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CC Resolution No. 1776 21 RESOLUTION NO. 1776 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS,AUTHORIZING THE MAYOR TO SEND TEXAS PETROCHEMICALS, LP, A LETTER OF THE CITY COUNCIL'S INTENT TO ESTABLISH A REINVESTMENT ZONE AND TO CONSIDER GRANTING TAX ABATEMENT AGREEMENTS THEREIN SHOULD ALL OF THE REQUIREMENTS OF BOTH THE PROPERTY REDEVELOPMENT AND TAX ABATEMENT ACT AND THE GUIDELINES AND POLICIES ADOPTED BY COUNCIL BE SATISFIED;AND PROVIDING FOR THE EFFECTIVE DATE THEREOF. WHEREAS,Texas Petrochemicals,LP("Texas Petrochemicals")has submitted Applications for Tax Abatement in Baytown, Texas, which are attached hereto as Exhibit "A" and are incorporated herein for all intents and purposes; and WHEREAS, the applications submitted by Texas Petrochemicals appear to meet the requisite guidelines and criteria of the City and the Property Redevelopment and Tax Abatement Act (the "Act"); and WHEREAS, based upon such application, the City of Baytown will initiate the process to designate the area described in Exhibit "A" as the Texas Petrochemicals Reinvestment Zone; and WHEREAS, should the City Council consider that the improvements proposed by Texas Petrochemicals are feasible and practical and will be a benefit to the land to be included in the zone and to the City of Baytown after the expiration of any tax abatement agreement hereinafter granted, the City Council may establish a reinvestment zone after a public hearing on the same; and WHEREAS, should the Texas Petrochemicals Reinvestment Zone be established, the City Council may execute a tax abatement agreement with Texas Petrochemicals; and WHEREAS, the City Council finds that it is in the best interest of the City at this time to continue the process (i)to establish the Texas Petrochemicals Reinvestment Zone and (ii) to enter into tax abatement agreements should all of the guidelines and criteria of the City and the Act be satisfied; NOW THEREFORE BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN,TEXAS: Section 1: That the findings of the City Council and its actions approving this resolution taken at this council meeting are hereby approved and adopted. Section 2: That the Mayor is hereby authorized to send Texas Petrochemicals a letter expressing the City Council's intent(i)to establish a reinvestment zone within the area described in Exhibit "A" and (ii) to consider granting tax abatement agreements therein should all of the requirements of both the Act and the guidelines and policies adopted by the City Council be satisfied. Such letter is attached hereto as Exhibit`B," and incorporated herein for all intents and purposes. 22 Section 3: 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 the City Council of the City of Baytown this the 23`d day of February, 2006. CALVIN MUNDINGER, May ATTEST: � r LORRI C D , ty Clerk APPROVED AS TO FORM: ACIO RAMIREZ, SR., 1iy Attorney R:AKarenAFilesVCity CouncilAResolutions\2006AFebruary 23\TaxAbatementApplicationTexasPetrochemicals.doe 2 APPLICATION FOR TAX ABATLNIENT IN BAYTOWN TEXAS The filing of this document acknowledges familiarity and conformance with Guidelines and Criteria for Tax Abatement. This application will become part of the agreement and any knowingly false representations will be grounds to void the agreeme_nt.Original copy of this request should be submitted to City Dianager, r.L. Box 2 , Baytown, `fexas 7752?-0424, if property is located inside the corporate limits of Baytown. APPLICANT INFORMATION DATE: 1-15-06 Texas Petrochemicals LP Company Name: Address: _4604 W Baker Rd Baytown, TX 77520 _ Mailing:Three Riverway Suite 1500 Houston TX 77056 Corporation lx Partnership O Proprietorship ( ) • PROJECT INFORMATION Tie or Facility See instructions. x Manufacturing Facility t 1 Wholesale Distribution Facility { ) Research Facility ( ) Service Facility ( ) Entertainment & Recreation Facility ( ) Other Basic Industry Proposed Project Location Address and Legal Description: School District Goose Creek College District Lee Jr College Citv or Town _Baytown -- Attach map showing proposed site. Describe Product or Service to be provided. EXH�IT A Y , Y Proiect Description: Attach statement fully explaining project, describe existing site and improvements and provide list of improvements and fixed machinery and equipment for which abatement is requested. ( ) New Plant ( ) Expansion (x Modernization O Other ECONOATIC INFORMATION Construction Estimates: YM Start Month!Year 1 06 Construction Man Years 150 ae 1 07 ,_.-ticuor ?ob; 250 If Modernization: Estimated Economic Life of Existing Plant 15 Years Added Economic Life From Modernization -15 Years Permanent Employment Estimates (PTE's): Current Employment -0 Number of Jobs ( ) Retained or iX Created . at start/opening .15 in year 2007 5 years into operation 25 in year 2012 Estimated Appraised Value on Site: Personal Improvements Land Property Value January 1, preceding 45,000 1,168,000 437,037 abatement agreement - - Estimated Value of Abated Properties after abateinen:expires_ 45,000 15,000,000 437,037 Value upon completion of proiect personai property and proiect. improvements not subiect to 1,000,000 20,000,000 437,037 abatement VARIANCE Is the applicant seeking a varancc under Section 4 (f) of the Guidelines? O Yes (x No If "Yes" attach required suppleuteutary information. OTHER ABATEMENTS Has company made application or abatement of this project by another taxing jurisdiction or nearby counties? Yes (,) No. if"Yes" provide dates of application, hearing dates if held U SCt1eGUlEG -.5£. Ol IU ..,i.:CCG.iS ci'iG Con=[S, sl:d - Cil COMPANY REPRESENTATIVE TO BE CONTACTED: ft Name: David Vaughn c;m, iur= of CmmM2ov Official Title: , VP Industrial Authorized Agent Name & Title of Company Official Address: _P0 Box 402 Sugar Land, TX 77487 281-341-6676 Telephone: _ • Texas Petrochemicals Narrative I. Introduction of the Company: a. Texas Petrochemicals LP (TPC) specializes in C4 hydrocarbons. TPC utilizes the stream of C4 olefins generated by ethylene producers as the principal feedstock for butadiene as well as several specialty and fuel products. Among the diverse product lines available are Butadiene, Butene-1, Isobutylene and Isobutylene derivatives. TPC maintains its leadership in the industry with an innovative ability to bring high-quality products to the marketplace. b. Names of chief officers: Charles Shaver,CEO Christopher Artzer,General Counsel ;t II. Reasons for seeking abatement: TPC has a production unit in Baytown that has been idled for several years. The economic benefit of a tax abatement agreement will help support the feasibility of refurbishing the idled production unit versus other alternative sites under consideration. The competitive nature of the chemical industry and availability of alternate project locations (see list below) drive the need for economic incentives to draw the project successfully to Baytown. In addition to the option of the project being done itt alternate locations, our customers have the alternative to continue to purchase these products from their current suppliers outside of Texas. Although other sites are under consideration, TPC prefers the Baytown location, if the economics justify the investment choice, because of 1) its location to our corporate office and other major plant 2) potential of integrating manufacturing with the existing terminal operations 3) successful business relationships in the Houston Port area 4) availability of raw materials and industrial infrastructure. III. Project Description: Texas Petrochemicals (TPC) owns a facility in Baytown Texas. This unit was built in 1983 to produce gasoline blendstocks but only operated for several months before the manufacturing facility was idled. In the past, TPC has utilized the storage and distribution infrastructure as a terminal for other local manufacturing companies. TPC is investigating the feasibility of refurbishing the production unit to manufacture specialty chemical products. This project would entail significant capital investment to convert the plant to produce the desired products instead of the originally intended gasoline blendstocks and to modernize, replace and refurbish much of the equipment. The specialty chemical products that are produced from this plant will be sold to customers that currently are manufactured by other companies outside of Texas. Additionally, TPC plans to invest in upgrades to the storage and logistics infrastructure of the facility in order to retain and grow its terminal services business on a sustainable basis. Proposed Site: TPC owns several tracts in the Baytown area. The Harris CAD account numbers for Baytown are: 0451440010070, 0451440010179, 0591510110095, 0591510110240, and 0591510110121. Please see attached site survey and legal description(s). to 1 of 2 Texas Petrochemicals Narrative Proposed equipment to be included in the project (estimated life 15 years): • Distillation columns and associated equipment • Additional heating capacity and associated burner management controls, low NOx burners, etc. • Additional cooling equipment • Upgrades to electrical infrastructure • New control room and office building • Instrumentation and computerized control systems • Pumps and other mechanical equipment • Storage tanks and product handling equipment • Improvements to fire protection system and emissions control equipment • Laboratory and analytical equipment Project timeline: Estimated construction start date March 2006 and end date May 2007. IV. Jobs a. Positions created for Site: Operators, Supervisor, Managers Maintenance, Technical Support, Engineers, Laboratory, Accounting/Finance, Health Safety and Environmental, Human Resources b. Estimated pay scale $50,000 to $110,000 C. Construction jobs created: 140-250 V. Competition with local business: The specialty chemical products are currently produced by competitors located outside of Texas. This will be a new product produced in Texas. VI. How will this project attract new business: New local suppliers and services will be needed for this site. Bring in a new product that is not being produced in Texas. J 2of2 3®, HARRIS COUNTY, TEXAS COMMUNITY &ECONOMIC DEVELOPMENT DEPARTMENT rams 9410 Lectern Point Drive Houston,Texas 77054 0 David B.Turkel Tel (713)578-2110000 Dmeaw Fax M3)57&2190 December 13,2005 Mr.Adam Merry Business Development Manager ' Texas Petrochemicals,LP Three Riverway Suite 1500 Houston,Texas 77056 RE: Tax Abatement Application Dear Mr.Merry, Thank you for your application for property tax abatement for the manufacturing facility to be constructed in Precinct 2 at 4604 West Baker Road in Baytown, 'Texas- A preliminmy review of vow current application indicates that your project meets the guidelines and criteria adopted by Harris Counry with the corrections we discussed. We have completed an initial evaluation and wn71 now cotnmencewith a due diligence coup component that reqion ui irestherol .. «, review of information secured from the Hams County AppraisalDistrict, ty Department,The Occupational Safety and Health Association and The Environmental Protection Agency. When this phase is complete,the package will be submitted for consideration,to the Commissioner in whose precinct the proposed facility will be located. As we discussed in our meeting on the 6th of December,state law will require the City of Baytown,to create a reinvestment zone for tax abatement which may allow you to receive acatio tax n. abbatap�from Harris Css for �5 Choould the project remain the same as presented in your corrected apt usually takes 45 to 60 days to complete once the City of Baytown creates the zone and approves a tax abatement Texas Petrochemicals must have approval from the City of Baytown to receive a tax abatement from Harris County. Should the Commissioner concur with our evaluation, we would provide drafting instructions to the County Attorney for preparation of your tax abatement agreement. We look forward to working with you on this project and appreciate your interest in Harris County.if you have any questions,please contact me at 713-579-2253. Sin rel 3 ne rvey t Manager 4le� cc: Olga Rodriguez,Office of Commissioner Oarcia,Precinct 2 David M.Vaughn,Atech B.J.Simon,Sr.,Baytown West Chambers County EDF I MMFI --------------------- Engineering _ moI proeess 1 .1 11 1 .. 1.. .I. ♦(brv.e b`ti:4.iv✓'+1.rh6'�'nin'-f... is -ICI . � _ . ..`. ♦_..., .u.. CivNY.Ucturai �.T � . . . I- II-- 1. ♦ dJ 1`Tf . -:�^I .. . iT i�i ��I ��-,: .� ♦ - - x. f ;„yam♦ 1� C.ontrolS temS ..__, . - w •*:: LIn.r-11Ieai:.. .:s_.....W6_..m ftchasl ����� ♦N. n.r:::u"✓.k.`.3�>Jrw.^N�LWYT .0.!l'°._,L;Ln A._fP.1M1. . - -•]ICI T — . F�", 1 1 1 .. �- ♦we st-� project„Management i�Tom•.: C� • ActllMy Ae1MY Orig Rem .Barry early ID Description Dur Dur Matt Flnlah I 1 Construction tT I IIII I SPCI® DaroMm ww YdM`AS pal Ifi n 97 lkdagasdPt*g 1fi1PDg _ nderglbund Piping SPCiEb (hMWCkwft 1ZA)m li CRtemIca Geantri I �' Sf %bB/Fard*Te 1� $labs I oundgtlona ,I I ✓i InsblEkxBFel t8A4�VB' 3iYND1 � � Insta Eledlcal � I I � RapeFE�gV� -' I Redalr Existing. aalsl . 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Topographic Surrey et the Texas Olefin Corporation 11p 1H02e Tellenhall 8nichem Siorav Facility Ott"t,a Houston, Texas 770M Baylom, Texas - GPAFM (713) 802-6702 METES AND BOUNDS: Being a tract containing 17.6329 acres(768,088 square feet) of land, more or less, out of a 19.1192 acre tract described as parcel 1, which is out of a 31.394 acre tract filed in the Official Public Records of Real Property of Harris County, TX, under Clerk File No. E440858, and Film Code No. 121-02-1001, out of the Harvey Whiting Survey, Abstract 840, in Baytown, Harris County, TX, and being described more particularly by metes and bounds as follows: BEGINNING at a '/2 inch iron rod set marking the southeast comer of said 31,394 acre tract at the intersection of the west right-of-way line of the Houston Northshore Railroad with the north right-of-way of Baker Road (80 feet wide); THENCE S 86 degrees 53 minutes 29 seconds W a distance of 862.80 feet along the north right-of-way of Baker Road to a '/2 inch iron rod set for comer; THENCE N 2 degrees 54 minutes 48 seconds W a distance of 541.15 feet with the east line of a 24.921 acre tract recorded under Harris County Clerk File No. N070826 aAd Film Code No. 030-06-1231 to a'/2 inch iron rod found for comer, THENCE N 87 degrees 06 minutes 02 seconds E a distance of 176.24 feet along the south line of the said 24.921 acre tract to a '/2 inch iron rod set for comer; • THENCE N 2 degrees 53 minutes 58 seconds W a distance of 493,42 feet along on east line of the said 24.921 acre tract to a'/2 inch iron rod set for corner; THENCE N 87 degrees 06 minutes 02 seconds E a distance of 518.43 feet to a'/2 inch iron rod set on the west line of a 1.5165 acre tract recorded under Harris County Clerk File No. N305419 and Film Code No. 045-04-2116; THENCE S 2 degrees 33 minutes 08 seconds E a distance of 314.43 feet along the west line of the said 1.5165 acre tract to a '/2 inch iron rod found for corner; THENCE N 87 degrees 32-minutes 26-seconds-E- distance-of499.63—feat along the south line of the said 1.5165 acre tract to a '/2 inch iron rod found for corner; THENCE S 2 degrees 33 minutes 08 seconds E a distance of 412.31 feet along the west right-of-way line of the Houston Northshore Railroad to a '/2 inch iron rod set for corner; THENCE along the west right-of-way line of the Houston Northshore Railroad along a curve to the right having a central angle of 9 degrees 28 minutes 17 seconds, a radius of 1843.26 feet, an are length of 304.70 feet, a chord bearing of S 2 degrees 11 minutes 03 seconds W , and a chord distance of 304.36 feet to the POINT OF BEGINNING of the herein described tract containing 17.6329 acres (768,088 square feet) of land, more or less. umm JED 1O IM m::FYxl,ul N o19 N}rw�0 baViN lenll.l Op '. ar`.ilvilin.ww:I,P n nw�u x w ee c.•n.nw. -�'FP - n w Immix r41n1':a s.a r&ee.x.�P[io��Maye�r.�wx:� _ /� may,„xnbwwi e,'ro er,.abe M.ralawn p Mx M '>o A R rAMNi FI r I}z MaM1 em rM M merYq IM w Mq b el IM'Ib e'RieM wlx M m ripl.a.xl rl Mn PM IMxlee niWn TWOpr re Sq(y[H[AW IIRX(!3 Is Inver 51 niwln A weMt Y e 6elpee q 96}yl Iv.ML b...P 1*1 .m el eYp aM I..vz Fa 11 yI� M 11. 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M4.brY Aelxaxe trA smrp xc»b 1 Sandoval Engine ere R Surveyors, Inc. Boundary Survey of 17.6329 Acres at the Texas olefins Corporation 1882 Taftenhall' Aw. Enichem Storage Facility tDR.eF®IC t7CA8.1G E' IlOVp Houton, Texas 77008 Boylown, Texas - (713) 862-6702 City of Baytown BAYTOWN February 24, 2006 Mr. David Vaughn Vice President Texas Petrochemicals LP P.O. Box 402 Sugar Land, TX 77487 Re: Resolution No. 1776 Dear Mr. Vaughn: Enclosed please find a certified copy of Resolution No. 1776 whereby I, as Mayor of the City of Baytown, am hereby authorized to express and hereby do express the City Council's intent (i) to establish a reinvestment zone within the area described in such resolution and (ii) to consider granting tax abatement agreements therein should all of the requirements of both the Property Redevelopment and Tax Abatement Act and the guidelines and policies adopted by the City Council be satisfied. Please be advised that a public hearing at which interested persons are entitled to speak and present evidence for or against the designation of the Texas Petrochemical Reinvestment Zone must be held prior to the establishment of the zone. Notice of such hearing must not only be published in a newspaper having general circulation but also must be delivered to the presiding officer of each taxing unit that includes in its boundaries real property within the proposed reinvestment zone. Please contact Lorri Coody, City Clerk, at 281-420-6588 regarding scheduling the public hearing and payment of the required notices. Should you need any more information conceming this matter you may contact Gary Jackson, City Manager, at the below-referenced address and phone number. Thank you for your attention in this matter. Sincerely, Calvin Mundinger Mayor OW B Enclosure R:\Karen\Files\City Manager\Letters\2006\TexasPetrochenucalsLetter.doc 2401Karket Street P.O. Box 424 Baytown,Texas 77522-0424 (281)422-8281 Fax (281)420-6586 baytown@baytown.org