M&C Review


COUNCIL ACTION:  Approved on 5/16/2017 - Resolution No. 4781-05-2017

DATE: 5/16/2017 REFERENCE NO.: **G-19005 LOG NAME: 17ED DILLARDSEZ
CODE: G TYPE: CONSENT PUBLIC HEARING: NO
SUBJECT:   Adopt Resolution Nominating Dillard Texas Four-Point, LLC, Located at 4501 North Beach Street as an Enterprise Project, Pursuant to the Texas Enterprise Zone Act, Chapter 2303 of the Texas Government Code (COUNCIL DISTRICT 4)

RECOMMENDATION:

It is recommended that the City Council adopt the attached resolution nominating Dillard Texas Four-Point, LLC, located at 4501 North Beach Street as an Enterprise Project, pursuant to the Texas Enterprise Zone Act, Chapter 2303 of the Texas Government Code.

 
DISCUSSION:

Over the next five years, Dillard Texas Four-Point, LLC (Dillard's) anticipates spending $11,200,000.00 on capital investment projects at its Fort Worth distribution facility located at 4501 North Beach Street. $5,200,000.00 will be spent on facility maintenance and improvement projects, including the upgrade of shipping divert lanes, installation of a garment on hangar infield line, replacement of a refusal line, as well as the purchase of yard tractors used to move trailers within the facility property. In addition to these projects, Dillard's is proposing to spend $6,000,000.00 on a remodel of its pool stock area to support the replenishment of warehoused merchandise to the stores serviced by the Fort Worth Distribution Center. This remodel project will update the pool stock work areas and provide new storage and new solutions for receiving, picking and shipping replenishment goods. The investment will result in the retention of 540 jobs with an average annual wage of $50,000.00.  

The City Council previously adopted Ordinance No. 15733, under which the City has elected to participate in the Texas Enterprise Zone Program. The City Council subsequently amended Ordinance No. 15733 on May 12, 2015 to update the list of potential local incentives that may be provided to a project on a case-by-case basis (Ordinance No. 21743-05-2015, M&C G-18473). The Office of the Governor Economic Development and Tourism through the Economic Development Bank will consider Dillard's as an Enterprise Project, pursuant to a nomination and an application made by the City. The Texas Enterprise Zone Program allows the City to pursue its goal of inducing the investment of private resources in productive business enterprises and provide employment to residents of enterprise zones and other economically disadvantaged individuals.

The attached resolution establishes the City Council's finding that the Dillards' facility meets the criteria for designation as an Enterprise Project, under Chapter 2303, Subchapter F of the Act on the following grounds:

1.  Dillard's is a qualified business, under Section 2303.402 of the Act, since it will be engaged in the active conduct of a trade or business at a qualified business site within the governing body's jurisdiction located within an enterprise zone and at least 25 percent of the business' new or retained employees will be residents of an enterprise zone, economically disadvantaged individuals or veterans;

2.  There has been, and will continue to be, a high level of cooperation between public, private and neighborhood entities within the area; and

3.  The designation of Dillard's as an Enterprise Project will contribute significantly to the achievement of the plans of the City for development and revitalization of the area.

If awarded an Enterprise Project designation, Dillard's will be eligible to apply for state sales and use tax refunds on qualified expenditures. Dillard's investment of $11,200,000.00 qualifies Dillard's for a single Enterprise Project Designation. Dillard's will retain a minimum of 540 jobs, with an average annual wage of $50,000.00, although the benefit for an Enterprise Project Designation is capped at 500 jobs. As part of the anticipated investment, Dillard's could be eligible for a maximum refund of $2,500.00 per job, distributed over the five year designation period. The maximum potential refund Dillard's could receive is $1,250,000.00 over the five year designation period. These state benefits have no fiscal impact on the City's general fund.

This project is located in COUNCIL DISTRICT 4, Mapsco 50N.

This M&C does not request approval of a contract with a business entity.

 
FISCAL INFORMATION/CERTIFICATION:

The Director of Finance certifies that approval of the above recommendation will have no material effect on the Fiscal Year 2017 Budget.  Upon approval of this Agreement, the long term financial impacts will be included in the multi-year financial forecast.

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Submitted for City Manager's Office by:
Jesus Chapa (5804)
Originating Department Head:
Robert Sturns (2122663)
Additional Information Contact:
Natalie Moore (2122680)

 
 
ATTACHMENTS
  Dillard Texas Four-Point LLC EZ Res.doc