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Home My WebLink AboutTIF1 1998-10-20 AgendasOctober 14, 1998 Dolores Webb, Vice President Birdville Independent School District 7001 Grapevine Highway, #104 N. Richland Hills, TX 76180 Dear Ms. Webb: On September 14, 1998, the North Richland Hills City Council conducted the required public hearing —and approved Ordinance No. 2333 establishing Reinvestment Zone Number 1, City of North Richland Hills (see attached). To complete the process for creating a Tax Increment Financing District, it is now necessary to convene the Zone's Board of Directors. Therefore, the Reinvestment Zone Board's first meeting is scheduled — ON: Tuesday, October 20, 1998 AT: 11:30 a.m. (Lunch will be Served) IN: North Richland Hills' Pre -Council Room 7301 N.E. Loop 820 As required by State law, the Reinvestment Zone Board will consider approving the Preliminary Financing and Project Plans mailed to each taxing entity in July —and presented formally to each governing board prior to September 14. Upon the approval of these two plans by the Board of Directors, North Richland Hills' City Council will be asked to ratify them at their next meeting —and each of the overlapping jurisdictions will be asked to consider an agreement with the City, pursuant to the approved Financial Plan and Project Plan. Likewise, the Board will be asked to consider a set of Draft Bylaws (also attached) —as well as review a Draft Agreement between the City and the Birdville Independent School District. We look forward to seeing you on October 20. Please call (581-5534) if you have any questions or need additional information. Sincerely, Larry Cunningham City Manager/Acting TIF Manager REINVESTMENT ZONE NUMBER 1, CITY OF NORTH RICHLAND HILLS BOARD OF DIRECTORS MEETING TUESDAY, OCTOBER 20, 1998 CITY HALL PRE -COUNCIL ROOM 11:30 a.m. AGENDA Call to Order & Introductions 2 Consider Adoption of Board Bylaws 3. Consider Approval of the Preliminary Financing Plan 4. Consider Approval of the Preliminary Project Plan 5. Review Draft Agreement to Participate in the District And Discuss Remaining Steps Necessary for Zone Creation 6. Review Status of Drainage Project Implementation 7. Review Status of Richland Business Centre (Richland Plaza) Renovations Adjourn BYLAWS OF REINVESTMENT ZONE NUMBER ONE CITY OF NORTH RICHLAND HILLS, TEXAS (TAX INCREMENT REINVESTMENT ZONE) ARTICLE I PURPOSE AND POWERS Section 1. Development or Redevelopment in the Zone. In order to promote the development and redevelopment of a certain area within its jurisdiction, the City Of North Richland Hills, Texas (the "City") has authorized the creation of Reinvestment Zone Number One, City Of North Richland Hills, Texas, (the "Zone") following formal notification and presentation of the preliminary financial and project plans to the governing bodies of the other local taxing entities, as authorized by the Tax Increment Financing Act, Chapter 311, Texas Tax Code, as amended (the "Act"). Pursuant to the Act, the City has likewise established a Board of Directors ("Board") for the Zone. Section 2. Powers. The property and affairs of the Zone shall be managed and controlled by the City Council based on the recommendations of the Board, subject to the restrictions imposed by law, the ordinance creating the Zone, and these Bylaws. It is the intention of the City Council that the Board shall function in an advisory capacity with respect to the Zone and shall exercise only those powers that are either granted to the Board pursuant to the Act or delegated to the Board by the City Council. ARTICLE II BOARD OF DIRECTORS Section 1. Powers. Number and Term of Office. As set forth in the ordinance creating the Zone, the Board shall consist of nine directors; five of whom shall be appointed by the City Council of the City; one of whom shall be appointed by the governing body of the Birdville Independent School District ("BISD"); one appointed by the governing body of Tarrant County, Texas ("County"); one appointed by the Tarrant County Junior College District ("TCJC"); and one appointed by the Tarrant County Hospital District ("TCHD"); provided, however, that if a taxing unit (other than the City) waives its right to appoint a member to the Board, as evidenced by written resolution duly appointed by the governing body of such taxing unit, the City may appoint such Board member in its stead. Each initial Board member shall serve two-year terms, as stipulated in the Act, or until his or her successor is appointed. Subsequent directors shall be appointed by the governing bodies of the City, BISD, County, TCJC and TCHD and shall serve two year terms until their successors are appointed by the respective governing bodies. In the event of a vacancy caused by the resignation, death or removal, for any reason, of a director, the governing body of the respective taxing unit (i.e. 2 City, County, BISD, TCJC, TCHD) which made such Board appointment shall be responsible for filling the vacancy. Section 2. Meetings of Directors. The directors may hold their meetings within a building accessible to the public in the City as the Board may from time to time determine. Section 3. Regular Meetings. Regular Meetings of the Board shall be held at such times and places as shall be designated from time to time, by the Board. Notice of all regular and emergency meetings of the Board and any committees thereof shall be conducted and posted in accordance with the provisions of the Texas Open Meetings Act, Article 6252-17, Vernon's Annotated Civil Statutes, as amended. There shall be at least one Regular Meeting held each year in the month of April. Section 4. Emergency Meetings. Emergency Meetings of the Board shall be held whenever called by the Chairman, by the secretary, by a majority of the directors then in office or upon advice of or request by the City Council or Zone Manager. The secretary shall give notice to each director of each Emergency Meeting in person, or by courier, facsimile, telephone, telegraph, or electronic M mail, at least 24 hours before the meeting. Notice of all Emergency Meetings shall state the purpose, which shall be the only business conducted. Section 5. Quorum. A majority of the directors holding current appointments shall constitute a quorum for the consideration of matters pertaining to the purposes of the Zone. The act of the majority of the directors present at a meeting at which a quorum is in attendance shall constitute the act of the Board, unless a greater number is required by law. Section 6. Conduct of Business. At the meetings of the Board of Directors, matters pertaining to the purposes of the Zone shall be considered in such order as from time to time the Board may determine. At all meetings of the Board, the Chairman shall preside and in the absence of the Chairman, the Vice Chairman shall exercise the power of the Chairman. The Secretary of the Board shall act as Secretary of all meetings of the Board, but in the absence of the Secretary, the presiding officer may appoint any person to act as Secretary of the meeting. City staff shall provide notice of meetings and prepare meeting agendas. 4 Within five business days following each Regular and Emergency meeting, a copy of the minutes of the meeting shall be submitted to the City Secretary of the City. Section 7. Compensation of Directors. Directors as such shall not receive any salary or compensation for their services, except that they shall be reimbursed for their actual expenses incurred in the performance of their duties hereunder. Section 8. Attendees. Board Members shall make every effort to attend all Regular and Emergency Meetings of the Board and/or any Committees. The City Council may replace a City appointee of the Board or request replacement of an appointee from other taxing jurisdictions for non-attendance. Section 9. Books and Records: Approval of Programs and Financial Statements. The Board shall keep, correct and complete books and records of accounts, and shall also keep minutes of its proceedings and the proceedings of any committees having any of the authority of the Board. All books and records of the Zone may be inspected by any director or his agent or attorney for any proper purpose at any reasonable time; and at all times the City Council and the City Auditor will have access to the books and records of the Zone. The City council must approve all programs and expenditures for the Zone and annually review any financial statements of the Zone. ACT III OFFICERS Section 1. Titles and Terms of Office. The officers of the Zone shall consist of a Chairman, a Vice Chairman, a Secretary, and such other officers as the Board of Directors may from time to time elect or appoint; provided, however, that the City Council shall, on an annual basis, appoint the chairman in accordance with the Act. One person may hold more than one office, except that the Chairman shall not hold the office of Secretary. Terms of office for officers, other than the Chairman, shall not exceed two years. All officers, other than the Chairman, shall be subject to removal from office, with or without cause, at any time by a vote of a majority of the entire Board. A vacancy in the office of any officer, other than the Chairman, shall be filled by a vote of a majority of the directors. Section 2. Powers and Duties of the Chairman. The Chairman shall serve as the Chairman of the Board and shall preside at all meetings of the Board. C. Section 3. Vice Chairman. The Vice Chairman shall be a member of the Board, shall have such powers and duties as may be assigned to him by the Board, shall exercise those powers and duties, and shall exercise the powers of the Chairman during that officer's absence or inability to act. Any action taken by the Vice Chairman in the performance of the duties of the Chairman shall be conclusive evidence of the absence or inability to action of the Chairman at the time such action was taken. Section 4. Secretary. The Secretary shall keep the minutes of all meetings of the Board in books provided for the purpose, he/she shall have charge of such books, records, documents and instruments as the Board may direct, all of which shall at all reasonable time be open to inspection, and he/she shall in general perform all duties incident to the office of Secretary subject to the control of the City Council and the Board. Section 5. Zone Manager. The Zone Manager shall be the City Manager, and shall serve as the chief operating officer of the Board, subject to the paramount authority of the Board and the approval of the City Council. He/She shall be in general charge of the properties and affairs of the Zone, shall execute all service contracts, conveyances, franchises, bonds, deeds, assignments, notes and other instruments in the name of the Zone and subject to the Rules and Procedures of the City. The Zone manager shall also oversee all additional staff functions. 7 Section 6. Staff. Additional staff functions for the Board shall be performed by the Zone Manager and his/her designee(s). Section 7. Compensation. Officers who are members of the Board shall not receive any salary or compensation for their services, except that they shall be reimbursed for their actual expenses incurred in the performance of their official duties as officers. ARTICLE IV PROVISIONS REGARDING BYLAWS Section 1. Effective Date. These Bylaws shall become effective upon adoption by the Board and approval by the City Council. Section 2. Amendments to Bylaws. These Bylaws may be amended by majority vote of the Board, provided that the Board files a written application to the City Council requesting approval of such amendment, specifying in such application the amendment or amendments proposed. If the City Council, by appropriate resolution, finds and approves the form of the proposed amendment(s), the Board shall proceed to amend the Bylaws. N After consultation with the Board, the Bylaws may also be amended at any time by the City Council by adopting an amendment to the Bylaws by resolution of the City Council and delivering the Bylaws to the Secretary of the Board. Section 3. Interpretation of Bylaws. These Bylaws and all the terms and provisions hereof shall be liberally construed to the purposes set forth herein. If any word, phrase, clause, sentence, paragraph, section or other part of these Bylaws, or the application thereof to any person or circumstance, shall ever be held to be invalid or unconstitutional by any court of competent jurisdiction, the remainder of these Bylaws and the application of such word, phrase, clause, sentence, paragraph, section or other part of these Bylaws to any other person or circumstance shall not be affected thereby. ARTICLE V GENERAL PROVISIONS Section 1. Notice and Waiver of Notice. Whenever any notice whatsoever is required to be given under the provision of these Bylaws, said notice shall be deemed to be sufficient if given by depositing the same in a post office box in a sealed postpaid wrapper addressed to the person entitled hereto at his/her post office box as it appears on the books of the Zone. Such notice shall be deemed to have been given on the day of such mailing. Attendance of a director at a meeting shall constitute a waiver of notice of such meeting, except 9 where a director attends a meeting for the express purposes of objecting to the transaction of any business on the grounds that the meeting is not lawfully called or convened. A waiver of notice in writing signed by the person or persons entitled to said notice, whether before or after the time stated herein, shall be deemed equivalent to the giving of such notice. Section 2. Resignations. Any director or officer may resign at any time. Such resignation shall be made in writing and shall take effect at the time specified therein, or, if at no time specified, at the time of its receipt by the City Council. The acceptance of a resignation shall not be necessary to make it effective, unless expressly so provided in the resignation. Section 3. Approval or Delegation of Power by the City Council. To the extent that these Bylaws refer to any approval by the City or refer to advice and consent by the Council, such approval, delegation, advice and/or consent shall be evidenced by official action of the City Council, through a certified copy of a resolution, order or motion. Me E I 1 1**41tH CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. 1 PRELIMINARY FINANCE PLAN July 8, 1998 PREPARED BY: :FFtRST SOUTHtitiFSTCOMPANY CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. 1 FINANCING OPTIONS FOR TAX INCREMENT SUPPORTED DEBT E CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. 1 IDEFINITION OF TERMS ♦ The City creates the Tax Increment Reinvestment Zone (TIRZ). ♦ The Base Value is the value that is on the ground when the TIRZ is Created. ♦ The Captured Assessed Valuation is the real property which is added to the tax base after TIRZ is created. The Captured Assessed Valuation does not include personal property. ♦ The TIRZ has no taxing powers; however, participating overlapping political subdivisions' tax revenues generated on the Captured Assessed Valuation are diverted to the Tax Increment Fund. ♦ Tax increment revenues can only be used for the benefit of the property within the TIRZ, including paying for capital improvements and paying debt service on bonds issued for improvements. ♦ A TIRZ has a defined period of existence which may be related to the term of debt. Once the TIRZ is abolished, the tax revenues are no longer diverted to the Tax Increment Fund. 4 ♦ The City creates the TIRZ and is the issuer of debt and is therefore responsible for the payment of the Debt. Other participating political subdivisions allow their tax revenues to be diverted to the Tax Increment Fund and have representation on the TIRZ Board. C 1 3 CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. 1 i 4 FINANCING OPTIONS FOR TAX INCREMENT SUPPORTED DEBT 3 I toCombination Tax and TIRZRevenue Certificates of Obligation i ♦ Same rating as general obligation bonds; ♦ Requires a pledge of tax increment revenues and ad valorem property taxes; f ♦ Are subject to vote if petitioned by 5% of the registered voters; ♦ Most cost effective debt option; ♦ Sold on a more timely basis. it TIRZ Revenue Bonds j♦ Supported solely by the revenues generated by the TIRZ zone; ♦ Cannot generally be marketed until improvements are on the ground; ♦ Generally, these are sold at a lower rating than certificates of obligation; ♦ They require the use of a Reserve Fund and restrictive additional issuance covenants; ♦ Higher borrowing costs. 4 f CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. 1 FLOW -OF -FUNDS Tax Increment Revenues City Ad Valorem Property Tax Revenuesltl Interest Earnings on Construction Fund"' i -'-'--'--(1) Ifnecessary. (2) During construction period only. 11 9 11 A R CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. I SOURCES OF TAX INCREMENT FUND REVENUES 1 4 4 4 CITY OF NORTH RICHLAND HILLS Tax Increment Reinvestment Zone No. 1 Sources of Funds Sources of Funds Certificates of Obligation Interest Earnings on Construction Fund Total Sources of Funds Amount $ 850,000.00 50,000.00 $ 900,000.00 ■ 7 :1 CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. I PRELIMINARY FINANCE PLAN PROJECTED TAX INCREMENT FUND CASH FLOWS s CITY OF NORTH RICHLAND HILLS Tax Increment Reinvestment Zone No. 1 Estimated Tax Revenues t 100% 100% 100% 100% 100% Total City of Tarrant Tarrant Cty. Tarrant Cty. Birdville Total Fiscal Captured N. Richland Hills County Jr. College Hosp. Dist. ISD Tax Revenues(�) Year Valuation(]) S 0.570000 $0 264840 S0.057690 S0.234070 S 1.500500 S 2.627100 1998 1999 2,500,000 14,250 6,621 1,442 5,852 37,513 65,678 2000 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 A 2001 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 2002 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 2003 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 s 2004 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 r 2005 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 T 2006 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 2007 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 I 2008 5,375,000 30,638 14,235 3,101 12,581 80,652 141,207 UN- (1) Source: Today Richland Center LP (2) Assumes total captured value of S5.375.000 by September 30. 2000. If the projected captured value is not achieved. the TIRZ may not accumulate sufficient revenue to call all S425. 000 of the callable Certificates in FY2008. If the revenues are not sufficient, the Certificates will continue to be paid off annually until all certificates are redeemed or until final maturity in 2018, which ever comes first. 9 CITY OF NORTH RICHLAND HILLS Tax Increment Reinvestment Zone No. I Tax Increment Fund - Estimated Coverage Calculations $ 850,000 Estimated Estimated Estimated Estimated Certificate Certificate Surplus Cumulative Fiscal Pledged Debt Coverage Certificate Surplus Year Revenues Service Ratio Coverage Coverage__ 1998 n/a 1999 $ 65,678 $ 96,541 n/a IZI 2000 141,207 81,998 1.72 $ 59,209 $ 59,209 2001 141,207 79,813 1.77 61,394 120,602 2002 141,207 77,628 1.82 63,579 184,181 . 2003 141,207 75,443 1.87 65,764 249,945 2004 141,207 73,257 1.93 67,950 317,894 2005 141,207 71,072 1.99 70,135 388,029 . 2006 141,207 68,887 2.05 72,320 460,348 2007 141,207 66,702 2.12 74,505 534,853 2008 141,207 489,516 (3) n/a n/a 186,544 (4) (I) Assumes total captured value of 55,375,000 by September 30, 2000. If the projected captured value is not achieved, . the TIRZ may not accumulate sufficient revenue to call all $425, 000 of the callable Certificates in FY2008. If the revenues are not sufficient, the Certificates will continue to be paid off annually until all certificates are redeemed or until final maturity in 2018, which ever comes first. (2) Paid from interest earnings on construction fund. . (3) Includes $425,000 which represents the principal amount of the callable portion of the Certificates, to be paid out of Cumulative Surplus Revenues generated by the TIRZ. (4) Estimated surplus after calling and retiring all outstanding Certificates associated with the project. ■ 10 CITY OF NORTH RICHLAND HILLS, TEXAS TAX INCREMENT REINVESTMENT ZONE NO. 1 TENTATIVE TIMETABLE OF EVENTS Day Action 1 Staff and First Southwest Company prepare a conceptualized financing plan for City Council review and comment. 30 City Council authorizes the team to move forward with the creating a financing plan and project plan. 60 Presentation of Preliminary Financing Plan and Preliminary Project Plan to City Council. 90 Presentations to overlapping jurisdictions 100 City Council calls a Public Hearing (60 day notice) 115 Within 15 days, the overlapping jurisdictions appoint a representative to meet with the City. 160 Formal presentations to the overlapping jurisdictions 160 Public Hearing; City Council creates the tax increment reinvestment zone 175 Overlapping jurisdictions vote to participate in the TIRZ 180 First TIRZ Meeting: Board approves the Preliminary Financing Plan and Preliminary Project Plan 190 City Council ratifies Preliminary Financing Plan and Preliminary Project Plan 195 Overlapping jurisdictions vote to contract with the City pursuant to the Financing Plan and Project Plan . 200 Begin Bond Issuance Process January I, 1999 First increment is realized RICHLAND PLAZA DRIVE 1 ®.9 \ 4%:',�� 9,c ,\ X\ r / r 61 Ilk 0 � a . 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Z 1 m > r 7 m V > , r ZC rCl> _ y O C p pip p a p p 3 s Richland Business Centre T :.� __ _ _z Highway 26 & Richland Plaza Drive _ z J North Richland Hills, Texas pip CEO - p O p p- CITY OF NORTH RICHLAND HILLS TAX INCREMENT REINVESTMENT ZONE NO. 1 PRELIMINARY PROJECT PLAN JULY 8, 1998 PREPARED BY THE CITY OF NORTH RICHLAND HILLS ECONOMIC DEVELOPMENT DEPARTMENT Preliminary Project Plan Page 2 As required by the Chapter 311, Title 3, Subtitle B of the Texas Property Tax Code, the City of North Richland Hills and First Southwest Company submit the following Preliminary Project Plan for the creation of the Richland Plaza Tax Increment Reinvestment Zone: BACKGROUND Fort Worth -based Ranchview Investments, Inc. assembled a group of investors (Today Richland Center, L.P.) to purchase the 42.09-acre Richland Plaza shopping center complex. In conjunction with Calloway Architects, Today Richland Center officials have prepared plans to renovate and convert Richland Plaza into a mixed -use "business center" — including spaces for office, industrial/manufacturing and service retail uses. Preliminary architectural renderings portray the future Richland Business Centre as a well - landscaped development that preserves existing stone in attractive new facades. PROJECT In the process of preparing these development plans, however, Today Richland Center representatives pointed out that the unimproved Mackey Creek Channel periodically steers a great deal of water onto Richland Plaza, encircling the development with floodplain and even floodway. While the City of North Richland Hills has plans for a $531,000 project to improve the Mackey Creek runoff, it is not scheduled until 2000—and would block Richland Plaza's redevelopment, as well as take the water across the best location for potential new development. Di Sciullo & Terry, Inc. Consulting Engineers of Arlington have completed a Conceptual Drainage Study evaluating two options for the drainage —a south culvert running east/west (taking water underneath Richland Plaza's parking lot), priced at $2.7 million and a north channel which extends west to Big Fossil Creek, costing $1.34 million (see Exhibit 1). The City, Today Richland Center and Di Sciullo & Terry all agree that the north channel offers the best option —and the Birdville Independent School District Board of Trustees has already agreed to grant an easement for the portion of this project which crosses its vacant "Thomas Acres" property. Preliminary Project Plan Page 3 The following is Di Sciullo & Terry's description of the North Channel project: "Flood waters will be conveyed from Mackey Creek at the north side of Richland Plaza Drive west to Big Fossil Creek. This conveyance system utilizes open channels to convey the water with two culverts under Richland Plaza Drive. The channels are grass lined with a concrete pilot channel to convey low flows. Energy dissipater baffles are required at the culvert outlets, drop structure within the channel, and the channel outlet at Mackey Creek. The culverts under Richland Plaza Drive near the inlet and the channel between the Richland Plaza Drive culverts are designed to convey the 100 year flood. The culverts under west Richland Plaza Drive and the downstream channel are designed to convey the 10- year flood, while the 100-year flood will continue to flow across the west parking lots away from the onsite buildings." MAP Attached are an aerial map showing the existing conditions and uses of the 42.09-acre Richland Plaza shopping center and a site plan and artist rendering illustrating the proposed improvements to and use of the future Richland Business Centre complex. PROPOSED CHANGES TO ZONING ORDINANCE, MASTER PLAN, BUILDING CODES AND/OR OTHER MUNICIPAL ORDINANCES The existing zoning (1-2) will provide for all uses intended by owner/developer Today's Richland Center, LP. The City of North Richland Hills is not proposing any changes to its master plan, zoning ordinance, building codes or any other municipal ordinances to help facilitate this project. LIST OF NON -PROJECT COSTS The City of North Richland Hills expects that Today's Richland Center, LP, its tenants and/or other future investors will to spend a minimum of $5.375 million in abating asbestos, restoring the building shells and completing tenant finish out, as well as constructing two 10,000 sf retail buildings on outparcels. The non -project costs are as follows. - Asbestos Replacement in Buildings 1 through 6 $ 212,750 Roof Replacement, Shell & Parking Lot Restoration 3,126 925 Replacement of 8" water line and fire hydrants 120,950 Preliminary Project Plan Page 4 (Non -Project Costs continued) Parking Lot & Street Lighting 244,375 Estimated Tenant Finish out 770,000 Retail Outparcel Development 900,000 Total $5,375,000 METHOD OF RELOCATION The City of North Richland Hills does not anticipate needing to relocate any existing property owners or tenants as a result of implementing the plan. Representatives of the owner/developer are negotiating with several existing tenants about possible relocation as a requirement of their leases, and the City's Economic Development Department will continue to offer its assistance in placing (and, if possible, retaining) these businesses in a new location. Preliminary Project Plan Page 5 EXHIBIT 1 Proposed Tax Increment Reinvestment Zone Project Plan Mackey Creek Channel Improvements North Channel to Big Fossil Creek Estimated Cost of Project Plan: Non-TIF Expenses: North Richland Hills Bond Principal $531,000 Cost of Issuance 5,300 Interest Expense Over 20 Years 271,484 Total $807,784 TIF Expenses Balance of Proposed Drainage Project $850 000 Cost of Issuance 8,500 Interest Earnings 50,000 Interest Expense Over 20 Years 435,997 Total $1,344,497 y - Property Line- r •�ti •Ioo,000 G.>t. Gro,.�ly Ton^ o ` Par k i n9 on 100 4t. To-e r. Botto.n 17(t Abv,H:)V, sk spr A+,Itr111 - - (N.l'l.. Ux\ I � Sin , �-• .� -- Ng _ 6' fin cl I BLDG. A _ BLDG..13 BLDG. C zoo,t 1135 335 'A LGS -j_ ilt, -t r rote ISto. 8 Br. Focg ' - - - - - - - - - - - - - - - - - - - - r Ilo..r.co..r�� • LJ.o 6 < 'IG. ,e : Jn^xr. .ram..•.:, zzs z Bo � •nn•� Sro.` rn ��c Sro;._r• o C 1- `1 i L25 o-i cs erne•. L--- ----' 'II $;... (i Sin • t-- - - - -'r r. r !•, c....-L� ,i�� n.. a!-l• ,f.,.. f..l..- ..,. i ♦,._-�l ��,•.': 'c'-!%' �' l ae_r.. :e C�ol�orce T171 Gs�.o� ,. rcu cam •rl..aa ------------- Richland Business Centre 17CALLAWAY North Richland Hills, Texas CITY OF NORTH RICHLAND HILLS Department: Economic Development Council Meeting Date: 10/20/98 Subject: Draft Agreement to Participate in District Agenda Number TIF 98-1.5 Representatives of the Birdville Independent School District (BISD) have expressed concern for their participation in the Tax Increment Reinvestment Zone —and the possible impact on BISD's State funding. BISD would like to have the ability to adjust their contribution in the event that the TIF does affect their payments or contributions under Texas school finance laws. The attached Draft Agreement provides for that possibility (see Section 1.a.)—and it is included on the Reinvestment Zone agenda for the Board's consideration. Please note that if BISD's participation in the TIF does affect their State funding —and therefore does in fact reduce the percentage of their annual repayment —the life of the District is likely to be extended past the preferred 10 years. The bonds must be repaid within 20 years. Ed Esquivel of Fulbright Jaworski (the City's Bond Attorney) has indicated to us that the Act constitutes a difference in TIFs—whether created through property owner petition or City initiation (as is the case here) --and he believes the TIRZ has no authority for such an agreement. Mr. Esquivel believes that if challenged, such an agreement may not hold up in court since the Act stipulates that each taxing unit notify the Board in writing of its percentage of determination on or before the 601h day after the North Richland Hills City Council approves the Financing Plan. Nevertheless, City and BISD staff believe such an agreement does provide a structure for the City, the Board and BISD to follow in negotiating BISD's level of participation —and may serve as BISD's notification as required by law RECOMMENDATION That the Board recommend the North Richland Hills City Council enter into such an agreement with the Birdville Independent School District. Source of Funds: Bonds (GO/Rev.) Finance Review Acct. Number Sufficient Funds Available Operating udget h r Firma Dr.a« epartment Head Signature V Cit nager CITY COUNCIL ACTION ITEM Page 1 of CITY OF NORTH RICHLAND HILLS AND BIRDVILLE INDEPENDENT SCHOOL DISTRICT AGREEMENT TO PARTICIPATE IN THE RICHLAND PLAZA TAX INCREMENT FINANCING DISTRICT THIS AGREEMENT TO PARTICIPATE IN REINVESTMENT ZONE NUMBER ONE, CITY OF NORTH RICHLAND HILLS (the "Agreement') is made and entered into by and between the City Of North Richland Hills, ("City"), a municipal incorporation and the Board of Trustees of the Birdville Independent School District ("BISD"). WITNESSETH: WHEREAS, in accordance with the provisions of the Tax Increment Financing Act, V.T.C.A., Tax Code, Chapter 311, (the "Act'), and after due notice to the BISD and other taxing units levying real property taxes in the area, the City Council of the City, pursuant to Ordinance No. 2333 (the "Ordinance"), adopted on September 14, 1998, created, established and designated "Reinvestment Zone Number One, City Of North Richland Hills, Texas" (hereinafter called the "Reinvestment Zone") under the Act; and WHEREAS, the Act provides that each taxing unit levying taxes on real property in a reinvestment zone may determine the portion of the tax increment produced that it will retain, if any, by notifying the Board of Directors of the Zone in writing of that percentage on or before the 60th day after the date on which the governing body of the municipality approves the reinvestment zone financing plan as provided by Section 311.011 (d). Likewise, the governing body of a taxing unit may not decrease the portion of the tax increment that it has determined to dedicate to a reinvestment zone after the project plan is approved; and WHEREAS, the City desires to enter into an agreement with BISD prior to the 60th day after the City approves the reinvestment zone financing plan; and WHEREAS, a tax increment agreement under the Act may be entered into any time before or after the zone is created, and such agreement may include any conditions for payment of the tax increment into the fund and must specify the portion of the tax increment paid into the tax fund and the years for which that tax increment is to be paid into the tax increment fund; and WHEREAS, the City and BISD desire to enter into this Agreement. NOW, THEREFORE, the City, Board and BISD, in consideration of the terms, conditions, and covenants contained herein, hereby agree as follows: Section 1. BISD Participation BISD agrees to pay into the Tax Increment Fund 100% of taxes levied and collected against the captured appraised value of real property as determined in Section 311.012 of the Act, in said "Reinvestment Zone" subject to the following terms and conditions: a. BISD shall retain, from the taxes described above, the amount necessary to offset any negative impact on BISD, as a result of its participation in the Reinvestment Zone, relating to State funds that would otherwise be received by BISD or relating to amounts that must be paid or contributed by BISD under school finance law. Each fiscal year, BISD shall calculate the amount necessary to offset such negative impact, if any, and shall deduct such amount from the payment made pursuant to section 311.012 of the Act. Each such calculation shall take into account any adjustments to the amount calculated for the previous year that should be made in order to reflect the actual impact on the School for such previous fiscal year. In return, BISD shall document these calculations and report them to the Board within 30 days of paying the annual increment. b. The boundaries of the Reinvestment Zone are and shall be those boundaries described in the Ordinance. C. Within the boundaries of the Reinvestment Zone, a mixed -use business center of 290,000 or more square feet of enclosed office, manufacturing, retail, service and/or distribution space and other out parcel development is proposed to be constructed. d. The land within the boundaries of the Reinvestment Zone is to be appraised by the central appraisal district in 1998 for ad valorem tax purposes and for establishing the tax increment base referenced in Section 311.012 of the Act. e. The total principal amount of bonds issued to pay public improvement costs for the Reinvestment Zone pursuant to Section 311.015 of the Act shall not exceed Eight Hundred Fifty Thousand Dollars ($850,000) in present value 1998 funds. Total issuance costs will be approximately $8,500. 2 f. All amounts paid into the tax increment fund shall be used solely to repay cash expenditures for project costs or the principal of and interest on bonds, notes or other evidence of indebtedness issued to finance project costs under the Act and generally accepted accounting principles to the administration of the Reinvestment Zone; however, in no event shall any of the amounts paid into the tax increment fund be used to pay any overhead or administrative cost of City employees or officials for time spent or services rendered with respect to the Project. Section 2. In accordance with Section 311.013 of the Act, BISD shall not be required to pay tax increment into the tax increment fund of the Reinvestment Zone after three years from the date the Reinvestment Zone has been created unless: a. cash has been expended for the Reinvestment Zone under Section 311.015 of the Act to finance the Project, or b. construction of the Project pursuant to the project plan has begun in the Reinvestment Zone. Section 3. As inducement to BISD to enter into this Agreement, the City agrees that no cash will be expended to construct the Zone Project until (a) a final project plan and financing plan has been prepared and adopted by the Board of Directors of the Reinvestment Zone and approved by City Council of the City and (b) the City has been furnished documentation and evidence satisfactory to the Board of Directors of the Reinvestment Zone and the City to the effect that all final agreements and arrangements for the construction of the Project have been completed and executed and all major construction contracts necessary to complete the construction have been awarded. Section 4. The term of this Agreement shall be for three years from the date the Reinvestment Zone was created, in accordance with Section 2, or until all cash expended for the Reinvestment Zone under Section 311.015 of the Act, or refunding bonds issued to refinance the bonds issued under Section 311.015 of the Act, have been fully paid and discharged, whichever event shall be the latest to occur. Section 5. City and BISD shall each be responsible for the sole negligent acts of their officers, agents, employees or separate contractors. In the event of joint and concurrent negligence of the City and BISD, responsibility, if any, shall be apportioned comparatively in accordance with the laws of the State of Texas, without, however, waiving any governmental immunity available to the City and BISD under Texas law and without waiving any defenses of the parties under Texas law. K, Section 6. Administration. This agreement shall be administered by the City Manager or his designee(s). Section 7. Notice. Whenever this Agreement requires or permits any consent, approval, notice, request, proposal, or demand from one party to another, the consent, approval, notice, request, proposal or demand must be in writing to be effective and shall be delivered to the party intended to receive it at the addresses shown below: If intended to the City or the Board, to: City Manager City Of North Richland Hills P.O. Box 820609 North Richland Hills, Texas 76182-0609 If intended for BISD, to: Superintendent of Schools Birdville Independent School District 6125 East Belknap Haltom City, Texas 76117 Or to such other addresses as the parties may request, in writing, from time to time. Section 8. Governing Law and Venue This Agreement is made subject to the provisions of the Charter and ordinances of the City, as amended; Texas constitution, codes, and statutes; and all other applicable state and federal laws, regulation and requirements, as amended. Venue shall be exclusively in Tarrant County, Texas. Section 9. Binding Agreement This Agreement shall be binding upon, and shall inure to the benefit of, the parties hereto and their respective successors and assigns. No third party shall have any rights herein. Section 10. Execution. This Agreement shall become a binding obligation on the parties upon execution by all parties. Each party hereto warrants and represents that the individual executing this Agreement on behalf of such party has full authority to executive this Agreement and bind such party to the same. This Agreement may be executed in one (1) or more counterparts, each of which shall be deemed an original and all of which taken together shall constitute one in the same agreement. 4 Section 11. Entire Agreement. This Agreement embodies the complete understanding of City and BISD, superseding all oral or written previous and contemporary agreements between the parties relating to matters herein. This Agreement may be amended, modified, or supplemented only by an instrument in writing executed by City and BISD. Any alterations, additions or deletions to the terms of this Agreement required by changes in federal, state or local law or regulations will be automatically incorporated into this Agreement without written amendment, and shall become effective on the date designated by such law or regulation. EXECUTED this the day of , 1998, by the City, signing by and through its City Manager, duly authorized by Resolution No. approved on , 1998, and by BISD, through its duly authorized officials. APPROVED AS TO FORM: CITY OF NORTH RICHLAND HILLS Rex McEntire City Attorney Larry Cunningham City Manager BIRDVILLE INDEPENDENT SCHOOL DISTRICT By: Dr. Bob Griggs Superintendent of Schools 5