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Home My WebLink AboutPR 23843: EDC, APPROVING AMENDMENT NO. 1 TO THE PERFORMANCE AGREEMENT WITH MPW INDUSTRIAL WATER SERVICES, INC. „ f 1 I PORT*ARTHUR (>' )IICI) ta.IIP\I t:NT(7(1K PQ R.ATIU\ MEMORANDUM Date: July 18, 2024 To: Honorable Mayor and Members of the City Council of Port Arthur Through: Ronald Burton, Port Arthur City Manager From: Terry Stokes, PAEDC Chief Executive Officer RE: Proposed Resolution No. 23843 regarding Amendment no. 1 to the Economic Development Performance Agreement between the City of Port Arthur Section 4A Economic Development Corporation and MPW Industrial Water Services, Inc. Introduction: The intent of this Agenda Item is to seek the Council's consideration and approval of a First Amendment to the Economic Development Performance Agreement with MPW Industrial Water Services, Inc. Background: The PAEDC entered into an Economic Development Performance Agreement with MPW Industrial Water Services, Inc. ("MPW”) on February 16, 2023 for an expansion project at 9655 Richard Wycoff Dr. in the Spur 93 Business Park for an amount of up to $485,363.00, for the capital improvements and new job creation as a result of the expansion. MPW is requesting an extension of time allowed for the payroll performance due to the delay in the design and installation of a newly constructed lift station to service the Business Park, which was out of MPW's control and therefore caused a delay in their expansion efforts and hiring performance. The attached prepared Amendment provides for one additional year for payroll performance. Budget Impact: None Recommendation: It is recommended that the City Council approve the First Amendment to the Economic Development Performance Agreement with MPW Industrial Water Services, Inc. P. R. No. 23843 07/16/2024 KVM RESOLUTION NO. A RESOLUTION APPROVING AMENDMENT NO. 1 TO THE ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT BETWEEN THE CITY OF PORT ARTHUR SECTION 4A ECONOMIC DEVELOPMENT CORPORATION AND MPW INDUSTRIAL WATER SERVICES,INC. WHEREAS, per Resolution 22-580, dated December 20, 2022, the City Council of the City of Port Arthur approved an Economic Development Performance Agreement (the "Agreement") between the City of Port Arthur Section 4A Economic Development Corporation (the"PAEDC")and MPW Industrial Water Services, Inc. ("MPW") in an amount of$485,363.00 for the expansion of their water solutions operations at their Spur 93 Business Park location; and WHEREAS, due to the delay in the design and installation of a new upgraded lift station for the business park, which was out of the Company's control, the PAEDC and Company desire to extend Company's payroll performance obligations under Article V.1 of the Agreement; and WHEREAS,at their regular board meeting of July 1,2024,the PAEDC Board of Directors approved an amendment to the Agreement allowing for an extension of time to perform the payroll obligations as detailed in the amendment attached hereto as Exhibit"A". 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 Amendment No. 1 to the Economic Development Performance Agreement between the Port Arthur Section 4A Economic Development Corporation and MPW Industrial Water Services, Inc. as denoted in the Amendment attached hereto as Exhibit"A". 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., 2024, 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: , .1,1 L Terry Stokes,PAEDC CEO APPROVED AS TO FORM: Charles Zech,PAEDC Attorney #1370989 Page 2 APPROVED AS TO FORM: 3/r4t- --- am s M. Black,Interim City Attorney #1370989 Page 3 EXHIBIT "A" FIRST AMENDMENT TO THE ECONOMIC DEVELOPMENT PERFORMANCE AGREEMENT MPW INDUSTRIAL WATER SERVICES, INC. This First Amendment to the Performance Agreement MPW Industrial Watr Services, Inc., (this "First Amendment")is entered into to be effective as of the Effective Date,by and between the Port Arthur Economic Development Corporation, located in Jefferson County,Texas, a Texas non-profit industrial development corporation under the Development Corporation Act and governed by TEx. Loc. Gov. CODE chapters 501, 502 and 504 and the Texas Non-Profit Corporation Act(hereinafter called "PAEDC"),created by, and for the benefit of the City of Port Arthur, Texas (hereinafter the called the "City"), and MPW Industrial Water Services, Inc., a corporation registered in the state of Ohio and authorized to do business in the State of Texas (hereinafter called "Company"; the PAEDC and the Company collectively known as the"Parties" to this Agreement). RECITALS WHEREAS,the Development Corporation Act of 1979, as amended(Section 501.001 et seq, Texas Local Government Code, formerly the Development Corporation Act of 1979) (the "Act") authorizes a development corporation to fund certain projects as defined by the Act and requires development corporations to enter into performance agreements to establish and provide for the direct incentive or make an expenditure on behalf of a business enterprise under a project; and WHEREAS, Section 501.158 of the Act requires a performance agreement to provide at a minimum for a schedule of additional payroll or jobs to be created or retained and capital investment to be made as consideration for any direct incentives provided or expenditures made by a corporation under an agreement and to specify the terms under which repayment must be made if the business enterprise does not meet the performance requirements specified in the agreement; and WHEREAS,Section 501.103 of the Act authorizes expenditures found to be required or suitable for infrastructure necessary to promote or develop new or expanded business enterprises, including water and sewer utilities, drainage, site improvements, and related improvements; and WHEREAS, the Company and the PAEDC previously entered into a Performance Agreement (the"Agreement"); and WHEREAS,due to the delay in the design and installation of a new upgraded lift station for the business park, which was out of Company's control, the PADEDC and Company desire to extend Company's payroll performance obligations under Article V.1 of the Agreement; and WHEREAS,the Parties agree that all conditions precedent for this Agreement to become a binding agreement have occurred and been complied with, including all requirements pursuant to the Texas Open Meetings Act and all public notices and hearings; if any, have been conducted in accordance with Texas law; and 1 WHEREAS, on the Effective Date, the commitments contained in this Agreement shall become legally binding obligations of the Parties. NOW, THEREFORE,in consideration of the mutual covenants,benefits and agreements described and contained in this First Amendment, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged and further described herein, the Parties agree as follows: ARTICLE I RECITALS Recitals. The recitals set forth above are declared true and correct by the Parties and are hereby incorporated as part of this Agreement. ARTICLE II AMENDMENTS Amendments to Agreement. Article V.1. of the Agreement is hereby amended to read as follows: 1. PBC Grant. Subject to the conditions provided herein, the PAEDC shall release incremental portions of the PBC Grant funds, which total Four Hundred and Eighty-Five Thousand Three Hundred and Sixty-Three Dollars ($485,363.00) to the Company in accordance with the following schedule: (a) Distribution 1 -A cash grant in the amount of$215,363.00 shall be paid to the Company no later than 30 days following the receipt by the PAEDC of the Compliance Reporting Form certifying the Completion of the Capital Investment, as described above in Section IV(1). (b) Distribution 2 - Optional Employment and Payroll Grant 1: A cash grant equal to ten percent (10%) of the total annual salary for each Full- Time Job created and maintained between July 1, 2022 and December 31, 2024 (Payroll Term 1), the total amount of which shall not exceed $90,000.00, and which shall be paid to the Company no later than 30 days following the receipt by the PAEDC of the Compliance Reporting Form (including W-2s and other information as may be required by the PAEDC to confirm compliance). (c) Distribution 3 - Optional Employment and Payroll Grant 2: A cash grant equal to ten percent (10%) of the total annual salary for each Full- Time Job created and maintained between January 1, 2024 and December 31, 2025 (Payroll Term 2), as well as for any Full-Time Job created in Payroll Term 1 and retained through Payroll Term 2, the total amount of which shall not exceed$90,000.00,and which shall be paid to the Company 2 no later than 30 days following the receipt by the PAEDC of the Compliance Reporting Form (including W-2s and other information as may be required by the PAEDC to confirm compliance). (d) Distribution 4 - Optional Employment and Payroll Grant 3: A cash grant equal to ten percent (10%) of the total annual salary for each Full- Time Job created and maintained between January 1, 2025 and December 31, 2026 (Payroll Term 3), as well as for any Full-Time Job created in Payroll Term 1 and Payroll Term 2, and retained through Payroll Term 3, the total amount of which shall not exceed $90,000.00, and which shall be paid to the Company no later than 30 days following the receipt by the PAEDC of the Compliance Reporting Form (including W-2s and other information as may be required by the PAEDC to confirm compliance). ARTICLE III MISCELLANEOUS 1. Binding Agreement. The terms and conditions of this First Amendment shall be binding on and inure to the benefit of the Parties, and their respective successors and assigns. This First Amendment is not binding until it has been approved by the Port Arthur Economic Development Corporation and the City of Port Arthur; upon said approval, the Chief Executive Officer of the PAEDC shall be responsible for the administration of this Agreement and shall have the authority to execute any instruments, duly approved by the PAEDC,on behalf of the Parties related thereto. 2. Previous Agreement Otherwise Unaffected. All other provisions in the Agreement shall remain in place and are binding on the Parties. This First Amendment and the Agreement constitute the entire agreement between the Parties. There is no other collateral, oral or written agreement between the Parties that,in any manner, relates to the subject matter of this Agreement, except as provided for in any Exhibits attached hereto or duly executed amendments to this Agreement. [SIGNATURE PAGES IMMEDIATELY FOLLOWING] 3 Executed on this day of , 2024 (the Effective Date). COMPANY: MPW Industrial Water Services, Inc., A By: Name: Title: 4 Executed on this day of , 2024 PORT ARTHUR ECONOMIC DEVELOPMENT CORPORATION By: Name: Terry Stokes Title: Chief Executive Officer APPROVED AS TO FORM: By: PAEDC Attorney 5