Ben E. Keith Company, or an affiliate (Company) intends to construct an approximate 185,000 square foot expansion of office and warehouse facilities to support expanded operations at its existing food distribution facility located at 7650 Will Rogers Boulevard in Carter Industrial Park. The proposed expansion would involve a minimum investment of $22 million in total construction costs and would lead to the hiring of at least 283 net new jobs at the facility.
Tax Abatement Agreement
In order to facilitate this development, the City of Fort Worth (City) proposes to enter into a 7-year Tax Abatement Agreement, as authorized by Chapter 312, Texas Local Government Code. The percentage of the tax abatement will be tied to the amount of investment made by the Company and satisfaction of other project and spending requirements, as follows:
Investment:
Minimum investment of $22 million in total construction costs (exclusive of land acquisition costs) by no later than January 1, 2022, a minimum $20 million of which is required to be hard construction costs. The development shall consist of approximately 185,000 square feet of new office and warehouse space at the property. All improvements must have a temporary or final certificate of occupancy by June 30, 2021.
Failure to meet the following criteria is an event of default, which subject to commercially reasonable notice and cure rights, will result in immediate termination of the Agreement.
Employment Commitments:
The Company must employ a minimum 855 full-time jobs at the property for the duration of the agreement. Additionally, Company must add a minimum 179 net new full-time employees to be based out of the project site by no later than December 31, 2023 and must add a minimum 283 net new jobs (inclusive of the 179 previously added) by no later than December 31, 2025. All 283 new full-time employees added to the project site must have an average annual wage of $73,000 (not including benefits). Of the 179 new full-time employees added to the project site by December 31, 2023, a minimum of 46 must be Fort Worth residents and a minimum 12 must be Fort Worth Central City Residents. Of the 283 new full-time employees added to the project site by December 31, 2025, a minimum of 85 must be Fort Worth residents and a minimum 21 must be Fort Worth Central City Residents (with the understanding that employment of Fort Worth Central City residents will also count as employment of Fort Worth residents). Utilization of Fort Worth Companies and Fort Worth Certified M/WBE Companies (Construction):
The Company must spend a minimum of $3 million of all Hard Construction Costs with contractors that are Fort Worth companies. Company must spend a minimum of 10% of total construction costs – both hard and soft – with qualified M/WBE businesses. Failure to meet the M/WBE commitment will result in a reduction of 10% of the eligible incentive. Utilization of Fort Worth Companies (Supply & Services):
The Company must spend a minimum of $900,000.00 of annual discretionary supply and service expenditures with Fort Worth companies. Supply and Service Expenditures means all expenditures by the company expended directly for the operation and maintenance of the development, excluding amounts paid for electric, gas, water and any other utility services (but not excluding cable, internet or television services). City Commitments:
The City will provide a tax abatement for a period of seven years. The maximum taxes to be abated annually will equal up to 50 percent of the incremental real and business personal property taxes collected by the City of Fort Worth in each tax year. Except for cases of default, failure to meet any of the commitments above will result in a reduction of the corresponding component of the abatement for that year proportional to the amount the commitment was not met, or for the duration of the Agreement in the case of construction commitments. TABLE IV-I Maximum Potential Abatement with Corresponding Components: Property Owner or Company Commitment | Potential Abatement
(Year 1 and 2) | Potential Abatement(Year 3 and beyond) | Total Construction Cost Investment | 20% | 5% | Minimum of $3 million of Construction Spending with FW Contractors | 5% | 2.5% | Construction Spending with FW Certified M/WBE Contractors | 10% | 10% | Creation of new jobs in accordance with Section II.a. | 10% | 10% | Creation of new jobs in accordance with Section II.b. | 0% | 15% | Full Time Employees hired are Fort Worth Residents in accordance with Section II.c. | 0% | 2.5% | Full Time Employees hired are Fort Worth Central City Residents in accordance with Section II.d. | 0% | 2.5% | Annually spend the amount in Section II.e. with FW Companies for Services and Supplies | 5% | 2.5% | TOTAL | 50% | 50% |
Resolution Nominating this Project as an Enterprise Project
The City Council previously adopted Ordinance No. 15733 electing to participate in the Texas Enterprise Zone Program. On May 12, 2015, the City Council adopted Ordinance No. 21743-05-2015, amending Ordinance No. 15733 by adding additional potential local incentives that could be made available to qualified businesses under the Texas Enterprise Zone Program. The Office of the Governor Economic Development and Tourism through the Economic Development Bank will consider Company as an enterprise project pursuant to a nomination and an application made by the City.
The Texas Enterprise Zone Program is an economic development tool for local communities to partner with the State of Texas to promote job creation and capital investment in economically distressed areas of the State. An enterprise project is defined as a business that is nominated by a municipality or county and then approved for state benefits. Designated projects are eligible to apply for state sales and use tax refunds on qualified expenditures. The level and amount of refund is related to the capital investment and jobs created at the qualified business site.
Company qualifies for a single Enterprise Project Designation. The single project designation allows for a state sales and use tax refund on qualified expenditures of $2,500 per job, for up to 500 jobs, with a maximum benefit of $1.25 million over a five year period. Under the Texas Enterprise Zone Act at least twenty-five percent of the business' new or retained employees will be residents of an enterprise zone, economically disadvantaged individuals, or veterans. In addition, the jobs will be provided through the end of the designation period or at least three years after the date on which a state benefit is received, whichever is later.
This project is located in COUNCIL DISTRICT 8.
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