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HomeMy WebLinkAboutResolution No. 2013-036 CITY OF THE COLONY, TEXAS RESOLUTION NO. 2013-036 A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, APPROVING A PROJECT REIMBURSEMENT AGREEMENT BY AND BETWEEN THE CITY OF THE COLONY, TEXAS, AND THE COLONY ECONOMIC DEVELOPMENT CORPORATION CONCERNING THE CONSTRUCTION OF THE SOUTH COLONY BOULEVARD EXTENSION AT THE SAM RAYBURN TOLLWAY; PROVIDING A SEVERABILITY CLAUSE; AND PROVIDING FOR AN EFFECTIVE DATE. WHEREAS, The Colony Economic Development Corporation (hereinafter referred to as the "EDC") is a Type A economic development corporation, created pursuant to Chapter 504 of the Texas Local Government Code, as amended; and WHEREAS, on June 12, 2013, the Board of Directors of the EDC approved a Project Reimbursement Agreement, a copy of which is attached hereto as Exhibit A, by and between the li City of The Colony, Texas (the "City"), and the EDC concerning the payment of certain construction costs concerning the construction of the South Colony Boulevard extension at the Sam Rayburn Tollway; and WHEREAS, the City Council of the City of The Colony, Texas, hereby finds and determines that the adoption of this Resolution and the approval of the Project Reimbursement Agreement, a copy of which is attached hereto as Exhibit A, is in the best interests of the citizens of the City. NOW THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, THAT: SECTION 1. The findings set forth above are incorporated into the body of this Resolution as if frilly set forth herein. SECTION 2. The City Council of the City of The Colony, Texas, does hereby approve the Project Reimbursement Agreement, a copy of which is attached hereto as Exhibit A, and is incorporated herein for all purposes, and authorize the Mayor to execute said agreement. SECTION 3. The City Council of the City of The Colony, Texas, does hereby approve the expenditures by The Colony Economic Development Corporation pursuant to the Project Reimbursement Agreement, a copy of which is attached hereto as Exhibit A. SECTION 4. If any section, article paragraph, sentence, clause, phrase or word in this Resolution, or application thereto to any persons or circumstances, is held invalid or unconstitutional by a Court of competent jurisdiction, such holding shall not affect the validity of the remaining portions of this Resolution; and the City Council hereby declares it would have passed such remaining portions of this Resolution despite such invalidity, which remaining portions shall remain in full force and effect. SECTION 5. This Resolution shall become effective from and after its date of passage in accordance with law. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF THE COLONY, TEXAS, THIS THE 18"' day of JUNE, 2013. / Joe McCour%y, Mayor ATTEST: ; ( 1 f Chr son, City Secretar istie ~i~ APPROVED AS TO FORM: Jeff Moore, City Attorney ~ly~ld~ ~nzzc2c t1 - . ~o j~~ o oF- xi ~ Page 2 Exhibit A [Project Reimbursement Agreement] Page 3 STATE OF TEXAS § § PROJECT REIMBURSEMENT COUNTY OF DENTON § AGREEMENT THIS PROJECT REIMBURSEMENT AGREEMENT (the "Agreement") executed by and between the City of The Colony, Texas ("Cit}V'), a home rule municipality created, existing and organized under the laws of the State of Texas and the City's home rule charter and The Colony Economic Development Corporation ("Corporation"), a nonprofit corporation created and organized under the laws of the State of Texas, particularly Vernon's Ann. Civ. St., Article 5190.6, Section 4A, as amended (now codified as Texas Local Government Code, Title 12, Subtitle C1, as amended, and hereinafter referred to as the "Act'). WITNESSETH WHEREAS, in accordance with the provisions of the Act, an election was duly held and conducted in the City on the 17th day of January 1998, to submit a proposition to the voters of the City on the question of the adoption of a sales and use tax within the City at a rate of one- half of one percent for the promotion and development of new and expanded business enterprises; and WHEREAS, the proposition submitted to the voters of the City at said election was duly approved, and thereafter the City created the Corporation as authorized by the Act; and a certificate of incorporation for the Corporation was issued by the Secretary of State of Texas; and WHEREAS, the receipts received from the collection of the local sales and use tax of one-half of one percent ("Sales Tax") for the benefit of the Corporation may be used to pay the costs of "projects" described in the Act which include streets and roads, rail spurs, water and electric utilities, gas utilities, drainage and related improvements and telecommunications and internet improvements (one or more) to promote new and expanded business development; and WHEREAS, the City Council of the City (the "City Council") and Board of Directors of the Corporation (the "Board") have found and determined and do hereby find and determine that construction of the street improvements related to the "Grandscape" development, as described in Exhibit A attached hereto and incorporated herein for all purposes, (the "Project'), is required for the promotion and development of new and expanded business enterprises and that construction of and payment of costs for the Project is authorized under the Act; and WHEREAS, after considering the options available to finance the costs of the Project and the benefit to the City, the Corporation, and the citizens of the City of undertaking the Project, the City Council and the Board have further determined that the best and most cost effective manner to finance the costs of the Project would be for the City to issue certificates of obligations secured in part from the City's ad valorem taxing authority with the understanding and agreement that the Corporation will pay a portion of the costs of the Project by making payments to the City from the Sales Tax revenues to pay principal of and interest on such certificates of obligation as the same shall become due and payable in the amounts and at the times set forth in this Agreement; and NOW, THEREFORE, in consideration of the covenants and agreements herein made, and other good and valuable consideration, the receipt and sufficiency of which are hereby 52854326.4/11210115 acknowledged, and subject to the conditions herein set forth, the City and the Corporation agree as follows: SECTION 1. DEFINITIONS AND INCORPORATION OF PREAMBLES. The terms and expressions used in this Agreement, unless the context shows clearly otherwise, shall have meanings set forth herein, including terms defined in the preambles hereto, which preambles are incorporated herein and made a part hereof for all purposes. SECTION 2. FINANCING OF PROJECT. The parties agree and understand the costs of Project, including all construction costs, equipment costs and improvements contemplated, are to be paid from the proceeds received from the sale of certificates of obligation authorized to be issued and sold by the City in a principal amount not to exceed TWO MILLION TWO HUNDRED THOUSAND DOLLARS ($2,200,000) (the "Project Obligations") on or about the 16th day of July, 2013. SECTION 3. OBLIGATIONS OF THE CORPORATION AND CITY. (a). Subject to the terms of this Agreement, the Corporation agrees to pay a portion of the costs of the Project by remitting to the City from receipts of the Sales Tax amounts sufficient to pay the first ten (10) principal payments and the corresponding interest on the Project Obligations as the same shall become due and payable and the City agrees to pay the remaining portion of the costs of the Project by paying all remaining principal of and interest on the Project Obligations as the same shall become due and payable. (b). As soon as possible following the issuance and sale of the Project Obligations, the City shall furnish the Corporation a debt retirement schedule for such Project Obligations and a schedule showing the annual payments described below in subsection (c) of this Section 3 for attachment hereto as Exhibit B, and such attachment shall be incorporated herein for all purposes. (c). For each annual period beginning October 1 and ending the next September 30, commencing October 1, 2013, the Corporation shall pay to the City on or before April 1 of such annual period amounts sufficient to make the principal payments and interest corresponding to such annual payments as shown in Exhibit B. (d). If for any reason the Corporation does not make its annual payment in full on or before April 1 of the applicable annual period, any such deficiency shall, subject to subsections (e) and (f) below, be made up from the next available Sales Tax revenues of the Corporation. (e). The Corporation further agrees the payments due to the City under this Agreement for the payment of the debt service on the Project Obligations will be incorporated and included in the Corporation's annual budget, as adopted or amended, and the City shall be entitled to a claim on and right to the amounts budgeted each year for the payment of the debt service requirements on the Project Obligations; provided, however, that the Corporation's obligation to make the payments due hereunder shall be subject to any superior lien obligations of the Corporation secured by the Sales Tax revenues of the Corporation; and provided further that the Corporation may issue or incur other obligations secured by and payable from a superior lien on and pledge of the Sales Tax revenues securing the Corporation's obligation hereunder only with the prior consent and approval of the City as evidenced by a resolution duly adopted by the City Council. 52854326.4/11210115 2 (e). The Corporation may prepay the amounts described in subsection (c) above, and any such prepaid amounts shall be credited against the next amount or amounts due from the Corporation. SECTION 4. CONSTRUCTION CONTRACTS. The City shall be solely responsible for the construction and maintenance of the Project and the payment of the Project Obligations, and the Corporation shall have no liability with respect to the construction, operation or maintenance of the Project or the Project Obligations other than to make the payments to the City herein contemplated from the Corporation's receipts from the Sales Tax levied and allocated for the Corporation's benefit. SECTION 5. MISCELLANEOUS PROVISIONS. The following miscellaneous provisions are a part of this Agreement: (a). Amendments. This Agreement, including the exhibits hereto, constitutes the entire understanding and agreement between the City and the Corporation as to the matters set forth herein. No alteration of or amendment to this Agreement shall be effective unless given in writing and signed by the party or parties sought to be charged or bound by the alteration or amendment. (b). Applicable Law and Venue. This Agreement shall be governed by and construed in accordance with the laws of the State of Texas, and all obligations of the City and the Corporation created hereunder are performable in Denton County, Texas. Venue for any action arising under this Agreement shall lie in the state district courts of Denton County, Texas. (c). Assignment. This Agreement may not be assigned without the express written consent of the other party. (d). Binding Obligation. This Agreement shall become a binding obligation on the signatories upon execution by all signatories hereto. The City warrants and represents that the individuals executing this Agreement on behalf of the City have full authority to execute this Agreement and bind the City to the same. The Corporation warrants and represents that the individuals executing this Agreement on its behalf have full authority to execute this Agreement and bind it to the same. (e). Caption Headings. Caption headings in this Agreement are for convenience purposes only and are not to be used to interpret or define the provisions of this Agreement. (f). Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute one and the same document. (g). Force Majeure. If, by reason of Force Majeure, either party hereto shall be rendered unable wholly or in part to carry out its obligations under this Agreement, then such party shall give notice and full particulars of such Force Majeure in writing to the other party within a reasonable time after occurrence of the event or cause relied upon, and the obligation of the party giving such notice, so far as it is affected by such Force Majeure, shall be suspended during the continuance of the inability then claimed, except as hereinafter provided, but for no longer period, and any such party shall endeavor to remove or overcome such inability with all reasonable dispatch. The term Force Majeure as employed herein, shall mean acts of God, strikes, lockouts, or other industrial disturbances, acts of public enemy, orders of any kind of the Government of the United States or the State of Texas or any civil or military 52854326.4/11210115 3 authority, insurrections, riots, epidemics, landslides, lightning, earthquake, fires, hurricanes, storms, floods, washouts, droughts, arrests, restraint of government and people, civil disturbances, explosions, breakage or accidents to machinery, pipelines, or canals, or other causes not reasonably within the control of the party claiming such inability. It is understood and agreed that the settlement of strikes and lockouts shall be entirely within the discretion of the party having the difficulty, and that the above requirement that any Force Majeure shall be remedied with all reasonable dispatch shall not require the settlement of strikes and lockouts by acceding to the demands of the opposing party or parties when such settlement is unfavorable to it in the judgment of the party having the difficulty. It is specifically excepted and provided, however, that in no event shall any Force Majeure relieve the City of its obligation to levy, collect and transfer Sales Tax revenues to the Corporation as required under the Act. (h). Regulatory Bodies. This Agreement shall be subject to all valid rules, regulations, and laws applicable thereto passed, or promulgated by the United States of America, the State of Texas, or any governmental body or agency having lawful jurisdiction or any authorized representative or agency of any of them. (i). Severability. If a court of competent jurisdiction finds any provision of this Agreement to be invalid or unenforceable as to any person or circumstance, such finding shall not render that provision invalid or unenforceable as to any other persons or circumstances. If feasible, any such offending provision shall be deemed to be modified to be within the limits of enforceability or validity; however, if the offending provision cannot be so modified, it shall be stricken and all other provisions of this Agreement in all other respects shall remain valid and enforceable. 0). Term of Agreement. This Agreement shall terminate on the date on which all amounts due to be paid by the Corporation under this Agreement have been paid. (k). Time is of the Essence. Time is of the essence in the performance of this Agreement. [remainder of page left blank intentionally] 52854326.4/11210115 4 IN WITNESS WHEREOF, the Corporation and the City, acting under authority of their respective governing bodies have caused this Agreement to be duly executed in several counterparts, each of which shall constitute an original, all as of the 18th day of June, 2013, which is the date of this Agreement. CITY: CITY OF THE COLONY, TEXAS A Texas home-rule municipality By: - f, Joe McCourry, Mayor Date Executed: ATTEST: Christie Wilson, City Secretary APPROVED AS TO FORM: A Jeff Moore, City Attorney loor CORPORATION: THE COLONY ECONOMIC DEVELOPMENT CORPORATION, A Texas nonprofit corporation By: Tom vardzik, President Date Executed: ATTEST: Femi Omonije, Secretary 52854326.4/11210115 S-1 EXHIBIT A PROJECT DESCRIPTION 52854326.4/11210115 A-1 EXHIBIT B DEBT RETIREMENT SCHEDULE AND SCHEDULE OF ANNUAL PAYMENTS BY THE CORPORATION (To be provided in accordance with Section 3(b) of the Agreement) 52854326.4/11210115 B-1