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CC Resolution No. 514 739 RESOLUTION NO. 514 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF BAYTOWN, TEXAS , REPEALING RESOLUTION NO. 460 , DULY ADOPTED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN ON JANUARY 10 , 1974 , AND DECLARING SAID RESOLUTION TO HAVE NO FORCE AND EFFECT, FINDING, DECLARING AND ESTABLISHING THAT MANU- FACTURING INDUSTRIES NEAR THE CORPORATE LIMITS OF THE CITY OF BAYTOWN RARELY USE BAYTOWN' S MUNICIPAL SERVICES TO THE SAME EXTENT AS DO PRIVATE CITIZENS AND, CONSEQUENTLY, SUCH MANU- FACTURING INDUSTRIES AS A WHOLE SHOULD COMPENSATE THE CITY OF BAYTOWN PROPORTIONATELY TO THEIR USE AND ENJOYMENT OF SUCH MUNICIPAL SERVICES. 9rw 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 wherever possible for the general advancement of the affected population; and WHEREAS, it is generally recognized that manufacturing industries make limited use of municipal services of the City of Baytown; and WHEREAS, the City Council of the City of Baytown is of the opinion that manufacturing industries should compensate the City of Baytown proportionately, recognizing their limited use of municipal services , but realizing that industries derive benefits , both direct and indirect, from municipal services; NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BAYTOWN: Section 1: That the City Council of the City of Baytown hereby finds , declares, and establishes that such r manufacturing industries should pay a fair share of tax revenues of the City of Baytown. 740 Section 2 : That the City Council further finds, declares , and establishes that such manufacturing industries should not be annexed in excess of twenty (20%) per cent of fair market value of such property. Section 3 : That the City Council, having previously created industrial districts , desires to continue with contractual arrangements with industries situated in the industrial districts in the City' s extraterritorial jur- isdiction, as provided for in Article 970a of Vernon' s Civil Statutes. The City Council further desires that all manu- facturing industries be treated equally and that contractual provisions with all such industries should be uniform and consistent so as to generate equitable industrial revenues between industries, set uniform boundary lines , and uniformly apply environmental protection regulations. Section 4 : It is hereby provided that compensation shall be determined uniformly for each manufacturing industry as follows : TOTAL PAYMENT TO CITY = TAX PAYMENT + INDUSTRIAL DISTRICT PAYMENT Tax Payment = Tax Rate x Assessment Ratio x (20%) of fair market value of entire industrial ( facility. ✓ Industrial District Payment = Tax Rate x (80%) of fair market value of total industrial facility x (6%) . The above result may be accomplished by industries con- tractually agreeing to render (20%) of the fair market value of their entire industrial facility as the value of the property, both real and personal, situated within the corporate limits of the City of Baytown. Section 5: That the City Council desires to encourage the establishment and expansion of responsible industry near the City of Baytown in order to encourage orderly economic growth and thus enhance the general advancement of the affected population. -2- 741 New manufacturing industries or expansions to existing industries , announced after the effective date hereof, may upon application to City Council, be entitled to exemptions from compensation to the City of Baytown in the following manner: 1. The first contract year, the calendar year in which construction is begun, no compensation is due the City of Baytown. 2. Compensation due for the second, third, and fourth contract years shall be calculated in the following manner: January 1 of the second contract year of the contract, the anticipated fair market value of the new industry or an expansion shall be rendered to the City of Baytown. This value shall be used for calculating the payment due the City of Baytown using the 20%-80% Industrial District Payment Formula as per the standard contract. one-third of this amount shall be paid January 31 of each contract year be- ginning with the second contract year and ending with the fourth contract year. Adjustments as to value shall be made during the fourth contract year. Payments reflecting any increase in value shall be due on or before December 31. Any credits shall be deducted from the next year' s industrial district payment. 3. For the purposes of this Resolution and contracts executed pursuant to the terms hereof, contract year shall mean January 1 �. through December 31 of any given year. -3- 742 AO- An expansion shall be defined as a new manufacturing facility or a major addition to an existing manufacturing facility which is intended to permanently and significantly increase production capacity or produce a new product and represents a capital investment in excess of the lesser of five (5%) per cent of the fair market value of the existing facilities or ten million dollars. Investment which replaces or modernizes existing facilities only shall not be considered an expansion. Replacement-type expenditures , including but not limited to repairs , maintenance, catastrophe losses, or similar items shall not be considered or treated as an expansion, regardless of the amount involved. The City Council reserves the right to judge the desirability of new industry or expansions to existing industry so as to qualify for the compensation exempt period. New industries which accept the benefits of this exemption consent to the annexation of twenty (20%) per cent of their facilities in the third contract year of this ex- emption and agree to entering into the Standard Industrial District Contract with the City of Baytown. Section 6 : That this Resolution shall take effect a..-� from and after its passage by the City Council , and the Mayor and City Clerk are hereby authorized and directed to execute this Resolution and to properly publicize same. INTRODUCED, READ and PASSED by the affirmative vote of the City Council of the City of Baytown this loth day of July , 1975 . /f TOM GENTRY, Mayor ATTEST: EDNA OLIVER, City Clerk APPROVED: —/,,&/ z4Z� NEEL RI 7 ARD ON, City Attorney -4-