HomeMy WebLinkAboutPR 21943: AGREEMENT IWTH DEZTEX INDUSTRIAL SERVICES, LLC DBA RAMTEX Q_
PORT*ARTHUR
ONONIC DEVELOPMENT CORPORATION
INTEROFFICE MEMORANDUM
Date: May 14, 2021
To: The Honorable Mayor and City Council
Through: Ronald Burton, City Manager
From: Floyd Batiste, CEO Port Arthur EDC ---i
RE: PR 21943 —Amendment#1 to Incentive Agreement with Deztex Industrial
Services, LLC dba Ramtex
Introduction:
The intent of this Agenda Item is to seek City Council's approval of a First Amendment to the
Economic Incentive Contract &Loan Agreement between the PAEDC and Deztex Industrial
Servics, LLC dba Ramtex.
Background:
The PAEDC awarded Ramtex a conditional incentive in an amount of$288,460.00 to reimburse
Ramtex for equipment purchased for the expansion of their operations into the Spur 93 Business
Park. Ramtex has promised to employ Port Arthur residents in jobs created by this expansion and
create a total of$1,978,080.00 in Port Arthur payroll over three years. Ramtex has requested an
extension to the term of their Agreement to allow for two more years to complete the payroll
requirement as they have faced setbacks in work due to the recent pandemic.
Budget Impact:
None
Recommendation:
It is recommended that the City Council of the City of Port Arthur approve the First Amendment
to the Economic Incentive Contract & Loan Agreement between the PAEDC and Deztex
Industrial Servics, LLC dba Ramtex allowing Ramtex two additional years to perform their
contractual obligations.
P. R. No. 21943
5/5/2021 KVM
RESOLUTION NO.
A RESOLUTION APPROVING FIRST AMENDMENT TO THE
ECONOMIC INCENTIVE CONTRACT & LOAN AGREEMENT
BETWEEN THE CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION AND DEZTEX
INDUSTRIAL SERVICES,LLC D/B/A RAMTEX
WHEREAS, per Resolution 19-294 dated July 16, 2019, the City Council of the City of
Port Arthur approved an Economic Incentive Contract & Loan Agreement (the "Agreement")
between the City of Port Arthur Section 4A Economic Development Corporation("PAEDC")and
Deztex Industrial Services, LLC d/b/a Ramtex ("Ramtex") in an amount of $288,460.00 to
reimburse Ramtex for equipment purchased for the expansion of their operations into the Spur 93
Business Park; and
WHEREAS, Ramtex has requested an amendment to their Agreement to allow for more
time to perform their contractual obligations as they have had a reduction in projects due to the
pandemic effect on the local economy resulting in a reduced workforce as detailed in the letter
submitted by Ramtex on April 9, 2021 and attached hereto as Exhibit"A"; and
WHEREAS, the PAEDC Board of Directors at their regular Board meeting of May 3,
2021, approved extending the Agreement with Ramtex by two additional years as detailed in the
First Amendment to the Agreement attached hereto as Exhibit"B".
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 Council of the City of Port Arthur approves the First Amendment
to the Economic Incentive Contract & Loan Agreement between PAEDC and Deztex Industrial
Services, LLC d/b/a Ramtex.
Section 3. That a copy of the caption of this Resolution shall be spread upon the Minutes
of the City Council.
READ, ADOPTED AND APPROVED on this day of A.D., 2021,
at a Meeting of the City Council of the City of Port Arthur, Texas, by the following vote: AYES:
Mayor
Councilmembers
•
NOES:
Thurman Bartie, Mayor
ATTEST:
Sherri Bellard, City Secretary
APPROVED:
Floyd Batiste, PAEDC CEO
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APP • ' 11 AS TO FORM:
aed:c..„
Guy N. Goodson, PAEDC Attorney
APPROVED AS TO FORM:
Valecia R. Tizeno, City Attorney
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EXHIBIT "A"
DezTex Industrial Services,LLC-dba Website:www.Deztex.com
RAtNTaxtlt Company Email:info@deztex.com
905 jade Ave,Port Arthur,TX 77640
P.O.Box 21397,Beaumont,TX 77720
10:409-983-5555 IF :409-985-7762
April 9,2021
ATTN: Port Arthur Economic Development
Port Arthur,TX
Reference: Contract Agreement Dated August 7,2019
Request for Time Extension
Dear PAEDC:
With receipt of the attached letter in regards to the economic incentive provided in 2019,
we would sincerely request an extension of time through an Amendment with regard to the
economic hardships our industry faced during the year of 2020 and the continuing effects
to our area's industrial market. Due to the COVID-19 effect on the local economy, our
company endured through the shutdown,but suffered nearly 50% loss in our employee
family with the lack of clients moving forward with industrial work, and or projects being
completely shut down. This directly affected our ability to retain and produce the payroll
milestones agreed upon in our current contract.
We would like to respectfully request an additional two to three years for our company to
meet the milestone goals in the agreement with a hopeful uptick in the local economy as
clients begin to release resources to begin work that we can service.
In a good faith effort, our company has begun to pick up some work which has resulted in
hiring an additional 5 employees who are Port Arthur residents just in the past month. We
hope to continue to retain more work in the area and put additional Port Arthur residents to
work as the industrial clients continue to move forward with projects.
Thank you for your consideration for the additional time.
Sincerely,
Jordan Robbins
Deztex Industrial Services LLC,
DBA RAMTEX
409-983-5555
www.deztex.com
EXHIBIT " B "
FIRST AMENDMENT TO THE
ECONOMIC INCENTIVE CONRACT & LOAN AGREEMENT
BETWEEN
THE CITY OF PORT ARTHUR SECTION 4A
ECONOMIC DEVELOPMENT CORPORATION
AND
DEZTEX INDUSTRIAL SERVICES, LLC D/B/A RAMTEX
WHEREAS, Deztex Industrial Services, LLC d/b/a Ramtex ("Incentive Recipient") and
the City of Port Arthur Section 4A Economic Development Corporation ("PAEDC") entered into
an Economic Incentive Contract& Loan Agreement(the"Agreement") on July 16, 2019 pursuant
to Resolution No. 19-294
WHEREAS, the Agreement provided that Incentive Recipient would expand their
business operations in the Spur 93 Business Park; and
WHEREAS, the Agreement provided that Incentive Recipient would receive a credit
against payroll paid to full-time employees who are residents of Port Arthur as outlined in the
Agreement; and
WHEREAS, Incentive Recipient has requested for PAEDC to modify the performance
milestones to allow it additional time to perform its contractual obligations due to the Pandemic
effecting the local economy; and
WHEREAS, the PAEDC Board of Directors agreed to amend the Agreement and
performance milestones at its May 3, 2021 meeting.
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF
THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT
CORPORATION that:
1. This Amendment to the Economic Incentive Contract & Loan Agreement between
PAEDC and Incentive Recipient was approved by the PAEDC Board of Directors on May 3,2021.
2. This Amendment to the Agreement shall be effective upon approval by the City of Port
Arthur, Texas.
3. Exhibit "C" to the agreement is amended per the attached Performance Milestone
Schedule (Modified) for Incentive Recipient attached hereto as Exhibit "C".
4. The recitals to this Amendment are incorporated and fully referenced in this
Amendment.
7. Other than the amendment set forth herein, Incentive Recipient and PAEDC ratify and
affirm all terms and conditions of the Agreement dated July 16, 2019.
SIGNED AND AGREED to on this day of , 2021.
City of Port Arthur Section 4A
Economic Development Corporation
By:
President
ATTEST:
Secretary
THE STATE OF TEXAS §
§
COUNTY OF JEFFERSON §
This instrument was acknowledged before me on the day of , 2021, by
as President and as Secretary on
behalf of City of Port Arthur Section 4A Economic Development Corporation.
Notary Public, State of Texas
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DEZTEX INDUSTRIAL SERVICES, LLC
DB/A RAMTEX
By:
Its:
THE STATE OF TEXAS §
§
COUNTY OF JEFFERSON §
This instrument was acknowledged before me on the day of , 2021, by
behalf of DEZTEX INDUSTRIAL SERVICES, LLC
D/B/ARAMTEX
Notary Public, State of Texas
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EXHIBIT "C"
RAMTEX
Amended-May 2021
PERFORMANCE MILESTONE SCHEDULE
Deadline Milestone
(a) JULY 31, 2019 RAMTEX will issue a status report on their move into their new location
in the Spur 93 Business Park and the retrofitting of the building and
installation of equipment completion date to PAEDC
(b) DECEMBER 31, 2020 RAMTEX will issue an operational report—achieve employment of
Port Arthur residents from July 2019 through December 2020; total
payroll for permanent Port Arthur Resident employees for years ending
2019 and 2020 should be not less than$369,378.83
(c) MARCH 31, 2021 RAMTEX will issue a payroll report-provide PAEDC with W-2's for
permanent Port Arthur residents employed during 2019 and 2020
RAMTEX will issue an operational report—achieve employment of
(d) DECEMBER 31, 2021 additional Port Arthur residents in 2021; total payroll for permanent Port
Arthur Resident employees for year ending 2021 should be not less than
$536.233.73; total payroll accumulated 2019-2021 - $905,612.56
(e) MARCH 31, 2022 RAMTEX will issue a payroll report-provide PAEDC with W-2's for
permanent Port Arthur residents employed during 2021
(f) DECEMBER 31, 2022 RAMTEX will issue an operational report—maintain employment of
Port Arthur residents; total payroll for permanent Port Arthur Resident
employees for year ending 2022 should be not less than$536.233.73;
total payroll accumulated 2019-2022 - $1,441,846.29
(g) MARCH 31, 2023 RAMTEX will issue a payroll report-provide PAEDC with W-2's for
permanent Port Arthur residents employed during 2022
(h) DECEMBER 31, 2023 RAMTEX will issue an operational report—maintain employment of
Port Arthur residents; total payroll for permanent Port Arthur Resident
employees for year ending 2023 should be not less than $536.233.73;
total payroll accumulated 2019-2021 - $1,978,080.00
(i) MARCH 31, 2024 RAMTEX will issue a payroll report-provide PAEDC with W-2's for
permanent Port Arthur residents employed during 2023
(j) JUNE 30, 2024 Once all contractual obligations are met, PAEDC will recommend the
closing of the file.
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