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HomeMy WebLinkAboutPR 15523: PRAXAIR - INDUSTRIAL DISTRICT AGREEMENTP. R. No. 15523 09/17/09 gt RESOLIITION NO. A RESOLIITION AIITHORIZING THE CZTY MANAGER TO EXECIITE AN INDIISTRIAL DISTRICT AGREEMENT WITH PRARAIR, INC. FOR 2010 WHEREAS, the City Council of the City of Port Arthur deems it in the best interests of the citizens of Port Arthur to enter into an "In Lieu of Tax" Agreement with Praxair, Inc. for 2010. NOW THEREFORE, SE IT RESOLVED BY THE CITY COIINCIL OF THE CITY OF PORT ARTHIIR: Section 1. That the facts and opinions in the preamble are true and correct. Section 2. That the City Council hereby authorizes the City Manager to execute an "In Lieu of Tax" Agreement with Praxair, Inc., in substantially the same form as attached hereto as Exhibit ~~ p ,. Section 3. That a copy of the caption of this Resolution be spread upon the Minutes of the City Council. READ, ADOPTED AND APPROVID on this day of A.D., 2009, at a Meeting of the City Council of the City of Port Arthur, by the following vote: AYES: Mayor Councilmembers z.pr15523 NOES: MAYOR ATTEST: TERRZ HANKS, CITY SECRETARY APPROVED AS TO FORM: CITY ATTORNEY APPROVED FOR ADMINISTRATION: CITY MANAGER z.pr15523 EXHIBIT ~~A" STATE OF TERAS 5 COIINTY OF JEFFERSON 5 INDIISTRIAL DISTRICT AGREEMENT WZTH PRABAIR, INC. (20101 WHEREAS, in 2008, the City of Port Arthur (hereinafter referred to as the "City") and Praxair, Inc. (hereinafter denoted to as the "Company") entered into an Industrial District Agreement for the Praxair Hydrogen plant for the payment to the City of Port Arthur of 75~ of the amount of taxes that the Company would have paid the City if the property had been located within the corporate limits of the City; and, WHEREAS, the Industrial District Agreement with Praxair was approved by Resolution No. 08-472 and expires December 31, 2009; and, WHEREAS, the assessed value on this facility has grown over the years to the JCAD assessed value of at least $82,323,900; and WHEREAS, the City Council is concerned as to the unemployment rate of Port Arthur residents; and, WHEREAS, the City Council is interested in maximizing job opportunities and contracting opportunities for Port Arthur residents and Port Arthur businesses and z.ida Praxair 2010a 1 contractors. The Council is interested in working with industry and Lamar State College-Port Arthur to obtain sound information on current hiring and procurement efforts, including results, and working with industry and the Port Arthur City Council to try to increase employment opportunities for Port Arthur residents and procurement for Port Arthur companies; and WHEREAS, the Council also believes improved opportunities for minority and women-owned businesses is important; and WHEREAS, Company hiring and procurement experience and efforts to increase Port Arthur resident hiring and Port Arthur procurement opportunities will be considered by the Council in future in-lieu of tax contractual agreements; and WHEREAS, the Company will provide updated written reports at such intervals as requested by the City during the term of this Agreement; and WHEREAS, the Company owns the property described in Attachment "A"; and WHEREAS, the City and the Company desire to enter into an Industrial District Agreement with respect to the property described in Attachment "A" that is within the extraterritorial jurisdiction of the City; and z.ida Praxair 2010a z WHEREAS, the City and the Company agree that there has been full and adequate consideration for this Agreement; and WHEREAS, this Agreement is authorized under Sections 42.044 and 212.172 Local Government Code, Vernon's Texas Code Annotated and Article 1, Section 5 of the City's Charter, and that the parties agree that the following terms are reasonable, appropriate, and not unduly restrictive of business activities; and WHEREAS, all parties find that this Agreement, as delineated herein, is beneficial to each party. NOW, THEREFORE, in consideration of the promises and the mutual agreements of the parties contained herein, the City and the Company agree with each other as follows: Section 1-Pay ments by the Com pany (a) For the year 2010, the Company shall pay to the City the amounts delineated in this Section so long as this Industrial District Agreement is in full force and effect and all of the property described in Attachment "A" is not annexed by the City. (b) The Company shall pay to the City of Port Arthur amounts equal to seventy-five percent (75%) of the amount of taxes that the Company would have paid to the City with 3 z.ida Praxair 2010a respect to the land, improvements, units, equipment, inventory and all other property located on the land, described in Attachment "A", as if they had been located within the corporate limits of the City of Port Arthur. The "In Lieu of Tax" payment shall be paid by October 15, 2010. (c) The City shall not refund or credit any monies previously paid by the Company prior to the date of the execution of this Agreement, either directly or indirectly, to the City. Except as delineated in Section 15, once monies are paid to the City of Port Arthur on October 15, 2010, the City shall not refund or credit any of said monies. (d) The Company shall make all payments that are due or was due on October 15, 2009 as it pertains to the Industrial District Agreement approved by Resolution No. 08-472 Section 2. In working with the City Council, the Company shall also do the following: (a) The Company will notify the City Council and post job openings with the Texas Workforce in Port Arthur. The Company will also request that its contractors and subcontractors notify the City Council and post its job openings with the Texas Workforce in Port Arthur. 9 z.ida Praxaii 2010a (b) The Company will notify the following of job openings: • City of Port Arthur • Official newspaper of the City • Texas Work Force Commission • Lamar State College of Port Arthur • Port Arthur ISD • Sabine Pass ISD • Port Arthur Labor Unions • Digital Work Force • Associations representing historically underutilized segments of the population in Port Arthur who contact the Parties as to be notified of job opportunities The Company will also request that its contractors and subcontractors notify the above nine entities of job openings. (c) The Company will make reasonable efforts to break up any new construction contracts and major service contracts to allow Port Arthur contractors the opportunity to bid on the projects. z.ida Praxair 2010a 5 (d) The Company will include a provision in the Company's contracts with any new prime construction contractors or major service contractors, which requires the prime contractors to read and comply with the terms of this Agreement relating to the use of Port Arthur vendors, suppliers, subcontractors, professionals, and historically underutilized businesses and segments of the population. (e) The Company and its contractors will pay at least the prevailing wage, as reasonably set by the City, in accordance with Chapter 2258, Texas Government Code, V.T.C.A. Section 3. If requested orally or in writing by the Company, the City's Fire Department shall provide back- up Fire Suppression Support as determined by the City's Fire Chief, and the City's Police Department shall assist in providing an evacuation route and traffic control in the case of a fire or a chemical release at the Company's facilities located in the City's extraterritorial jurisdiction. Nevertheless, the Company shall abide by and shall take such precautions as to prevent (1) fires, explosions and chemical releases and (2) the imprudent discharge of storm water that contribute to flooding on z. ida Praxair 2010a 6 adjacent property. The Company shall also provide an evacuation as is expected in the industry, and as is required by applicable federal and state laws, and the health and safety laws of the City. The Company shall employ or provide sufficient primary fire suppression response, as well as control and abate chemical releases. The Company shall provide the City's Fire Chief and Police Chief with Emergency Response Plans for any plants, refineries, chemical operations or other hazardous operations that take place on the land, described in Attachment "A". If there is a fire and the City is requested to provide initial and primary fire suppression services or if a clean up is required, the Company will pay to the City the costs and expenses incurred by the City and any of its departments or of any of its affiliated providers, i.e. ambulance companies that are called to the scene. Section 4. The Company shall immediately notify the central dispatch office which serves the City's Fire Chief, Police Chief, and the City's Emergency Management Coordinator of all incidents involving fires, serious injuries, deaths, chemical releases and flooding that create a health and safety hazard to the community or that exceed OSHA, TNRCC or EPA permissible exposure limits. z.ida Pzaxait 2010a ~ Section 5. Annexation for Health, Safety and welfare Reasons. It is specifically stipulated that nothing in this Agreement will in any manner limit or restrict the authority of the City to annex all or part of said lands and facilities during the period of the Agreement if the City should determine that such annexation is reasonably necessary to promote and protect the general health, safety, and welfare of the persons residing within or adjacent to the City, provided however, that the City agrees that such annexation for the land described in Attachment "A" prior to October 1, 2010 will not be made for revenue purposes only. Section 6. Annexation due to Legislative Action. Notwithstanding the provisions of Section 5, the parties agree and consent that the City may annex if a bill is adopted by the State legislature which limits or restricts the authority of the City to annex all or part of said land and improvements. In the event of annexation, the Company will not be required to make further payments under this Agreement for any calendar year commencing after annexation with respect to the property so annexed; but shall nevertheless be obligated to make full payments for the year during which such annexation becomes effective if the annexation becomes effective after January ls` of said year. z.ida Praxair 2010a 9 The Company shall not be required to pay ad valorem taxes to the City for the same period of time they have already paid an "in lieu of tax" payment, with respect to the property described in Attachment "A" to this Agreement. If for any reason, the City can not annex the property of the Company and if the parties cannot reach an agreement on a new payment schedule or on a new "in lieu of tax" agreement, the Company agrees that it will continue to pay to the City the "in lieu of tax" payments delineated in Section 1 until December 31, 2010, and it will thereafter continue to annually pay the City an "in lieu of tax" payment of seventy five percent (75%) of its taxable value times the City's tax rate for so long as it or its assignees and successors or affiliates own the property, as described in Attachment "A". Payments will be due on October 15th of each year. Pursuant to Sections 42.044 and 212.172 Local Government Code, the Company agrees and consents that the City has the option, in the City' s sole discretion, to extend this contract and that the Company will continue to annually pay the City "in lieu of tax" payments at the seventy-five (75%) rate, as denoted above, for successive periods not to exceed 15 years each, for a total duration not to exceed 45 years, or the maximum period allowed by law, whichever is longer. "Taxable value" z. ida Praxair 2010a 9 is the value as determined by the Jefferson County Appraisal District in appraisal rolls after the completion of all litigation and appeals (if any), of all property, land, industrial realty, improvements, units, equipment, inventory, and all other property, excluding the value of exempt pollution control devices, owned or leased by the Company and located within the extra-territorial jurisdiction of the City, as described in Attachment "A". The "taxable value" also includes the assessed value of any property that is located in a foreign trade zone or in any other type of federal, state, or local zone. Section 7. The parties agree that the City has the sole discretion, after October 1, 2010, to annex the property in Attachment "A" or to enter into negotiations on the payment by the Company of additional "in lieu of tax" payments. Section 8. The present owners and lessees of the land, improvements, units, equipment, inventory, and all other property located on the land in Attachment "A" are described in Attachment "B". The City reserves the right to annex that tract or parcel with the minimum required adjacent area, as .per Chapter 43 Local Government Code, if the owners or the lessees do not pay an "in lieu of tax" payment for its interest in the land, improvements, units, to z.ida Praxair 2010a equipment, inventory, and all other property located on the property, as described in Attachment "A". Nothing contained herein shall be construed to prohibit or prevent the Company from paying the other owners' or lessees' "in lieu of tax" payment to prevent annexation by the City. If the City annexes a tract or tracts, the total "in lieu of tax" payment will be reduced by the same percentage as the assessed value of the tracts under the contract are reduced. Section 9. If the Company desires to assign this Agreement to any person, the Company shall provide written notice of such assignment and shall receive the written consent of the City Council, by a duly adopted Resolution, which will not be unreasonably withheld. The Company shall provide the description of the new Company and such other information as is reasonably requested to indicate that the new Company will safely operate the facility, act as a good corporate citizen, and will fully abide by the terms of this agreement. If the assignment is approved by the City Council, the Company shall be relieved of its obligations under this Agreement to the extent that an assignee expressly assumes the Company's obligations. Subject to the preceding, this Agreement shall inure to the benefit of z. ida Praxair 2010a 11 and be binding upon the parties hereto and its respective successors and assigns. Section 10. It is agreed by the parties to this Agreement that the Company and the City have the right to seek equitable relief, including specific performance of this Agreement. Section 11. The Company shall allow a reasonable number of authorized employees and/or representatives of the City who have been designated and approved by the City Manager, City Council, or Mayor to have access to the Company land and/or plants during the term of this Agreement to inspect the plants and any improvements thereto to determine compliance with the terms and conditions of the Agreement. All inspections will be made at mutually agreeable times and will only be conducted in such manner as to not unreasonably interfere with safety standards and security standards and rules. All inspections will be made with one or more representatives of the Company and in accordance with industry safety standards. Section 12. The Company shall participate in the Port Arthur Industrial Group during the life of this Agreement in order to assist in the establishment of apprenticeship, internship, and/or education programs and z. ida Praxair 2010a 12 projects for the training of Port Arthur residents for permanent jobs in the Port Arthur area. The Company further hereby agrees to request and encourage its contractors and subcontractors to establish and fund their own apprenticeship, internship, and/or education programs and projects for the training of Port Arthur residents for permanent jobs in the Port Arthur area. Section 13. The City reserves the right to hire or contract for a monitor as to inspect the Company's records and hiring practices in accordance with this Agreement as to verify whether the Company has complied and will continue to comply with this Agreement. Section 14. The Company certifies that they have not, and will not, knowingly employ an "undocumented worker" which means an individual who, at the time of employment, is not lawfully admitted for permanent residence to the United States or authorized under law to be employed in that manner in the United States. The Company acknowledges that it has reviewed Chapter 2264, Texas Government Code, and hereby affirmatively agrees to repay the amount of any incentive with interest at the rate of ten percent (10%) per annum, not later than the 120th day after the date the City notifies the Company of a violation. The Company acknowledges the City may bring a z.ida Praxair 2010a 13 civil action as to recover any amounts owed under this Chapter, and further acknowledges that the City may recover court costs and reasonable attorney's fees incurred in bringing an action under Section 2264.101, Texas Government Code. The Company will also promptly report to the City any "undocumented worker" that is improperly retained by its contractors or subcontractors on its facility. Section 15. Information on property values. The Company shall file, in writing with the Director of Finance of the City, an itemized rendition by affidavit, in the same form and manner as required by State Law, for rendition of property for ad valorem tax purposes, of all its properties (land, improvements, units, equipment, inventory, and all other property) real, personal and mixed. The Company shall provide to the City a copy of all pleadings and discovery filed in any litigation or protest that the Company has with Jefferson County Appraisal District. Pending final determination of any tax protest filed by the Company with the Jefferson County Appraisal Review Board, or appeal thereof , the Company shall pay to City, on October 15, 2010, the amount calculated based upon the value of the property reflected on the most recently adopted appraisal roll prepared by or for Jefferson County Appraisal District. If the final determination of a 14 z.ida Praxair 2010a protest or an appeal reduces the value of the property after Company has tendered payment to the City hereunder, the Company's liability hereunder shall be recalculated based on the final determination of value, and City shall in its discretion, after the final determination of such protest or appeal, either credit toward future "In Lieu of Tax" agreements or refund to Company, the difference between the amount actually paid hereunder and the amount for which the Company is determined to be liable, without interest. Under no circumstances, shall there be a refund or a credit of more than ten (10~) of any "In Lieu of Tax" payment made. Section 16. Electrical IIsage. The Company will, upon request provide the City with information as to the electrical consumption from Entergy or from any other electric utilities, transmission and distribution utility, municipally owned utility, electric cooperative, or from any other source, as well as all metering locations that service the area in Attachment "A". On August 15, 2010, the Company shall provide the City Manager or his designee information, i.e. kilowatt usage as to the electrical consumption from January 1, 2010 to June 30, 2010 with another report being made at the end of the year as to the total electrical consumption. is z.ida Praxaii 2010a Section 17. Notice of Default. Notwithstanding anything herein to the contrary contained, in the event of any breach by the Company of any of the terms or conditions of this Agreement, the City shall give the Company not less than five (5) business days' written notice, specifying the nature of the alleged default, and manner in which the alleged default may be satisfactorily cured. Thereafter, the Company will be afforded a reasonable time within which to cure the alleged default. Nevertheless, time is of the essence on the payment schedule for the "in lieu of tax" payment on October 15th. If the Company does not pay the "in lieu of tax" payment on October 15th, the City can immediately commence annexation proceedings and sue for all damages. In case of litigation for breach of the Agreement and to encourage timely payments, the City can seek 100% of all monies that the City would have received from the Company if it been within the corporate limits, which include 100% of all taxes, building permits, sales or use taxes. and all franchise fees on electrical usage, interest and penalty thereon, attorney's fees, and court costs. Also, if the Company intentionally discriminates against Port Arthur companies, the City can seek the direct and indirect damages that the City would have accrued, if the discrimination did not occur. z. ida Praxair 2010a 16 Section 18. Entire Agreement. This Agreement constitutes the entire agreement of the parties with respect to the Projects described herein and supersedes any and all prior understandings or oral or written agreements between the parties respecting such subject matter, except as otherwise provided in the instruments referenced herein. This Agreement may be amended only by written instrument signed by all of the parties hereto. Section 19. Severability. If any term or provision in this Agreement, or the application thereof to any person or circumstance, shall to any extent be held to be invalid or unenforceable by a court of competent jurisdiction, such invalidity or unenforceability shall not affect any other provision of this Agreement or the application thereof, which can be given effect without the invalid or unenforceable provision or application, and the parties agree that the provisions of this Agreement are and shall be severable. Payment of the "in lieu of tax" payments is an essential part of this Agreement. Section 20. Remedies Cumulative. Except as other- wise expressly provided herein, all rights, privileges, and remedies afforded the parties by this Agreement shall be deemed cumulative and not exclusive, and the exercise of any or more of such remedies shall not be deemed to be a 17 z.ida Praxait 2010a waiver of any other right, remedy, or privilege provided for herein or available at law or in equity. Section 21. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas. This Agreement is to be performed in Jefferson County, Texas. Section 22. Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original, and all of which taken together, shall constitute but one and the same instrument, which may be sufficiently evidenced by one counterpart. Section 23. Authority By acceptance of this Agreement and/or benefits conferred hereunder, the Company represents and warrants that its undersigned agents have complete and unrestricted authority to enter into this Agreement and to obligate and bind the Company to all of the terms, covenants and conditions contained herein. Section 24. Notice Any notice provided for in this contract shall be given in writing to the parties hereto by certified mail, return receipt requested, addressed as follows: TO CITY: City Manager CITY OF PORT ARTHIIR 444 4th St. TO TRB COMPANY: Don McLean Tax Department PRA%AIR, INC. 18 z.ida Praxair 2030a Port Arthur, TX 77640 39 Old Ridgeburg Road Danbury, CT 06810 WITH A COPY T0: City Attorney CITY OF PORT ARTHIIR 444 4tn St. Port Arthur, TX 77640 (409) 983-8126 (409) 983-8124 Section 25. This agreement is effective the 1st day of January, 2010, and shall expire on the 31st day of December, 2010, unless extended by the City of Port Arthur, as delineated in Section 6. z.ida Praxair 2010a 19 SIGNED AND AGREED to on the day of 2009. PRAXAIR, INC. BY: ACKNOWLEDGMENT STATE OF TEXAS 5 5 COIINTY OF JEFFERSON S BEFORE ME, the undersigned Notary Public, on this day personally appeared ' known to me to be the person whose name is ascribed to the foregoing instrument, and acknowledged to me that he executed the same as the act and deed of PRAXAIR, INC. for the purposes and considerations therein expressed, and the capacities therein stated. GIVEN IINDER MY HAND AND SEAL OF OFFICE, THIS THE day of A.D., 2009. NOTARY PUBLIC, STATE OF TEXAS z.ida Equilon 2009-2013 20 SIGNED AND AGREED to on the _ day of 2009. CITY OF PORT ARTHIIR, TEAS BY: Stephen Fitzgibbons City Manager ACKNOWLEDGMENT STATE OF TE%AS § § COIINTY OF JEFFERSON § BEFORE ME, the undersigned Notary Public, on this day personally appeared Stephen Fitzgibbons, City Manager of the City of Port Arthur, known to me to be the person whose name is ascribed to the foregoing instrument, and acknowledged to me that he executed the same as the act and deed of the City of Port Arthur, for the purposes and considerations therein expressed, and the capacities therein stated. GIVEN IINDER MY HAND AND SEAL OF OFFICE, THIS THE day of A.D., 2009. NOTARY PUBLIC, STATE OF TEXAS z.ida Praxair 2010a 21 LIST OF ATTACHMENTS • "A" Area of land owned by The Company • "B" Description of owners of property z.ida Praxair 2010a 22 ATTACFIMENT "A" Attached is the legal description of the tract that contains the hydrogen plant of PRAXAIR and a drawing of the tract. z.ida Praxair 2010a 23 page I of 2 t~(HIBIT A The Hydrogen Facility will lie on a portion of Motiva's property wilhiri the parcel bcunded north of W. 11^ Street to the south, east of South W Road to the west, west of South T Rcad to the east, and south of Townsend Road (also known as Chemical Piant Road) to the north. The dimensions of such parcel are approximately 400' (NS) by 500' (E-W), together with part of the parcel bounded by W. 11" Street to the south, South W Road to the east, Townsend Road to the north, and the storm water drainage canal to the west. l'he approximate dimensions d such partial parcel are 400' (NS) by 130' (E-W). A portion of the.Hydrogen Facility will also lie an a portion of Mctiva's property within the parcel bounded north of Townsend Road ip the south, east of South W Road to the west, west of South'T' Road to the east, and south of the Railroad Tracks W the north. The dimensons cf this parcel are approximately 200' (NS) by 60' {E-W). The black highlighted portion of the drawing on the second page of this Exhibit depicts the portions of Motiva's property on which the Hydrogen Facility is expected to be located. EXHIBIT A pigs 2 of 2 I SABINE GhS STATION II Si AR LEASE SITE II I~ I 1 11 I I II II II - 11 HUNTSHAN CHENICAI CO. 1 I _ II IC-' 11 I~ II II I~ .. ,I •' N2 Q P~ ~ ~~ - e fIARE b EIPRC JG d ` LP] <__ L'RU ` I - ~- - CLME "~ II I I~ \ ~ _ ~t __ - - JJ\ vcv stw :1 -_~-~ 1Q)~ ul m ~~ nl i I ~ / -~ II Itl ~ RESERVO: ~ ~, ~ ~ rig- i; ;il 1 HydrogenFacility~°_'_ .I. II I ~ ~ 4 =HydrogepnpFaciliry ~ I ~~` I qII I r---- ~' V I RESERVOIR ] ~ RESCRVO d ; . ~---= rl~__ ~ I ;` ~ ~ a I - ~~ dp li ji ii n Lca t d pq I ~ II n xiv t I n u.mv~ ~ __-- it c~ n II ~ - ILJL'_' h ~ Y x, ~------ ...~ ~. - NN 2 NN • ~ _-~ ~ 11 II ~~ FOR ~ FNIFRFyl2 ATTACHMENT "B" PRAXAIR owns the hydrogen plant which is within the MOTIVA facility. z.ida Praxair 2o10a 24