M&C Review


COUNCIL ACTION:  Approved on 5/14/2019 

DATE: 5/14/2019 REFERENCE NO.: **C-29120 LOG NAME: 17ED_AMENDM&C_BLACK&DECKERTA
CODE: C TYPE: CONSENT PUBLIC HEARING: NO
SUBJECT:  

Amend M&C C-29029 Authorizing Execution of a Tax Abatement Agreement with Stanley Black & Decker USA, Inc to Add Wachovia Service Corporation as a Party to the Tax Abatement Agreement (COUNCIL DISTRICT 7)


RECOMMENDATION:

It is recommended that the City Council approve an amendment to M&C C-29029, which authorized execution of a Tax Abatement Agreement with Stanley Black & Decker USA, Inc., to add Wachovia Service Corporation as a party to the Tax Abatement Agreement.

 
DISCUSSION:

On February 5, 2019, the City Council approved M&C C-29029 authorizing the execution of a Tax Abatement Agreement (Agreement) with Stanley Black & Decker USA, Inc. (Company) for the construction of an approximately 375,000 square foot manufacturing facility on property in the vicinity of the intersection of North Beach Street and Eagle Parkway, east of I-35W (Property). Under the Agreement, the Company must invest at least $80 million in real and business personal property improvements (exclusive of land costs) and have at least 500 full-time jobs filled on the Property by December 31, 2020. In return, as authorized by Chapter 312, Texas Tax Code (Tax Abatement Statute), the City will grant a 40 percent tax abatement on the incremental increase in value of real and business personal property improvements for a period of five years.

During contracting, the Company disclosed that they will be pursuing an operating lease with Wachovia Service Corporation (Wachovia), which is affiliated with Wachovia National Bank, under which Wachovia will take title to the Property and lease it back to Company as part of their financing arrangements. Under Chapter 312 of the Texas Tax Code, the City can only enter into an agreement for tax abatement with the owner of the real property in which incentivized improvements will be constructed. Therefore, because Wachovia will be the record owner of the Property, Wachovia must also be a party to the Agreement.

This project is located in COUNCIL DISTRICT 7.

 
FISCAL INFORMATION/CERTIFICATION:

The Director of Finance certifies that upon approval of the above recommendations an estimated $1,070,416.00 in property taxes (calculated at current rate of .7850/100) will be abated over the five year period from 2021-2025. This amount will be included in the City's five year financial forecast.


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Submitted for City Manager's Office by:
Susan Alanis (8180)
Originating Department Head:
Robert Sturns (2663)
Additional Information Contact:
Brenda Hicks-Sorensen (2606)

 
 
ATTACHMENTS
  1295 Exception.pdf