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Home My WebLink AboutPR 14608: ALLY INVESTMENTS, LLC & NEOFUEL USA, INC. - AGREEMENTinteroffice MEMORANDUM To: .Mayor,- City Council, and City Manager From: Mark T. Sokolow, City Attorney ~~ ~~~~~_~ Date: March 20, 2008 Subject: P. R. No. 14608; Council Meeting March 25, 2008 Attached is P. R. No. 14608 as it pertains to an Incentive Agreement with Ally Investments, LLC. (Requested by Councilmember Williamson). Exhibit "C" will be discussed with the`City Council during the Executive Session on incentives. MTS:ts Attachment z.pr14508_memo P. R. No. 14608 03/20/08 is RESOLUTION NO A RESOLUTION AS IT PERTAINS TO AN INCENTIVE AGREEMENT WITH ALLY INVESTMENTS, LLC AND NEOFUEL USA, LLC (REQUESTED BY COUNCILMEMBER WILLIAMSON) WHEREAS, the City has received a proposal from Ally Investments, LLC and NeoFuel USA, LLC to build a pyrolysis plant adjacent to Denbo, as described in Exhibits "A" and "B"; and WHEREAS, Ally Investments, LLC and NeoFuel USA, LLC have requested incentives, which includes the waiver of building permit fees, tap fees, and other City required fees for the new facility; and WHEREAS, the City Council deems it appropriate for the City Manager and the City Attorney to negotiate incentives, as described in Exhibit °C" NOW THEREFORE, BE IT RESOLVED BY THE CITY,COUNCIL OF THE CITY OF PORT ARTHUR, TEXAS: Section 1. That the facts and opinions in the preamble are true and correct. Section 2. That the City Manager and the City Attorney are herein authorized to negotiate an incentive agreement with Ally Investments, LLC and NeoFuel USA, LLC with the terms as denoted in Exhibit "C" and with final approval by the City Council. z.pr14608 Section 3. That a copy of the caption of this Resolution be spread upon the Minutes of the City Council. READ, ADOPTED AND APPROVED on this day of A.D.,-2008, at a Meeting of, the City Council of the City of Port Arthur, Texas, by the following vote: AYES: Mayor Councilmembers NOES: ` MAYOR ATTEST: CITY SECRETARY APPROVED' AST/O FORM: ~cs,/t ~--L.G:.-E'er CITY ATTORNEY APPROVED FOR ADMINISTRATION: CITY MANAGER z.pr146oe ' EXHIBIT "A" ALLY INVESTMENTS, LLC February2l, 2008 Mr. Steve Fitzgibbons, City Manager City of Port Arthur City Hail P.O. Box 1089 Port Arthur, Texas 77641- 1089 Re: NeoFuels USA, LLC Dear Steve: Pursuant to our conversations regarding our pyrolysis plant being built in Port Arthur, I wanted to share a few facts about the project, as well as a few requests. NeoFuels USA plans to build the first pyrolysis plant in the United States at 400 Denbo, as a major addition to the Westend Development Project. This facility will require an initial investment of $50 million to $60 million, while bringing 110 permanent new jobs to Port Arthur, with an annual-payroll of apprdximately $5 million in its first phase. These numbers do not reflect the construction jobs and construction payroll created over the next year. We expect to have the plant operational prior to year end. I am requesting the City of Part Arthur give favorable consideration to the following: 1) Waive all building permit fees, tap fees, and other city required fees for a new facility. 2) An exclusive contract for all scrap tires generated by the city, including all tires presently stored in landfills under the City's jurisdiction. 3) Access to free advertising on the City owned television channel. 4) The City to create a monthly roundup to gather all scrap tires in and around the city, including unincorporated areas contiguous to Port Arthur, which may affect the health of the citizens of Port Arthur. 2501 Jimmy Johnson Blvd., Suite 201 Port Arthur, TX 77640 409.722.4001 409.722.4010 Fax - ALLY INVESTMENTS, r.Lc Again, it has been a pleasure visiting with you regarding this exciting "green project", which has zero emissions or pollutants. I think you will agree that this plant will showcase Port Arthur as manufacturers, environmentalists, and retailers from around the world come to the city to study the plant, the process, and this exciting new facility, which has such great economic benefits to Port Arthur and environmental benefits to our region. I shall anxiously await additional information from your office, as well as our next visit. In the interim, if I may be of assistance or should you have any questions, please contact me at your earliest convenience. Respectfully yours, ~N Saeed A. Ally, M.D. Chairman and CEO 2501 Jimmy Johnson Blvd.,. Suite 201 Port Arthur, TX 77640 409.722.4001 409.722.4010 Fax EXHIBIT "B" ~` ® ®~USA ~IcO~ i 2501 Jimmy Johnson Blvd.,$uite 201 ~ Pt. Arthur, TX 77640, ^ (409)-722-4001 March 7, 2008 Mr. Steve Fitzgibbons, City Manager City of Port Arthur City Hall ' P.O. Box 1089 Port Arthur, Texas 77641- 1089 Re: NeoFuels USA, LLC Dear Steve: would like to address the two concerns of the City Council namely the issues regarding. emissions from the plant and the storage of tires on the facility. Regarding the former, the plant and process produces no significant emissions and we are permitted by the TCEC! as such. I have attached excerpts of the permit for your review. Regarding the latter, the Neofuel plant will process 12 million tires per year. We will have enclosed storage sheds for our feedstock. Given the high volume of tires to be processed, . we will not have any significant volume of storage tires at the site. In addition, we have a separate staging site, away from the plant, that will be used for long term storage, if needed. I have attached a copy of the plant layout with the storage facility outlined. Thank you for your help. Respectfully yours, ~J ~ ~ Saeed A. Ally, M.D. - Chairman and CEO _, BECKON 5.0 - REGULATORY APPLJCA&LITY RE41EW AND CONIAOL TECHNOLOGY ANALYSIS The equipment addressed by this applicafion will achieve the performance described in this permit application. 5.1:8 §116.111(a)(2)(H) -NON ATTAINMENT REVIEW If the proposed facility is located in a nonattainment area, it shall comply with all - applicablerequirements in this chapter concerning nonattainment review. The proposed facility will be located in Jefferson County which is a nonattainment area for ozone. However, the proposed facility is neither a major stationary source nor a major modification and the predicted emission of VOC and NOx, criteria pollutants in azeas designated nonattainnient for ozone, are well below the emission threshold established for Jefferson County. Therefore, nonattainment review requirements aze not applicable to the _- ---propose8~acility: ---- ----- ----- - 5.1.9 §116.111(a)(2)(I) -PREVENTION OF SIGNIFICANT DETERIORATION (PSD) REVIEW If the proposed facility is located in an attainment area, it shall comply with all applicable requirements in this chapter concerning .PSD review. PSD review applies to facilities included in the EPA list of 28 named sources or to major stationary sources. The proposed facility, which will be located in an attainment azea for PM10, and 502, is neither one of the EPA's 28 named sources neither has the potential to emit 250 tons per year or more of a PSD regulated pollutant for which the area is _. - -- _._ .designated as attainment. Therefore, requirements for a PSD review in an attainment azea aze not applicable to the proposed facility. _ _ ._ - 5.1.10 6:11 §li6.li1(a)(2)(k)-HAZARDOUS AiR P(3LI:UTANTS Affected sourced (as defined in §116.15 (1) of this ride (relating ko'Section 112 (g) Definitions) for hazazdous air pollutants shall comply with all applicable requirements under Subchapter Cof this chapter (relating to Hazazdous Air Pollutant: Regulations Governing Constructed or Reconstructed Major Sources (FCAA, §112 (g), 40 CFR Part 63). The facility does not have any potential to emit any single HAP in excess of 10 ton/yr or total HAPs in excess of 25 ton/yr. Therefore, the facility is not a major source of HAPs and is not subject to §116.111(a)(2)(K). PAGE 3 OF 8 ~~,>;,~. wr~w 29xs° rt ~I Im W 0 N' 2'0° ~. ~ ~ ~ OPTION 2 niE as- eue nr.r' J ..._.. _... ......_. _.._.. _..... ~~~ EXHIBIT "C" will be .forthcoming