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HomeMy WebLinkAboutRES 15-259RESOLUTION NO. 15-259 BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF BEAUMONT: THAT the City Manager be and he is hereby authorized to execute an Industrial District Agreement with Air Liquide Large Industries U.S., a Delaware limited partnership. The agreement is substantially in the form attached hereto as Exhibit "A" and made a part hereof for all purposes. PASSED BY THE CITY COUNCIL of the City of Beaumont this the 8th day of December, 2015. THE STATE OF TEXAS § COUNTY OF JEFFERSON § AGREEMENT This Agreement is made under the authority of § 42.044 of the Texas Local Government Code. The parties to the Agreement are The City of Beaumont, a municipal corporation and a home -rule city located in Jefferson County, Texas, hereinafter called "City," and Air Liquide Large Industries US L.P, a Delaware limited partnership, hereinafter called "Company." 1.1-i-VaIT, I -i■ -4 WHEREAS, City has established an industrial district comprising a certain part of the extra -territorial jurisdiction of City, such industrial district being known as City of Beaumont Industrial District (the "District") WHEREAS, Company and/or its Affiliates (as hereinafter defined) owns and/or leases land and improvements which are part of the manufacturing and industrial facilities of Company and/or its Affiliates located within District, such land and improvements (the "Property") WHEREAS, Company recognizes the benefits of this Agreement and an obligation to contribute to the revenue needs of said City in an amount commensurate with the burdens placed upon City and benefits derived by Company by reason of being located immediately adjacent to City. Page 1 EXHIBIT "A" WHEREAS, Company and City desire to base the industrial district payment on assessed value to ensure equity among the companies. WHEREAS, City desires to encourage the addition of new improvements to the Company's property located within the City of Beaumont Industrial District; In view of the above and foregoing reasons, and in consideration of the mutual agreements herein contained, Company and City hereby agree as follows: ARTICLE I. COMPANY'S OBLIGATION 1. The City of Beaumont granted Natgasoline, LLC 100% abatement for a term of 2015 through 2024, on all new construction and improvements to existing facilities on the herein described property. In November 2014, Natgasoline made a partial Assignment of the abatement to Company through which after executing a ground lease with Natgasoline, Company will construct, own, and operate an air separation unit ("ASU") as part of Natgasoline's methanol project. The estimated value of the ASU is $115 million. Such an assignment was allowed by the industrial district agreement between the City of Beaumont and Natgasoline. 2. The Company will receive 100% tax abatement for payments due in the years of 2016 through 2024, on all new construction and improvements to existing land herein described as property. The abatement does not include the value of the existing property owned by Company and in the City's extraterritorial jurisdiction related or unrelated to this new construction. Company shall be responsible for the payment of ad valorem taxes based upon the existing value of the property and improvements Page 2 currently existing on property leased from Natgasoline or any other unrelated property in the ETJ as determined by the Jefferson County Appraisal District. 3. Company will make an annual payment to City on or before February 1St of each such year computed based on 100% of the Assessed Value of the Company's facilities and property, real, personal, and mixed, located on Company's land covered by this Agreement (herein "the property") as provided herein (the "Annual Payment") .Upon expiration of the abatement period, the Annual Payment shall include all property covered by this Agreement. 4. "Assessed Value" means the 100% valuation of Company Property and improvements thereon as determined by the Jefferson County Appraisal District for the previous tax year. 5. "Assumed City Taxes Due" means the number obtained by the following formula: Assessed Value Less Improvement Value Subject to Abatement / 100 x Current City Tax Rate = Assumed City Tax Due 6. In October of each year the Finance Officer for City shall obtain the most recent Assessed Value as set by the Jefferson County Tax Appraisal District and such valuation shall be used for the Annual Payment due the following February; by way of Page 3 example, October 2015 Assessed Values would be used for the February 1, 2016 payment. If the assessed values are in question and/or under litigation with the Jefferson County Appraisal District, payment shall be computed on the most recent certified values from the Jefferson County Appraisal District. The Company shall notify the City following resolution of the appraised value question and an adjustment for the payment, without interest, will be made within thirty (30) days following such resolution. 7. Payments for each year of the agreement shall be equal to 100% of the Assumed city Taxes due, as defined above, on real property during the years of abatement, 2015 through 2024. City shall bill Company for payments due hereunder on or before January 1 each year. Company shall pay to City the amount billed on or before February 1 each year. Upon receiving the final payment, the Finance Officer shall issue an official receipt of said City acknowledging full, timely, final and complete payment due by said Company to City for the property involved in this Agreement for the year in which such payment is made. If payment is not made on or before any due date, the same penalties, interest, attorneys' fees and costs of collection shall be recoverable by City as would be collectible in the case of delinquent ad valorem taxes. Further, if payment is not timely made, all payments which otherwise would have been paid to City had Company been in the city limits of City will be recaptured and paid to City within 60 days of any such event. Page 4 ARTIrl P II PROPERTY COVERED BY AGREEMENT This Agreement will reflect the intention of the parties hereto that this Agreement shall govern and affect the properties of Company and/or its Affiliates (facilities, real, personal, and mixed) located on the Property more particularly described in Exhibit "A", which are within the extra -territorial jurisdiction of the City of Beaumont. "Affiliates" shall mean any entity owned entirely or in part by Company. ARTICLE III. SALE BY COMPANY (a) Company shall notify City of any sale of any or all of Company's facilities to any person or entity. It is the intent of the parties that no sale of any of Company's facilities will affect the amount to be paid to City as provided under this Agreement. Accordingly, and as to payments due under this Agreement, no such sale shall reduce the amount due City under this Agreement until the purchaser of such facility has entered into a contract in lieu of taxes with City that provides for a continuation of like payments to City. (b) Company shall have the right to assign, transfer or convey all, or any part of, its rights, title and interest in the Agreement in connection with any transfer or conveyance of title to all or any part of the properties subject to this Agreement to any person or entity at any time of this Agreement; provided, however, that Company shall provide City with written notice of such assignment. Company shall be relieved of its Page 5 obligations under this Agreement to the extent that an assignee expressly assumes Company's obligations in a written instrument binding such assignee to City. Subject to the preceding, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns. ARTICLE IV. CITY'S OBLIGATIONS 1. City agrees that it will not annex, attempt to annex or in any way cause or permit to be annexed any portion of lands or facilities or properties of said Company covered by this Agreement for the period of the Agreement except as follows: (a) If the City determines that annexation of all or any part of the properties covered by this Agreement belonging to said Company is reasonably necessary to promote and protect the general health, safety and welfare of persons residing within or adjacent to the City, the City will notify Company in accordance with state law of the proposed annexation. In the event of such annexation, Company will not be required to make further payment under this Agreement for any calendar year commencing after such annexation becomes final with respect to the property so annexed, but shall nevertheless be obligated to make full payment for the year during which such annexation becomes effective if the annexation becomes effective after January 1st of said year. (b) In the event any municipality other than the City attempts to annex separately or in the event the creation of any new municipality shall be attempted so as Page 6 to include within its limits any land which is the subject matter of this Agreement, City shall, with the approval of Company, seek immediate legal relief against any such attempted annexation or incorporation and shall take such other legal steps as may be necessary or advisable under the circumstances with all costs of such action being borne equally by the City and by the said Company or companies with Company's portion allocated on the basis of Assessed Values. 2. The City further agrees that during the term of this Agreement, there shall not be extended or enforced as to any land and property of Company within said City of Beaumont Industrial District, any rules, regulations, or any other actions: (a) seeking in any way to control the platting and subdivisions of land, (b) prescribing any buildings, electrical, plumbing or inspection standards or equipment, or (c) attempting to regulate or control in any way the conduct of Company's activities, facilities or personnel thereof. 3. It is understood and agreed that during the term of this Agreement or any renewals thereof, City shall not be required to furnish any municipal services to Company's property located within the City of Beaumont Industrial District; provided, however, City agrees to furnish fire protection to Company should such protection be requested by Company in the event an unusual emergency situation occurs. ra_ydra■=Rn TERMINATION FOR BREACH It is agreed by the parties to this Agreement that only full, complete and faithful performance of the terms hereof shall satisfy the rights and obligations assumed by the parties and that, therefore, in addition to any action at law for damages which either Page 7 party may have, Company shall be entitled to enjoin the enactment or enforcement of any ordinance or charter amendment in violation of, or in conflict with, the terms of this Agreement and shall be entitled to obtain such other equitable relief, including specific performance of the Agreement, as is necessary to enforce its rights. It is further agreed that should this Agreement be breached by Company, City shall be entitled, in addition to any action at law for damages, to obtain specific performance of this Agreement and such other equitable relief necessary to enforce its rights. ARTICLE VI. AFFILIATES The benefits accruing to Company under this Agreement shall also extend to Company's "parent," "affiliates" and to any properties owned or acquired by said parent and affiliates within the area described in Exhibit "A" to this Agreement, and where reference is made herein to land, property and improvements owned by Company, that shall also include land, property and improvements owned by its parent and/or affiliates. The word "affiliates" as used herein shall mean all companies with respect to which Company directly or indirectly, through one or more intermediaries at the time in question, owns or has the power to exercise the control over fifty percent (50%) or more of the stock having the right to vote for the election of directors. The word "parent" as used herein shall mean all companies which directly or indirectly, through one or more intermediaries at the time in question, owns or has the power to exercise control over fifty percent (50%) of the stock having the right to vote for the election of directors of Company. Page 8 2024. ARTICLE VII. TERM OF AGREEMENT The term of this Agreement shall be for nine (9) years, expiring December 31, NOTICES Any notice provided for in this Agreement, or which may otherwise be required by law shall be given in writing to the parties hereto by certified mail addressed as follows: TO NTY City of Beaumont Attn: City Manager 801 Main Street Beaumont, Texas 77704 TO COMPANY Air Liquide Large Industries US L.P. Attn: Vice President Gulf Coast Pipeline 9811 Katy Freeway, Suite 100 Houston, Texas 77024 Page 9 IN WITNESS THEREOF, this Agreement, consisting of ten pages plus Exhibit "A" is executed in duplicate counterparts as of this day of , 2015. ATTEST: Tina Broussard City Clerk ATTEST: LOM City of Beaumont Kyle Hayes City Manager Air Liquide Large Industries US LP Page 10 THE STATE OF TEXAS § COUNTY OF JEFFERSON § AGREEMENT This Agreement is made under the authority of § 42.044 of the Texas Local Government Code. The parties to the Agreement are The City of Beaumont, a municipal corporation and a home -rule city located in Jefferson County, Texas, hereinafter called "City," and Air Liquide Large Industries US L.P, a Delaware limited partnership, hereinafter called "Company." DCCARAQI C WHEREAS, City has established an industrial district comprising a certain part of the extra -territorial jurisdiction of City, such industrial district being known as City of Beaumont Industrial District (the "District") WHEREAS, Company and/or its Affiliates (as hereinafter defined) owns and/or leases land and improvements which are part of the manufacturing and industrial facilities of Company and/or its Affiliates located within District, such land and improvements (the "Property") WHEREAS, Company recognizes the benefits of this Agreement and an obligation to contribute to the revenue needs of said City in an amount commensurate with the burdens placed upon City and benefits derived by Company by reason of being located immediately adjacent to City. Page 1 WHEREAS, Company and City desire to base the industrial district payment on assessed value to ensure equity among the companies. WHEREAS, City desires to encourage the addition of new improvements to the Company's property located within the City of Beaumont Industrial District; In view of the above and foregoing reasons, and in consideration of the mutual agreements herein contained, Company and City hereby agree as follows: ARTICLE I. COMPANY'S OBLIGATION 1. The City of Beaumont granted Natgasoline, LLC 100% abatement for a term of 2015 through 2024, on all new construction and improvements to existing facilities on the herein described property. In November 2014, Natgasoline made a partial Assignment of the abatement to Company through which after executing a ground lease with Natgasoline, Company will construct, own, and operate an air separation unit ("ASU") as part of Natgasoline's methanol project. The estimated value of the ASU is $115 million. Such an assignment was allowed by the industrial district agreement between the City of Beaumont and Natgasoline. 2. The Company will receive 100% tax abatement for payments due in the years of 2016 through 2024, on all new construction and improvements to existing land herein described as property. The abatement does not include the value of the existing property owned by Company and in the City's extraterritorial jurisdiction related or unrelated to this new construction. Company shall be responsible for the payment of ad valorem taxes based upon the existing value of the property and improvements Page 2 currently existing on property leased from Natgasoline or any other unrelated property in the ETJ as determined by the Jefferson County Appraisal District. 3. Company will make an annual payment to City on or before February 15t of each such year computed based on 100% of the Assessed Value of the Company's facilities and property, real, personal, and mixed, located on Company's land covered by this Agreement (herein "the property") as provided herein (the "Annual Payment") .Upon expiration of the abatement period, the Annual Payment shall include all property covered by this Agreement. 4. "Assessed Value" means the 100% valuation of Company Property and improvements thereon as determined by the Jefferson County Appraisal District for the previous tax year. 5. "Assumed City Taxes Due" means the number obtained by the following formula: Assessed Value Less Improvement Value Subject to Abatement / 100 x Current City Tax Rate = Assumed City Tax Due 6. In October of each year the Finance Officer for City shall obtain the most recent Assessed Value as set by the Jefferson County Tax Appraisal District and such valuation shall be used for the Annual Payment due the following February; by way of Page 3 example, October 2015 Assessed Values would be used for the February 1, 2016 payment. If the assessed values are in question and/or under litigation with the Jefferson County Appraisal District, payment shall be computed on the most recent certified values from the Jefferson County Appraisal District. The Company shall notify the City following resolution of the appraised value question and an adjustment for the payment, without interest, will be made within thirty (30) days following such resolution. 7. Payments for each year of the agreement shall be equal to 100% of the Assumed city Taxes due, as defined above, on real property during the years of abatement, 2015 through 2024. City shall bill Company for payments due hereunder on or before January 1 each year. Company shall pay to City the amount billed on or before February 1 each year. Upon receiving the final payment, the Finance Officer shall issue an official receipt of said City acknowledging full, timely, final and complete payment due by said Company to City for the property involved in this Agreement for the year in which such payment is made. If payment is not made on or before any due date, the same penalties, interest, attorneys' fees and costs of collection shall be recoverable by City as would be collectible in the case of delinquent ad valorem taxes. Further, if payment is not timely made, all payments which otherwise would have been paid to City had Company been in the city limits of City will be recaptured and paid to City within 60 days of any such event. Page 4 ARTICLE II. PROPERTY COVERED BY AGREEMENT This Agreement will reflect the intention of the parties hereto that this Agreement shall govern and affect the properties of Company and/or its Affiliates (facilities, real, personal, and mixed) located on the Property more particularly described in Exhibit "A", which are within the extra -territorial jurisdiction of the City of Beaumont. "Affiliates" shall mean any entity owned entirely or in part by Company. ARTICLE III. SALE BY COMPANY (a) Company shall notify City of any sale of any or all of Company's facilities to any person or entity. It is the intent of the parties that no sale of any of Company's facilities will affect the amount to be paid to City as provided under this Agreement. Accordingly, and as to payments due under this Agreement, no such sale shall reduce the amount due City under this Agreement until the purchaser of such facility has entered into a contract in lieu of taxes with City that provides for a continuation of like payments to City. (b) Company shall have the right to assign, transfer or convey all, or any part of, its rights, title and interest in the Agreement in connection with any transfer or conveyance of title to all or any part of the properties subject to this Agreement to any person or entity at any time of this Agreement; provided, however, that Company shall provide City with written notice of such assignment. Company shall be relieved of its Page 5 obligations under this Agreement to the extent that an assignee expressly assumes Company's obligations in a written instrument binding such assignee to City. Subject to the preceding, this Agreement shall inure to the benefit of and be binding upon the parties hereto and their respective successors and assigns. r.11-y1irMaMa1n CITY'S OBLIGATIONS 1. City agrees that it will not annex, attempt to annex or in any way cause or permit to be annexed any portion of lands or facilities or properties of said Company covered by this Agreement for the period of the Agreement except as follows: (a) If the City determines that annexation of all or any part of the properties covered by this Agreement belonging to said Company is reasonably necessary to promote and protect the general health, safety and welfare of persons residing within or adjacent to the City, the City will notify Company in accordance with state law of the proposed annexation. In the event of such annexation, Company will not be required to make further payment under this Agreement for any calendar year commencing after such annexation becomes final with respect to the property so annexed, but shall nevertheless be obligated to make full payment for the year during which such annexation becomes effective if the annexation becomes effective after January 1st of said year. (b) In the event any municipality other than the City attempts to annex separately or in the event the creation of any new municipality shall be attempted so as Page 6 to include within its limits any land which is the subject matter of this Agreement, City shall, with the approval of Company, seek immediate legal relief against any such attempted annexation or incorporation and shall take such other legal steps as may be necessary or advisable under the circumstances with all costs of such action being borne equally by the City and by the said Company or companies with Company's portion allocated on the basis of Assessed Values. 2. The City further agrees that during the term of this Agreement, there shall not be extended or enforced as to any land and property of Company within said City of Beaumont Industrial District, any rules, regulations, or any other actions: (a) seeking in any way to control the platting and subdivisions of land, (b) prescribing any buildings, electrical, plumbing or inspection standards or equipment, or (c) attempting to regulate or control in any way the conduct of Company's activities, facilities or personnel thereof. 3. It is understood and agreed that during the term of this Agreement or any renewals thereof, City shall not be required to furnish any municipal services to Company's property located within the City of Beaumont Industrial District; provided, however, City agrees to furnish fire protection to Company should such protection be requested by Company in the event an unusual emergency situation occurs. ARTICLE V. TERMINATION FOR BREACH It is agreed by the parties to this Agreement that only full, complete and faithful performance of the terms hereof shall satisfy the rights and obligations assumed by the parties and that, therefore, in addition to any action at law for damages which either Page 7 party may have, Company shall be entitled to enjoin the enactment or enforcement of any ordinance or charter amendment in violation of, or in conflict with, the terms of this Agreement and shall be entitled to obtain such other equitable relief, including specific performance of the Agreement, as is necessary to enforce its rights. It is further agreed that should this Agreement be breached by Company, City shall be entitled, in addition to any action at law for damages, to obtain specific performance of this Agreement and such other equitable relief necessary to enforce its rights. ARTICLE VI. AFFILIATES The benefits accruing to Company under this Agreement shall also extend to Company's "parent," "affiliates" and to any properties owned or acquired by said parent and affiliates within the area described in Exhibit "A" to this Agreement, and where reference is made herein to land, property and improvements owned by Company, that shall also include land, property and improvements owned by its parent and/or affiliates. The word "affiliates" as used herein shall mean all companies with respect to which Company directly or indirectly, through one or more intermediaries at the time in question, owns or has the power to exercise the control over fifty percent (50%) or more of the stock having the right to vote for the election of directors. The word "parent" as used herein shall mean all companies which directly or indirectly, through one or more intermediaries at the time in question, owns or has the power to exercise control over fifty percent (50%) of the stock having the right to vote for the election of directors of Company. Page 8 2024. ARTICLE VII. TERM OF AGREEMENT The term of this Agreement shall be for nine (9) years, expiring December 31, NOTICES Any notice provided for in this Agreement, or which may otherwise be required by law shall be given in writing to the parties hereto by certified mail addressed as follows: TO CITY TO COMPANY City of Beaumont Air Liquide Large Industries US L.P. Attn: City Manager Attn: Vice President Gulf Coast Pipeline 801 Main Street 9811 Katy Freeway, Suite 100 Beaumont, Texas 77704 Houston, Texas 77024 Page 9 IN WITNESS THEREOF, this Agreement, consisting of ten pages plus Exhibit "A" is executed in duplicate counterparts as of this I` `t day of 2015. ATTT ST: IV vw Tina Broussard City Clerk ATTEST: City of Beaumont Kyle Hayes City Manager do, wk T UL LWU Air Liquide Large Industries US LP B y: ///, o o' Page 10