HomeMy WebLinkAbout1-24-22 packetRICHARD WARREN, PRESIDENT DANNY EARP, BOARD MEMBER
BRENT McCAULLEY, COUNCILPERSON JOHN BLAKEMORE, BOARD MEMBER
RACHEL COTTON, BOARD MEMBER NANCY OJEDA, VICE-PRESIDENT
CHUCK ENGELKEN, COUNCILPERSON
CITY OF LA PORTE DEVELOPMENT CORPORATION MEETING AGENDA
Notice is hereby given of a meeting of the City of La Porte Development Corporation to be held on
January 24, 2022, at the City Hall Council Chamber, 604 West Fairmont Parkway, La Porte, Texas,
beginning at 5:15 pm to consider the following items of business:
Remote participation is available, also. Attend via a screen using this link:
https://us02web.zoom.us/j/81563561950?pwd=d1FjQ3Q5aGc5Z0xxTXF2V2VHeGh4dz09
Join by phone at 877-853-5257 or 888-475-4499. The meeting ID is 815 6356 1950 and the passcode is
714581.
1.CALL TO ORDER
2.CITIZEN COMMENT (Generally limited to five minutes per person; in accordance with state law,
the time may be reduced if there is a high number of speakers or other considerations.)
3.AUTHORIZATIONS
(a)Approve the minutes of the regular meeting of the La Porte Development Corporation held
on December 13, 2021. [President W arren]
(b)Presentation, discussion, and possible action to approve an economic development
incentive agreement with Mark Rosado, providing for a financial incentive in an amount not
to exceed $27,308.00, for the construction and operation of Battleground Saloon, located
at 116 S. Broadway Street, in La Porte, Texas. [Corby Alexander, City Manager]
(c)Presentation, discussion, and possible action to recommend that the La Porte City Council
authorize the City Manager to contract with a third-party consultant to provide professional
services in connection with the City of La Porte Office of Economic Development. [Corby
Alexander, City Manager]
4.SET NEXT MEETING
5.BOARD COMMENTS Hear announcements concerning matters appearing on the agenda;
items of community interest; and/or inquiries of staff regarding specific factual information
or existing policy from the Committee members and City staff, for which no formal action
will be discussed or taken.
6.ADJOURN
If, during the course of the meeting and discussion of any items covered by this notice, the La Porte
Development Corporation Board determines that a Closed or Executive Session of the Board is required,
then such closed meeting will be held as authorized by Texas Government Code, Chapter 551, Section
551.071 - consultation with counsel on legal matters; Section 551.072 - deliberation regarding purchase,
exchange, lease or value of real property; Section 551.073 - deliberation regarding a prospective gift; Section
551.074 - personnel matters regarding the appointment, employment, evaluation, reassignment, duties,
discipline, or dismissal of a public officer or employee; Section 551.076 - implementation of security
personnel or devices; Section 551.087 - deliberation regarding economic development negotiation; Section
551.089 - deliberation regarding security devices or security audits, and/or other matters as authorized under
the Texas Government Code. If a Closed or Executive Session is held in accordance with the Texas
Government Code as set out above, the La Porte Development Corporation Board will reconvene in Open
Session in order to take action, if necessary, on the items addressed during Executive Session.
Persons with disabilities who plan to attend this meeting and who may need auxiliary aids or services are
requested to contact the City Secretary's office (281-470-5019), two working days prior to the meeting for
appropriate arrangements.
Pursuant to Texas Government Code Sec. 551.127, on a regular, non-emergency basis, members may attend and participate in the
meeting remotely by video conference. Should that occur, a quorum of the members will be physically present at the location noted
above on this agenda.
CERTIFICATE
I, Lee W oodward, City Secretary, do hereby certify that a copy of the January 24, 2022, La Porte Development
Corporation Board agenda was posted on the City H all bulletin board, a place convenient and readily accessible to the
general public at all times, and to the C ity's website, www.LaPorteT X .gov, in compliance with Chapter 551, Texas
Government Code.
DATE OF
POSTING
TIME OF
POSTING
TAKEN DOW N
Lee Woodward
Lee W oodward, City Secretary
Page 1 of 2
December 13, 2021, La Porte Development Corporation Board Minutes
RICHARD WARREN
PRESIDENT
BRENT MCCAULLEY
COUNCILPERSON
RACHEL COTTON
BOARD MEMBER
CHUCK ENGELKEN
COUNCILPERSON
DANNY EARP
BOARD MEMBER
JOHN BLAKEMORE
BOARD MEMBER
NANCY OJEDA
VICE-PRESIDENT
MINUTES OF THE LA PORTE DEVELOPMENT CORPORATION
BOARD OF DIRECTORS MEETING OF DECEMBER 13, 2021
The City of La Porte Development Corporation Board met on Monday, December 13, 2021, at the
City Hall Council Chambers, 604 West Fairmont Parkway, La Porte, Texas, at 5:00 p.m., with the
following in attendance:
Board members present: Richard Warren, Nancy Ojeda, Chuck Engelken, Danny Earp, John Blakemore,
Brent McCaulley, Rachel Cotton
Board members attending remotely: None
Board members absent: None
Council-appointed members present: Corby Alexander, City Manager, Lee Woodward, City Secretary;
Clark Askins, Assistant City Attorney
1. CALL TO ORDER – President Warren called the meeting to order at 5:00 p.m.
2. CITIZEN COMMENT (Generally limited to five minutes per person; in accordance with state law, the
time may be reduced if there is a high number of speakers or other considerations.)
There were no comments.
3. CONSENT AGENDA
a. Presentation, discussion, and possible action to approve the minutes of the regular meeting
of the La Porte Development Corporation held on October 25, 2021. [President Warren]
Member Engelken moved to approve the minutes of the October 25, 2021, meeting; the motion
was seconded by Member Earp; the motion was adopted, 7-0.
4. PUBLIC HEARINGS AND ASSOCIATED MATTERS
a. The La Porte Development Corporation Board of Directors will hold a public hearing to
receive comment on consideration to authorize the following projects of the La Porte
Development Corporation: Downtown Lighting & Enhancements - $150,000.00;
Enhancement Grant Program - $100,000.00; Fairmont Park Splash Pad (1/3 funding) -
$200,000.00; Dog Park at Fairmont Park - $72,275.00; Broadway Street Trail Lighting Phase II
- $390,156.00; Signage Project Phase I - $350,000.00; Fairmont Park Improvements (Exercise
Shade Structure) - $52,600.00; and Pecan Park Parking Lot Improvements - $336,000.00;
followed by discussion and possible action to authorize the following projects of the La Porte
Development Corporation: Downtown Lighting & Enhancements - $150,000.00;
Enhancement Grant Program - $100,000.00; Fairmont Park Splash Pad (1/3 funding) -
$200,000.00; Dog Park at Fairmont Park - $72,275.00; Broadway Street Trail Lighting Phase II
- $390,156.00; Signage Project Phase I - $350,000.00; Fairmont Park Improvements (Exercise
Shade Structure) - $52,600.00; and Pecan Park Parking Lot Improvements - $336,000.00.
[Corby Alexander, City Manager]
Page 2 of 2
December 13, 2021, La Porte Development Corporation Board Minutes
Chair Warren opened the public hearing at 5:03 p.m. Mr. Alexander noted the 60-day comment
period had expired without the City receiving any written comments. Chair Warren closed the public
hearing at 5:05 p.m. Member Ojeda moved to authorize the following projects of the La Porte
Development Corporation: Downtown Lighting & Enhancements - $150,000.00; Enhancement
Grant Program - $100,000.00; Fairmont Park Splash Pad (1/3 funding) - $200,000.00; Dog Park at
Fairmont Park - $72,275.00; Broadway Street Trail Lighting Phase II - $390,156.00; Signage Project
Phase I - $350,000.00; Fairmont Park Improvements (Exercise Shade Structure) - $52,600.00; and
Pecan Park Parking Lot Improvements - $336,000.00; the motion was seconded by Member
Engelken; the motion was adopted, 7-0.
b. The La Porte Development Corporation Board of Directors will hold a public hearing to hear
comment on proposed 116 S. Broadway Street Project - 'Battleground Saloon', a project to
promote and develop new and expanded business enterprises, specifically for site,
infrastructure, and related improvements for construction of facilities at 116 S. Broadway
Street, to be operated as a restaurant bar and grill, which location is legally described as Lots
22, 23, 24, & 25 & south 1/2 Lot 26, Block 37, Town of La Porte Subdivision, in a total amount
not to exceed $27,308.00; followed by discussion and possible action to authorize the
following project of the La Porte Development Corporation: 116 S. Broadway Street Proje ct
- 'Battleground Saloon', in an amount not to exceed $27,308.00. [Corby Alexander, City
Manager]
Chair Warren opened the public hearing a t 5:08 p.m. Mr. Alexander noted the 60-day comment
period had expired without the City receiving any written comments. He provided the proposed
performance measures for the project. Project developer Mark Rosado expressed his desire for
revisions to the performance measures and funding. Chair Warren closed the public hearing at 5:46.
Member Earp moved to authorize the following project of the La Porte Development Corporation:
116 S. Broadway Street Project - 'Battleground Saloon', for $27,308.00; the motion was seconded
by Member McCaulley; the motion was adopted, 7-0.
5. AUTHORIZATIONS
a. Consider approval or other action authorizing the City Manager to sign a thirty -six (36)
month economic development services agreement with Bay Area Houston Economic
Partnership, in the amount of $20,000.00 per ye ar, beginning January 1, 2022, and ending
December 31, 2024. [Corby Alexander, City Manager]
Member McCaulley moved to authorize the City Manager to sign a thirty-six (36) month
economic development services agreement with Bay Area Houston Economic Partnership,
in the amount of $20,000.00 per year, beginning January 1, 2022, and ending December 31, 2024;
the motion was seconded by Member Engelken; the motion was adopted, 7-0.
6. SET DATE FOR NEXT MEETING
The next meeting date was scheduled for January 24, 2022.
7. BOARD COMMENTS Hear announcements concerning matters appearing on the agenda; items of
community interest; and/or inquiries of staff regarding specific factual information or existing policy from
the Committee members and City staff, for which no formal action will be discussed or taken.
There were no comments.
ADJOURN – The meeting was adjourned without objection at 5:52 p.m.
___________________________________
Lee Woodward, City Secretary
REQUEST FOR LA PORTE DEVELOPMENT CORPORATION BOARD
AGENDA ITEM
Agenda Date Requested: January 24, 2022
Requested By: Corby Alexander, City Manager
Department: Administration/CMO
Report Resolution Ordinance
Exhibits: Application, Public Notice, Scorecard,
and Agenda Request from 9/27/21, & Draft
Development Agreement
SUMMARY & RECOMMENDATIONS
On September 27, 2021, Staff brought the La Porte Development Corporation Board a
project in downtown La Porte. The applicant, Mark Rosado, was interested in building
the “Battleground Saloon” business, which would be located at 116 S. Broadway Street,
south of the old Magic Mart (corner of Main Street and Broadway).
Rosado is a first-time business owner looking to establish his Bar & Grill as a staple in
the community. Though no kitchen or grill would be installed at his business, the plan
is for food to be sold via food truck(s). He provided the Board with a layout for the
project, which included an outdoor seating area for customers and three small buildings
for another bar, stage and retail area. The plan has been revised to include only one
building at this time. Additionally, the applicant has clarified that at opening, he would
employ five full-time employees or full-time equivalents (FTE’s), rather than the 15
anticipated when we last discuss this project.
The City of La Porte receives mixed beverage sales tax receipts issued through the
Texas Comptroller of Public Accounts from multiple permitees within La Porte. La Porte
has several dozen establishments that contribute monthly mixed beverage sales tax to
the City. On average, these establishments average gross receipts of $30,000 per
month. Staff has estimated that the applicant will submit approximately $4,500 annually
to the City for mixed beverage taxes.
Staff provided the Board of an analysis of this project:
“Per Harris County Appraisal District, the location Mr. Rosado is building
Battleground Saloon, 116 S. Broadway, has an assessed valuation as of
January 1, 2021 of $84,000 for this vacant parcel. The applicant plans to sell
food and alcohol, which will generate sales and mixed beverage taxes for the
City. Based on the projected project cost of $143,200, the applicant would have
Appropriation
Source of Funds: 038 – EDC Fund
Account Number: 038-6030-565-9997
Amount Budgeted: $540,200
Amount Requested: TBD
Budgeted Item: Yes No
investment in the business of $227,200, which could generate approximately
$1,613 in property taxes annually for the City. Additionally, the applicant would
be a water and sewer customer; therefore, the City would receive utility fees from
the applicant. As a reminder, property tax and mixed beverage sales tax are not
revenue producers for the La Porte Development Corporation. Only sales tax on
non-alcoholic items (food and drinks) would increase the revenue sources for
the LPDC. After entering data into the matrix, the applicant would qualify for an
incentive of $27,308. Again, the matrix is subjective based on my assumptions;
therefore, this amount could be adjusted slightly up or down.”
Included in this agenda is a draft development agreement with the following three
payment benchmarks:
1. A $10,000 payment upon proof of capital investment of at least $50,0 00,
exclusive of land purchase. The developer will also have to obtain a Certificate
of Occupancy no later than February 28, 2022.
2. A $10,000 payment upon proof of 5 full-time employees of full-time equivalent
employees and an additional $93,000 in capital investment exclusive of land
costs. Employment number must be m et each year for the following five years.
3. A $7,308 payment upon proof of alcohol beverage sales of not less than
$250,000 in the first 12 months of operation and proof of an additional $93,000
in capital investment.
ACTION REQUIRED BY LPDC BOARD
Consider, discuss, and possible action to approve the development agreement
with Mark Rosado, providing financial incentive in an amount not to exceed
$27,308 for the construction of Battleground Saloon, located at 116 S. Broadway
Street in La Porte, Texas.
Approved for the La Porte Development Corporation Board meeting agenda
Corby D. Alexander, City Manager Date
Notice of Proposed Project of the La Porte Development Corporation
Board (Type B)
116 S. Broadway St. Building Project: Pursuant to the Texas Local Government Code Section 505.160
notice is hereby given that the La Porte Development Corporation Board (Type B Board) of the City of La
Porte, Texas has proposed an official project and is considering granting an incentive to an eligible
business enterprise in an amount not to exceed $27,308.00. The purpose of the project is to promote and
develop new and expanded business enterprises, specifically for site, infrastructure, and related
improvements at 116 S. Broadway St., which location is legally described as Lots 22, 23, 24, 25, and the
North ½ of Lot 26, Block 37, Town of La Porte Subdivision.
In accordance with Texas Local Government Code 505.160 the public has a right to gather a petition to
object to the proposed project by requiring an election. The petition must request that an election be held
before the project is undertaken and must be signed by more than ten percent (10%) of the registered
voters of the City of La Porte. The petition must be received by the City of La Porte not later than sixtieth
(60th) day after the publication of this notice.
Please reach out to Jason Weeks, Assistant City Manager at WeeksJ@LaPorteTX.Gov or 281-470-5012
with any questions or comments you may have.
Project Type
Project's
PRIORITY Value
(Up to 10) 1
Project's 10 Year
Tax or PILOT
Revenue 2
Project's
Multiplier Value
(Up to 4) 3
# of New
Full Time
Jobs
Full Time
Job Avg.
Value 4
Project's Existing
10 Year
Incentives 5
Regression
Analysis 6
Estimated
Incentive Value 7
Incentive Value
Allowed by Tax
Abatement Policy 8
% Allowed by
Tax Abatement
Policy
New Retail/Restaurant Dev.
(Higher)A 10 $3,420,000 2 0.0 0.0 $0 342.0 $2,565,000 $355,000 50%
Palais Royal A1 10 $471,000 2 16 0 $0 47.1 $353,250 $17,750 50%
Retail or Restaurant Re-Development/
Blight Removal/EHG (Higher)B 9 $684,000 1 0 0 $0 30.8 $230,850 $71,000 50%
Pipeline Grill B1 9 $846,628 2 100 0 $0 76.2 $571,474 $11,657 50%
Fischer's Hardware B2 9 $210,500 2 8 0 $0 18.9 $142,088 $17,750 50%
Quality Waterfront Development C 8 $1,532,500 2 0 0 $0 122.6 $919,500 $133,125 50%
Main Street Improvements D 7 $648,500 3 0 0 $0 68.1 $510,694 $62,125 50%
Bank Building Remodel D1 7 $35,500 3 8 0.1 $0 3 $22,365 $8,875 50%
Micro-Brewery (Purchase)D2 7 $105,500 2 12 0.1 $0 9 $66,465 $8,875 50%
Battleground Saloon D3 5 $64,730 2 15 0.075 $0 4 $27,308 $8,875 50%
New Retail/Restaurant Dev.
(Lower) - Rob Johnson/Dollar Tree E 6 $826,000 1 0 0 $0 24.8 $185,850 $106,500 50%
Retail or Restaurant Re-Development/
Blight Removal/EHG (Lower)F 6 $121,000 1 0 0 $0 3.6 $27,225 $3,550 50%
El Toro F1 6 $542,000 2 12 0 $0 32.5 $243,900 $35,500 50%
Industry - NEW Development
(Higher) - INEOS Unit #1 - $250 Million G 5 $11,182,500 4 24 0.125 $4,579,500 396 $2,971,350 $2,662,500 10%
INEOS Unit #2 - $500 Million G1 5 $22,365,000 4 60 0.125 $9,159,000 1981 $14,856,750 $2,662,500 10%
Project Regulate G2 5 $1,136,000 3 40 0.125 $0 85 $639,000 $56,800 10%
La Porte Development Corporation Project Scorecard -- PRIORITIES
ACT Turbo (New Industry)G3 5 $426,000 3 73 0.13 $0 61 $454,808 $21,300 10%
NEW Office/HQ - InterGulf Corporation H 4 $142,000 4 30 0.15 $0 10 $76,680 $7,100 10%
NEW Office/Regional - Richard Industrial Group I 4 $10,650 4 75 0.15 $0 2 $14,378 $1,775 10%
Industry - NEW Development
(Lower) - Sector 23 (Original)J 3 $568,000 4 35 0.1 $0 24 $178,920 $28,400 10%
Sector 23 (Latest)J1 3 $1,278,000 4 72 0.1 $0 110 $828,144 $28,400 10%
Industry - RETENTION/EXPANSION
(Higher) - ACT Turbo (Expansion)K 3 $426,000 3 73 0.13 $0 36 $272,885 $21,300 10%
Industry - RETENTION/EXPANSION
(Lower)L 2 $710,000 3 15 0.075 $0 5 $35,944 $35,500 10%
Airport Re-Development M 1 $177,500 2 30 0.1 $0 1 $7,988 $8,875 10%
Notes:
1. Staff assigned prioritized values, from a maximum of 10 to a minimum of 1, based upon his understanding of the City Council and 4B Board’s values for various types of projects.
2. The values in this column include revenues from property taxes, business personal proeprty taxes, and sales taxes.
3. Staff assigned a value, from a maximum of 4 to a minimum of 1, for each project. A value of 4 means that the project will have a significant multiplier effect to bring new money and/or people into our local economy. A value
of 1 means that the project will have little or no multiplier effect to bring new money and/or people into our local economy.
4. Staff assigned a value, from a maximum of 0.15 to a minimum of 0.075, for each type of “primary job” associated with each project type. A value of 0.15 was assigned to higher paying,white collar, engineering, engineering
design, or executive positions. A value of 0.125 was assigned to highly skilled positions for a process technician and/or advanced manufacturer. A value of 0.10 was assigned to skilled positions. A value of 0.075 was assigned
to unskilled positions.
5. Data in this column identifies all other local incentives, like PILOT abatements under an existing IDA or scheduled TIRZ reimbursements, that any project may be entitled to receive.
6. The formulas in this column represent staff’s best estimate using regression analysis to tie together all the columns of data. Important assumptions of the formulas are as follows:
x Retail projects are five times (5x) more attractive to the community than industrial projects. For reference, please see page #6 of La Porte’s enclosed Tax Abatement Policy.
x Each “project type” is not equal to every other project type. Therefore, each project type’s priority value is included in the formula.
x The value of incentives that a project is already scheduled to receive, and is shown in the “Project's Existing 10 Year Incentives”, must be deducted from the total tax/PILOT revenue that the project is expected to
generate, which is shown in “Project's 10 Year Tax or PILOT Revenue“.
x Each project’s value to create a “multiplier effect” on our local economy should be included. See the values listed under “Project's Multiplier Value (Up to 4)"above.
x Each value in the column for “Regression Analysis” is divided by 1 million to make the values under “Regression Analysis”smaller, more manageable, and easier to compare.
The two (2) basic formulas used in “Regression Analysis” are as follows:
(a) For all Retail, Restaurant, Re-Development, and Waterfront Projects, “Project's PRIORITY Value (Up to 10)” x 5 times “Project's 10 Year Tax or PILOT Revenue” –“Project's Existing 10 Year Incentives”times “Project's
Multiplier Value (Up to 4)”divided by 1 million.
(b) For all Industry and Office Projects,“Project's PRIORITY Value (Up to 10)” x 1 times “Project's 10 Year Tax or PILOT Revenue” –“Project's Existing 10 Year Incentives”times “Project's Multiplier Value (Up to 4)”divided
by 1 million.
7. The values in this column are simply the value from the column called “Regression Analysis” times $7,500.
8. Data in this column shows the value of incentive recommended for each project type, according to the La Porte’s current Tax Abatement Policy.
Projects identified in dark green text represent projects that have either already been awarded an incentive grant, or staff has good estimates for the projects.All other projects are completely "hypothetical".
A. Hypothetical -$20 million retail/restaurant/mixed use development project with $10 million in annual retail sales.
A1. Palais Royal -$1 million property value with $2 million in annual retail sales.
B. Hypothetical -$4 million project with $2 million in annual retail sales.
B1.Pipeline Grill -$1.2 million in commercial property with $4 million in annual retail sales.
B2. Fischer's Hardware -$1.5 million in commercial property with $520,000 in additional, annual retail sales.
C. Hypothetical -$7.5 million with $5 million in annual retail sales.
D. Hypothetical -$3.5 million with $2 million in annual retail sales.
D1.Micro-Brewery (Lease) -$500,000 in commercial property value, $350,000 in annual retail sales, 12 full time employees, and rent of $48,000/year for five years.
D2.Micro-Brewery (Purchase)-$500,000 in commercial property value, $350,000 in annual retail sales, and 12 full time employees
E.Rob Johnson/Dollar Tree -$6 million project with $2 million in annual retail sales.
F. Hypothetical -$1 million project with $250,000 in annual retail sales.
F1.El Toro -$2 million in new commercial property, plus $2 million in additional, annual retail sales.
G. INEOS USA, LLC -Unit #1, $250 million investment, 84 highly skilled, full time jobs, 20% IDA for years #1-6, 63% IDA for years #7-10.
G1.INEOS USA, LLC -Unit #2, $500 million investment, highly skilled, full time jobs, 20% IDA for years #1-6, 63% IDA for years #7-10
G2.Project Regulate -$16 million investment, with at least 40 (to 60 within 5 years) highly skilled, advanced manufacturing, full time jobs. (Note: Project would be in the TIRZ).
G3.ACT Turbo (New Industry)-$6 million investment with 73 new, highly skilled, advanced manufacturing, full time jobs.
H. InterGulf Corporation -$2 million investment with 30 white collar, higher paying, full time jobs.
I. Richard Industrial Group -$500,000 investment with 75 white collar, higher paying, full time jobs. (Note: the 10 year PILOT is based on 3 years, equal to the term of the lease, rather than the usual 10 year timeframe.)
J. Sector 23 (Original) -$8 million investment and 35 full time, skilled jobs assuming 15 buildings, 3 employees per building, and minus 10 employees per the development agreement.
J1. Sector 23 (Latest)-$18million investment and est. 72 full time, skilled jobs assuming 18 buildings, 4 employees per building.
K. ACT Turbo (Expansion) -$6 million investment with 73 new, highly skilled, advanced manufacturing, full time jobs.
L. Hypothetical -Warehouse/Distribution, $10 million investment, 15 unskilled, full time jobs.
M. Hypothetical -Airport expansion, $2.5 million city participation/investment with 30 skilled, full time jobs.
REQUEST FOR LA PORTE DEVELOPMENT CORPORATION BOARD
AGENDA ITEM
Agenda Date Requested: September 27, 2021
Requested By: Jason Weeks, Asst. City Manager
Department: Administration/CMO
Report Resolution Ordinance
Exhibits: Application, Conceptual Renderings,
Scorecard, Mixed Beverage Tax Info, and FAQ’s
On Mixed Beverage Tax
SUMMARY & RECOMMENDATIONS
The City Manager’s Office has received and reviewed the business plan for the
“Battleground Saloon” business that will b e located at 116 S. Broadway Street, which
is next to the old Magic Mart (corner of Main Street and Broadway). The owner, Mark
Rosado, resides at 3527 Bayou Forest Dr. in La Porte. Rosado is a first-time business
owner looking to establish his bar & grill as a staple in the community. Though no
kitchen or grill will be installed at his business, the plan is for food to be sold via food
truck(s). Currently, the proposed building site is vacant; however, Mr. Rosado is
requesting a financial incentive to assist with building his new establishment.
According to his business model, he “will provide a safe and friendly gathering place by
choosing the right staff to hire and properly training them in customer service and most
importantly public safety.” Also, he will be taking an initiative to prevent underage
drinking and prioritizing serving the customer.
Rosado has indicated that his family-friendly neighborhood bar and grill will sell food,
drinks, and provide retail space and live musical entertainment. The layout for the
project includes an outdoor seating area for customers and three small buildings for
another bar, stage and retail area. The retail area will include logo merchandise, such
as hats and shirts, along with toys for kids, jewelry items for women and knickknacks.
Mr. Rosado will be purchasing signs, shades, office electronics, point-of-sale
equipment, furniture and wood to build additional furniture to assist with the opening of
the Battleground Saloon. He anticipates Battleground Saloon opening in December
2021.
Staff has included within the agenda packet renderings, which indicate several patio
benches on the outside of the restaurant that could seat up to 36 people. Also, Rosado
plans on building a playground for children at a later date. The main building will be
approximately 750 square feet in size, while the other remaining “out” buildings (retail
Appropriation
Source of Funds: 038 – EDC Fund
Account Number: 038-6030-565-9997
Amount Budgeted: $540,200
Amount Requested: TBD
Budgeted Item: Yes No
space, storage shed, and live music stage) will be a total of another 750 square feet of
space for a total 1,500 square feet. The applicant will not have a walk-in cooler, but the
main building will be fully air conditioned.
General Cost to Start Business:
Construction of Main Building $79,000**
Concrete work $13,500**
Retail, Stage and Bar Buildings $19,200**
Refrigeration Equipment $16,000**
Furniture and other equipment $9,500**
Other Smaller Items* $6,000**
Total of Project Cost $143,200
*- Miscellaneous/Not Listed
**- All amounts are estimates from owner
Job Creation Breakdown:
Number of Jobs: Est. Annual Payroll Year
15-16 jobs created at opening $159,000 21’-22’
28 jobs available after 3 yrs. $319,000 24’-25’
45 jobs available after 5 yrs. $509,000 26’-27’
Also, Mr. Rosado has indicated that there will be 38+ construction jobs that will be
created in the construction of the building. Rosado believes this project will last for 35 -
plus years.
Mr. Rosado provided a copy of his resume within the submitted documents, which
indicated he has 21 years of hospitality experience working most recently for Noah’s
Ark Bar & Grill in Bacliff. Additional employers included Pipeline Grill, and several
establishments in Miami, Florida such as Klutch – South Beach, Martini Bar,
Bennigan’s. He began is his hospitality career in Austin, Texas working for Light Bar.
He is a La Porte High School graduate and earned an Associate ’s Degree from Miami
Dade Community College. He is a Certified Home Inspector, Blood Borne Pathogens
Certified, CPR & TABC Certified. Mr. Rosado has listed that he will be using personal
savings and the sale of his home as equity to build his business.
At the time of publication of this agenda item, the applicant has received his TABC
license for the establishment and the City’s permitting (including FMO) has approved
his building permit. The La Porte ZBOA approved an special exception for this project
by waiving on-site parking and the applicant will be allowed to utilize off-site parking
along the street.
Mixed Beverage Tax
A mixed beverage is any alcoholic beverage (beer, wine, ale and distilled spirits), or
part of an alcoholic beverage, that a permitee sells or serves to be consumed on the
permittee’s premises. An alcoholic beverage is any beverage containing more than ½
of 1% of alcohol by volume. A permittee is the holder of one or more of the following
alcohol permits: mixed beverage, private club, private club exemption certificate, mixed
beverage or private club late hours, daily temporary mixed beverage or private clu b,
mixed beverage or private club registration permit holding a food and beverage
certificate, caterer’s, distiller’s and rectifier’s permits. According to the applicant, Mr.
Rosado, has received his mixed beverage permit from the Texas Alcohol and Beverage
Commission. There are two mixed beverage taxes, both based on the sale, preparation
or service of alcoholic beverages and mixers. Mr. Rosado would pay the mixed
beverage gross receipts tax to the State and his customers would pay him the mixed
beverage sales tax, which would be remitted to the State. The mixed beverage gross
receipts tax is based on the total amount received from the sale, preparation or service
of mixed beverages, ice, and non-alcoholic beverages that are sold, prepared or served
to be mixed with an alcoholic beverage and consumed at the Battleground Saloon. A
customer will pay the mixed beverage sales tax on each mixed beverage Battleground
Saloon sells, prepares or serves, and ice and each non-alcoholic beverage
Battleground Saloon sells, prepares or serves that is mixed with an alcoholic beverage
and consumed on Battleground Saloon’s premises. The mixed beverage gross receipts
tax rate is 6.7%, and the mixed beverage sales tax rate is 8.25%. All sales of beer, ale
or wine from Battleground Saloon are subject to both mixed beverage taxes. However,
this is different than retailer locations that sell beer, ale or wine, which their tax is strictly
subject to the sales and use tax. Staff has included two (2) documents within the
agenda packet that the Texas Comptroller of Public Accounts discusses “Mixed
Beverage Sales Tax” and “ the “Mixed Beverage Taxes Frequently Asked Questions.”
The City receives mixed beverage sales tax receipts issued through the Texas
Comptroller of Public Accounts from multiple permitees within La Porte. La Porte has
several dozen establishments that contribute monthly mixed beverage sales tax to the
City. On average, these establishments average gross receipts of $30,000 per month.
Staff Analysis:
Per Harris County Appraisal District, the location Mr. Rosado is building Battleground
Saloon, 116 S. Broadway has an assessed valuation as of January 1, 2021 of $84,000
for this vacant parcel. The applicant plans to sell food and alcohol, which will generate
sales and mixed beverage taxes for the City. Based on the projected project cost of
$143,200, the applicant would have investment in the business of $227,200, which
could generate approximately $1,613 in property taxes annually for the City.
Additionally, the applicant would be a water and sewer customer; therefore, the City
would receive utility fees from the applicant. As a reminder, property tax and mixed
beverage sales tax are not revenue producers for the La Porte Development
Corporation. Only sales tax on non-alcoholic items (food and drinks) would increase
the revenue sources for the LPDC. After entering data into the matrix, the applicant
would qualify for an incentive of $27,308. Again, the matrix is subjective based on my
assumptions; therefore, this amount could be adjusted slightly up or down.
Staff would recommend during the negotiations of any development agreement that
benchmarks be spread over several years to guarantee the applicant will still be in
business. Additionally, consideration may need to be given that the first benchmark not
be established until one-year after the applicant opens for business.
ACTION REQUIRED BY LPDC BOARD
Consider, discuss, and possible action on a financial incentive to Mark Rosado,
applicant for his construction of Battleground Saloon, located at 116 S.
Broadway Street in La Porte, Texas.
Approved for the La Porte Development Corporation Board meeting agenda
Corby D. Alexander, City Manager Date
1
ECONOMIC DEVELOPMENT INCENTIVE AGREEMENT BETWEEN THE LA
PORTE DEVELOPMENT COPRPORATION, AND MARK ROSADO, FOR USE
OF TYPE B DEVELOPMENT CORPORATION SALES TAX FUNDS
THIS AGREEMENT made by and entered into this 24th day of January
2022 between the La Porte Development Corporation, a Type B non-profit
corporation operating under authority of Texas Local Government Code Chapters
501 and 505, hereinafter “LPDC”, and Mark Rosado, hereinafter referred to as
“Recipient”.
WITNESSETH:
WHEREAS, the voters of the City of La Porte authorized the levying of
additional sales tax within the City for promotion of economic development and the
LPDC is authorized to use such tax revenues for certain qualifying projects and
other economic development related purposes; and
WHEREAS, Recipient is a sole proprietor who desires to develop and
operate a retail business in the City of La Porte; and
WHEREAS, Recipient wishes to construct a building at 116 S. Broadway
Street, for the purpose of operating a bar and grill restaurant business to be known
as “Broadway Saloon” and which would 1) result in the expenditure by Recipient
of an estimated $143,200.00 in capital improvements; and 2) employ an estimated
five (5) full-time personnel (or part-time positions which are equivalent to five (5)
full-time positions); and
WHEREAS, Recipient has requested that LPDC provide financial incentives
to Recipient to contribute towards the cost of constructing the building to be located
at 116 S. Broadway Street under a qualifying project of the LPDC for infrastructure,
site and related improvements, as authorized by Texas Local Government Code
Chapters 501 and 505, and it is the desire of LPDC to assist in the funding of same,
finding that such expenditures will promote or develop new or expanded business
enterprises; and
WHEREAS, Texas law and the by-laws of the LPDC require that certain
expenditures and projects by the LPDC be approved by the governing body of the
City; and whereas the LPDC Board has duly approved such project and the
expenditures for same have been authorized by the La Porte City Council; and
NOW THEREFORE, in consideration of the covenants and conditions
stated herein, and in consideration of the mutual benefits that will accrue to each
of the parties hereof, as well as to the citizens of the City of La Porte, Texas, the
parties have agreed and do hereby agree as follows:
ARTICLE I
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In consideration of Recipient constructing a building at 116 S. Broadway
and operating a bar and grill restaurant at the subject site (“Building” herein), which
proposal was considered in that certain public hearing authorizing a proposed
project for the expenditure of LPDC funds for the promotion or development of new
or expanded business enterprises, held before the LPDC on December 13, 2021,
LPDC agrees to provide Recipient an incentive package consisting of a cash
payment in a total sum not to exceed $27,308.00, to be distributed in three
increments of $10,000.00, $10,000.00 and $7,308.00 each, with each distribution
conditioned on the attainment of certain performance thresholds, more specifically
outlined as follows:
1) A cash incentive payment in an amount equal to $10,000.00 will
be distributed to Recipient by LPDC, upon 1) receipt by LPDC of
proof of issuance of a certificate of occupancy for the Building and
2) proof of minimum capital investment in the amount of
$50,000.00 applied towards construction of the Building and
related infrastructure and site work, exclusive of the cost to
Recipient to purchase the existing vacant real estate tract at 116
S. Broadway Street. However, in no case will the $10,000.00
payment be made by LPDC if documentation substantiating 1)
issuance of a certificate of occupancy for the Building and 2) the
expenditure of no less than $50,000.00 applied towards
construction of the Building and related infrastructure and site
work is not delivered to and received by LPDC by February 28,
2022. In the case that proof of issuance of a certificate of
occupancy for the Building and minimum capital investment of
$50,000.00 applied towards capital construction costs to construct
the Building, as well as related infrastructure and site work, is
presented to LPDC on or before said February 28, 2022 deadline,
the LPDC shall convene a meeting of the LPDC Board of Directors
for a date no later than forty-five (45) days after receipt of proof of
issuance of a certificate of occupancy for the Building and related
infrastructure and site work and minimum capital investment of
$50,000.00 by LPDC from Recipient. Upon verification of the
issuance of a certificate of occupancy for the Building and related
infrastructure and site work and minimum capital investment of
$50,000.00, as reflected by formal vote of the LPDC Board of
Directors that Recipient has satisfied the requirements of this
paragraph, LPDC will then remit the $10,000.00 to Recipient
within a period not to exceed thirty (30) days.
In the case where Recipient fails to submit proof of issuance of a
certificate of occupancy for the Building and proof of a minimum
capital investment in the amount of $50,000.00 by the February
28, 2022 deadline, Recipient will be disqualified for the said
$10,000.00 incentive payment, and in addition, will be ineligible to
qualify for receipt of the $10,000.00 and $7308.00 payments
provided for in Paragraphs two (2) and three (3), immediately
below.
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2) A cash incentive payment in an amount equal to $10,000.00 will
be distributed to Recipient by LPDC upon delivery to the LPDC of
1) proof of additional capital investment in the amount of
$93,200.00 applied towards construction of the Building and
related infrastructure and site work, exclusive of the cost to
Recipient to purchase the existing vacant real estate tract at 116
S. Broadway Street, and 2) an employment roster evidencing that
Battleground employs a minimum of five (5) full-time employees
(or that number of part-time employees which are the equivalent
of five (5) full-time employees, or combination thereof) [“full-time
equivalent positions” herein] at the Building site as of March 31,
2022. However, in no case will the $10,000.00 payment be made
by LPDC if 1) proof of additional capital investment in the amount
of $93,200.00 applied towards construction of the Building and
related infrastructure and site work, exclusive of the cost to
Recipient to purchase the existing vacant real estate tract at 116
S. Broadway Street, and 2) proof of the employment of a minimum
of five (5) full-time equivalent positions as of March 31, 2022, is
not delivered to and received by LPDC by April 30, 2022. Proof
of employment, for purposes of this agreement, may be satisfied
by submission to LPDC by the said April 30, 2022 deadline of a)
copies of Battleground Saloon’s 941 Report to the Internal
Revenue Service and C3 Report to the Texas Workforce
Commission for each employee (but with social security numbers
of each employee redacted) and b) a notarized statement
executed by Recipient) affirming that a cumulative five (5) full-time
equivalent positions are employed in positions permanently
located at the Building site.
In the case that 1) proof of additional capital investment in the
amount of $93,200.00 applied towards construction of the Building
and related infrastructure and site work, exclusive of the cost to
Recipient to purchase the existing vacant real estate tract at 116
S. Broadway Street, and 2) proof of employment of five (5) full-
time equivalent positions is presented to LPDC on or before said
April 30, 2022, deadline, the LPDC shall convene a meeting of the
LPDC Board of Directors for a date no later than forty-five (45)
days after receipt of proof of 1) additional capital investment in the
amount of $93,200.00 applied towards construction of the Building
and related infrastructure and site work, exclusive of the cost to
Recipient to purchase the existing vacant real estate tract at 116
S. Broadway Street, and 2) employment of five (5) full-time
equivalent positions at the Building site by Recipient. Upon
verification of additional capital investment in the amount of
$93,200.00 applied towards construction of the Building and
related infrastructure and site work, exclusive of the cost to
Recipient to purchase the existing vacant real estate tract at 116
S. Broadway Street, and 2) employment of five (5) full-time
equivalent positions, as reflected by formal vote of the LPDC
Board of Directors, LPDC will then remit the $10,000.00 to
Recipient within a period not to exceed thirty (30) days.
4
In the event that Recipient qualifies for the second $10,000.00
incentive installment based upon 1) proof of additional capital
investment in the amount of $93,200.00 applied towards
construction of the Building and related infrastructure and site
work, exclusive of the cost to Recipient to purchase the existing
vacant real estate tract at 116 S. Broadway Street, and 2) proof of
employment of five (5) full-time equivalent positions at the Building
site pursuant to Article 1, Paragraph 2, above, then in such case
Recipient shall be required to prove the continuous employment
at the Building site of a cumulative minimum of five (5) full-time
equivalent positions, for a continuous five (5) year period. At the
conclusion of each calendar year during such five (5) year period,
beginning on December 31, 2022, through and including
December 31, 2026, Recipient shall be required to submit to the
LPDC proof of employment of a minimum of five (5) full-time
equivalent positions at the Building site, in the manner required
under Article 1, Paragraph 2, above. Should Recipient fail to
provide proof of the employment of five (5) full-time equivalent
employees at the end of a calendar year, then for that year
Recipient shall be responsible for remitting to the LPDC the sum
of $4,000.00, representing recapture out of the previously
awarded cumulative $20,000.00 incentive paid under Paragraphs
1 and 2 of this Article. However, in the instance that Recip ient
provides proof of employment of a minimum of five (5) full-time
equivalent positions at the end of a calendar year, Recipient shall
be relieved from the obligation to remit to the LPDC $4,000.00
recapture for that year.
3) If recipient qualifies for distribution of both the $10,000.00
incentive payment authorized under Paragraph One (1) and the
$10,000.00 incentive payment authorized under Paragraph Two
(2) of this Agreement, then in that case a cash incentive payment
in an amount equal to $7,308.00 will be distributed to Recipient by
LPDC upon delivery to the LPDC of proof that Battleground
Saloon attained gross sales of alcoholic beverages of no less than
$250,000.00 for the twelve (12) month period following issuance
of a certificate of occupancy for the Building site. However, in no
case will the $7,308.00 payment be made by LPDC if proof of
gross sales of alcoholic beverages of no less than $250,000.00
for the twelve (12) month period following issuance of a certificate
of occupancy for the Building site is not delivered to and received
by LPDC by no later than sixty (60) days after the conclusion of
the twelve (12) month period for gross alcohol sales . Proof of
gross alcohol sales, for purposes of this agreement, may be
satisfied by submission to LPDC by the above indicated deadline
of copies of __________________________________.
In the case that proof that Battleground Saloon attained gross
sales of alcoholic beverages of no less than $250,000.00 for the
5
twelve (12) month period following issuance of a certificate of
occupancy for the Building site is presented to LPDC on or before
the above indicated deadline, the LPDC shall convene a meeting
of the LPDC Board of Directors for a date no la ter than forty-five
(45) days after receipt of proof that Battleground Saloon attained
gross sales of alcoholic beverages of no less than $250,000.00
for the twelve (12) month period following issuance of a certificate
of occupancy for the Building site. Upon verification of gross sales
of alcoholic beverages of no less than $250,000.00 for the twelve
(12) month period following issuance of a certificate of occupancy
for the Building site, as reflected by formal vote of the LPDC Board
of Directors, LPDC will then remit the $7,308.00 to Recipient
within a period not to exceed thirty (30) days.
ARTICLE II
All funds received as herein provided shall be solely for the purpose of
contributing towards Recipient’s costs in the construction and building of the
building to be located at 116 S. Broadway Street and for the use of Battleground
Saloon, a bar and grill facility. Recipient further acknowledges that the incentive
grant provided for herein is tied to a project of the LPDC for the promotion or
development of new or expanded business enterprises, as authorized by Texas
Local Government Code chapters 501 and 505 .
ARTICLE III
Disbursement and/or retention of the cash incentive identified in Article I of
this Agreement shall be made as follows:
A. Disbursement shall be made to Recipient, subject to the satisfaction of the
conditions precedent or conditions subsequent contained within Article I of
this Agreement.
B. LPDC’s obligation to Recipient shall not exceed $27,308.00, nor shall LPDC
be obligated to reimburse Recipient for requests delivered to LPDC after
the termination of this Agreement.
ARTICLE IV
Recipient understands that the funds paid to Recipient by the LPDC are
derived from tax revenues collected under Texas Local Government Code
505.252, and that LPDC has estimated the tax revenues to be collected during the
term of this Agreement. Recipient further understands, acknowledges, and agrees
that if the tax revenue actually collected is less than 90% of the estimated tax
revenues to be collected in any fiscal year during the term of this Agreement, LPDC
will be under no obligation to provide funding to Recipient for any payment or
payments during or after the fiscal year for which there is a revenue shortfall. Upon
execution of the Agreement, funds will be placed in a City of La Porte designated
commitment account for purposes of this Agreement.
6
ARTICLE V
In the event of any default by Recipient hereunder, including, but not limited
to, use of the funds provided herein for purposes other than those stated in Article
I of this Agreement, LPDC may cease all future payments hereunder and terminate
this Agreement. In addition, LPDC shall have the right to reclaim and recapture,
and Recipient shall refund, any funds that are not spent in accordance with the
terms of this Agreement, including 1) LPDC funds spent by Recipient in
contravention of this Agreement and 2) any LPDC funds previously paid to
Recipient but not yet spent by Recipient. In each such case, the previously paid
cash payment or payments shall be remitted to the LPDC within sixty (60) of receipt
of written demand for same.
Any breach of this covenant shall be grounds for immediate termination of
the distribution of funds.
ARTICLE VI
The term of this Agreement is for a period beginning on the date of approval
by LPDC and ending June 30, 2027.
ARTICLE VII
All funds provided by the LPDC pursuant to this Agreement may be used
only for the purposes authorized by this Agreement . Notwithstanding Article I,
above, City shall be under no obligation to make any fund disbursements if the
reports required under this Article have not been delivered to the LPDC.
ARTICLE VIII
This Agreement does not create any joint venture, partnership, or agency
relationship between the LPDC and Recipient. Recipient shall have exclusive
control of, and the exclusive right to control the details of the work to be performed
by Recipient hereunder and all personnel performing same, and shall be solely
responsible for the acts and omissions of its officers, members, agents, servants,
employees, subcontractors, program participants, volunteers, licensees, and
invitees. In no event shall any person participating in or performing any of
Recipient’s duties or responsibilities hereunder be considered an officer, agent,
servant, or employee of the LPDC.
ARTICLE IX
Recipient agrees to assume and does hereby assume all responsibility and
liability for damages sustained by persons or property, whether real or asserted,
by or from the carrying on of work by Recipient or in the performance of services
performed and to be performed by Recipient hereunder. Recipient covenants and
agrees to, and does hereby indemnify, defend, and hold harmless LPDC and all
their respective officers, agents, and employees from all suits, actions, claims, and
expenses of any character, including attorney’s fees, brought for or incurred on
account of any injuries or damages, whether real or asserted, sustained by any
7
person or property by or in consequence of any intentional or negligent act,
omission, or conduct of Recipient, its agents, servants or employees.
ARTICLE X
This Agreement may be amended by the mutual agreement of the Parties
hereto in writing to be attached to and incorporated into this Agreement.
ARTICLE XI
Recipient shall adhere to all local, state, and federal laws and regulations
that may affect its actions made pursuant to this Agreement, and shall maintain in
effect during the term of this Agreement any and all federal, state, and local
licenses and permits which may be required of Recipients generally.
ARTICLE XII
Recipient may not assign this Agreement, or any of the benefits provided
herein including but not limited to incentive payments identified in Article I, without
the written consent of LPDC.
ARTICLE XIII
The waiver by LPDC of any breach of any term, condition, or covenant
herein contained shall not be deemed a waiver of any subsequent breach of the
same, or any other term, condition, or covenant.
ARTICLE XIV
The obligations of the Parties to this Agreement are performable in Harris
County, Texas and if legal action is necessary to enforce same, venue shall lie in
Harris County, Texas.
ARTICLE XV
This Agreement shall be governed by and construed in accordance with the
laws of the State of Texas.
ARTICLE XVI
This Agreement may be executed in triplicate, each of which shall be
deemed an original and constitute one and the same instrument.
ARTICLE XVII
Neither LPDC nor Participant shall be required to perform any term,
condition, or covenant in this Agreement so long as such performance is delayed
or prevented by force majeure, which shall mean Acts of God, civil riots, floods,
and any other cause not reasonably within the control of LPDC or Recipient except
as herein provided, and which by the exercise of due diligence LPDC or Recipient
is unable, wholly or in part, to prevent or overcome.
8
ARTICLE XVIII
In submitting this application, the applicant whose signature appears
below affirms its intent and commitment to comply in full with Section 2264.052 of
the Government Code and certifies that it does not and will not knowingly employ
an undocumented worker during any time period associated with the public
subsidy for which the application is being submitted. The applicant further certifies
its understanding and agreement that if it is convicted of a violation of 8 U.S.C.
Section 1324a(f), providing for civil and/or criminal penalties for engaging in a
pattern or practice of knowingly hiring or continuing to employ unauthorized aliens,
it shall repay the amount of the public subsidy with interest, at the rate and
according to the terms of the agreement signed under Section 2264 .053 of the
Government Code, not later than the 120th day after the date the city notifies the
business of the violation.
ARTICLE XIX
The Agreement embodies the complete agreement of the parties hereto,
superseding all oral or written pervious and contemporary agreements between
the Parties, which relate to matters in this Agreement.
SIGNED AND AGREED to by LPDC and Recipient on the dates indicated
below.
LA PORTE DEVELOPMENT CORPORTION
__________________________
Richard Warren, President
___________________
Date
ATTEST
___________________________
Mark Rosado (Recipient)
_________________________
Date
ATTEST
9
________________________________
REQUEST FOR LA PORTE DEVELOPMENT CORPORATION BOARD
AGENDA ITEM
Agenda Date Requested: January 24, 2022
Requested By: Corby D. Alexander, City Mngr
Department: Administration/CMO
Report Resolution Ordinance
Exhibits:
SUMMARY & RECOMMENDATION
The City Manager’s Office is currently looking to fulfill Economic Development Services
for the City of La Porte. For more than a year, the Economic Development Coordinator
job has been vacant. Staff is seeking direction on possibly outsourcing the City’s
economic development services. If the board is interested, we would need to go through
a formal RFP process.
ACTION REQUIRED BY BOARD
Provide direction to staff regarding outsourcing economic development
services.
Approved for the La Porte Development Corporation Board meeting agenda
Corby D. Alexander, City Manager Date
Appropriation
Source of Funds:
Account Number:
Amount Budgeted:
Amount Requested:
Budgeted Item: No