2001-037 ResolutionRESOLUTION NO. 01-037
A RESOLUTION OF THE CITY OF SOUTHLAKE, TEXAS, ADOPTING A
REVISED TAX ABATEMENT POLICY; ESTABLISHING GUIDELINES
AND CRITERIA FOR TAX ABATEMENT AGREEMENTS; ELECTING TO
BECOME ELIGIBLE TO PARTICIPATE IN TAX ABATEMENT; AND
PROVIDING AN EFFECTIVE DATE.
WHEREAS, on May 4, 1999, the City Council adopted a Tax Abatement Policy,
established guidelines and criteria for tax abatement agreements, and elected to become eligible to
participate in tax abatement; and
WHEREAS, the Tax Abatement Policy for the City of Southlake was effective for two years
from the date of adoption and has now expired;
WHEREAS, the future economic viability of the City of Southlake depends on the ability
to attract new investments through the location of new businesses and the expansion and
modernization of existing businesses; and
WHEREAS, the City Council continues to believe that the creation and retention of job
opportunities that result from new economic development is in the best interest of the City of
Southlake; and
WHEREAS, the establishment of economic development incentives such as tax abatements
may encourage enhancement of the local economy; and
WHEREAS, the City Council wishes to revise the guidelines and criteria governing tax
abatement agreements; and
WHEREAS, the guidelines and criteria adopted herein authorize tax abatement for both new
facilities and structures and for the expansion or modernization of existing facilities and structures.
NOW, THEREFORE, BE IT RESOLVED BY THE CITY COUNCIL OF THE CITY
OF SOUTHLAKE, TEXAS, THAT:
SECTION 1.
The City Council does hereby adopt the Tax Abatement Policy, attached hereto as Exhibit
A" and incorporated herein for all purposes. This Tax Abatement Policy shall govern all tax
abatement matters considered by the City from and after the date of this Resolution, until said policy
expires or is repealed or amended as provided by law.
Resolution 01-037 adopting a Revised Tax Abatement Policy - Approved June 19, 2001 - Pagel of 3
SECTION 2.
The Tax Abatement Policy is effective for two (2) years from the date of adoption. During
that period, the Tax Abatement Policy may be amended or repealed only by a vote of 3/4 of the
members of the City Council. Said Tax Abatement Policy is intended as a guide for use in
developing tax abatement programs and agreements under the provisions of Chapter 312 of the
Texas Tax Code.
SECTION 3.
The City of Southlake hereby again elects to become eligible to participate in tax abatement.
SECTION 4.
The adoption of the Tax Abatement Policy and the City's election to become eligible to
participate in tax abatement as provided herein shall not be construed to require the City of
Southlake to approve any proposed tax abatement agreement which meets the requirements of the
policy. Tax abatements shall be reviewed on a case by case basis and shall be granted only where
the City Council determines in its sole discretion that the tax abatement is in the best interest of the
citizens of Southlake.
SECTION 5.
This Resolution shall become effective upon passage.
PASSED AND APPROVED this the 19th
day of June, 2001.
ATTEST:
4wh, \A 4
Sandra LeGrand, City
Citacy, Mayor
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EXHIBIT A
TAX ABATEMENT POLICY
Resolution 01-037 adopting a Revised Tax Abatement Policy - Approved June 19, 2001 - Page 3 of 3
City of Southlake, Texas
Tax Abatement Policy
Section I. General Purpose and Objectives
A. The City of Southlake, Texas, is committed to the promotion and retention of high
quality development in all parts of the City; and to an on-going improvement in the quality of
life for its citizens. Insofar as these objectives are generally served by the enhancement and
expansion of the local economy, the City of Southlake will, on a case-by-case basis, give
consideration to providing tax abatements as stimulation for economic development in
Southlake. It is the policy of the City of Southlake that said consideration will be provided in
accordance with the criteria outlined in this document. Nothing herein shall imply or suggest
that the City of Southlake is under any obligation to provide tax abatement to any applicant. All
applicants shall by considered on a case-by-case basis.
Section II. Applicability
A. This tax abatement policy establishes guidelines and criteria for tax abatement programs
and agreements under the provisions of Chapter 312 of the Texas Tax Code.
Section III. Abatement Criteria
A. Any consideration for a tax abatement shall be reviewed by the City of Southlake City
Council. The review process will examine the "value added" terms of the project.
Considerations by the City Council shall be for new construction, whether it is a new facility or
an expansion of an existing building.
B. Specific considerations will include the degree to which the individual project furthers
the goals and objectives of the community, as well as the relative impact of the project, including
costs to the City for providing services, impact on the environment and the local housing market,
and required infrastructure.
C. Value and Term of Abatement. Abatement shall be granted effective with the execution
of the agreement. The amount of the abatement will be determined based on the merits of the
project, including, but not limited to, total capital investment, added employment, and average
annual salary. Abatement will be granted for a maximum of ten years. Abatement may be
granted only for the additional value of eligible property improvements made subsequent to and
listed in a tax abatement agreement.
1.) For new businesses, the project must be reasonably expected to produce a minimum
added value of Ten Million Dollars ($10,000,000) in real and personal property improvements
within the City of Southlake, and create a minimum of 500 full-time jobs which have an average
annual salary of $40,000 or more.
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2.) For expansion or modernization of existing businesses, the project must be reasonably
expected to produce a minimum added value of Five Million Dollars ($5,000,000) in real and
personal property improvements within the City of Southlake, and create a minimum of 500 new
full time jobs with an average annual salary of $40,000.
D. Consideration will also be given for direct sales tax that is generated by the applicant.
Section IV. Inspection and Financial Verification
A. The terms of the agreement shall include the City of Southlake's right to (1) review and
verify the applicant's financial statements in each year during the life of the agreement prior to
granting a tax abatement in any given year, and (2) conduct an on-site inspection of the project
in each year during the life of the abatement to verify compliance with the terms of the tax
abatement agreement.
Section V. Evaluation
A. Upon completion of the construction of the facilities, the City shall no less than annually
evaluate each project receiving abatement to insure compliance with the terms of the agreement.
Any incidents of non-compliance will be reported to all affected taxing units.
Section VI. Severability and Limitation
A. In the event that any section, clause, sentence, paragraph or any part of this Tax
Abatement Policy shall, for any reason, be adjudged by any court of competent jurisdiction to be
invalid, such invalidity shall not affect, impair, or invalidate the remainder of the guidelines and
criteria in this Tax Abatement Policy.
Section VII. Expiration and Modification
A. This Tax Abatement Policy is effective upon the date of its adoption and will remain in
force for two years, at which time all reinvestment zones and tax abatement contracts created
pursuant to its provisions will be reviewed by the City Council to determine whether the goals of
the abatement program have been achieved. Based upon that review, the Tax Abatement Policy
may be modified, renewed or eliminated.
B. Prior to the date for review, as defined above, the Tax Abatement Policy may be
modified by a three fourths vote of the City Council, as provided for in Chapter 312 of the Texas
Tax Code.
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