in providing any firefighting
assistance to the Property Owner, including chemical and personnel costs.
XIII.
Declaratory Judgment Action
If any disagreement arises between the parties concerning the interpretation of this
Agreement, it is agreed that either of the said parties may petition any Civil District Court of
Harris County, Texas, for a Declaratory Judgment determining said controversy and the
cause shall be tried as other civil causes. If the controversy affects an Industrial District
Payment, the Property Owner shall, pending final determination of said controversy, pay to the
City on the due date the same amount which was paid to the City for the last preceding
period as to which there was no controversy concerning the amount owed by the Property
Owner to the City. The Property Owner agrees to tender any additional amount of potential
liability to the registry of the Civil District Court, Harris County, Texas, pending final
determination of the controversy beyond any further appeal.
XIV.
Assignment
This Agreement shall not bestow any rights upon any third party, but rather, shall bind
and benefit the Property Owner and the City only. If the Property Owner conveys all or any
part of the property then covered hereby, the Property Owner shall notify the City within 30
days of the conveyance and shall thereafter cease to be obligated with respect to the property so
conveyed and the Base Value shall be apportioned between the Property Owner and the grantee
based upon the property conveyed, only if the grantee thereof enters into an Industrial District
Agreement with the City with respect to such property so conveyed. No right or obligation
under this Agreement may be sold, assigned or transferred.
XV.
Authori
The Property Owner covenants that it has the authority to enter into this Agreement
by virtue of being either the legal or equitable owner of a possessory estate (including a
leasehold estate) in the land comprising the affected area, which will not terminate before the
expiration date of this Agreement. Additionally, the officers executing this Agreement on
behalf of the parties hereby represent that such officers have full authority to execute this
Agreement and to bind the party he represents.
XVI.
No Municipal Services
It is agreed that during the term of this Agreement, the City is under no obligation to
provide any governmental, proprietary or other municipal services to the affected area.
Specifically, but without limitation, it is agreed that the City shall not be required to furnish (1)
sewer or water service, (2) police protection, (3) fire protection (4) road or street repairs, and (5)
garbage pickup service.
XVII.
Severability
If any provision of this Agreement, or any covenant, obligation or agreement contained
herein, including, without limitation, that term hereof, is determined by a court to be invalidated
or unenforceable, such provision, covenant, obligation or agreement shall be reformed so as to
comply with applicable law. If it is not possible to so reform such provision, covenant,
obligation or agreement, such determination shall not affect any other provision, covenant,
obligation or agreement, each of which shall be construed and enforced as if the invalid or
unenforceable portion were not contained herein. Provided, further that such invalidity or
00
unenforceability shall not affect any valid and enforceable provision thereof, and each such
provision, covenant, obligation or agreement shall be deemed to be effective, operative, made,
entered into or taken in the manner and to the full extent permitted by law. Notwithstanding
the above, if the application of this Section XVII requires reformation or revision of any term
that removes or materially diminishes the obligation of the Property Owner to make the
payments to the City described herein (except in the event of a reformation that shortens the
term of this Agreement), the City shall have the option to declare this Agreement terminated.
XVIII.
Complete Agreement
This Agreement contains all the agreements of the parties relating to the subject
matter hereof and is the full and final expression of the agreement between the parties.
XIX.
Non - waiver
Failure of either party hereto 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 waiver 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.
XX.
Ambiguities
In the event of any ambiguity in any of the terms of this Agreement, it shall not be
construed for or against any party hereto on the basis that such party did or did not author the
same.
XXI.
Headings
The headings appearing at the first of each numbered section in this Agreement are
inserted and included solely for convenience and shall never be considered or given any effect
in construing this Agreement or any provision hereof, or in connection with the duties,
obligations or liabilities of the respective parties hereto or in ascertaining intent, if any question
of intent should arise.
H
XXII.
Choice of Law; Venue
This Agreement shall in all respects be interpreted and construed in accordance with and
governed by the laws of the State of Texas and the City, regardless of the place of its execution
or performance. The place of making and the place of performance for all purposes shall be
Baytown, Harris County, Texas.
XXIII.
Agreement Read
The parties acknowledge that they have read, understand and intend to be bound by
the terms and conditions of this Agreement.
IN WITNESS WHEREOF, this Agreement is executed in multiple counterparts on behalf
of the Property Owner this day of _ , 20, and on behalf
of the City this day of _ , 20
Printed Name
Title
STATE OF
COUNTY OF
Before me, , the undersigned notary public,
on this day personally appeared , the
of , the owner of the affected property, known to me to be the
person whose name is subscribed to the foregoing instrument and acknowledged to me that he
executed the same for the purposes, in the capacity, and for the consideration therein expressed.
SUBSCRIBED AND SWORN before me this _ day of , 20—...
Notary Public in and for the State of
CITY OF BAYTOWN
STEPHEN H. DONCARLOS,
Mayor
ATTEST:
LETICIA BRYSCH, City Clerk
APPROVED AS TO FORM:
IGNACIO RAMIREZ, SR., City Attorney
CARL CURRIE, Acting Finance Director
R:\Karen \Files \Contracts \Industrial District Agreements\2016 Fors \Existing Company IDA -- Non - Logistics.docx
12
Exhibit "B"
Industrial District Agreement
This Industrial District Agreement ( "Agreement ") is made and entered into between the
City of Baytown, Texas, a municipal corporation in Harris and Chambers Counties, Texas,
hereinafter also referred to as "Baytown" or "City," and , a
, hereinafter referred to as "Property Owner." In consideration of the
promises and of the mutual covenants and agreements herein contained, it is agreed by and
between the City and Property Owner as follows:
I.
Parties
This Agreement is made under the authority of Texas Local Government Code
Annotated §42.044 (Vernon 1993), article XI, §5 of the Texas Constitution and other
applicable law. The parties to the Agreement and their addresses are:
The "City"
City of Baytown
Attn: City Manager
P.O. Box 424
Baytown, TX 77522
Copy to:
City of Baytown
Attn: City Attorney
P.O. Box 424
Baytown, TX 77522
2. The "Property Owner" Tax Statement Address:
II.
Identification of Property and Industrial
District
This Agreement includes provisions concerning certain real estate and tangible personal
property owned or leased by the Property Owner. Real estate located outside the corporate
limits of the City is sometimes referred to herein as the "affected area," and it is described in
Exhibit A, which is attached to this Agreement and made a part hereof. Acting pursuant
to the above mentioned authority, the City Council of the City has by ordinance, designated the
affected area as an industrial district, the same to be known as Baytown Industrial District
No. _ (the "Industrial District ").
III.
Term
The term of this Agreement is seven tax years, from 20 through 20 , unless it is
sooner terminated under the provisions hereof. This Agreement shall be effective and
binding on the parties hereto upon execution hereof on behalf of the parties to this Agreement
and shall remain in effect for seven years. This Agreement supersedes any prior existing
agreements between the Property Owner and the City relating to the subject matter specific to
the term hereof.
IV.
Limited Immunity from Annexation by the City
In consideration of the obligations of the Property Owner herein set forth, the City
hereby guarantees for the term of this Agreement the immunity of the affected area from
annexation of any type by the City except for such parts of the affected property as may
be necessary to annex property owned by third parties within the Industrial District that the
City may decide to annex. Additionally, this Agreement shall not affect the continuation of
any limited purpose annexation status to which the affected area is now subject.
V.
Industrial District Payment
As part of the consideration for the City's undertakings as set forth above, the Property
Owner agrees to pay to the City on or before December 31 St of each year during the term
hereof a sum of money equal to:
(1) the fair market value as agreed to and stipulated by the parties to be as follows
for each year indicated:
Year
1
YEARLY
PAYMENT
RATE
Base Value
1
20_
.66
1
.66
20
1
20
.66
1
.66
20
1
1
hereinafter referred to as the "Base Value," multiplied by
(2) the property tax rate per $100.00 of assessed valuation adopted by the City
Council for the City, multiplied by the applicable Yearly Payment Rate as
detailed below:
TAX YEAR
YEARLY
PAYMENT
RATE
20
.66
20_
.66
20_
.66
20
.66
20
.66
20_
.66
20
.66
plus
(3) the value of the situs inventory, which is the personal property and inventory
stored or held on or within the affected property which is not owned by the
Property Owner, as assessed each year by the County
Appraisal District, multiplied by
(4) the property tax rate per $100.00 of assessed valuation adopted by the City
Council for the City, multiplied by 0.50, and multiplied by the applicable Yearly
Payment Rate as detailed below:
TAX YEAR
YEARLY
PAYMENT
RATE
20
.66
20_
.66
20
.66
3
TAX YEAR
YEARLY
PAYMENT
RATE
20
.66
20
.66
20_
.66
20
.66
On or before February 1" of each contract year during the term of this Agreement, the
Property Owner shall file a written information report with the City's Director of Finance stating
the name and address of each person to whom the Property Owner leased or otherwise provided
storage space on January 1 of each contract year.
VI.
Valuations and Collections
A.
Generallv
The parties hereto recognize that said County Appraisal District is not
required to appraise for the City the land, improvements, and tangible property, real or mixed, in
the affected area, which is not within the corporate limits of the City, for the purpose of
computing the payments hereunder. For the purpose of providing a procedure for determining
and collecting the amounts payable by the Property Owner hereunder, there are hereby adopted
and made a part hereof all provisions of the Constitution and statutes of the State of Texas
pertaining to ad valorem taxation as amended throughout the term of this Agreement (including,
in particular, the Texas Property Tax Code), except, however, that (i) to the extent that any of
such provisions would require the assessment of the Property Owner's property on an equal
and uniform basis with property in the general corporate limits of the City, the provisions of
this Agreement will control where in conflict with the provisions of such laws and (ii) the
income method of appraisal as described in Section 23.012 of the Texas Property Tax Code
shall not be limited to only properties for which a rental market exists. Specifically, nothing
contained herein shall limit the income method of appraisal specified in Section 23.012 of the
Texas Property Tax Code to only properties for which a rental market exists, instead if such
method is used, the chief appraiser shall:
1. use income and expense data pertaining to the property, if possible and applicable;
2. make any projections of future income and expenses only from clear and
appropriate evidence;
3. use data from generally accepted sources in determining an appropriate
capitalization rate; and
4. determine a capitalization rate for income - producing property that includes a
reasonable return on investment, taking into account the risk associated with
the investment.
The parties agree that the fair market value of the Property Owner's land,
improvements, and tangible property subject to Subsections B and C of this section shall be
determined in accordance with the market value computation contemplated in the Texas
Property Tax Code for the purpose of calculating the Property Owner's payment under this
Agreement on properties annexed or disannexed subsequent to the commencement of this
Agreement. The City may choose to use the appraised value as finally determined by the
County Appraisal District (or through administrative or judicial appeal of the
County Appraisal District's determination), or by appraisal conducted by an
independent appraiser of the City's selection at the City's expense. The determination of fair
market values by the City shall be final and binding unless the Property Owner within thirty
(30) days after receipt of the City's determination petitions for a Declaratory Judgment to the
Civil District Court of County, Texas, as provided for by Section XIII
hereof. Nothing contained herein shall ever be construed as in derogation of the authority of
the County Appraisal District to establish the appraised value of land,
improvements, and tangible personal property in the annexed portion for ad valorem tax
purposes.
B.
Adiustment of Base Value for Property Inside the Corporate Limits but Subsequently
Disannexed
Land, improvements and tangible property, real or mixed, of the Property Owner, which
is disannexed from the corporate limits of the City during the term of this Agreement, shall
become part of the affected area immediately upon disannexation. The value for such
disannexed land, improvements and tangible property, real or mixed shall be determined as
described in Subsection A of this Section based upon the year in which the property is
disannexed and shall be added to the Base Value specified in Article V each year after the
disannexation for purposes of payment hereunder.
C.
Ad'ustment of Base Value for Property Outside the Corporate Limits but Subsequently Annexed
Land, improvements and tangible property, real or mixed, of the Property Owner, which
is annexed into the corporate limits of the City during the term of this Agreement, shall be
removed from the affected area the year after the annexation. The value for such annexed
land, improvements and tangible property, real or mixed shall be determined as described in
Subsection A of this Section based upon the year in which the property is annexed and shall be
subtracted from the Base Value specified in Article V each year after the annexation for
purposes of payment hereunder.
D.
Statements
The City shall mail one statement to the Property Owner on or about December 1 of
each year showing the total amount due on December 31 of such year pursuant to this
Agreement. Such statement shall be mailed to the "Tax Statement Address" noted in this
W
Agreement. Any amounts due on December 31 that are not paid when due shall become
delinquent on January 1 of the following year. Provided, however, if the tax statement is
mailed after December 10, the delinquency date is postponed to the first day of the next
month that will provide a period of at least 21 days after the date of mailing for payment of
the amount due. Delinquent amounts shall be immediately subject to the same penalties,
interest, attorneys' fees and costs of collection as recoverable by the City in the case of
delinquent ad valorem taxes. The City shall have a lien upon the Property Owner's land within
the affected area upon any delinquency in the Industrial District Payment.
E.
Valuation Contests
If any differences concerning the appraised values shall not have been finally
determined by the due date of the Property Owner's payment hereunder and the Property
Owner is pursuing through a declaratory judgment action as specified in Subsection A, the
Property Owner shall, without prejudice to such action, pay to the City by December 31 of each
year (subject to the exception in the preceding paragraph for statements mailed after December
10), such amount as is provided in the Texas Property Tax Code, as amended throughout the
term of this Agreement, for payments made under such conditions by owners of property within
the general corporate limits of the City subject to ad valorem taxation. Any refund payable
by the City to the Property Owner hereunder shall be paid within 60 days after receipt by the
City of both County Appraisal District's form notification that the appraised
value of the property has been reduced and a written refund request by the Property Owner; if
not paid timely, the refund amount shall bear interest at the rate specified in Section 2251.025
of the Texas Government Code beginning 60 days after the City received both the Property
Owner's written refund request and the County Appraisal District's formal
notification that the appraised value of the property has been reduced.
VII.
Compliance with Law
The City and the Property Owner mutually recognize that the health and welfare of
Baytown residents require adherence to high standards of quality in the air emissions, water
effluents and noise, vibration and toxic levels of those industries located in the Industrial
District, and that development within the District may have an impact on the drainage of
surrounding areas. To this end, the Property Owner and the City agree that the same standards
and criteria relative to noise, vibration and toxic levels and drainage and flood control which are
adopted by the City and made applicable to portions of the City adjacent to the Industrial
District shall also be applicable to the affected area. The Property Owner agrees that any
industrial or other activity carried on within the affected area will be constructed in strict
compliance with all applicable valid state and federal air and water pollution control standards.
If the Property Owner's property within the affected area is subject to the Occupational Safety
and Health Act, 29 U.S.C. 65, et seq., as amended, then the Property Owner shall undertake to
ensure that its facilities and improvements in the affected area comply with the applicable fire
J
safety standards of such act and the resolutions from time to time promulgated hereunder (the
"OSHA Standards "), but there shall be no obligation to obtain any permits of any kind from the
City in connection with the construction, operation or maintenance of improvements and
facilities in the affected area not located within the corporate limits of the City. Nonetheless, the
Property Owner agrees that any structure built within the affected area shall be built in
accordance with the building code adopted by the City in effect at the time of construction.
The City and the Property Owner recognize that activities in the City's industrial
districts are subject to regulation by other governmental entities, including the state and federal
governments and their various departments and agencies. The City and the Property Owner
also recognize that the City may have an interest in activities in the City's industrial districts
that are regulated by other governmental entities. Nothing in this Agreement is intended to limit
the City's right and authority to communicate its interest in, or opposition to, those activities to
the applicable regulatory agencies or to participate, to the extent allowed by law, in any related
administrative or judicial proceeding.
VIII.
Inspections
The Chief Appraiser of the County Appraisal District and the City or its
independent appraiser shall have the same right to enter and inspect the Property Owner's
premises and the same right to examine the Property Owner's books and records to determine
the value of the Property Owner's properties as are provided in the Texas Property Tax Code as
amended.
IX.
Default
A.
Default by Property Owner
In the event of default by the Property Owner in the performance of any of the terms of
this Agreement, including the obligation to make the payments above provided for, the City
shall have the option, if such default is not fully corrected within sixty (60) days from the
giving of written notice of such default to the Property Owner to either (i) declare this
Agreement terminated or (ii) continue the term of this Agreement and collect the payments
required hereunder. Notwithstanding any to the contrary contained herein, should the City
determine the Property Owner is in default according to the terms and conditions of Section
VII hereof, the City shall notify the Property Owner in writing by U.S. Mail, certified return
receipt requested, at the address stated in this Agreement, and if such default is not cured within
sixty (60) days from the date of such notice (the "Cure Period ") then such failure to cure shall
constitute a material breach of this Agreement; provided that, in the case of a default under
Section VII for causes beyond the Property Owner's control that cannot with due diligence be
cured within such sixty (60) day period or in the event that the failure to cure results from
ongoing negotiations with federal or state officials, administrative proceedings or litigation
regarding the necessary cure steps, then the cure period shall be extended until such
negotiations, administrative proceedings or litigation are concluded.
B.
Default by City
In the event of default by the City, the Property Owner may, if such default is not fully
corrected within 60 days from giving written notice of such default to the City, terminate this
Agreement. Upon such termination, both the Property Owner and the City shall be relieved
of all further obligations hereunder, but the Property Owner shall not be relieved of the
obligation to pay any amounts that accrued prior to such termination. In the event of
termination, the City shall have the right to repeal the ordinance designating the affected area
as an industrial district. Provided, however, if the termination occurs as a result of the
City's exercising its option to terminate (as provided in the first sentence of this Section
IX), the City shall not have the right to annex the affected area into the general corporate
limits of the City so as to subject the affected area to ad valorem taxes for any part of the period
covered by the Property Owner's last payment hereunder.
X.
Notice
Any notice to the Property Owner or the City concerning the matters to which
the Agreement relates may be given in writing by registered or certified mail addressed to the
Property Owner or the City at the appropriate respective addresses set forth on the cover page of
this Agreement. Any such notice in writing may be given in any other manner. If given by
registered or certified mail, the notice shall be effective when mailed. With the exception of
annual bills for payments due herein, notice given in any other manner shall be effective when
received by the Property Owner or the City, as the case may be.
XI.
No Further Expansion of Taxing Jurisdiction
Nothing herein contained shall be construed to change or enlarge the jurisdiction, power
or authority of the City over or with respect to the affected area as prescribed by applicable law,
except as specifically provided in this Agreement. The Property Owner shall not be obligated
by virtue of this Agreement, or the establishment of the industrial district covering the affected
area not within the corporate limits of the City, to make any payments to the City in the
nature of a tax or assessment based upon the value of the Property Owner's property in the
affected area during the term of this Agreement other than the payments specified herein.
Specifically, the Property Owner shall not be liable for any City taxes within the affected area,
including, without limitation, City ad valorem taxes on taxable property within the affected area.
8
XII.
Reimbursement for Services
If the Property Owner requests and receives mutual aid firefighting assistance and
is a member of Channel Industries Mutual Aid organization ( "CIMA ") or similar
organization, the Property Owner shall reimburse the City for costs incurred by the City in
providing fire protection services to the Property Owner as shall be provided in the charter,
bylaws and agreements pursuant to which CIMA or such similar organization is organized and
operates. If the Property Owner requests and receives mutual aid firefighting assistance and is
not a member of CIMA or a similar organization, then the Property Owner shall be required to
reimburse the City for costs actually expended by the City in providing any firefighting
assistance to the Property Owner, including chemical and personnel costs.
XIII.
Declaratory Judgment Action
If any disagreement arises between the parties concerning the interpretation of this
Agreement, it is agreed that either of the said parties may petition any Civil District Court of
Harris County, Texas, for a Declaratory Judgment determining said controversy and the
cause shall be tried as other civil causes. If the controversy affects an Industrial District
Payment, the Property Owner shall, pending final determination of said controversy, pay to the
City on the due date the same amount which was paid to the City for the last preceding
period as to which there was no controversy concerning the amount owed by the Property
Owner to the City. The Property Owner agrees to tender any additional amount of potential
liability to the registry of the Civil District Court, Harris County, Texas, pending final
determination of the controversy beyond any further appeal.
XIV.
Assianment
This Agreement shall not bestow any rights upon any third party, but rather, shall bind
and benefit the Property Owner and the City only. If the Property Owner conveys all or any
part of the property then covered hereby, the Property Owner shall notify the City within 30
days of the conveyance and shall thereafter cease to be obligated with respect to the property so
conveyed and the Base Value shall be apportioned between the Property Owner and the grantee
based upon the property conveyed, only if the grantee thereof enters into an Industrial District
Agreement with the City with respect to such property so conveyed. No right or obligation
under this Agreement may be sold, assigned or transferred.
0
XV.
Authori
The Property Owner covenants that it has the authority to enter into this Agreement
by virtue of being either the legal or equitable owner of a possessory estate (including a
leasehold estate) in the land comprising the affected area, which will not terminate before the
expiration date of this Agreement. Additionally, the officers executing this Agreement on
behalf of the parties hereby represent that such officers have full authority to execute this
Agreement and to bind the party he represents.
XVI.
No Municipal Services
It is agreed that during the term of this Agreement, the City is under no obligation to
provide any governmental, proprietary or other municipal services to the affected area.
Specifically, but without limitation, it is agreed that the City shall not be required to furnish (1)
sewer or water service, (2) police protection, (3) fire protection (4) road or street repairs, and (5)
garbage pickup service.
XVII.
Severability
If any provision of this Agreement, or any covenant, obligation or agreement contained
herein, including, without limitation, that term hereof, is determined by a court to be invalidated
or unenforceable, such provision, covenant, obligation or agreement shall be reformed so as to
comply with applicable law. If it is not possible to so reform such provision, covenant,
obligation or agreement, such determination shall not affect any other provision, covenant,
obligation or agreement, each of which shall be construed and enforced as if the invalid or
unenforceable portion were not contained herein. Provided, further that such invalidity or
unenforceability shall not affect any valid and enforceable provision thereof, and each such
provision, covenant, obligation or agreement shall be deemed to be effective, operative, made,
entered into or taken in the manner and to the full extent permitted by law. Notwithstanding
the above, if the application of this Section XVII requires reformation or revision of any term
that removes or materially diminishes the obligation of the Property Owner to make the
payments to the City described herein (except in the event of a reformation that shortens the
term of this Agreement), the City shall have the option to declare this Agreement terminated.
XVIII.
Complete Agreement
This Agreement contains all the agreements of the parties relating to the subject
matter hereof and is the full and final expression of the agreement between the parties.
m
XIX.
Non - waiver
Failure of either party hereto 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 waiver 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.
XX.
Ambiguities
In the event of any ambiguity in any of the terms of this Agreement, it shall not be
construed for or against any party hereto on the basis that such party did or did not author the
same.
XXI.
Headings
The headings appearing at the first of each numbered section in this Agreement are
inserted and included solely for convenience and shall never be considered or given any effect
in construing this Agreement or any provision hereof, or in connection with the duties,
obligations or liabilities of the respective parties hereto or in ascertaining intent, if any question
of intent should arise.
XXII.
Choice of Law; Venue
This Agreement shall in all respects be interpreted and construed in accordance with and
governed by the laws of the State of Texas and the City, regardless of the place of its execution
or performance. The place of making and the place of performance for all purposes shall be
Baytown, Harris County, Texas.
XXIII.
Agreement Read
The parties acknowledge that they have read, understand and intend to be bound by
the terms and conditions of this Agreement.
IN WITNESS WHEREOF, this Agreement is executed in multiple counterparts on behalf
of the Property Owner this day of , 20 , and on behalf
of the City this day of
20�
Printed Name
Title
STATE OF
COUNTY OF
Before me, , the undersigned notary public,
on this day personally appeared , the
of , the owner of the affected property, known to me to be the
person whose name is subscribed to the foregoing instrument and acknowledged to me that he
executed the same for the purposes, in the capacity, and for the consideration therein expressed.
SUBSCRIBED AND SWORN before me this _ day of , 20_.
ATTEST:
LETICIA BRYSCH, City Clerk
12
Notary Public in and for the State of
CITY OF BAYTOWN
STEPHEN H. DONCARLOS,
Mayor
APPROVED AS TO FORM:
IGNACIO RAMIREZ, SR., City Attorney
CARL CURRIE, Acting Finance Director
R:'. Karen% Files'.Contracts' %Industrial District Agreements\2016 Forms Existing Company IDA -- Logistics.docx
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