HomeMy WebLinkAbout10-01-03 La Porte Redevelopment Authority Meeting minutes
La Porte Redevelopment Authority
City of La Porte, Texas
Minutes of the Board Meeting
Held October 1, 2003
1. Call to Order and Determination of a quorum
The Board of Directors of the La Porte Redevelopment Authority, City of La Porte, Texas, held a
meeting, open to the public, on the 1 st day of October 2003,6:00 p.m. in Council Chambers at the
City Hall, 604 West Fairmont Parkway, La Porte, Texas 77572-1115 and the roll was called of the
duly appointed members of the Board, to wit:
Peggy Antone
Paul Larson
Alton Porter
Horace Leopard
Norman S. Cook
Lindsey Pfeiffer
Molly Helmlinger
Chester Pool
John Black
Position 1
Position 2
Position 3 - Chairman
Position 4
Position 5
Position 6
Position 7
Position 8
Position 9
and all of the above were present except Director Black, thus constituting a quorum. Also present
at the meeting were John Joems, David Hawes, Michael Dolby, James Hernandez (Andrews
Kurth), Drew Masterson (First Southwest Co.), and Melisa Lanclos.
2. Acknowledge appointments/new appointments to the TIRZ board and the La Porte
Redevelopment auhtority.
The board chair acknowledged the reappoinment of board members and the new appointment of
Director Helmlinger by the La Porte ISD board of Trustees.
3. Election of Officers
. Chairperson (Designated by Mayor of La Porte)
. Vice Chairperson
. Secretary
Upon a motion duly made by Director Pool and being seconded by Director Cook, the board
unanimously approved Lindsey Pfeiffer as Vice Chair and Peggy Antone as Secretary.
4. Approve Minutes of the meeting held March 26, 2003
Upon a motion duly made by Director Antone and being seconded by Director Leopard, the board
unanimously approved the Minutes of March 26, 2003.
5. Review and approve renewal of Service Agreement by and between the City of La Porte,
Texas, Tax Increment Reinvestment Zone Number One, City of La Porte, Texas and the La
Porte Redevelopment Authority, City of La Porte, Texas
Mr. Joerns reviewed the Agreement with the board and pointed out that it was the same agreement
approved for last year and that this was a renewal of the same agreement. Upon a motion duly
made by Director Pfeiffer and being seconded by Director Larson, the board unanimously
approved the Service Agreement.
6. Review Annual audit for the TIRZ Fund FY Ending September 30, 2003
Mr. Dolby, city of La Porte reviewed the financial documents presented in the board packets.
7. Receive and Review Activity Report for 2002 Tax Year
Mr. Dolby gave a review of the increment revenue collections for the 2002 Tax Year. He pointed
out a correction to the Harris County disbursements.
8. Review and Consider Approval of FY 03-04 budget
Mr. Joerns reviewed the FY 2003-2004 Budget for the Redevelopment Authority and TIRZ.
Upon a motion duly made by Director Pfeiffer and being seconded by Director Leopard, the board
unanimously approved the FY 2003 - 2004 Budget.
9. Staff Updates
. Drainage Study - Taylor Bayou Watershed
· StaffInterviews for Bond counsel and financial Advisor
· Development Activity within TIRZ
Proposed Residential golf community
Mr. Joerns gave a brief overview of the existing contract for the Taylor Bayou Watershed. He
indicated that staff had reviewed the report and that the contract-engineering firm was redoing
exhibits and maps, as well as making other adjustments to the final report. Final payment will not
been made until the all issues are resolved.
Mr. Joerns gave an overview of the process that city staff and the TIRZ consultant went through to
select fmalists for Bond Counsel and Financial Advisory Services. Present at the board meeting
were Mr. James Hernandez, Andres Kurth and Mr. Drew Masterson, first Southwest Company.
Each gave brief overview of each firm and what services they offered. Mr. Joerns concluded by
stating that staff would bring a recommendation with agreements back to the board at its next
meeting.
Mr. Joerns gave a brief overview on where the zoning stood for the Arete Development next to the
City's golf course. He discussed mobility issues with the board and that staff were working with
the developer in doing a due diligence with regard to TIRZ involvement.
10. Other Matters Which may properly come before the Board
It was suggested that the board chair draft a note to city council about moving the golf course
community project forward and taking no stand on the 8th Street issue.
11. Executive Session
The board went into executive session at 7: 15 PM and resumed Regular Session at 7:30 PM.
12. Adjournment
The board chair adjourned the meeting at 7:31 PM.
SIGNED Ct~lj2-tr~
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ATTEST:
TITLE:
TITLE:
DATE:
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DATE:
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AGENDA ITEM 4:
CONSIDER APPROVAL OR OTHER ACTION REGARDING THE FINAL DRAFT OF
THE TAYLOR BAYOU WATERSHED STUDY
At the last board meeting we reported that CivilTech was making the final changes to the Draft
Report on the Taylor Bayou Watershed. Enclosed is a staff memorandum from Robert
Cummings, summarizing the concerns/issues raised by staff during our preliminary review, the
actions taken by the consultant and the resulting effect on the study. The cumulative effect of the
changes decreased the amount of detention in "Pond C" by 14 Ac Ft.
This study will be utilized in our discussion with prospective developers to guide development
within the TIRZ Boundary and the Taylor Bayou Watershed. It has already been shared with the
Engineering Consultants (Brown & Gay) that are designing the residential subdivision presently
known as the Golf Course Community.
Action
To accept the Final Draft of the Taylor Bayou Watershed Study.
City of La Porte Planning Department
MEMORANDUM
December 16, 2003
TO:
John Joerns, Assistant City Manager
Robert A. Cummings, Supervising Engineer MC-
FROM:
CC:
Nick Finan, Interim Director of Planning
RE:
Taylor Bayou Drainage Study Summary
SUMMARY
Items of concern after 8/27/03 reVIew of revised Taylor Bayou Wastershed Master
Drainage Plan report:
. Size and storage volume of regional detention pond at the intersection of McCabe
Road and Broadway.
. Exact location of regional detention pond at the intersection of McCabe Road and
Broadway including the concern over portions of the pond having to be located
south of McCabe road.
. Inclusion of area east of Broadway in A I 04A4 drainage subarea.
. Was the golf course area modeled at a developed or undeveloped rate?
. The total amount of runoff from the watershed seemed high.
. An assumption that the A I 04A2 subarea would develop as large commercial and
multi-family housing.
Actions taken by engineering consultant (CivilTech Engineering, Inc) on the project:
. Removed proposed portion of the regional detention pond at McCabe Road and
Broadway that was shown to be south of McCabe Road.
. Moved same detention pond west to preserve zoned residential area at northwest
comer of intersection of McCabe Road and Broadway and to line up east side of
detention pond with the existing A104-12-01 creek.
. Kept area east of Broadway in Al04A4 subwatershed due to the fact that recent
LiDAR of the area supports CivilTech's contention that eastern boundary of
Al04A4 drainage subarea is established by low ridge that runs along Galveston
Bay.
. The golf course area was changed in the hy; raulic models and rerun as a purely
undeveloped area since the golf course has '~iIr tention via amenity lakes and
water hazards.
. The total amount of runoff from the watershe in a design event decreased by 78
cfs in the hydrologic models when the percent impervious and percent developed
numbers were changed for the Al04A2 and Al04A4 drainage sub areas
. We shared with CivilTech the fact that there was a submitted general plan for
most of the Al04A2 subarea that indicated that the area will develop as single-
family residential. CvilTech took this and input it into their hydrologic models.
The revised study has revised HEC models that reflect this.
· The cumulative effect of the changes we asked for was to decrease the needed
regional detention by approximately 14 AC*FT.
. The revised study has revised exhibits showing the smaller and relocated regional
detention pond (Exhibit 2).
FINANCIAL ADVISORY AGREEMENT
This Financial Advisory Agreement (the "Agreement") is made and entered into by and between
La Porte Redevelopment Authoritv ("Issuer") and First Southwest Comoanv ("FSC") effective as ofthe date
AGENDA ITEMS 5 & 6:
CONSIDER APPROVAL OR OTHER ACTION REGARDING PROFESSIONAL
SERVICES AGREEMENT RETAINING SERVICES OF FINANCIAL ADVISOR AND
BOND AND GENERAL COUNSEL
Both staff and our consultant, David Hawes, have reviewed the proposed Agreement for services
provided by 1st Southwest Company and Andrews/Kurth, LLP. Mr. Hawes has noted that these
agreements are typical of the professional services agreements these firms have with other
Redevelopment Authorities and the fee schedules are also in line. Mr. Hawes did note the
Financial Advisors fees are higher than typical municipal work because of the complexities of
the TIRZ and the amount of documentation that has to be provided. The good news is that after
the initial bond sale, the fees for subsequent bond sales would be lower on a percentage basis
because much of the initial documentation is repetitive.
Regarding the Andrews/Kurth Agreement, please note the reference to their representation of the
Houston Port Authority. This is to obviously notify the Redevelopment Authority that they
represent the Port of Houston (and potentially other clients) and by consent the firm would
continue to represent the Port of Houston in matters not substantially related to work performed
for the Authority. However, the consent does not apply to proprietary, confidential or non-public
information obtained by Andrews/Kurth while representing the Authority. The TIRZ Project
Plan and its implementation does not conflict with any known plans for development by the Port
of Houston.
Note
City Council (which would approve future bond sales) wrote letters to the ACOE objecting to
certain findings contained in the EIS and recommending consideration of other sites for the
proposed terminal facility. However, Andrews/Kurth's representation ofthe Port of Houston and
any known Port of Houston projects should not conflict with the TIRZ Project Plan or duties as
Bond Counsel.
Each of these agreements has been reviewed by Hawes Hill & Associates and the Authority's
Ex-Officio Members (Debra Feazelle, Cynthia Alexander and Knox Askins). While the 1st
Southwest Agreement contained a specific term of 5 years (plus I-year extensions) the
Andrews/Kurth Agreement did not. However, more importantly, each agreement contains a 30-
day termination clause (for convenience).
Action
To consider approval or other action of agenda item 5 retaining the services of I st Southwest
_ . ... . ... . c..1I
survey will include an analysis of any existing debt structure as compared with the existing and
projected sources of revenues which may be pledged to secure payment of debt service and, where
appropriate, will include a study of the trend of the assessed valuation, taxing power and present
and future taxing requirements of the Issuer. In the event revenues of existing or projected
facilities operated by the Issuer are to be pledged to repayment of the Debt Instruments then under
consideration, the survey will take into account any outstanding indebtedness payable from the
revenues thereof, additional revenues to be available from any proposed rate increases and
additional revenues, as projected by consulting engineers employed by the Issuer, resulting from
improvements to be financed by the Debt Instruments under consideration.
2. Future Financings. Consider and analyze future financing needs as projected by the Issuer's
staff and consulting engineers or other experts, if any, employed by the Issuer.
3. Recommendations for Debt Instruments. On the basis of the information developed by the
survey described above, and other information and experience available, submit to the Issuer
recommendations regarding the Debt Instruments under consideration, including such elements as
the date of issue, interest payment dates, schedule of principal maturities, options of prior
payment, security provisions, and such other provisions as may be appropriate in order to make
the issue attractive to investors while achieving the objectives ofthe Issuer. All recommendations
will be consistent with the goal of designing the Debt Instruments to be sold on terms which are
advantageous to the Issuer, including the lowest interest cost consistent with all other
considerations.
4. Market Information. Advise the Issuer of our interpretation of current bond market
conditions, other related forthcoming bond issues and general information, with economic data,
which might normally be expected to influence interest rates or bidding conditions so that the date
of sale of the Debt Instruments may be set at a favorable time.
5. Elections. In the event it is necessary to hold an election to authorize the Debt Instruments
then under consideration, FSC will assist in coordinating the assembly of such data as may be
required for the preparation of necessary petitions, orders, resolutions, ordinances, notices and
certificates in connection with the election, including assistance in the transmission of such data to
a firm of municipal bond attorneys ("Bond Counsel") retained by the Issuer.
B. Debt Management and Financial Implementation. At the direction ofIssuer, FSC shall:
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1. Method ofSa1e. Evaluate the particular financing being contemplated, giving consideration
to the complexity, market acceptance, rating, size and structure in order to make a
recommendation as to an appropriate method of sale, and:
a. If the Debt Instruments are to be sold by an advertised competitive sale, FSC will:
(1) Supervise the sale of the Debt Instruments, reserving the right, alone or in
conjunction with others, to submit a bid for any Debt Instruments issued under this
Agreement which the Issuer advertises for competitive bids; however, in keeping with
the provisions of Rule G-23 of the Municipal Securities Rulemaking Board, FSC will
request and obtain written consent from the Issuer to bid prior to submitting a bid, in
any instance wherein FSC elects to bid, for any installment of such Debt Instruments;
(2) Disseminate information to prospective bidders, organize such informational
meetings as may be necessary, and facilitate prospective bidders' efforts in making
timely submission of proper bids;
(3) Assist the staff of the Issuer in coordinating the receipt of bids, the safekeeping of
good faith checks and the tabulation and comparison of submitted bids; and
(4) Advise the Issuer regarding the best bid and provide advice regarding acceptance
or rejection of the bids.
b. If the Debt Instruments are to be sold by negotiated sale, FSC will:
(1) Recommend for Issuer's final approval and acceptance one or more investment
banking firms as managers of an underwriting syndicate for the purpose of negotiating
the purchase of the Debt Instruments.
(2) Cooperate with and assist any selected managing underwriter and their counsel
in connection with their efforts to prepare any Official Statement or Offering
Memorandum. FSC will cooperate with and assist the underwriters in the preparation
of a bond purchase contract, an underwriters agreement and other related documents.
The costs incurred in such efforts, including the printing of the documents, will be
paid in accordance with the terms of the Issuer's agreement with the underwriters, but
shall not be or become an obligation ofFSC, except to the extent specifically provided
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1. Method ofSa1e. Evaluate the particular financing being contemplated, giving consideration
to the complexity, market acceptance, rating, size and structure in order to make a
recommendation as to an appropriate method of sale, and:
a. Ifthe Debt Instruments are to be sold by an a vertised competitive sale, FSC will:
(1) Supervise the sale of the Debt Ins ments, reserving the right, alone or in
conjunction with others, to submit a bid or any Debt Instruments issued under this
Agreement which the Issuer advertises or competitive bids; however, in keeping with
the provisions of Rule G-23 of the nicipal Securities Rulemaking Board, FSC will
est and obtain written conse to bid prior to submitting a bid, in any instance
installment of such Debt Instruments;
to prospective bidders, organize such informational
meetings as may b eces ary, and facilitate prospective bidders' efforts in making
timely submission of p er bids;
(4) Advise the suer regarding the best . d and provide advice regarding acceptance
or rejection of he bids.
b. If the Debt nstruments are to be sold by negotiated
(1) Rec mmend for Issuer's final approval and acceptance 0
bankin firms as managers of an underwriting syndicate for the purpo
the p rchase of the Debt Instruments.
of negotiating
"
I
(2/ Cooperate with and assist any selected managing underwriter and their counsel in
connection with their efforts to prepare any Official Statement or Offering
I
Memorandum. FSC will cooperate with and assist the underwriters in the preparation
of a bond purchase contract, an underwriters agreement and other related documents.
The costs incurred in such efforts, including the printing of the documents, will be paid
in accordance with the terms of the Issuer's agreement with the underwriters, but shall
not be or become an obligation of FSC, except to the extent specifically provided
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otherwise in this Agreement or assumed in writing by FSC.
(3) Assist the staff of the Issuer in the safekeeping of any good faith checks, to the
extent there are any such, and provide a cost comparison, for both expenses and
interest which are suggested by the underwriters, to the then current market.
(4) Advise the Issuer as to the fairness of the price offered by the underwriters.
2. Offering Documents. Coordinate the preparation of the notice of sale and bidding
instructions, official statement, official bid form and such other documents as may be required and
submit all such documents to the Issuer for examination, approval and certification. After such
examination, approval and certification, FSC shall provide the Issuer with a supply of all such
documents sufficient to its needs and distribute by mail or, where appropriate, by electronic
delivery, sets of the same to prospective purchasers of the Debt Instruments. Also, FSC shall
provide copies of the final Official Statement to the purchaser of the Debt Instruments m
accordance with the Notice of Sale and Bidding Instructions.
3. Credit Ratings. Make recommendations to the Issuer as to the advisability of obtaining a
credit rating, or ratings, for the Debt Instruments and, when directed by the Issuer, coordinate the
preparation of such information as may be appropriate for submission to the rating agency, or
agencies. In those cases where the advisability of personal presentation of information to the
rating agency, or agencies, may be indicated, FSC will arrange for such personal presentations,
utilizing such composition of representatives from the Issuer as may be finally approved or
directed by the Issuer.
4. Trustee, Paving Agent, Registrar. Upon request, counsel with the Issuer in the selection of a
Trustee and/or Paying Agent/Registrar for the Debt Instruments, and assist in the negotiation of
agreements pertinent to these services and the fees incident thereto.
5. Financial Publications. When appropriate, advise financial publications ofthe forthcoming
sale of the Debt Instruments and provide them with all pertinent information.
6. Consultants. After consulting with and receiving directions from the Issuer, arrange for such
reports and opinions of recognized independent consultants as may be appropriate for the
successful marketing of the Debt Instruments.
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7. Auditors. In the event formal verification by an independent auditor of any calculations
incident to the Debt Instruments is required, make arrangements for such services.
8. Issuer Meetings. Attend meetings of the governing body of the Issuer, its staff,
representatives or committees as requested at all times when FSC may be of assistance or service
and the subject of financing is to be discussed.
9. Printing. To the extent authorized by the Issuer, coordinate all work incident to printing of
the offering documents and the Debt Instruments.
10. Bond Counsel. Maintain liaison with Bond Counsel in the preparation of all legal documents
pertaining to the authorization, sale and issuance of the Debt Instruments.
11. Changes in Laws. Provide to the Issuer copies of proposed or enacted changes in federal and
state laws, rules and regulations having, or expected to have, a significant effect on the municipal
bond market of which FSC becomes aware in the ordinary course of its business, it being
understood that FSC does not and may not act as an attorney for, or provide legal advice or
services to, the Issuer.
12. Deliverv of Debt Instruments. As soon as a bid for the Debt Instruments is accepted by the
Issuer, coordinate the efforts of all concerned to the end that the Debt Instruments may be
delivered and paid for as expeditiously as possible and assist the Issuer in the preparation or
verification of final closing figures incident to the delivery of the Debt Instruments.
13. Debt Service Schedule; Authorizing Resolution. After the closing of the sale and delivery of
the Debt Instruments, deliver to the Issuer a schedule of annual debt service requirements for the
Debt Instruments and, in coordination with Bond Counsel, assure that the paying agent/registrar
and/or trustee has been provided with a copy of the authorizing ordinance, order or resolution.
SECTION II
OTHER AVAILABLE SERVICES
In addition to the services set forth and described in Section I herein above, FSC agrees to make
available to Issuer the following services, when so requested by the Issuer and subject to the agreement by
Issuer and FSC regarding the compensation, if any, to be paid for such services, it being understood and agreed
that the services set forth in this Section II shall require further agreement as to the compensation to be
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received by FSC for such services:
1. Investment of Funds. From time to time, as an incident to the other services provided hereunder as
financial advisor, FSC may purchase such investments as may be directed and authorized by Issuer to be
purchased, it being understood that FSC will be compensated in the normal and customary manner for each
such transaction. In any instance wherein FSC may become entitled to receive fees or other compensation in
any form from a third party with respect to these investment activities on behalf oflssuer, we will disclose to
Issuer the nature and, to the extent such is known, the amount of any such compensation so that Issuer may
consider the information in making its investment decision. It is understood and agreed that FSC is a duly
licensed broker/dealer and is affiliated with First Southwest Asset Management, Inc. ("FSAMI"), a duly
registered investment advisor. Issuer may, from time to time, utilize the broker/dealer services ofFSC and/or
the investment advisory services ofFSAMI with respect to matters which do not involve or affect the financial
advisory services referenced in this Agreement. The terms and conditions of the engagement ofFSC and/or
FSAMI to provide such services shall be determined by mutual agreement at the time such services are
requested.
2. Exercising Calls and Refunding. Provide advice and assistance with regard to exercising any call and/or
refunding of any outstanding Debt Instruments.
3. Capital Improvements Programs. Provide advice and assistance in the development of any capital
improvements programs of the Issuer.
4. Long-Range Planning. Provide advice and assistance in the development of other long-range financing
plans of the Issuer.
5. Post-Sale Services. Subsequent to the sale and delivery of Debt Instruments, review the transaction and
transaction documentation with legal counsel for the Issuer, Bond Counsel, auditors and other experts and
consultants retained by the Issuer and assist in developing appropriate responses to legal processes, audit
procedures, inquiries, internal reviews and similar matters.
SECTION III
TERM OF AGREEMENT
This Agreement shall become effective as ofthe date executed by the Issuer as set forth on the signature
page hereof and, unless terminated by either party pursuant to Section IV of this Agreement, shall remain in
effect thereafter for a period offive (5) years from such date. Unless FSC or Issuer shall notifY the other party
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in writing at least thirty (30) days in advance of the applicable anniversary date that this Agreement will not be
renewed, this Agreement will be automatically renewed on the fifth anniversary of the date hereof for an
additional one (1) year period and thereafter will be automatically renewed on each anniversary date for
successive one (1) year periods.
SECTION IV
TERMINATION
This Agreement may be terminated with or without cause by the Issuer or FSC upon the giving of at
least thirty (30) days' prior written notice to the other party of its intention to terminate, specifying in such
notice the effective date of such termination. In the event of such termination, it is understood and agreed that
only the amounts due FSC for services provided and expenses incurred to the date oftermination will be due
and payable. No penalty will be assessed for termination of this Agreement.
SECTION V
COMPENSATION AND EXPENSE REIMBURSEMENT
The fees due to FSC for the services set forth and described in Section I ofthis Agreement with respect
to each issuance of Debt Instruments during the term ofthis Agreement shall be calculated in accordance with
the schedule set forth on Appendix A attached hereto. Unless specifically provided otherwise on Appendix A
or in a separate written agreement between Issuer and FSC, such fees, together with any other fees as may have
been mutually agreed upon and all expenses for which FSC is entitled to reimbursement, shall become due and
payable concurrently with the delivery of the Debt Instruments to the purchaser.
SECTION VI
MISCELLANEOUS
1. Choice of Law. This Agreement shall be construed and given effect in accordance with the laws of the
State of Texas.
2. Binding Effect; Assignment. This Agreement shall be binding upon and inure to the benefit of the
Issuer and FSC, their respective successors and assigns; provided however, neither party hereto may assign or
transfer any of its rights or obligations hereunder without the prior written consent of the other party.
3. Entire Agreement. This instrument contains the entire agreement between the parties relating to the
rights herein granted and obligations herein assumed. Any oral or written representations or modifications
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concerning this Agreement shall be of no force or effect except for a subsequent modification in writing signed
by all parties hereto.
FIRST SOUTHWEST COMPANY
By~t'(:f-~
Hill A. Feinberg, Chairman and
Chief Executive Officer
By:Q~-=-, >
Drew K. Masterson
Senior Vice President
LAPORTE REDEVELOPMENT AUTHORITY
(\ ~ i":>i-
By: ~(:'~i \ ~
Title: ~)-){) J Y-fhl1 n
Date: 1-/ ~--O4-
A~2a
secret~
8
APPENDIX A
The fees due FSC will not exceed those contained in our customary fee schedule as listed below.
$0 - $5,000,000
$5,000,00 I - $10,000,000
Over $10,000,000
$2,500 minimum flat fee
$15.00 per thousand
$7.50 per thousand
$3.75 per thousand
The charges for ancillary services, including computer structuring and official statement printing, shall be
levied only for those services which are reasonably necessary in completing the transaction and which are
reasonable in amount, unless such charges were incurred at the specific direction of the Issuer.
The payment of charges for financial advisory services described in Section 1 of the foregoing Agreement shall
be contingent upon the delivery of bonds and shall be due at the time that bonds are delivered. The payment of
charges for services described in Section 11 of the foregoing Agreement shall be due and payable in
accordance with the mutual agreement therefor between FSC and Issuer.
The Issuer shall be responsible for the following expenses, if and when applicable, whether they are charged to
the Issuer directly as expenses or charged to the Issuer by FSC as reimbursable expenses:
Bond counsel
Bond printing
Bond ratings
Computer structuring
Credit enhancement
CPA fees for refunding
Official statement preparation and printing
Paying agent/registrar/trustee
Travel expenses
Underwriter and underwriters counsel
Miscellaneous, including copy, delivery, and phone charges
The payment of reimbursable expenses that FSC has assumed on behalf of the Issuer shall NOT be contingent
upon the delivery of bonds and shall be due at the time that services are rendered and payable upon receipt of
an invoice therefor submitted by FSC.
ATTORNEYS
ANDREWS
KU RTH LLP
Andrews & Kurth L.L.P.
600 Travis, Suite 4200
Houston, Texas 77002
713.220.4200 Phone
713.220.4285 Fax
andrewskurth.com
James Hernandez
713.220.3942 Direct
713.238.7148 Fax
jameshernandez@andrewskurth.com
February 12, 2004
Mr. John J oems
Assistant City Mnager
City of La Porte, Texas
604 West Fairmont Parkway
La Porte, Texas 77571
FEB I 3'
Re: Bond Counsel Services Agreement
Dear Mr. Joems:
As requested, enclosed is an executed original Bond Counsel Services Agreement. We
appreciate the opportunity to be of service to the City of La Porte and look forward to working
with you.
Sincerely,
~~em~e~ \1r ~~^il
HOU:2273664.!
Austin Dallas
Houston
London
Los Angeles
New York
The Woodlands
Washington, DC
ATTORNEYS
ANDREWS
K U R T H LLP
600 Travis, Suite 4200
Houston, Texas 77002
713.220.4200 Phone
713.220.4285 Fax
andrewskurth.com
,.- btuu-1
~ary JJ, 2004
Boards of Directors
Tax Increment Reinvestment Zone No. 1
City of La Porte, Texas and
La Porte Redevelopment Authority
c/o City of La Porte, Texas
604 West Fairmont Parkway
La Porte, Texas 77571
Re: Engagement of Andrews Kurth LLP to Perform Legal Services
Dear Members of the Boards of Directors:
We are pleased to submit to you a proposed agreement for Andrews Kurth LLP ("AK"),
Houston, Texas, to provide legal services for Tax Increment Reinvestment Zone No.1, City of
La Porte, Texas (the "Zone") and the City of La Porte Redevelopment Authority (the
"Authority"). When approved by you, this letter will become effective and will evidence an
agreement between AK and, collectively, the Zone and the Authority.
Bond Counsel Services - Basic and AdditionaL AK will provide legal services to the
Authority as its Bond Counsel with respect to notes, bonds and other possible debt obligations
that the Authority may issue. (Such bonds, notes or other obligations are collectively referred to
herein as "Bonds.") As Bond Counsel, AK will prepare, or assist the appropriate Authority
officials and staff in the preparation of, all required legal proceedings and will perform certain
other necessary legal work in connection with the Authority's authorization, issuance and sale of
each series of the Bonds. Services as Bond Counsel will include the following Basic Services,
which will be carried out directly or in concert with Authority officials and staff, as follows:
(1) Preparation of the resolutions, orders and indentures authorizing issuance of each
series of the Bonds and all other instruments which comprise the transcript of legal proceedings
pertaining to the authorization, issuance and sale of each such series;
(2) Attendance at meetings, to the extent required or requested by the appropriate
Authority officials and staff, to discuss the sizing, timing or sale of each series of the Bonds;
(3) Consultation with Authority officials and staff and the Authority's financial
advisors to review information to be included in the offering documents for each series of Bonds,
but only to the extent that such information describes such series, the security therefor, their
federal income tax status and our opinion;
(4) Preparation and submission of transcripts of legal proceedings pertaining to the
issuance of each series of the Bonds to the Attorney General to obtain an approving opinion;
HOU :2229311.4
Austin Dallas
Houston
London
Los Angeles
New York
The Woodlands
Washington, DC
.~.i, 2004
Page 2
(5) Supervision of the printing of each series of the Bonds and the delivery thereof to
the purchasers;
(6) At the closing of each series of the Bonds, delivery of an approving opinion,
based on facts and law existing as of its date, generally to the effect that such series has been
duly issued, executed and delivered in accordance with the Constitution and laws of the State of
Texas, that the Bonds of each series constitute valid and legally binding obligations of the
Authority (subject to bankruptcy, insolvency, reorganization, moratorium and other similar laws
in effect from time to time relating to or affecting the enforcement of rights of creditors of
political subdivisions) and that interest on such series of the Bonds is excludable from the gross
income of the owners thereof for federal income tax purposes under then existing law; provided
that after the closing we do not undertake, unless specifically engaged by you to do so as an
Additional Service described below, to provide continuing advice concerning any actions
necessary to assure that interest paid on the Bonds will continue to be excluded from gross
income for federal income tax purposes; and
(7) Prior to and in connection with the closing of each series of the Bonds, giving
advice to the Authority to enable appropriate officials to comply with the arbitrage requirements
of the Internal Revenue Code of 1986 as they affect the Bonds, including yield restrictions and
rebate requirements.
As Bond Counsel, AK is also prepared to undertake the following Additional Services, as
directed by appropriate Authority officials:
(1) Disclosure work or similar services (other than the limited review of certain
sections of the offering documents for the Bonds as described in paragraph (4) under Basic
Services above) to assist the Authority or its financial advisor in the preparation of such offering
documents, on such basis and to such extent as shall be directed by the appropriate Authority
officials and staff, including compliance with the requirements of Rule 15c2-12 of the Securities
and Exchange Commission;
(2) Attendance at rating agency presentations, investor meetings or other
presentations relating to the marketing of the Bonds and consultation with Authority officials,
staff and advisors and the Authority's financial advisor to develop such presentations;
(3) Preparation of the "Blue Sky" surveys or securities registration services;
(4) In the case of a series of Bonds, or a portion thereof, that is issued to refund prior
bonds of the Authority, providing advice regarding federal income tax and other issues unique to
refunding transactions;
(5) Any other special services related to but not ordinarily required in connection
with the issuance of obligations of the nature of the Bonds, including services rendered in
connection with special federal income tax issues, unusual issues arising in connection with the
Authority's financial reports or audits, any documentation or related services for credit or
HOU:22293 1 1.4
~
'JaBUarY 4, 2004
Page 3
liquidity facilities or enhancements or other special structuring techniques or devices to be
employed in connection with the issuance of any series of the Bonds; and
(6) After the closing of any series of the Bonds and upon specific request of the
appropriate Authority officials and staff, providing assistance to the Authority concerning
questions and issues that may arise prior to the maturity of each series of Bonds.
For the Basic Service performed as Bond Counsel, our fee for a fixed rate transaction
would be according to the following schedules, with such fee payable from bond proceeds and
contingent upon the actual delivery ofthe Bonds:
First Issue*
A.
For the first $15 million in principal of Bonds, an amount not to exceed $65,000,
to be billed at standard hourly rates;
B.
an amount equal to 2% of the principal amount of such Bonds above such first
$15,000,000 in principal.
*
The fee for a variable rate transaction would be the same as the foregoing, plus our standard
hourly rates at a 10% discount for amounts in excess of the foregoing fees.
Subsequent Issues: To be agreed to prior to the issuance of such Bonds depending on the
size and complexity of the transaction.
As Bond Counsel, AK will also be reimbursed for its reasonable and actual out-of-pocket
expenses, such as the cost of reproduction of documents, out-of-town travel, long-distance
telephone, telegraph, telex and similar expenses, deliveries, filing fees and all items paid for by
AK on behalf of the Zone or the Authority and incurred in connection with the performance of
all services hereunder.
AK will provide invoices for legal services and out-of-pocket expenses hereunder.
Payment of all fees and expenses as Bond Counsel will be made upon the issuance and delivery
of the series of the Bonds in connection with which such services are performed. The fee and
expenses for each series will be paid from the proceeds of the sale of such series or from other
funds, as the Authority deems appropriate.
The fee for any Additional Services provided by AK will be determined on an hourly rate
basis, applying rates then charged by AK for the same or similar services performed by attorneys
and paralegals of similar experience for other clients.
As we have discussed, you are aware that AK represents many other governmental
entities, companies and individuals. It is possible that during the time that we are representing
you, some of our present or future clients will have disputes or transactions with you. In
particular, as we have advised you, we represent the Port of Houston Authority of Harris County,
HOU:2229311.4
1~~i,2004
Page 4
Texas as Bond Counsel and in other capacities, including as litigation counsel. You agree that
we may continue to represent or may undertake in the future to represent existing or new clients
in any matter that is not substantially related to our work for you even if the interests of such
clients in those other matters are directly adverse. We agree, however, that your prospective
consent to conflicting representation contained in the preceding sentence shall not apply in any
instance where, as a result of our representation of you, we have obtained proprietary or other
confidential information of a nonpublic nature, that, if known to such other client, could be used
in any other such other matter by such client to your material disadvantage.
Nothing herein shall be construed as creating any personal liability on the part of any
officer of the Authority, and this agreement may be terminated by the Authority by giving 30
days' written notice to AK, provided that all fees and expenses owing to AK will be paid as of
the effective date of any such termination.
If this proposed agreement for the performance of legal services by AK is satisfactory,
please evidence your acceptance and approval by executing three copies in the space provided
below and returning one copy to us.
Very truly yours,
ANDREWS KURTH LLP
B~~~~
HOU:22293 1 1.4
~ry{,2004
Page 5
APPROVED:
TAX INCREMENT REINVESTMENT ZONE NO.1, CITY OF LA PORTE
By: Ulk.--- t ~ ""'-~
~i:~: 1t).~'r~4 PX'lap..J
Q
Secretary
LA PORTE REDEVELOPMENT AUTHORITY
a\":)
By: Ll~L~f\~
Name: ~') ~. Pork"
Title: id n+ t>I- -f-I~ l-:Sb'l rr/
Secretary
HOU:22293 1 1.4
AGENDA ITEM 7:
CONSIDER APPROVAL OR OTHER ACTION REGARDING CONSULTING
SERVICES AGREEMENT RETAINING SERVICES OF HAWES HILL &
ASSOCIATES, LLP
Mr. Hawes' earlier engagements with the City were very specific in nature. His recent support
services have been approved by the City Manager's office and have remained under the dollar
limits for the signature authority of the City Manager.
At this time I believe it would be important to have the Redevelopment Authority approve an
agreement retaining Hawes Hill & Associates. We will soon be more active and while we still
may not exceed signature authority, I believe this is a cleaner and more appropriate
arrangement. The staff interaction with Hawes Hill & Associates will still fall under the Tri-
Party and City Services Agreement. The fees for service are based on an hourly rate and are the
same as the prior agreement.
The agreement features a 3D-day notice of termination (by convenience).
Action
To consider approval ofthe agreement retaining the services of Hawes Hill & Associates, LLP as
Consultant, according to the terms of the attached agreement.
AGREEMENT FOR CONSULTING SERVICES
The following is an agreement for consulting services to be provided by Hawes Hill & Associates, LLP
("Consultant") to La Porte Redevelopment Authority ("Client").
Consultant agrees to provide the following services:
· Provide general technical assistance and consultation as needed on matters pertaining to the
operations and implementation of project plans and project financing plans of Tax Increment
Reinvestment Zone Number One, City of La Porte, and La Porte Redevelopment Authority;
· Review all documents relative to the Client's projects, including but not limited to land plans,
public area improvement plans, and engineering plans relative to a determination of eligibility
for such programs and incentives;
· Take and prepare minutes of Board meetings and assist in maintenance of Reinvestment Zone
and Authority files;
· Assist in the preparation of budgets for inclusion in the City's Annual Budget and financial
reports as required;
· Assist Reinvestment Zone and Authority Board of Directors in the implementation of the Project
Plan and Reinvestment Zone Financing Plan;
· Assist the client and other consultants in the preparation of Developer Reimbursement
Agreements
· Assist City/TIP to develop and construct a property owner database for mapping, taxation, and
information purposes;
· Serve as liaison with the City and other interested parties to further mission of the Reinvestment
Zone and Authority;
· Represent Client at meetings and public hearings with city and county government officials and
representatives of other taxing agencies as may be required; and
· As necessary, represent Client at meetings with the general public regarding Client's projects
Termination
Either party may terminate this agreement by giving a thirty (30) day written notice. If this agreement is
terminated, the Consultant shall be paid for all work performed up to the date of termination.
Consulting Fees
Professional consulting fees will charged on an hourly basis according to the following rate schedule:
David W. Hawes
Susan Hill
Bill Calderon
Scott Bean
Jennifer DeChillo
Josh Hawes
$ 135.00/hour
$ 135.00/hour
$ 135.00/hour
$ 100.00/hour
$ 60.00/hour
$ 60.00/hour
In addition to the professional consulting fee, actual expenses associated with the services, including but
not limited to prints and reproductions, graphics, art supplies, postage, deliveries, long distance
telephone calls, submittal fees, parking fees, travel and lodging, and public notices, shall be charged back
to the Client. Automobile use directly attributable to this project will be charged at the rate allowable
under the Internal Revenue Service regulations. Consulting fees and actual expenses associated with the
scope of services will be invoiced monthly.
Acceptance
When executed by both parties, this contract shall evidence the entire agreement, and shall constitute a
notice to proceed, unless otherwise designated by Client in writing. This document is being executed in
two (2) counterpart originals, each of which has the full force and effect of an original. Signing below
indicates acceptance of the terms stated in this Agreement.
This contract is made and entered into in Harris County, Texas and venue for all purposes shall be in
Harris County, Texas.
Please signify your agreement and acceptance by signing below where indicated. Return one copy to
Hawes Hill & Associates LLP.
AGREEDANDACCEPTEDTHIS /4 DAYOF~n. 20014
~G~
Alton Porter, Chairman
La Porte Redevelopment Authority
P.O. Box 1115
La Porte TX 77572-1115
:~aa
Consulting Fees
Professional consulting fees will charged on an hourly basis according to the following rate schedule:
David W. Hawes
Susan Hill
Bill Calderon
Scott Bean
Jennifer DeChillo
Josh Hawes
$ 135.00/hour
$ 135.00/hour
$ 135.00/hour
$ lOO.OO/hour
$ 60.00/hour
$ 60.00/hour
In addition to the professional consulting fee, actual expenses associated with the services, including but
not limited to prints and reproductions, graphics, art supplies, postage, deliveries, long distance telephone
calls, su mittal fees, parking fees, travel and lodging, and public notices, shall be charged back to the
Client. Au obile use directly attributable to this project will be char ed at the rate allowable under the
Internal Reve e Service regulations. Consulting fees and actual exp ses associated with the scope of
services will be voiced monthly.
Acceptance
. s, this contract shall evidence t entire agreement, and shall constitute a
notice to proceed, unless othe ise designated by Client inriting. This document is being executed in
two (2) counterpart originals, eacof which has the full foce and effect of an original. Signing below
indicates acceptance of the terms stat~d in this Agreeme .
This contract is made and entered into in Harris Coun , Texas and venue for all purposes shall be in
Harris County, Texas.
Please signifY your agreement and acceptance bysigning below where indicated. Return one copy to
Hawes Hill & Associates LLP.
AGREED AND ACCEPTED THIS
DAY OF ,
2003.
.,,~.
Alton Porter; hairman
La Porte Redev
P.O. Box 1115
La Porte TX 77572-1 15
David W. Hawes, Managing Partner
Hawes Hill & Associates, L. L. P.
P.O. Box 22167
Houston TX 77227-2167
I
/
/
AGENDA ITEM 8:
DISCUSS INTERLOCAL AGREEMENTS WITH HARRIS COUNTY AND CITY OF
LA PORTE FOR REFUNDING EXPENSES ASSOCIATED WITH SYL VAN BEACH
SHORELINE EROSION AND BEACH NOURISHMENT PROJECT
As noted in our earlier report to TIRZ/Redevelopment Authority, the City and Harris County
co-sponsors of a Grant Application to Texas General Land Office for construction of an erosion
and beach nourishment project at Sylvan Beach Park.
This project/type of work was included in the TIRZ Project Plan and in the Interlocal Agreement
with Harris County and therefore obviously eligible for reimbursement from TIRZ funds.
David Hawes is preparing a draft Interlocal agreement between the Redevelopment Authority
and Harris County and a second one with the City of La Porte.
Harris County will need to review the agreement as well as the Authority's legal counsel.
Copies will also be provided to the Authority's Ex-Officio Members for comment (Debra
Feazelle, Cynthia Alexander and Knox Askins).
Action
Review report and discuss Draft Interlocal Agreement and instruct staff to submit to Harris
County, City of La Porte Ex-Officio Members and Andrews/Kurth for review and action (as
appropriate).
NOTE: PLEASE BRING MATERIAL SENT TO YOU IN DECEMBER 2003. IF YOU
NEED ANOTHER COPY PLEASE CONTACT MELISA LANCLOS.
Sylvan Beach Shoreline Protection and Beach Nourishment Project
Texas General Land Office, Project #1114
Harris County Precinct 2
City of La Porte
OVERVIEW
As you know, the City of La Porte's primary interest in the Sylvan Beach Erosion
Protection and Beach Nourishment Project (USACE Permit #23069) has been to
restore the Sylvan Beach Park "beach" that has eroded away over time, and to
reduce the likelihood of future erosion by adding shoreline protection. The
project has been designed by URS under an agreement between the City of La
Porte and the Texas General land Office, and Harris County. The project has
been approved and a permit has been issued by the U.S,. Army Corps of
Engineers for the project. All that remains now is to put the funding in place for
the actual construction of the project.
CURRENT STATUS
As a result of the Texas Legislature's "belt tightening" in the last session, the
amount of money allocated to coastal protection projects was reduced from $15
million to 7.5 million. Subsequently, the Texas General Land Office changed its
match requirements from 850/0-150/0 match for coastal erosion protection
projects, to a 600/0 state, 400/0 local match. Given our estimated cost of $2.43
million for our overall project, that increases the City of La Porte/Harris County
share from $360,000 to $972,871, or $486,435 for each local partner, if the
project remains classified strictly as a coastal erosion protection project. This
amounts to a 630/0 increase in our original cost estimates for the local match.
The TGLO has an alternative classification under the program, "Beach
nourishment/replenishment" that allows a 750/0 state, 250/0 local match. A
portion (approximately 40%) of our project could potentially be classified under
this category because of the beach establishment portion of our project, and we
have asked the Texas General Land Office to consider this option by submitting
an Amended Project Goal Summary.
If the TGLO agrees to re-classify this project as described above, the
savings would amount to just under $73,000 each, for Harris County and the City
of La Porte.
FUTURE DIRECTION
There are two ways that the project can move forward, given the
expanded budget requirements and depending on Harris County's, and City of La
Porte's continued participation:
· The project can be constructed as a single project
· The project, which is permitted as a whole, can be constructed in
2 or more phases, based on funding as it becomes available.
,,-
Harris County Precinct 2 officials have indicated that they have budgeted
their share in its entirety, but expect to be reimbursed by the Tax Increment
Reinvestment Zone #1 that they are partners in. This option is available for us as
well, and is probably our best opportunity for funding this project.
Another funding possibility is to borrow against the revenues generated by
the Sylvan Beach Fishing Pier. Our share of revenues in the past has been fairly
constant at $30,000 per year. We just increased fees at the beginning of this
fiscal year and expect revenues to increase by about 25-300/0, which should bring
in around $38,000 annually. We could issue revenue bonds at about 10 times
this revenue flow and expect to receive a roughly $380,000 that could be placed
toward our share of the project.
The TGLO Project Administrator has indicated that the state "probably"
will fund V2 of this project, primarily because of the severe funding cuts they
have received. There is a drawback to phased construction; that is, that
mobilization costs would be expected to be increased by about $60,000 if it's
divided into two phases.
SUMMARY
The positive part of all this is, the project is still a bargain in that development of
an established beach at Sylvan Beach Park will be a tremendous asset to our
community, both as a recreational destination and as an economic boon to the
local economy. Our share will, in any event be approximately 20Q/o of the total
cost, while the benefits to the City of La Porte should be much higher. The TIRZ
Board will meet to discuss these issues shortly, and we are awaiting word from
the Texas General Land Office as to what they will require from the City
regarding funding assurances (I.e. Resolution, Letter of Agreement, etc.). If a
Resolution is required, one will be presented for Council consideration at the
January 12th Coundl meeting. The TGLO is expected to make a decision on their
funding level sometime in January 2004.
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AGENDA ITEM 9:
DISCUSS REFUNDING REQUEST BY ARETE DEVELOPMENT FOR VARIOUS
EXPENSES ASSOCIATED WITH THE LA PROTE GOLF COURSE COMMUNITY
David Hawes has prepared a Draft Reimbursement Agreement between Redevelopment
Authority and Arete Development (attached). Most ofthe agreement is boilerplate items dealing
with the mechanics and measures for reimbursement. The amount of reimbursement has been
left blank. The agreement has been forwarded to both Andrews/Kurth and Arete for their
reVIew.
Staff will be prepared to review and answer questions on the initial report, previously forwarded
to board members, regarding estimated construction costs and reimbursable expenses.
The report is intended to be a starting point for discussions regarding the total reimbursement for
Arete Development. Additionally, we suggest that the final agreement be structured as a straight
percentage reimbursement to simplify future accounting/auditing.
Also, as a sidebar, staffhas asked Arete to have a Traffic Engineering Analysis performed
evaluating the impacts of the proposed development on SH146, Wharton Weems and McCabe
Road. Staff feels this should be a reimbursable expense as it benefits the general public.
Action
Discuss reimbursement agreement for Arete Development and receive further direction from the
Redevelopment Authority.
NOTE: PLEASE BRING MATERIAL SENT TO YOU IN DECEMBER 2003. IF YOU
NEED ANOTHER COPY PLEASE CONTACT MELISA LANCLOS.
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DEVELOPMENT AGREEMENT
Between
REINVESTMENT ZONE NUMBER ONE
CITY OF LA PORTE
and
LA PORTE REDEVELOPMENT AUHTORITY
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DEVELOPMENT AGREEMENT
This Agreement ("Agreement"), effective , 2003, is made by and between
REINVESTMENT ZONE NUMBER ONE, CITY OF LA PORTE, TEXAS ("La Porte Zone"), a
tax increment reinvestment zone created by the City of La Porte, Texas (the "~ to
Chapter 311. of the Texas Tax Code, as amended, acting by and through its;~verfilng:body Xhe
Board of DIrectors (the "Zone Board"), LA PORTE REDEVELOPMpNf AUHTO~'("La
Porte Authority"), a local government corporation created and organi~.the-pfOvisions of
the Texas Transportation Corporation Act, Chapter 431, Transportation Code, and authorized
and approved by the City under Resolution No. 1516 adopted on October 25,2001, acting by
and through its governing body, the Board of Directors (the "La Porte Board") and
(the "Developer").
RECITALS
WHEREAS, by Ordinances No. _ the City Council of the City created the La Porte
Zone in the City pursuant to Chapter 311 of the Texas Tax Code, as amended, and pursuant to a
Preliminary Project Plan and Preliminary Reinvestment Zone Financing Plan, and appointed its
Board of Directors ("TIRZ Ordinance"); and
WHEREAS, the Zone Board adopted a final Project Plan and Reinvestment Zone
Financing Plan (the "Project Plan") and submitted the final Project Plan to the City Council of
the City for approval; and
and
WHEREAS, the City Council approved the final Project Plan by Ordinance No. _;
WHEREAS, the City authorized the creation of the La Porte Authority to aid, assist and
act on behalf of the City in the performance of the City's governmental functions with respect to
the common good and general welfare of La Porte and neighboring areas as described in the
TIRZ Ordinance; and
WHEREAS, the City, the La Porte Zone and the La Porte Authority have entered into
that certain Agreement dated , and approved as Ordinance No. (the "La
Porte Agreement"), pursuant to which the City and the La Porte Zone contracted with the La
Porte Authority to administer the La Porte Zone including, but not limited to, the power to
engage in activities relating to the acquisition and development of land, to construct and improve
infrastructure in La Porte, to enter into development agreements with developerslbuilders in La
Porte, and to issue, sell or deliver its bonds, notes or other obligations in accordance with the
terms of the La Porte Agreement upon the approval of the City Council of the City; and
WHEREAS, the La Porte Agreement further provides that the La Porte Authority must
obtain the prior approval of the City for any project approved in the La Porte Zone's Project Plan
that is constructed or caused to be constructed by the La Porte Authority; and
8/20/2003
WHEREAS, the Texas Tax Code provides that the La Porte Zone may enter into
agreements as the Zone Board considers necessary or convenient to implement the Project Plan
and achieve its purposes; and
WHEREAS, the La Porte Board and the Zone Board have determined that it is in the best
interest of the La Porte Zone and the La Porte Authority to contract with the Developer, in order
to provide for the efficient and effective implementation of certain aspects of the Project Plan;
and
The Developer desires to proceed with the development of an urban project consisting of
(residential. commercial. industrial. and retail [NOTE: DEPENDS ON DEVELOPER)) on
land located within the La Porte Zone (the "Project") prior to the time that the La Porte
Authority can issue its bonds or incur other obligations to pay the costs of the Public
Improvements (as defined herein); NOW THEREFORE,
AGREEMENT
For and in consideration of the mutual promises, covenants, obligations, and benefits of
this Agreement, the La Porte Zone, the La Porte Authority and the Developer contract and agree
as follows:
ARTICLE 1
GENERAL TERMS
1.1 Definitions. The terms "Agreement," "City," "Developer", "La Porte Agreement,"
"La Porte Board," "La Porte Authority," "La Porte Zone," "Project," and "Zone Board" have the
above meanings, and the following terms have the following meanings:
"Act" shall mean the Tax Increment Financing Act, Chapter 311, Texas Tax Code, as
amended.
"Authority Bonds" shall mean the La Porte Authority's tax increment revenue bonds
issued in one or more series pursuant to Section 6.1 (H) of this Agreement.
"Available Tax Increment" shall mean funds in the Tax Increment Revenue Fund.
"La Porte" shall mean all of the property located within the boundaries of the La Porte
Zone.
"Completion" shall mean completion of construction of the Public Improvements in
accordance with the Plans and Specifications so that the Project can be used and maintained for
its intended purposes. Completion shall be approved by the City and certified by the engineering
firm engaged by Developer to make such certification.
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"Contract Progress Payment" shall mean the_payment due to a contractor or consultant
hired by Developer to complete the Public Improvements. A contract progress payment must be
supported not only by a report of a certified public accountant as required in Section 6.1 (B), but
also by customary documentation including, but not limited to, the name and address of the
contractor, a description of the contract pursuant to which the payment is requested, the amount
of such payment, the original contract amount, total payments made to date on such contract, an
estimate of remaining work to be completed, the cost of such work, and customary lien and
subcontractor releases.
"County" shall mean Harris County, Texas.
"Developer Advances" shall mean any funds advanced for eligible improvements by the
Developer pursuant to Section 6.1 of this Agreement and shall include any interest payable
thereon as prescribed in this Agreement.
"Parties" or "Party" shall mean the La Porte Zone, the La Porte Authority, and the
Developer, the parties to this Agreement.
"Plans and Specifications" shall mean the designs, plans and specifications for the Public
Improvements prepared or to be prepared by engineering and landscape architect firms at the
direction of Developer in accordance with the Project Plan and as approved by the City_in
accordance with Section 4.2.
"Pledged Available Tax Increment" shall mean the Available Tax Increment attributable
to the Project.
"Property Account" means an account within the Tax Increment Revenue Fund
established by the City to account for the tax increment attributable to the Project Site, the
proceeds of Authorized Bonds issued to finance Public Improvements pursuant to this
Agreement, and other obligations issued pursuant to Article 6, and earnings from the investment
of such amounts.
"Project Costs" shall mean the cost of the Public Improvements.
"Project Plan" means the Project Plan and Reinvestment Zone Financing Plan for
Reinvestment Zone Number One, City of La Porte, as approved by the City Council on
, and as thereafter amended and approved by the City Council.
"Project Site" shall mean the area known as
described in Exhibit A, and all improvements located thereon.
, located in certain tracts
~"~!:!PI~C lmp)ovements" shall have the meaning provided in Article 3 ofthis Agreement.
'Residenti~t Site" shall mean that part of the Project Site that is planned for residential
use and rther ci6scribed in Exhibit D.
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"State" shall mean the State of Texas.
"Tax Increment Revenue Fund" shall mean the special fund established by the La Porte
Authority and funded with payments made by the City and any other participating Taxing Units,
pursuant to the La Porte Agreement, which payments are attributable to ad valorem property
taxes paid on the Project Site.
"Taxing Unit" shall mean individually and collectively, the City and any other taxing
units participating in the La Porte Zone.
1.2 Singular and Plural. Words used herein in the singular, where the context so
permits, also include the plural and vice versa. The definitions of words in the singular herein
also apply to such words when used in the plural where the context so permits and vice versa.
ARTICLE 2
REPRESENTATIONS
2.1 Representation of La Porte Authority. The La Porte Authority hereby represents
to the Developer that:
(A) The La Porte Authority is duly authorized, created and existing in good
standing under the laws of the State and is duly qualified and authorized to carryon the
governmental functions and operations as contemplated by this Agreement.
(B) The La Porte Authority has the power, authority and legal right to enter
into and perform this Agreement and the execution, delivery and performance hereof (i) have
been duly authorized, (ii) to the best of its knowledge, will not violate any applicable judgment,
order, law or regulation, and (iii) do not constitute a default under, or result in the creation of,
any lien, charge, encumbrance or security interest upon any assets of the La Porte Authority
under any agreement or instrument to which the La Porte Authority is a party or by which the La
Porte Authority or its assets may be bound or affected.
(C) The Project, the Public Improvements and the Project Costs are
components of or are consistent with the Project Plan.
(D) This Agreement has been duly authorized, executed and delivered by the
La Porte Authority and, constitutes a legal, valid and binding obligation of the La Porte
Authority, enforceable in accordance with its terms except to the extent that (i) the enforceability
of such instruments may be limited by bankruptcy, reorganization, insolvency, moratorium or
other similar laws of general application in effect from time to time relating to or affecting the
enforcement of creditors' rights and (ii) certain equitable remedies including specific
performance may be unavailable.
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(E) The execution, delivery and performance of this Agreement by the La
Porte Authority does not require the consent or approval of any person which has not been
obtained.
(F) The La Porte Authority has an exemption from the payment of sales and
use taxes pursuant to the statute under which the La Porte Authority was created.
2.2 Representation of La Porte Zone. The La Porte Zone hereby represents to the
Developer that:
(A) The La Porte Zone is duly authorized, created and existing in good
standing under the laws of the State and is duly qualified and authorized to carry on the
governmental functions and operations as contemplated by this Agreement.
(B) The La Porte Zone has the power, authority and legal right to enter into
and perform this Agreement and the execution, delivery and performance hereof (i) have been
duly authorized, (ii) to the best of its knowledge, will not violate any applicable judgment, order,
law or regulation, and (iii) do not constitute a default under, or result in the creation of, any lien,
charge, encumbrance or security interest upon any assets of the La Porte Zone under any
agreement or instrument to which the La Porte Zone is a party or by which the La Porte Zone or
its assets may be bound or affected.
(C) The Project, the Public Improvements and the Project Costs are
components of or are consistent with the Project Plan.
(D) This Agreement has been duly authorized, executed and delivered by the
La Porte Zone and constitutes a legal, valid and binding obligation of the La Porte Zone,
enforceable in accordance with its terms except to the extent that (i) the enforceability of such
instruments may be limited by bankruptcy, reorganization, insolvency, moratorium or other
similar laws of general application in effect from time to time relating to or affecting the
enforcement of creditors' rights and (ii) certain equitable remedies including specific
performance may be unavailable.
(E) The execution, delivery and performance of this Agreement by the La
Porte Zone does not require the consent or approval of any person which has not been obtained.
2.3 Representations of the Developer. The Developer hereby represents to the La
Porte Authority and the La Porte Zone that:
(A) The Developer is duly authorized, created and existing in good standing
under the laws of the State, is qualified to do business in the State.
(B) The Developer has the power, authority and legal right to enter into and
perform its obligations set forth in this Agreement, and the execution, delivery and performance
hereof, (i) have been duly authorized, (ii) will not, to the best of its knowledge, violate any
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812012003
judgment, order, law or regulation applicable to the Developer or any provisions of the
Developer's by-laws or limited partnership agreement, and (iii) do not constitute a default under
or result in the creation of, any lien, charge, encumbrance or security interest upon any assets of
the Developer under any agreement or instrument to which the Developer is a party or by which
the Developer or its assets may be bound or affected.
(C) The Developer will have sufficient capital to perform its obligations under
this Agreement at the time it needs to have sufficient capital.
(D) This Agreement has been duly authorized, executed and delivered and
constitutes a legal, valid and binding obligation of the Developer, enforceable in accordance with
its terms except to the extent that (i) the enforceability of such instruments may be limited by
bankruptcy, reorganization, insolvency, moratorium or other similar laws of general application
in effect from time to time relating to or affecting the enforcement of creditors' rights and (ii)
certain equitable remedies including specific performance may be unavailable.
ARTICLE 3
THE PUBLIC IMPROVEMENTS
3.1 Public Improvements. The Public Improvements shall be and include the design,
construction and installation of certain public infrastructure relating to the Project, such
infrastructure being more particularly described in the Plans and Specifications.
3.2 Proiect Costs. The estimated Project Costs of the Public Improvements are
described in Exhibit B. The Public Improvements will be developed pursuant to the Plans and
Specifications and a schedule that is mutually agreeable to the Parties. The Project Costs shall
include all architectural, engineering, design, legal and other consultant fees and expenses (as
further set forth in Section 6.1 (A) hereof) related to such Public Improvements. The Project
Costs may be modified with approval of the Board of Directors of the La Porte Authority.
3.3 Obligation. The Public Improvements shall be designed, acquired, constructed
and implemented in accordance with the Plans and Specifications to be approved by the City
under Article 4.
ARTICLE 4
DUTIES AND RESPONSIBILITIES OF THE DEVELOPER
4.1 Construction Manager. Subject to Article 3, the Developer agrees to construct the
Public Improvements as described in the Plans and Specifications and to provide and furnish, or
cause to be provided and furnished, all materials and services as and when required in connection
with the construction of the Public Improvements. The Developer will obtain all necessary
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permits and approvals from the City and all other governmental officials and agencies having
jurisdiction (including the approvals required under the La Porte Agreement), provide
supervision of all phases of construction of the Public Improvements, provide periodic reports as
requested and required by the La Porte Authority of such construction to the La Porte Board with
copies to the City, and cause the construction to be performed in accordance with the Plans and
Specifications.
4.2 Design of the Public Improvements. The Developer shall prepare or cause to be
prepared the Plans and Specifications for the Public Improvements. Prior to the commencement
of construction or implementation ofthe Public Improvements, the Plans and Specifications must
be submitted to and approved by the City and all other regulatory authorities having jurisdiction.
Once the City has approved the Plans and Specifications, no changes thereto can be made
without the express written approval of the City, the Zone Board, and the La Porte Authority.
4.3 Completion. On the later of completion of the construction of the Public
Improvements or thirty days after this agreement is executed, Developer shall provide the La
Porte Authority and the City with a final cost summary of all costs associated with such Public
Improvements, a certificate of Completion and evidence that all amounts owing to contractors
and subcontractors have been paid in full evidenced by customary affidavits executed by such
contractors.
4.4 Conveyance of Easements. If applicable, the Developer shall grant the City and
the La Porte Authority all required temporary construction and access easements necessary to
maintain the Public Improvements. The easements granted must be satisfactory for the intended
purpose as determined by the City. On property owned by the La Porte Authority, the La Porte
Authority shall grant the Developer at no cost all required temporary construction and access
easements necessary to install the Public Improvements.
4.5 Payment of Fees. If applicable, Developer agrees to pay all monthly rates and
charges for water and sewer services and shall pay all applicable City building permit fees for the
Public Improvements.
4.6 Cooperation. Developer agrees that it will cooperate with the La Porte Zone and
the La Porte Authority and Developer will provide all necessary information to the La Porte
Authority and its consultants in order to assist the La Porte Authority in complying with the La
Porte Agreement, including, without limitation, the completion of the audit and construction
audit required therein.
4.7 Ad Valorem Taxes. The Developer agrees that all real property within the Project
Site will be valued for taxation in accordance with Section 23.01, Texas Tax Code and as
hereinafter may be amended, and that it will not request such property to be valued for taxation
on the basis of inventory as permitted by Section 23.12, Texas Tax Code and as hereinafter may
be amended.
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4.8 Design and Completion of Public Improvements prior to Effective Date. Prior to
the effective date of this Agreement, the Developer has committed and expended funds in
amounts for Public Improvements described in Exhibit B, in reliance upon the City's
commitment to establish the Zone and the La Porte Authority's commitment to payor reimburse
such costs in accordance with the terms herein, but no other contract has heretofore been entered
into by the Developer with the La Porte Authority or the La Porte Zone to provide for such
expenditures and reimbursement. The Developer represents that the fair market value of the
work and property resulting from the funds so committed or expended and benefiting the La
Porte Authority and the La Porte Zone is at least equal to the amounts so committed and
expended, respectively. In order to compromise and settle all claims the Developer may have
arising out of any failure by the La Porte Authority and La Porte Zone to reimburse funds
heretofore expended by the Developer for such Public Improvements, by entering into this
Agreement,
);> the La Porte Authority and the La Porte Zone agree to reimburse the Developer for
Project Costs of such Public Improvements paid or incurred prior to the date hereof in a
total amount of committed funds specified in Exhibit B plus financing costs and/or
interest as set forth in Section 6.1 below, attributable thereto in accordance with and
subject to the other provisions hereof, without admitting liability of any kind on their
part, and
);> the Developer releases and discharges the La Porte Authority and the La Porte Zone from
all claims of any nature the Developer might make, now or in the future, arising out of
any failure by the La Porte Authority and La Porte Zone to payor reimburse the
Developer for any other work done prior to the date hereof or in any greater amount or on
any other conditions for work performed in connection with Public Improvements prior
to the date hereof.
4.9 Changes in Proiect. The Developer shall not make any change in the Project as to
the uses of the property within the Residential Site or change the boundaries within the Project
Site without the express written consent of the City, the La Porte Board and the Zone Board.
4.10 No Vested Rights. The Developer expressly understands and agrees that neither
this Agreement nor any approvals required herein shall be construed as a "permit," as defined in
Section 245.001 of the Texas Local Government Code, or an application therefore; and, as such,
the Developer has no vested right as a "permit" in any order, regulation, ordinance, rule,
expiration date or other requirement in effect at the time of execution of this Agreement or at the
time any approval pursuant to the terms hereof is obtained. To this end, Developer, for itself, its
officers, agents, employees, successors and assigns, hereby releases and holds harmless the City,
the La Porte Authority and the La Porte Zone from any claim or cause of action involving vested
rights, including, but not limited to, such a right claimed pursuant to Chapter 245 of the Texas
Local Government Code, arising out of this Agreement or the approvals required to be obtained
herein.
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ARTICLE 5
DUTIES AND RESPONSIBILITIES OF THE LA PORTE AUTHORITY
5.1 La Porte Authority Contributions. The La Porte Authority shall payor reimburse
to Developer the Project Costs in the amount of the actual costs of the Public Improvements as
more particularly described in and as provided by Articles 3 and 4. The total, actual Project
Costs of the Public Improvements, for which the La Porte Authority shall be responsible under
the terms of this Agreement, is estimated to be $ . Attached hereto as Exhibit B
is a detailed description of the engineering estimates of the Public Improvements. The Project
Costs shall be financed and funded in accordance with Article 6 hereof. In the event a portion of
the Public Improvements is determined to be ineligible under the Act, the Project Costs shall be
reduced by the amount of such ineligible Public Improvements. If the La Porte Authority has
already repaid Developer for such ineligible Public Improvements in accordance with this
Agreement, the Parties agree that Developer shall reimburse the La Porte Authority for such
repayment within thirty (30) days of receipt of an invoice from the La Porte Authority and all
such sums shall bear interest at the rate established in section 6.1 (F) from the date past due until
the date of such reimbursement. Should the Developer fail to timely pay such amount, the La
Porte Authority may, in its sole discretion, withhold the amount due, including accrued interest,
from future Contract Progress Payments.
,'-
5.2 Proiect Costs. The La Porte Authority shall payor reimburse the Project Costs in
accordance with this Agreement. In the event the La Porte Authority does not have funds
available at the time all or part of the Project Costs are payable by the La Porte Authority in
accordance with this Agreement, the Project Costs shall be funded in accordance with Article 6
hereof, and such funding shall not be deemed a default by the La Porte Authority under this
Agreement.
ARTICLE 6
PUBLIC IMPROVEMENTS FINANCING AND FUNDING
6.1 Developer Advances.
(A) Developer shall advance sufficient funds as such become due for all costs
comprising the Project Costs including, without limitation, all costs of design, engineering,
materials, labor, construction, and inspection arising in connection with the Public
Improvements, including all payments arising under any contracts entered into by Developer
pursuant to this Agreement, all costs incurred in connection with obtaining governmental
approvals, certificates or permits (including any building permit fees) required as a part of any
contracts entered into in accordance with this Agreement and all related legal fees incurred in
connection therewith.
(B) The Developer must submit, within sixty (60) days after the latest of
recording a final plat of property within the Project Site, signing this Agreement, or completing
an identifiable segment of Public Improvements not subject to the platting requirements of the
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City, a request for a Contract Progress Payment when an identifiable segment of Public
Improvements has been completed. Documentation of cost and completion shall be forwarded to
the La Porte Authority. The La Porte Authority, at its expense, shall hire a certified public
accountant to calculate the amount due Developer and shall prepare and submit a report to the La
Porte Board and send a copy to the City Manager. Requests for Contract Progress Payments
shall be submitted only when an identifiable segment of Public Improvements has been
completed and shall be submitted no more often than once every sixty (60) days. If the La Porte
Authority does not have sufficient funds to pay any Contract Progress Payment within 30 days of
the date the certified public accountant's report is received by the La Porte Board, Developer
shall be deemed to have advanced such amount to the La Porte Authority as of the date actually
expended by the Developer. Interest (as defined in Subsection 6.1(F)) on each Developer
Advance made pursuant to this Subsection shall accrue from the date the Developer expended
the funds and shall accrue for a maximum period of two years from such date. At such time as
funds are available to pay all or any portion of the Developer Advances made hereunder, the La
Porte Authority, at its expense, shall hire a certified public accountant to calculate the amount
due Developer and shall prepare and submit a report to the La Porte Board and send a copy to the
City Manager certifying (1) the amount due Developer for the Developer Advances being repaid
with interest calculated thereon as specified herein and (2) that funds are available to make such
payment. Upon receipt of such report, the La Porte Board shall promptly authorize and make
payment to Developer.
(C) If, upon Completion of the Public Improvements and conveyance of the
Public Improvements to the La Porte Authority, or the City, as applicable, the La Porte Authority
does not have sufficient funds to reimburse to Developer the unpaid balance of the Project Costs,
Developer shall be deemed to have advanced to the La Porte Authority an amount equal to the
difference between (i) the amount of the Project Costs which has been previously paid by the La
Porte Authority to Developer and (ii) the final cost of the Public Improvements as evidenced by
documentation approved by the La Porte Board in accordance with Section 4.3.
(D) Each Developer Advance shall be evidenced by a certificate in the form
attached hereto as Exhibit C.
(E) The La Porte Authority shall begin repaying the Developer Advances, and
shall continue such repayment until repaid in full, on the earliest date that funds are available
from any of the following sources.
(1) proceeds of any applicable bank loan;
(2) proceeds from the sale of applicable La Porte Authority Bonds; or
(3) the available Tax Increment Revenue Fund attributable to the
Project.
(F) Interest on each Developer Advance shall accrue at the prime rate of
Chase Bank of Texas, National Association. Interest shall be calculated on the basis of a year of
360 days and the actual days elapsed (including the first day but excluding the last day)
occurring in the period for which such interest is payable, unless such calculation would result in
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a usurious rate, in which case interest shall be calculated on the per annum basis of a year of 365
or 366 days, as applicable, and the actual days elapsed (including the first day but excluding the
last day). In no case shall the interest rate exceed one percent per month.
(G) The La Porte Authority's obligation to pay the Developer Advances or
reimburse the Developer for Project Costs is limited to any Pledged Available Tax Increment.
The rights of Developer in and to the Pledged Available Tax Increment granted herein are
subject only to (i) the rights of any holders of bonds, notes or other obligations that have been
heretofore or are hereafter issued by the City or any other participating taxing unit that are
payable from and secured by a general levy of ad valorem taxes throughout the taxing
jurisdiction of the City or any other participating taxing unit, (ii) the rights of any of the holders
of bonds and notes that are hereafter issued or incurred by the La Porte Authority and which are
secured by a pledge of the Tax Increment Revenue Fund the proceeds of which are used to fully
pay the Project Costs, including all Developer Advances and accrued interest thereon as set forth
in this Agreement, and (iii) the rights of any of the holders of notes that are hereafter issued or
incurred by the La Porte Authority, which are secured by a pledge, all or a part, of the Tax
Increment Revenue Fund, the proceeds of which are used solely to fund the annual operating and
administration budget of the La Porte Authority approved by the La Porte Board and the City
Council of the City. Except in the event that sufficient tax increment increase does not occur
within the term of the Zone or within the Project Site to generate sufficient revenue to repay the
Developer Advance(s), it shall be the obligation of the La Porte Authority to repay the Developer
Advances and accrued interest thereon as set forth in this Agreement from the Pledged Available
Tax Increment until such time as the Developer Advances and accrued interest thereof incurred
pursuant to this Agreement, have been fully repaid or provision for payment thereon to
Developer shall have been made in accordance with their terms. The Developer Advances
constitute a special obligation of the La Porte Authority payable solely from the Pledged
Available Tax Increment as and to the extent provided in this Agreement. The Developer
Advances do not give rise to a charge against the general credit or taxing powers of the La Porte
Authority, the La Porte Zone, the City, the County or any other Taxing Unit and is not payable
except as provided in this Agreement. Developer, its successors and assigns, shall not have the
right to demand payment thereof out of any funds of the La Porte Authority other than the
Pledged Available Tax Increment or sources described in Section 6.1 (E).
(H) The La Porte Authority will evaluate and consider bond issues to
reimburse the Developer upon the following circumstances:
1) Projected incremental revenue generates 1.25 times coverage for the bonds over projected
annual debt service;
2) Projected incremental revenue will be calculated by multiplying estimated or certified
incremental value from the appraisal district by the participant( s) tax rate( s) divided by 100 times
one minus a reasonable historical tax collection factor times one minus the City set aside
percentage;
3) A reserve fund equal to maXImum annual debt service must be funded from the bond
proceeds;
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4) Adequate cash or capitalized interest must be set aside to assure payment of the bonds through
the date of the next increment payment;
5) The minimum bond size will be that size that after funding the Reserve Fund, any capitalized
interest and any costs of issuance will allow for a reimbursement to the developer of at least $1.5
million plus developer interest.
(I) The La Porte Authority shall not issue obligations in accordance with this
Article unless the resulting debt service requirements on all Zone obligations may be paid in full
when due from all money then on deposit in or thereafter required to be deposited to the Property
Account during the term of such Zone obligations, assuming that (a) the rates at which property
taxes are levied by all taxing units required to make deposits to the Tax Increment Fund do not
change from the rates at which they most recently levied property taxes, (b) the assessed value of
taxable property (net of exemptions) within the Property does not change from the amount then
most recently estimated or certified by the Harris County Appraisal District, (c) all amounts
deposited (or required to be deposited) to the Property Account bear interest at the City's
investment rate until expended, (d) proceeds of such obligations are deposited to and set aside in
the Property Account as capitalized interest in the amount requested by the Developer and
approved by the City Manager, and (e) the Property Account is expended in each year to pay
administrative expenses of the Zone in an amount equal to the product of (i) the total amount of
such expenses budgeted in the Zone's most recent operating budget and (ii) a fraction, the
numerator of which is the current Tax Increment attributable to the Property and the denominator
of which is the total current Tax Increment.
(1) The La Porte Authority shall provide to Developer, upon the written
request of Developer, and on the earliest date such information is available after the date of such
request, certified copies of all statements of revenue attributable to the Developer's portion of the
Project and the source of such revenue of the La Porte Zone and of the La Porte Authority the
intended use of which is to verify the availability of funds for payment of the Project Costs or
Developer Advances, if applicable, under this Section.
(K) The La Porte Zone and the La Porte Authority shall endeavor to cause
each Taxing Unit to collect all ad valorem taxes due on property located within the La Porte
Zone and shall endeavor to cause such Taxing Units to deposit all tax increments due with the
City for transfer to the Tax Increment Revenue Fund pursuant to the La Porte Agreement.
ARTICLE 7
INSURANCE~ RELEASE
7.1 Insurance. With no intent to limit any contractor's liability or obligation for
indemnification, the Developer shall require that each contractor providing work or service on
the Public Improvements provide and maintain certain insurance in full force and effect at all
times during the construction of the Public Improvements and shall require that the City, the La
Porte Authority, and the La Porte Zone are named as additional insured's under such contractor's
insurance policies.
12
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The msurance, at a mInImUm, must include the following coverage's and limits of
liability:
Comprehensive General Liability:
Including Broad Form Coverage,
Contractual Liability, Bodily and
Personal Injury, and Completed
Operations (for a period of one year after
completion of work)
Automobile Liability Insurance (for
automobiles used in performing under
this Agreement, including Employer's
Non-Ownership and Hired Auto
Coverage)
Professional Liability Coverage (for
professional service contract only)
Defense costs are excluded from the face amount ofthe policy.
Aggregate Limits are per 12-month policy period unless otherwise indicated.
Coverage
Worker's Compensation
Employer's Liability
Limit of Liability
Statutory
Bodily Injury by Accident $100,000 (each accident)
Bodily injury by Disease $500,000 (policy limit)
Bodily injury by Disease $100,000 (each employee)
Bodily Injury and Property Damage, Combined
Limits of $500,000 each Occurrence and $1,000,000
Aggregate
$500,000 Combined Single Limit per Occurrence
$500,000 per occurrence $1,000,000 aggregate
If the amount of any contract awarded by Developer to construct the Public Improvements shall
exceed $1,000,000, Developer shall contract with the contractor to maintain Commercial General
Liability coverage and the Auto Liability coverage for at least twice the combined minimum
limits specified above.
The amounts of the insurance required herein shall be reviewed on the fifth (5th) anniversary date
of this Agreement and each fifth (5th) year thereafter until the construction of the Project is
completed and shall be increased, if necessary, so that the amount of such coverage is at all times
generally equal to the limits described herein measured in year 2003 dollars.
(A) Form of Policies. The La Porte Board may approve the form of the
insurance policies, but nothing the La Porte Board does or fails to do relieves Developer of its
obligation to provide the required coverage under this Agreement. The La Porte Board's actions
or inactions do not waive the La Porte Zone's or La Porte Authority's rights under this
Agreement.
13
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(B) Issuers of Policies. The issuer of each policy shall have a certificate of
authority to transact insurance business in Texas or a Best's rating of at least A and a Best's
Financial Size Category of Class VI or better, according to the most current edition Best's Key
Rating Guide, Property-Casualty United States.
(C) Insured Parties. Each policy, except those for Workers' Compensation,
Employer's Liability, and Professional Liability, must name the La Porte Authority, its officers,
agents and employees as additional insured parties on the original policy and all renewals or
replacements.
(D) Deductibles. Developer shall be responsible for and bear (or shall contract
with each applicable contractor to bear and assume) any claims or losses to the extent of any
deductible amounts and waives (and shall contract with each contractor to waive) any claim it
may have for the same against the La Porte Authority or La Porte Zone, its officers, agents, or
employees.
(E) Cancellation. Each policy must state that it may not be canceled,
materially modified, or non-renewed unless the insurance company gives the La Porte Authority
30 days' advance written notice. Developer shall (and shall contract with each contractor to)
give written notice to the La Porte Authority within five days of the date on which total claims
by any party against such person reduce the aggregate amount of coverage below the amounts
required by this Agreement. In the alternative, the policy may contain an endorsement
establishing a policy aggregate for the particular Public Improvements or location subject to this
Agreement.
(F) Subrogation. Each policy must contain an endorsement to the effect that
the issuer waives any claim or right of subrogation to recover against the La Porte Authority, the
La Porte Zone, its officers, agents, or employees.
(G) Primary Insurance Endorsement. Each policy, except Workers'
Compensation and Professional Liability (if any), must contain an endorsement that the policy is
primary to any other insurance available to the additional insured with respect to claims arising
under this Agreement.
(H) Liability for Premium. Developer shall pay (or shall contract with
contractors to pay) all insurance premiums for coverage required by this Section, and the La
Porte Authority or La Porte Zone shall not be obligated to pay any premiums.
(I) Subcontractors. Notwithstanding the other provisions of this Section, the
amount of coverage contracted to be provided by subcontractors shall be commensurate with the
amount of the subcontract, but in no case less than $500,000 per occurrence. Developer shall
provide (or shall contract with contractors to provide) copies of insurance certificates to the La
Porte Authority.
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(J) Proof of Insurance. Promptly after the execution of this Agreement and
from time to time during the term of this Agreement at the request of the La Porte Authority,
Developer shall furnish the La Porte Authority with certificates of insurance maintained by
Developer in accordance with this Section. If requested in writing by the La Porte Authority,
Developer shall furnish the City with certified copies of Developer's actual insurance policies. If
Developer does not comply with the requirements of this Section, the La Porte Authority, at its
sole discretion, may (1) suspend performance by the La Porte Authority hereunder and begin
procedures to terminate this Agreement for default or (2) purchase the required insurance with
La Porte Authority or La Porte Zone funds and deduct the cost of the premiums from amounts
due to Developer under this Agreement. The La Porte Authority shall never waive or be
estopped to assert its right to terminate this Agreement because of its acts or omissions regarding
its review of insurance documents.
7.2 Indemnification and Release.
DEVELOPER SHALL DEFEND, INDEMNIFY, AND HOLD THE LA
PORTE AUTHORITY, THE CITY AND THE LA PORTE ZONE, THEIR
AGENTS, EMPLOYEES, OFFICERS, AND LEGAL REPRESENTATIVES
(COLLECTIVELY, THE "INDEMNIFIED PERSONS") HARMLESS FOR
ALL CLAIMS, CAUSES OF ACTION, LIABILITIES, FINES, AND
EXPENSES (INCLUDING, WITHOUT LIMITATION, REASONABLE
ATTORNEYS' FEES, COURT COSTS, AND ALL OTHER DEFENSE
COSTS AND INTEREST) FOR INJURY, DEATH, DAMAGE, OR LOSS TO
PERSONS OR PROPERTY SUSTAINED IN CONNECTION WITH OR
INCIDENTAL TO PERFORMANCE UNDER THIS AGREEMENT,
INCLUDING, WITHOUT LIMITATION, THOSE CAUSED BY:
A. DEVELOPER'S AND/OR ITS AGENTS', EMPLOYEES',
OFFICERS', DIRECTORS', CONTRACTORS', OR
SUBCONTRACTORS' (COLLECTIVELY, "DEVELOPER'S")
ACTUAL OR ALLEGED SOLE AND/OR CONCURRENT
NEGLIGENCE OR INTENTIONAL ACTS; ;
B. THE INDEMNIFIED PERSONS' AND DEVELOPER'S
ACTUAL OR ALLEGED CONCURRENT NEGLIGENCE AND/OR
GROSS NEGLIGENCE, WHETHER DEVELOPER IS IMMUNE
FROM LIABILITY OR NOT; AND
,-
C. THE INDEMNIFIED PERSONS' AND DEVELOPER'S
ACTUAL OR ALLEGED STRICT PRODUCTS LIABILITY OR
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STRICT STATUTORY LIABILITY, WHETHER DEVELOPER IS
IMMUNE FROM LIABILITY OR NOT.
IT IS THE EXPRESSED INTENTION OF THE PARTIES HERETO THAT
THE INDEMNIFICATION PROVIDED FOR IN THIS SECTION IS AN
INDEMNITY BY THE DEVELOPER TO INDEMNIFY AND PROTECT
THE INDEMNIFIED PERSONS FROM THE CONSEQUENCES OF THE
INDEMNIFIED PERSONS' OWN NEGLIGENCE, INCLUDING GROSS
NEGLIGENCE, WHERE THAT NEGLIGENCE IS A CONCURRING
CAUSE OF THE RESULTING INJURY, DEATH OR DAMAGE.
FURTHERMORE, THE INDEMNITY PROVIDED FOR IN THIS
PARAGRAPH SHALL HAVE NO APPLICATION TO ANY CLAIM, LOSS,
DAMAGE, CAUSE OF ACTION, SUIT AND LIABILITY WHERE THE
INJURY, DEATH OR DAMAGE RESULTS FROM THE SOLE
NEGLIGENCE OF THE INDEMNIFIED PERSONS UNMIXED WITH THE
FAULT OF ANY OTHER PERSON OR ENTITY.
THE INDEMNITY PROVIDED FOR IN THIS SECTION 7.2 SHALL
SURVIVE THE TERMINATION OR EXPIRATION OF THIS
AGREEMENT.
If an Indemnified Person or Developer receives notice of any claim or circumstance
which could give rise to an indemnified loss, the receiving party shall give written notice to the
other party within 30-days. The notice must include a description of the indemnification event in
reasonable detail, the basis on which indemnification may be due, and the anticipated amount of
the indemnified loss. This notice shall not estop or prevent an Indemnified Person from later
asserting a different basis for indemnification or a different amount of indemnified loss than that
indicated in the initial notice. If an Indemnified Person does not provide this notice within the
30-day period, it does not waive any right to indemnification except to the extent that Developer
is prejudiced, suffers loss, or incurs expense because of the delay.
For those matters for which the Developer has the obligation to defend an Indemnified
Person pursuant to this Section 7.2, Developer shall assume the defense of the claim at its own
expense with counsel chosen by it that is on the approved list established by the Texas Municipal
League or that is otherwise approved by the City. Within 10 days after receiving written notice
of the indemnification request, Developer shall advise the Indemnified Person as to the chosen
counsel. If Developer does not properly notify the Indemnified Persons as required above, the
Indemnified Person shall assume and control the defense, and all defense expenses actually
incurred by it shall constitute an indemnified loss, which must be paid by the Developer within
thirty (30) days of receipt of an invoice from an Indemnified Person. Such indemnified loss shall
bear interest at the rate, but not the time, established in section 6.1 (F) from the due date noted in
the invoice until the date of payment. Should the Developer fail to timely pay such amount, the
16
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La Porte Authority may, in its sole discretion, withhold the amount due, including accrued
interest, from future Contract Progress Payments.
If Developer defends a claim against any Indemnified Person, the Indemnified Person
may retain separate counsel at the sole cost and expense of such Indemnified Person to
participate in (but not control) the defense and to participate in (but not control) any settlement
negotiations. Developer may not settle the claim without the consent or agreement of the
Indemnified Person, unless such settlement is at no cost to the Indemnified Person and no
judgment is entered against any Indemnified Person.
DEVELOPER RELEASES EACH INDEMNIFIED PERSON FROM ALL
LIABILITY FOR INJURY, DEA TH, DAMAGE, OR LOSS TO PERSONS OR
PROPERTY SUST AINED IN CONNECTION WITH OR INCIDENT AL TO
PERFORMANCE UNDER THIS AGREEMENT, EVEN IF THE INJURY, DEATH,
DAMAGE, OR LOSS IS CAUSED BY THE INDEMNIFIED PERSON'S SOLE OR
CONCURRENT NEGLIGENCE AND/OR THE INDEMNIFIED PERSON'S STRICT
PRODUCTS LIABILITY OR STRICT STATUTORY LIABILITY; PROVIDED,
HOWEVER, THIS RELEASE SHALL HAVE NO APPLICA TION TO AN
INDEMNIFIED PERSON'S FAILURE TO PAY MONIES OWED PURSUANT TO THIS
AGREEMENT.
,.,..-...
FROM AND AFTER THE DATE OF THIS AGREEMENT, DEVELOPER SHALL
REQUIRE ALL CONTRACTORS ENGAGED BY IT TO CONSTRUCT PUBLIC
IMPROVEMENTS (AND THEIR SUBCONTRACTORS) TO RELEASE AND
INDEMNIFY THE INDEMNIFIED PERSONS TO THE SAME EXTENT AND IN THE
SAME FORM AS ITS RELEASE OF AND INDEMNITY TO THE INDEMNIFIED
PERSONS HEREUNDER.
THE DEVELOPER SHALL REQUIRE ALL GENERAL CONTRACTORS TO
POST PAYMENT AND PERFORMANCE BONDS IN THE AMOUNT OF THE
PROJECT COST AND ONE YEAR MAINTENANCE BONDS AS DEEMED
APPROPRIATE BY THE LA PORTE AUTHORITY.
ARTICLE 8
DEFAULT
8 .1 Default.
(A) If the La Porte Authority or the La Porte Zone does not perform its
obligations hereunder in compliance with this Agreement in all material respects, in addition to
the other rights given the Developer under this Agreement, the Developer may enforce specific
performance of this Agreement for any such default if such default is not cured or is not
17
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commenced and diligently pursued within thirty (90) days after receipt by the La Porte Authority
and the La Porte Zone of a written notice detailing the event of default. Failure of a project to
generate sufficient tax increment increase to repay Developer Advances is not a default on the
part of the La Porte Authority or the La Porte Zone.
(B) In the event the Developer completes the Public Improvements and the
Project but does not otherwise perform its obligations hereunder as provided in Article 4 in
compliance with this Agreement, in addition to the other rights and remedies the La Porte
Authority and the La Porte Zone may have under this Agreement or in law or equity, the La
Porte Authority and/or the La Porte Zone may enforce specific performance or seek actual
damages incurred for any such default if such default is not cured within thirty (30) days after
receipt by Developer of a written notice of default or such cure is not commenced within ten (10)
days after receipt by Developer of a written notice of default and thereafter diligently prosecuted
to completion as determined in the discretion of the La Porte Authority.
ARTICLE 9
GENERAL
9.1 Inspections. Audits. The Developer agrees to keep such operating records
relating to the Public Improvements as may be required by the La Porte Authority, or by state
and federal law or regulation for a period not to exceed four (4) years after completion unless
otherwise required by law. The Developer shall allow the La Porte Authority and the La Porte
Zone access to documents and records in the Developer's possession, custody or control that the
La Porte Authority deems necessary to assist the La Porte Authority in determining the
Developer's compliance with this Agreement.
9.2 Developer Operations and Employees. No personnel supplied or used by the
Developer in the performance of this Agreement shall be deemed employees, agents or
contractors of the La Porte Authority, the La Porte Zone or the City for any purpose whatsoever.
The Developer shall be solely responsible for the compensation of all such personnel, for
withholding of income, social security and other payroll taxes and for the coverage of all
worker's compensation benefits. Under no circumstance shall the La Porte Authority, the La
Porte Zone, or the City be deemed responsible for compensation of the above.
9.3 Personal Liability of Public Officials. To the extent not limited by State law, no
director, officer, employee or agent of the La Porte Zone or the La Porte Authority, and no
officer, employee or agent of the City, shall be personally responsible for any liability arising
under or growing out of the Agreement.
9.4 Notices. Any notice sent under this Agreement (except as otherwise expressly
required) shall be written and mailed via certified mail, return receipt requested, or sent by
electronic or facsimile transmission confirmed by mailing written confirmation via certified mail,
return receipt requested at substantially the same time as such electronic or facsimile
18
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transmission, or personally delivered to an officer of the receiving party at the following
addresses:
CITY
City Manager
City of La Porte
P. O. Box 424
La Porte, Texas 77522-0424
FAX: 281-420-5891
with a copy to:
City Attorney
City of La Porte
P. O. Box 424
La Porte, Texas 77522-0424
FAX: 281-420-5891
LA PORTE ZONE
Reinvestment Zone Number One, City of La Porte,
c/o Hawes Hill & Associates
7322 Southwest Freeway, Suite 1470
Houston, Texas 77074
Attn: David Hawes
FAX: (713) 541-0996
LA PORTE AUTHORITY
La Porte Redevelopment Authority
c/o Hawes Hill & Associates
7322 Southwest Freeway, Suite 1470
Houston, Texas 77074
Attn: David Hawes
FAX: (713) 541-0996
DEVELOPER
Attn: Developer
FAX:
19
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with a copy to:
Attn: Attorney or other Officer
FAX:
Each party may change its address by written notice in accordance with this Section. Any
communication addressed and mailed in accordance with this Section shall be deemed to be
given when so mailed, any notice so sent by electronic or facsimile transmission shall be deemed
to be given when receipt of such transmission is acknowledged, and any communication so
delivered in person shall be deemed to be given when receipted for by, or actually received by,
the City, the La Porte Zone, the La Porte Authority or the Developer, as the case may be.
9.5 Amendments and Waivers. Any provision of this Agreement may be amended or
waived if such amendment or waiver is in writing and is signed by the La Porte Zone, the La
Porte Authority and the Developer. No course of dealing on the part of the Developer, nor any
failure or delay by the Developer with respect to exercising any right, power or privilege of the
Developer under this AgreemeI,rtshall operate as a waiver thereof, except as otherwise provided
in this Section. l! J
\
'/2
9.6 Successors and Assigns. All covenants and agreements contained by or on behalf
of the La Porte Authority and the La Porte Zone in this Agreement shall bind their successors
and assigns and shall inure to the benefit of the Developer and its successors and assigns. The
La Porte Authority and the La Porte Zone may assign its rights and obligations under this
Agreement or any interest herein, with the prior written consent of the Developer. The
Developer m.ay sell or otherwise transrrr th~ Project with the prior written consent. of the La
Porte Authonty and the La Porte Zoqe:,fProvIded, however, any such purchaser or assIgnee must
specifically assume all of the oblightions of the Developer hereunder; notwithstanding, if the
Developer is in compliance with this Agreement prior to the assignment, the Developer may
retain the right to be reimbursed for actual costs of Project Costs, which are then accrued and
vested in the Developer. If such assignment of the obligations by the Developer hereunder is
effective, the Developer shall be deemed released from such obligations. If any assignment of
the obligations by the Developer hereunder is deemed ineffective or invalid, the Developer shall
remain liable hereunder. Nothing in this section shall be construed so as to prevent the
Developer from selling any portion of the Project for which a final plat has been approved and
recorded in the records of the county clerk.
/'
20
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9.7 Exhibits; Titles of Articles. Sections and Subsections. The exhibits attached to
this Agreement are incorporated herein and shall be considered a part of this Agreement for the
purposes stated herein, except that in the event of any conflict between any of the provisions of
such exhibits and the provisions of this Agreement, the provisions of this Agreement shall
prevail. All titles or headings are only for the convenience of the parties and shall not be
construed to have any effect or meaning as to the agreement between the parties hereto. Any
reference herein to a Section or Subsection shall be considered a reference to such Section or
Subsection of this Agreement unless otherwise stated. Any reference herein to an exhibit shall
be considered a reference to the applicable exhibit attached hereto unless otherwise stated.
9.8 Construction. This Agreement is a contract made under and shall be construed in
accordance with and governed by the laws of the United States of America and the State of
Texas.
9.9 Venue. All parties hereby irrevocably agree that any legal proceeding arising out
of or in connection with this Agreement shall only be brought in the District Courts of Harris
County, Texas or in the United States District Court for the Southern District of Texas, in
Houston, Texas.
9.10 Severability. All parties agree that should any provision of this Agreement be
determined to be invalid or unenforceable, such determination shall not affect any other term of
this Agreement, which shall continue in full force and effect.
9.11 No Thir~~arty Beneficiaries. This Agreement shall not bestow any rights upon
any third party, but rat~r, shall bind and benefit the Parties hereto only.
9.12 Authority to Enter Contract. Each party has the full power and authority to enter
into and perform this Agreement, and the person signing this Agreement on behalf of each party
has been properly authorized and empowered to enter into this Agreement. The persons
executing this Agreement hereby represent that they have authorization to sign on behalf of their
respective corporations, or limited partnerships.
9.13 No Partnership. Nothing herein contained shall be construed or held to make the
Parties hereto partners in the conduct of any business.
9.14 Entire Agreement. This written agreement represents the final agreement
between the parties, unless later amended in writing and signed by the parties and may not be
contradicted by evidence of prior, contemporaneous, or subsequent oral agreements of the
parties. There are no unwritten oral agreements between the parties.
9.15 Ambiguities. In the event of any ambiguity in any of the terms of this Agreement,
it shall not be construed for or against any party hereto on the basis that such party did or did not
author the same.
21
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9.16 Non-Waiver. Failure of either party hereto to insist on the strict performance of
any of the agreements contained herein or to exercise any rights or remedies accruing hereunder
upon default or failure of performance shall not be considered a waiver of the right to insist on
and to enforce by an appropriate remedy, strict compliance with any other obligation hereunder
or to exercise any right or remedy occurring as a result of any future default or failure of
performance.
9.17 Multiple Originals. It is understood and agreed that this Agreement may be
executed in a number of identical counterparts each of which shall be deemed an original for all
purposes.
9.18 Term. This Agreement shall be in force and effect from the date of execution
hereof for a term expiring on the later of (i) December 31 in the year following Completion of
the Public Improvements pursuant to Section 4.3 hereof or (ii) the date the Developer Advances
have been repaid in full. It is expressly understood and agreed that Section 7.2 shall not expire
but shall remain in full force and effect regardless of the termination of this Agreement. If the La
Porte Authority is dissolved, the La Porte Agreement requires that the City shall make
satisfactory arrangements to provide for the payment of the obligations to the Developer of the
La Porte Authority hereunder.
9.19 Approval by the Parties. Whenever this Agreement requires or permits approval
or consent to be hereafter given by any of the parties, the parties agree that such approval or
consent shall not be unreasonably withheld or delayed.
9.20 Additional Actions. The Parties agree to take such actions, including the
execution and delivery of such documents, instruments, petitions and certifications as may be
necessary or appropriate, from time to time, to carry out the terms, provisions and intent of this
Agreement and to aid and assist each other in carrying out said terms, provisions and intent.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly
executed as of the _ day of ,2003.
REINVESTMENT ZONE NUMBER ONE, CITY OF LA PORTE
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
22
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LA PORTE REDEVELOPMENT AUHTORITY
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
DEVELOPER
By:
Name:
Title:
STATE OF TEXAS S
S
COUNTY OF HARRIS S
Before me,
on this day personally appeared
, the undersigned notary public,
, the
of
known to me;
_ proved to me on the oath of
_ proved to me
; or
his/her current
{description of
identification card or other document issued by the federal government or any
state government that contains the photograph and signature of the acknowledging
person}
through
( Check one)
to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me
that he/she executed that instrument for the purposes and consideration therein expressed.
Given under my hand and seal of office this _day of
,20_.
23
8/20/2003
Notary Public in and for the State of Texas
24
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EXHIBIT A
Proiect Site
(Property Description)
A-l
8/20/2003
Sample Exhibit B
The TIRZ Improvements
The Developer shall contribute to the La Porte Zone's construction program an amount equal to
30% and the Authority shall contribute an amount equal to 70% of the construction costs for all
water, wastewater and drainage facilities, with the following exemptions, which shall be
reimbursed by the Authority at 100%:
(1) attendant engineering fees and reasonable attorney's fees;
(2) wastewater treatment plant facilities, including site costs;
(3) water supply, treatment and storage facilities, including site costs;
(4) stormwater pump stations associated with levee systems, including site costs;
(5) that portion of water, wastewater, and stormwater lines from the La Porte Zone's
boundary to the interconnect, source of water supply, stormwater, or wastewater
treatment facility as necessary to connect the La Porte Zone's system to a
regional, city, or a municipal utility district's system;
(6) pump stations and force mains located within the boundaries of the La Porte Zone
which directly connect the La Porte Zone's wastewater system to a regional
trunkline or a regional plant, regardless of whether such line or plant is located
within or without the boundaries of the La Porte Zone;
(7) segments of water transmission or wastewater trunk lines of districts or other
authorities which are jointly shared or programmed to be jointly shared between
the La Porte Zone and another political subdivision whether inside or outside of a
participating district or authority; and
(8) alternate water supply interconnects between a district and one or more other
entities.
Actual Costs of Actual Costs of
I terns Items
COST ITEM Subject to Subject to -,
Reimbursement Reimbursement)
SECTION 1 RESIDENTIAL DEVELOPMENT
Sanitary Sewer
Water
Storm Sewer/Drainage
Miscellaneous
Off Site Utilities
Engineering
TOTAL ESTIMATED COST SECTION 1
B-1
Estimated Costs of Estimated Costs of
Items Items
COST ITEM Subject to Subject to
Reimbursement Reimbursement)
SECTION 2 RESIDENTIAL DEVELOPMENT
Sanitary Sewer
Water
Storm Sewer/Drainage
Miscellaneous
Off Site Utilities
Engineering
TOT AL ESTIMATED COST SECTION 2
8/20/2003
Estimated Costs of Estimated Costs of
Items Items
COST ITEM Subject to Subject to
Reimbursement Reimbursement)
SECTION 3 RESIDENTIAL DEVELOPMENT
Sanitary Sewer
Water
Storm Sewer/Drainage
Miscellaneous
Off Site Utilities
Engineering
TOTAL ESTIMATED COST SECTION 3
Estimated Costs of Estimated Costs of
Items Items
COST ITEM Subject to Subject to
Reimbursement Reimbursement)
SECTION 4 RESIDENTIAL DEVELOPMENT
Sanitary Sewer
Water
Storm Sewer/Drainage
Miscellaneous
Off Site Utilities
Engineering
TOTAL ESTIMATED COST SECTION 4
B-2
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B-3
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EXHIBIT C
CERTIFICATE OF ADVANCE
This Certificate is issued under that certain Development Agreement (the "Development
Agreement") by and between the La Porte Redevelopment Authority (the "Authority"),
Reinvestment Zone Number One, City of La Porte (the "Zone"), and
("Developer") dated , 2003. Capitalized terms used in this Certificate shall
have the meaning provided for in the Development Agreement.
This Certificate evidences a Developer Advance under the Development Agreement in
the amount of $ for the [describe the project category and nature of work
completed].
Interest on the Developer Advance evidenced by this Certificate shall accrue at the prime
rate of Chase Bank of Texas, National Association as described in the Development Agreement
for the oeriod described in 6.1 (B) of the Develooment Alrreement and shall be payable in
accordance with the Development Agreement.
,~
By Developer's execution of this Certificate, Developer represents that it has made the
expenditures and completed the work described in this Certificate. Copies of the relevant
invoices and other appropriate documentation are attached to this Certificate.
By the Authority's execution of this Certificate, the Authority indicates its approval of
the expenditures and work described in this Certificate and its approval of the matters set forth in
this Certificate and recognizes its obligation to repay such Developer Advance together with
interest pursuant to the Development Agreement.
AGREED TO this
day of
,2003.
LA PORTE
REDEVELOPMENT AUTHORITY
By:
Name:
Title: Chairman Board of Directors
ATTEST:
By:
Name:
Title: Secretary, Board of Directors
C-l
REINVESTMENT ZONE
ONE, CITY OF LA PORTE
8/20/2003
NUMBER
By:
Name:
Title: Chairman Board of Directors
ATTEST:
By:
Name:
Title: Secretary, Board of Directors
DEVELOPER
By:
Name:
Title:
STATE OF TEXAS S
S
COUNTY OF HARRIS S
Before me,
on this day personally appeared
, the undersigned notary public,
, the
of
known to me;
proved to me on the oath of
proved to me
; or
his/her current
{description of
identification card or other document issued by the federal government or any
state government that contains the photograph and signature of the acknowledging
person}
through
( Check one)
to be the person whose name is subscribed to the foregoing instrument, and acknowledged to me
that he/she executed that instrument for the purposes and consideration therein expressed.
Given under my hand and seal of office this _day of
,20_
Notary Public in and for the State of Texas
C:\Documents and Settings\ignacio ramirez\My Documents\DEVELOPMENT AGREEMENT080102.doc
C-2
City of La Porte
Interoffice Memorandum
To:
,
!
TIRZ / La Porte Redevelopment Board
David Hawes, Board Consu t
ger
From:
John Joerns, Assistant City .
cc:
Debra B. Feazelle, Ex-Officio
Cynthia Alexander, Ex-Officio
Knox Askins, Ex-Officio
Date:
December 2, 2003
Subject:
Golf Course Community / Infrastructure Reimbursements
Mr. Fogarty (Arete Development) has requested a reimbursement of (see attached letter):
· 100% - Water, sewer and drainage $5,768,075.00
· 100% - Landscape @ entry points 250,000.00
· 100% - SH146 Landscape, buffer, walkways 450.000.00
SUBTOTAL $6,468,075.00
· 100% - Associated Engineering (15%) 970.211.25
TOTAL $7,438,286.20
In earlier conversation he has noted that this reimbursement level is allowable in a MUD if the tax
base created is 10 times the debt service. It is my understanding that the more typical
reimbursement for a MUD is 70%.
The TIRZ Board may recall that during the creation of the TIRZ, the City Council approved
guidelines for the TIRZ, which included a section on infrastructure eligible for reimbursement.
As a beginning point for discussion/negotiations, I have prepared an estimate for reimbursement
using the cost estimates provided by Mr. Fogarty's engineers.
· First, I subtracted $792,700 from the estimated sewer construction costs for items numbers
5-dewatering, 6-modified bedding and 7 -modified manhole base in sections 1-7 and
$93,400 for items 5, 6 and 7 in the off site section. These estimates assumed that all
manholes and every foot of sewer will require these special construction efforts. This is
very conservative and tends inflate the cost estimate since every manhole and foot of sewer
will not require this. To include this I suggest we note in the agreement that when this
specialty construction is ordered, it will be reimbursed at 100%.
· If this approach is taken, this modified request for reimbursement is $6,419,275.
· Next, utilizing the TIRZ guidelines (Section E attached) and the TIRZ project plan (portions
attached), we identified items that would or could readily be identified as eligible.
Landscaping at entry points -
*SH146 Landscaping, buffering, walkways
All offsite sewer
All sanitary sewer> 8"
Detention Basins Sections 1-7
Land for Landscaping/Trail Reserves
Land for Detention Basin
250,000
450,000
240,940
549,242
640,700
174,281
571.120
SUBTOTAL
2,876,283
*Does not include costs for Apartment Project landscaping, buffering, walkways.
Plus Other Considerations for the Board
. Entrance road at the north end of subdivision
without lots fronting roadway
73,200
. Collector street at south end without lots
Fronting roadway; suggest 32' width
278.775
SUBTOTAL
351.975
3,228,258
484.239
3,712,497
Associated Engineering - 15%
TOTAL
In reviewing the General Plan and Special Conditional Use Permit (attached) approved by City
Council, there are other offsite items requested of the developer that would be considered eligible.
Other Permit Conditions/Issue that would Be Considered as Eligible Items
Any waterline crossing McCabelW eems - unknown
Lift Station #6 relocation upgrade - not clear if included in costs estimates
Sidewalks along Wharton Weems
SH146 turning lane (lane) @ Wharton Weems
Wharton Weems improvements
Wharton Weems intersection - signalization
McCabe Road improvements
Traffic Impact Analysis for McCabe and Wharton Weems
Attached are the summary sheets for each eligible cost items discussed. I have not included Mr.
Fogarty's cost estimates from his engineers. If any of you are interested in viewing them please let
Melisa know.
Summary
At this point the items readily identified as eligible amount to $3,712,497 or 58% of the modified
request of$6,419,275. The same $3,712,497,is 83% ofa 70% reimbursement ($4,493,493).
Sanitary Sewer Reimbursements
Off site Sanitary Sewer
Offsite Sanitary Collection System
*Less items #5, 6 and 7
334,340.00
- 93,400.00
240,940.00
*See reference in the summary section regarding deletion of$93,400.
Sections 1-7 Sanitary Sewer> 8" diameter
(# Of manholes estimated without use of plans-adjustments may be necessary and items #5,
6 & 7 not included - see reference in summary section regarding deletion $792,700)
Onsite Sanitary Sewer> 8" diameter
Section 1: Line 24" 1553 LF 80.00 124,240
Manhole (500ft avg.) 3 ea. 1200.00 3,900
Trench Safety 1553 LF 0.50 752
$128,892
Section 2: Line 24" 980 LF 80.00 78,400
Manhole (500ft avg.) 2 ea. 1300.00 2,600
Trench Safety 980 LF 0.50 490
$81,490
Section 3: Line 24" 1,920 LF 80.00 153,600
Manhole 4 ea. 1300.00 5,200
Trench Safety 1,920 LF 0.50 960
$159,760
Section 4: Line 10" 1,200 LF 30.00 36,000
Line 15" 310 LF 40.00 12,400
Line 24" 290 LF 80.00 23,200
Manhole 9 ea. 1300.00 11,700
Trench Safety 1,800 LF 0.50 900
$84,200
Section 5: Line 10" 120 LF 30.00 36,000
Line 12" 1,320 LF 40.00 52,800
Line 15" 480 LF 45.00 21,600
Manhole 13 ea. 1300.00 16,900
$94,900
Section 6: Line 24" 1,860 LF 80.00 148,800
Manhole 3 ea. 1300.00 3,900
Trench Safety 1,860 LF 0.50 930
$153,630
Section 7: No Line> 8" 0
GRAND TOTAL SECTIONS 1-7 $549,242
~ ~--~----~.__..,_.~_._._--~-------_.._--~_._,_.- _________________________.._ u.____
Detention Costs Reimbursements
Construction Cost Estimates
Section: 1 105,400
2 101,000
3 95,800
4 129,500
5 81,200
6 127,800
7 0
$640,700
Land Reimbursements
Landscaping / Trial Reserves*
(SH146 to Little Cedar Bayou)
Reserve A
C
D
H
M
U
W
A1*
W1*
12,916 sf
11,483 sf
34,695 sf
37,486 sf
18,553 sf
41,121 sf
78,530 sf
23,400 sf
28.500 sf
286,684 sf
* AI - Estimated 30' wide landscaped trail/buffer at North end (30'x780')
*W1 - Estimated amount along SH146 at apartment site (30'x950')
Landscaping Reserves
Reserve N
o
p
Q
R
S
2,526 sf
2,373 sf
3,768 sf
3,014 sf
2,642 sf
2.618 sf
16,941 sf
Total Landscaping & Trail Reserves: 303,625 x .574/sf= $174,280.75
Detention Reserves
Reserve B
E
G
L
T
137,071 sf
102,278 sf
122,777 sf
170,211 sf
462.246 sf
994,983 sf
Total Detention Reserves: 994,983 sfx .574/sf= $571,120
Note: $O.574/sfwas assumed as an average costfor land.
Street Reimbursement Considerations
Northern Entrance Road from SHI46 without lots
(610 ft x 28 ft) x ($120/1t)
Collector Street North of Wharton Weems thru Sections 3 & 4
(2,065 ft x 32 ft); increase unit cost by 12.5% to $135/1f
,.,-.....
(610 ft x $120/1t) = $73,200
(2,065 ft x $ 135/1t) = $278,775
Open Space Considerations
. Per Development Ordinance
Open Space / Parkland
Requirement is I Acl160 lots
444 Lotsl160 Lots/Ac = 2.775 Ac
Reserve F = 1.345 Ac
For Discussion - the proposed use of Reserves I, J & K are not clear
Reserves I
J
K
4,795 sf
7,065 sf
8.891 sf
20,751 sf= 0.476 Ac
Total Reserve F, I, J & K = 1.821 Acvs. 2.775 Ac required
NOTE: Special Conditional Use Permit required a 1-2 acre park site in addition to the passive park
detention area shown in first round.
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ARETE REAL ESTATE & DEVELOPlVIEN
340 N. Sam Houston Parkway East, #14
Houston, TX 77060
(281) 272-6134
(281) 260-9798 FAX
C 3ST. CI: f ~A,\i\iAGER
CHICE
lvlay 1, 2003
Mr. David W. Hawes
Hawes, Hill & Associates
7322 Southwest Freeway, #1470
Houston, TX 77074
RE: La Porte
Mr. David Hawes:
Enclosed are the engineers cost estimates for the infrastructure improvements to the La Porte
Golf Course Community. In addition to these costs, I would expect to spend $250,000 minimum
on landscaping and beautification of entryways and $450,000 for landscape for the sound
abatement along 146 and for the walkways around the detention ponds which act as a buffer to
the Golf Course. We will create approximately 90 lots which will be valued at $30,000 each and
approximately 325 lots which would be valued at $25,000. We have pro-formaed an absorption
of 100 units per year with an average home valued in the range of$250,000. I expect that the
apartment community would be built sometime within the first three years.
I am hopeful that the TIRZ Board will approve the reimbursement to us of 100% of our water,
sewer and drainage and associated engineering cost and the landscaping and beautification cost.
Please note estimates do not include engineering which typically run 15%. Please call me once
you have had a chance to review and let me know what else you may need from myself or my
engineers. I am quite anxious to move forward on this project.
Sincerely,
Joe Fogarty
President
-~.,.,.-
JF/dlc
Legend:
Review of City of La Porte
Special Conditional Use Permit #SCU 03-002
For Proposed Golf Course Community
Review of Permit Conditions (attached) for eligible items for reimbursement
OS/E = offsite eligible
? = for discussion/consideration
N/ A = not applicable
./ = already included in initial analysis
x = deleted by City Council
City of La Porte
Special Conditional Use Permit # SCU 03-002
This permit is issued to:
Arete Real Estate & Development Co. and Hettiq Manaqement Corp.
Owners
340 N Sam Houston Parkway East. Suite#140 Houston, TX 77060
Address
5325 Katy Freeway Suite #1 Houston, TX 77007-2257
Address
For Development of:
Proposed La Porte Golf Course Community
Development Name
Located at SH 146 south of Baypoint town homes
Address
Legal Description:
150+ acres of land beinq located in the W.P. Harris Survey. A-30
City of La Porte, Harris County, Texas
Zoning:
Planned Unit Development (PUm
Use:
Sinqle-family residential. multi-family. and commercial
Permit Conditions:
Land Use:
N/A 1. Allow single-family lots with 70' along the Golf Course and 60' to 65' width lots in other areas.
N/A 2. Redesign the single-family lot layout so that fewer lots fronting on south ath Street.
N/A 3. Allow multi-family development near McCabe & SH 146. The Development Agreement could
determine density and driveway access.
N/A 4. Allow commercial development near McCabe & SH 146. A further refinement of the
commercial activity will be determined when the Development Agreement is created.
Streets:
X
N/A
1. Avoid utilizing S. 8th Street during construction phases of the development.
2. Seek the TIRZ Board a~proval for the funds to participate in the signal placement
and enhancement of at St. and Fairmont Parkway intersection, north of the
subdivision boundary.
3. Remove existing chain link fencing on border of golf course property.
4. Provide emergency access to the golf course from McCabe Road area (alley and
gate) to allow ambulance into this area of the course.
5. Center turn lanes on Wharton Weems should be considered.
6. Traffic signal on Wharton Weems and S.H. 146 is needed at the time the subdivision
is developed. The Developer should coordinate with TXDOT.
OS/?
05
os
OS
Detention:
05 1. Ensure that lake/detention areas are continuous and provide wrought iron fencing to
prevent free movement of pedestrian traffic between the golf course and the
subdivision. Install wrought iron fencing along the rear of each lot overlooking the
golf course/detention lake area.
N/A 2. Size outflow piping so that water is retained sufficiently to prevent flooding on the
golf course or the subdivision.
N/A 3. Discuss rounding right angle corners of detention areas, (possibly utilizing City-
owned land to do so); this will increase detention capacity for the lake system.
N/A 4. Maintenance of detention down to the water level and option such as constant water
level lakes can be determined in the development agreement.
5. Outflow is needed to gain access to reserve 'Z', which is not owned by the applicant.
Total volume should be in line with the recommendations by the Taylor Bayou study.
,"-
Parks. trails. and landscaoina:
? 1. Add at least one 1-2 acre park site in addition to the passive park/detention areas
shown in the 1 sl round
? 2. Install play/service equipment to the current City of La Porte park standards (i.e.
playground, picnic area, trash cans, barbeque pits, etc.)
05 3. Incorporate pedestrian/bicycle trails along the linear detention/park areas, with entry
and exit to the subdivision, in at least 4-5 locations along its length.
05 4. Note that pedestrian/bicycle trails will be primarily for the use of the subdivision
owners and shall be maintained by the homeowner's association.
./' &? 5. Create winding pedestrian/bicycle trails with trees situated to add shade and
landscaping to trails, both along the linear park area as well as SH 146.
./' 6. Provide a pedestrian/bicycle cut-through from SH 146 to Little Cedar Park along the
north perimeter of the subdivision, with a connection to the east side
pedestrian/bicycle trail.
05 7. Sidewalks are recommended along both sides of Wharton Weems and McCabe and
along SH 146.
./' 8. Create either perimeter 6 foot berms, or sound walls along SH146 to have to reduce
noise levels for the subdivision; if berms utilized, then shrubbery planted along the
top (i.e. oleanders) to provide additional sound deadening. Walkways should wind
among the berms; the entire landscaped area should be no less than 30 feet wide.
? 9. Irrigation to landscaped areas shall be provided to allow establishment of all plant
material.
N/A 1 O.Clearly state in covenents or deed restrictions that it is the responsibility of the
homeowner to pay for all costs for repairs that are incurred when property adjacent
to the existing golf course and driving range is damaged. Or if feasible, provide a
protective mechanism that prevents damage to property that is adjacent to the golf
course or driving range.
05 11.lnstall a pedestrian bridge over Taylor Bayou to provide continuity for internal
subdivision alternative transportation, if necessary.
OS/E&? 12.Extend landscaping, hike/bike trails along boundaries of the proposed apartment
complex.
N/A 13. Return with the Development Agreement, plats, deed restrictions etc. refimg and
resolving the above conditions.
Mandatory items:
1. Pay the public hearing costs of $238.44.
2. Comply with all other applicable laws and ordinances of the City of La Porte and the State
of Texas.
Failure to begin construction within 12 months after issuance or as scheduled under the terms of a special
conditional use permit shall void the permit as approved, except upon an extension of time granted after
application to the Planning and Zoning Commission.
If construction is terminated after completion of any stage and there is ample evidence that further development
is not contemplated, the ordinance establishing such special conditional use permit may be rescinded by the
City Council, upon its own motion or upon the recommendation of the Planning and Zoning Commission of the
City of La Porte, and the previous zoning of the entire tract shall be in full effect on the portion which is
undeveloped.
Validation Date:
Director of Planning
City Secretary
3. Under current Texas law, the City cannot delegate or extend to the Board
its power of eminent domain. If the applicable state law is amended to
permit the delegation of extension of such power, the policy of the City is
not to authorize the delegation or extension of its power to the Board.
In addition, the City will utilize its power of eminent domain within the Zone
,c"",",:;">""",""~",'.c'''~''''''''c=~=,"",.."...,,,,,=only-if the- City ..Col;lnci I finds . that-a. public, purpose will be served . by such~"''''''''"'''~7."-:,,,,.
an exercise of the City's power.
If the Board proposes to condemn property for purposes related to
redevelopment or urban renewal, the City will not exercise its power of
eminent domain unless the City Council additionally finds that the property
or the area immediately surrounding that property contains a substantial
number of substandard, slum, deteriorated, or deteriorating structures.
Provided, however, that in no event will the City condemn a residential
homestead for purposes of redevelopment or urban renewal unless City
Council finds that the property proposed to be condemned is, in fact, in a
substandard or blighted condition. .
4. The City will hold a public hearing prior to the approval of a Land Use Plan
for the Zone in accordance with the City's Zoning Ordinance. The City will
provide notice to all property owners within the Zone by certified mail,
return receipt requested not less than fifteen (15) days prior to the hearing.
5. The City Council by ordinance may authorize the Board to provide for the
management and administration of a public improvement district created
within the Zone, as provided in such district's service plan required by law.
6. The City will not consider the creation of Municipal Utility Districts within
the Zone.
,*-E.
Eligible Project Costs
1. In conformance with 311.002 of the Tax Code, the City shall consider the
"except for" requirements required for the creation of the Zone and make a
determination on a case by case basis of the project costs necessary to
implement the Project Plan and Reinvestment Zone Financing Plan. In
general, the City may consider the following project costs as eligible, but is
neither obligated nor limited to the following:
a. Off-site utilities required to bring utilities to the Zone (e.g. water,
waste water, road and drainage facilities, street lighting and traffic
lights);
b. Upgrade existing infrastructure to provide additional capacity for
future development of properties within the Zone (e.g. lift stations,
6
Revised 5/12/99
water and waste water improvements, turning lanes/intersection
improvements, waste water treatment plant enhancements);
c. Land purchase for public facilities and construction of projects that
serve the general public such as overpasses, interchanges
roadway beautification, convention centers, amphitheaters,
marinas, park improvements, etc.
:c,..:;::..'-:-::\.,>~'~ ".':)'?r"'"'~",';:"'_, -':::':'::,~;~.:'''.",.. '-"::- ,~~7~_c':'---.-~_-_i-_:,,,,.jo:'+:-,..::- -7c,~":~""_=-;;;~--'''-'::!:':''"",7~'::-:::"":'5:'!'''t.f,.~,,,, '?"":?::,:"r~:''''':~-'''''--'''-'':?:~-~-:::!,~~~.:,<,j.~:;~;,~::;'~''''-::'7:-, '~~""'~:=:t,~. t?:' "';1' c'.;:.,"t_ """'::""',""k-"':~Y-' :~.;;;:::'"':-;r-,-.!'3::",'~".!L,.'."'~'o::: ;'~":~":.:':':",,'N',=:~~-o;:-_ :'_"-;': ,~:""
d. Oversizing of infrastructure within the Zone, including water, waste
water, streets (arterial or greater), drainage (major channels and
detention basins) and street lighting.
e. Specialty items such as signage, streetscape/landscape
improvements and including the construction of sound barriers,
buffering landscape between residential and nonresidential uses,
and common recreation areas shall be considered on a case by
case basis.
f. In general, the City will not consider as eligible costs the public
infrastructure or land acquisition costs for individual developments
within the TIRZ boundaries that serve only that development.
....----=--
g. Exceptions to the policy on eligible costs will be considered on a
Gase bl' case basis. _._.----___~__._..-.__.-.-
--_.._-_.~ -,--- . -
2. The City may retain funds as provide in Chapter 311.002 of the Tax Code
to be reimbursed for the following:
a. administrative costs attributed to others, plus reasonable charges
for the time spent by employees of the City in connection with the
implementation of the Project Plan and Reinvestment Zone
Financing Plan;
b. the amount of any contribution made by the City from general
revenue for the implementation of the project plan; and
c. payments made at the discretion of the governing body of the City
that the City finds necessary or convenient to the creation of the
Zone or to the implementation of the Project Plan and
Reinvestment Zone Financing Plan.
F. Board of Directors
The Composition of the Board of Directors is determined by the Tax Increment
Financing Act.
For a Commercial Zone (less than 10% of the Zone is currently residential use),
the Board of Directors consist of at least five (5) and no more than fifteen (15)
7
Revised 5/12/99
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REINVESTMENT ZONE FINANCING PLAN
1. A DETAILED LIST DESCRIBING THE ESTIMATED PROJECT COSTS OF THE
ZONE, INCLUDING ADMINISTRATIVE EXPENSES AND A STATEMENT LISTING
THE KIND, NUMBER, AND LOCATION OF ALL PROPOSED PUBLIC WORKS
OR PUBLIC IMPROVEMENTS IN THE ZONE
Table A lists the estimated project costs for the Zone. It is anticipated that the taxing
units and developers will advance funds for the public improvements and will be
reimbursed as provided in separate agreements and other documentation between the
taxing units, developers, the Redevelopment Authority (references made herein to the
Authority are made in anticipation of its creation) and the Zone. The infrastructure
improvement costs are stated in 1999 dollars and may be inflated by the CPI-U. Line
Item amounts may be adjusted with approval of the TIRZ Board of Directors. It is
anticipated that the La Porte Independent School District (LPISD) will expend
approximately $29.7 million for education related project costs. As provided for in
Chapter 311, Texas Tax Code and its participation agreement between the City, Zone
and LPISD, the District may expend approximately 43%of its total tax participation for
educational purposes. .
TABLE A
Estimated Zone Project Costs
Non-Education Projects
Roadway & Associated Storm Drainage Improvements
Powell Road
Powell Road South
McCabe Road (East of SH 146)
McCabe Road (West of SH 146)
. San Jacinto Street
Park Street
Bayshore Drive
Sans Road
Broadway Street
Fairmont Parkway Overpass
Design and Construction of Sidewalks
Sub-total
Utility Improvements
Design and construction of Drainage
Design and Construction of Water Lines
Design and Construction of Storm Sewer
Design and Construction of Sanitary Sewer
Sub-total
Conference Center Associated Costs
Public Parking Facility
Supporting Public Infrastructure
Public Landscaping
Estimated Costs
3,000,000
1,170,000
2,200,000
605,000
2,400,000
1,700,000
1,700,000
1,010,000
1,960,250
4,250,000
975,000
$ 20,970,250
4,095,000
450,000
1,209,000
2,700,000
$ 8,454,000
Sub-total
6,500,000
975,000
650,000
$ 8,125,000
~
Project Plan and Reinvestment Zone Financing Plan
1,695,000
117,000
1,750,000
750,000
500,000
49,174,000
75,000
324,000
$ 54,385,000
$ 91,934,250
$35,150,000
$ 35,150,000
$127,084,250
Z. ECONOMIC FEASIBILITY OF DEVELOPMENT WITHIN THE ZONE
~merican Metro Study. an independent economic research firm, conducted a market
jemand leconomic feasibility analysis of the proposed residential land uses within the
>ror='-1d TIRZ. In 1997 Horwath Hospitality Consulting provided the City with a
narket study (Attached) relating to the above project. The market study provides an
lxcellent analysis of the total project. The overall results indicate a strong demand and
;uccess for such a project.
~. THE ESTIMATED AMOUNT OF BONDED INDEBTEDNESS TO BE INCURRED
'he estimated bonded indebtedness for non-education project costs is $ 92 million,
Alich include principal and interest.
'. THE TIME WHEN RELATED COSTS OR MONETARY OBLIGATIONS ARE TO BE
INCURRED
,chedule B.1 shows the time when revenue is expected to be available to pay for the
roject costs.
5
:oject Plan and Reinvestment Zone Financing Plan