Ordinance No. 14,866 ORDINANCE NO. 14,866
AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF BAYTOWN,
TEXAS, AUTHORIZING AND DIRECTING THE MAYOR TO EXECUTE
AND THE CITY CLERK TO ATTEST TO AN INDUSTRIAL DISTRICT
AGREEMENT WITH SAMSON CONTROLS, INC., AND SAMSON
PRODUCTS, INC.; AND PROVIDING FOR THE EFFECTIVE DATE
THEREOF.
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 Mayor and City Clerk of the City of Baytown to execute and attest to an Industrial
District Agreement with Samson Controls, Inc., and Samson Products, Inc. A copy of said
Industrial District Agreement is attached hereto, marked 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 vote of the City Council of the
City of Baytown, this the 23rd day of SeptemberaANDON'CAPETTIL-O,
ayor
ATTEST:
gyp@�'TO 1,V
0Or s
a .
r
ANGELA YCKSOJF7, C erk Ires n
ar °
'� °y •r �r°rr�
APPROVED AS TO FOR
5!L?�?�- �-�
KAREN L. HORNER, City Attorney
RAKaren HomerlDocumentslFiles\City Council\Ordinances120211Septetnber 231IDAwilhSamsonControls&5amsonProducts.docx
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 Samson Controls, Inc., a Texas
corporation, and Samson Products, Inc., a Delaware corporation, hereinafter referred to as
"Property Owners." In consideration of the promises and of the mutual covenants and
agreements herein contained, it is agreed by and between the City and Property Owners 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:
1. 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 Owners" Tax Statement Address:
Samson Controls, Inc. Samson Controls,Inc.
4111 Cedar Boulevard Attn: Mr.Tariq Farooqui
Baytown,TX 77520 Chief Financial Officer
4111 Cedar Boulevard
Baytown,TX 77520
Samson Products, Inc. Samson Products, Inc.
4111 Cedar Boulevard Mr.Tariq Farooqui
Baytown,TX 77520 Chief Financial Officer
4111 Cedar Boulevard
Baytown,TX 77520
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 Owners. 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. 3 (the
"Industrial District").
III.
Term
The term of this Agreement is seven tax years,from 2021 through 2027,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 Owners and the City relating to the subject matter specific to the term hereof.
IV.
Limited Immunity from Annexation b the e City
In consideration of the obligations of the Property Owners 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
Owners agree to pay to the City on or before December 31 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:
2
i
2021 $26,207,124.00
2022 $26,207,124.00
2023 $26.207,124.00
2024 $26,207,124.00
2025 $26,207,124.00
2026 $26,207,124.00
2027 $26,207,124.00
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:
YEARLY
TAX YEAR PAYMENT
RATE
2021 .66
2022 .66
2023 .66
2024 .66
2025 .66
2026 .66
2027 .66
VI.
Valuations and Collections
A.
Generallv
The parties hereto recognize that said Chambers 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 Owners 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 Owners'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
3
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 Owners' 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 Owners' 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 Chambers County Appraisal
District(orthrough administrative or judicial appeal of the Chambers 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 Owners within thirty (30) days after receipt of the City's determination
petition for a Declaratory Judgment to the Civil District Court of Harris County, Texas, as
provided for by Section XIII hereof. Nothing contained herein shall ever be construed as in
derogation of the authority of the Chambers 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.
Adjustment of Base Value for Property Inside the Corporate Limits but Subsequently
Disannexed
Land, improvements and tangible property,real or mixed,of the Property Owners,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.
Adjustment of Base Value for Property Outside the Corporate Limits but Subsequently Annexed
Land, improvements and tangible property,real or mixed,of the Property Owners,which
is annexed into the corporate Iimits of the City during the term of this Agreement, shall be
4
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 Owners on or about December I 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 I
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 Owners' 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 Owners' payment hereunder and the Property Owners are
pursuing through a declaratory judgment action as specified in Subsection A,the Property Owners
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 Owners hereunder shall be paid within 60 days after receipt by the City of both
Chambers County Appraisal District's form notification that the appraised value of the property
has been reduced and a written refund request by the Property Owners; 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 Owners' written
refund request and the Chambers County Appraisal District's formal notification that the
appraised value of the property has been reduced.
5
VII.
Compliance with Law
The City and the Property Owners 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 Owners 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 Owners agree 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 Owners'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 Owners 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 Owners agree 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 Owners 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 Owners
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.
VIll.
Inspections
The Chief Appraiser of the Chambers County Appraisal District and the City or its
independent appraiser shall have the same right to enter and inspect the Property Owners'premises
and the same right to examine the Property Owners' books and records to determine the value
of the Property Owners'properties as are provided in the Texas Property Tax Code as amended.
6
I.X.
Default
A.
Default by Property Owners
In the event of default by the Property Owners 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 Owners 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 Owners are in default according to the terms and conditions of Section VII
hereof, the City shall notify the Property Owners 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 Owners'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 Owners 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 Owners and the City shall be relieved
of all further obligations hereunder,but the Property Owners 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 Owners' 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 Owners 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
7
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 Owners or the City,as the case may be.
Xl.
No Further Exl2ansion 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 Owners 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 Owners' property in the
affected area during the term of this Agreement other than the payments specified herein.
Specifically,the Property Owners 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.
XI1.
Reimbursement for Services
If the Property Owners request and receive mutual aid firefighting assistance and is
a member of Channel Industries Mutual Aid organization ("CIMA") or similar organization,
the Property Owners shall reimburse the City for costs incurred by the City in providing fire
protection services to the Property Owners 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 Owners request and receive mutual aid firefighting assistance and is not a member
of CIMA or a similar organization, then the Property Owners shall be required to reimburse the
City for costs actually expended by the City in providing any firefighting assistance to the
Property Owners, 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 Owners 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 Owners to the
City.The Property Owners agree 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.
8
XIV.
Assignment
This Agreement shall not bestow any rights upon any third party, but rather, shall bind
and benefit the Property Owners and the City only. If the Property Owners convey all or any
part of the property then covered hereby,the Property Owners 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 Owners 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.
Authority
The Property Owners covenant that they have 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
9
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 Owners 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 A egr ement
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.
Ambigpities
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.
10
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 ex cuted in multiple counterparts on behalf
of the Property Owners this day o 2021, and on behalf
of the City this_day of 2021.
SAMSCLNIIPONTROLS,INC.
By:
Printed Name
�461 C.FD GFa
Title
STATE OF f— 0. §
COUNTY OF 1 §
Before me, JiLk ie Pt• %llcstrJ the undersigned notary public,
on this day personally appeared TArb the Pj-e5�1 CM SePO
of Samson Controls, Inc., the owner of theaffected property,known to me to be the person whose
name is subscribed to the foregoing instrument and acknowledged to me that he/she executed the
same for the purposes, in the capacity, and for the consideration therein expressed.
SUBSCRIBED AND SWORN before me this 14day of �r,t`1edY��'�/�Q 2021.
o"wrir�. JULIE A. VILLARREAL
.,:S Notary Public,State of Texas tart' ublic in and for the State of
9+. Comm.Expires 10-20-2022
;�° Notary ID 6961683
ll
SAMS RODUCTS,INC.
By:
Printed Name
p4e,il I CAD CFO
Title
STATE OF -5�(, §
COUNTY OFCI& 6 §
Before me, ,SLAM [ (at \Mi&vY� the undersigned notary public,
on this day personally appeared L theQQQQQQQQj'X ttCt z13O
of Samson Products,Inc., the owner of thY cted p operty,known tome to be the person whose
name is subscribed to the foregoing instrument and acknowledged to me that he/she executed the
same for the purposes, in the capacity, and for the consideration therein expressed.
SUBSCRIBED AND SWORN before me this lla day of st�p}eYlY�nbe,X ,2021.
lam-4
"""wrar, JULIE A. VILLARREAL C
?...�e'. ary ublic in and for the State of J
Notary Public,State of Texas
%'• 'P' Comm.Expires 10-20-2022
Notary ID 6861683 11 CITY OF BAYTOWN
BRANDON CAPETILLO,Mayor
ATTEST:
ANGELA JACKSON, City Clerk
12
APPROVED AS TO FORM:
KAREN L.HORNER,City Attorney
VICTOR BROWNLEES,Finance Director
R:UCaren AndersonUDAsU021-2027UDA-SamsonContmIsExisitingIDA202I.docx
13
`- BUSINESS PARK I urnarro or ra�IM41
W aE20OAE 4N2 li�W MV — NrEP]90YE M v __, •rw.r, ..e.. • •r i
1 !��u^N.4Ngr—_�^ gg 9 sws'Mvtgu 5 v—ra
Z7 AG g z 746 Acll4�p zJZR Ac r�z3712 Ac b ]2l 3 AG A 3-an AC
L .A11R1 GM1E vr. a' t7 18
I 38470 AG 0 w srw muu aem m m IM7 AG l
R I
34
P ,aee. 3S5]0 AG 3.W,AG �� SH24 AG 4� am 42 AG is
sfr�[.ly µ7 O
.5 W m. �� YJm N CFDAR Eit7..t_EVARO q 1
Vw qw1 m a,nP 1CG `
m GW ]W2 � rQ181A � ]YO 'am tpm q14 I
.7 ZL 25 � 24 //�,J6 2i 22 2' €Q 20 € 9 Ree
AG p 2A119 AG $ 27420 AG; 27429 AG 27428 AG 1 2742e M. 1 1 27428 AG 4 C U732 AG 4 f 4=9 AG p
iew— arm—
aT10N WfSt 4en� eBV RAM
POWER CO. 80'RAW.
" ! 1,
OWER M. 60'RAW,6 CONOCO lY RA.W.
Property ID Account/Geo Number Property Legal Desuiption
28222 20350-00227-00000-003700 LT 37 CEDAR CROSSING BUSINESS PARK
28221 20350-00227-00000-003600 LT 36 CEDAR CROSSING BUSINESS PARK
28220 20350-00227-00000-003500 LT 35 CEDAR CROSSING BUSINESS PARK i
28219 20350-00227-00000-003400 LT 34 CEDAR CROSSING BUSINESS PARK