HomeMy WebLinkAbout10-12-05 La Porte Redevelopment Authority Meeting minutes
La Porte Redevelopment Authority
City of La Porte, Texas
Minutes of the Board Meeting
Held October 12, 2005
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 its annual
meeting, open to the public, on the 12th day of October 2005, and meeting was called to order at 7:04 p.m. in
Council Chambers at the City Hall, 604 West Fairmont Parkway, La Porte, Texas 77571, and roll was called of
the duly appointed members of the Board, to wit:
Peggy Antone
Dave Turnquist
Alton Porter
Horace Leopard
Doug Martin
JJ Meza
Vacant
Chester Pool
Lin Pfeiffer
Position 1
Position 2
Position 3
Position 4
Position 5
Position 6
Position 7
Position 8
Position 9 - Chairman
and all of the above were present except Director Martin, thus constituting a quorum. Also present at the meeting
were John Joerns, David Hawes and Russell Plank.
2. CONSIDER APPROVAL OF MINUTES OF THE MEETING HELD AUGUST 3, 2005
Upon a motion duly made by Director Turnquist and being seconded by Director Meza, the board unanimously
approved the minutes of August 3, 2005.
3. REVIEW AND CONSIDER APPROVAL OF FISCAL YEAR 2005-2006 BUDGET
Upon a motion duly made by Director Turnquist and being seconded by Director Meza, the board unanimously
approved the minutes of August 3, 2005.
4. PRESENTATIONS ANDDISCUSSION OF PROPOSED DEVELOPMENT IN LA PORTE TAX
INCREMNT REINVESTMENT ZONE #1
Russell Plank, National Property Holdings made a presentation to the board with regard to the status of his
proposed commercial development project on the west side of State Highway 146 and south ofFairmont
Parkway. He reviewed with the board the type of development that was planned and the projected locations of
certain buildings and their size. He responded to questions from the board related detention, landscaping and
mobility in and through the proposed project. No action was taken.
5. DISCUSS DEVELOPMENT AGREEMENT WITH 65 LA PORTE, LTD AND PROPOSED
DEVELOPMENT AGREEMENT WITH THE CITY OF LAPORTE
John Joems and David Hawes reviewed with the board the status of the 65 La Porte project on the east side of
State Highway 146. They discussed with the board the approach to be taken with regard to the oversized trunk
main and the status of the engineering for the project. No action was taken.
6. STAFF REPORTS
. Review City of La PortelLPISD Report for 2004 Tax Year
. Review Harris County Report for 2004 Tax Year
. Update on Various Developments
Mr. Joems reviewed the board the collection status of tax receipts on behalf of the TIRZ. He also discussed the
status of a small independent development (21 lots) occurring with the TIRZ.
7. BOARD MKMBER COMMENTS
No comments made or further discussion requested by the board.
8. ADJOURNMENT
The acting board chair adjourned the meeting at 7:49 PM.
SIGNED ~/i(~ J
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AGENDA ITEM 5:
ANNUAL AUDIT FOR TIRZ FUND FY ENDING SEPTEMBER 30,2005
Per Article IV, Section 1 of the Redevelopment Authority Bylaws, the fiscal year of the
Authority shall begin October 1 of each year. At the end of each fiscal year the Authority will
have at its own expense an audit prepared by an independent Certified Public Accountant for the
fiscal year that shall be submitted to the Authority, the Zone and the City within 120 days after
the end of the fiscal. The Authority shall furnish copies of the audit without cost to the City and
the Zone Board.
Per Section H (3) of the TIRZ Guidelines the funds of the Zone shall be budgeted, expended and
audited in the same general manner as City bond and tax funds with such changes required by
the provisions of state law. The costs of such City financial controls shall be included in the
costs of administration of the Zone. The Zone budget must be submitted annually to the City
Finance Department for approval and a copy of the Zone's Annual Audit must be forwarded to
the City Secretary after Board approval.
The audit of the TIRZ Fund for FY ending September 30,2005 is contained within the City's
Comprehensive Annual Financial Report (CAFR). The attached pages are excerpts from the
CAFR, which review the TIRZ Fund.
Also attached is a detail of expenditures for you review.
City of La Porte
Established 1892
April 4, 2006
Mr. Dick Raycraft, Director
Harris County Department of Management Services
County Budget Coordinator
1001 Preston, Ninth Floor
Houston, Texas 77002
RE: Interlocal Agreement
City of La Porte I Tax Increment Reinvestment Zone Number One (TIRZ)
Dear Mr. Raycraft:
Per terms of the lnterlocal Agreement, attached is the La Porte Tax Increment Reinvestment
Zone Number One Comprehensive Annual Financial Report (CAFR) for fiscal year ended
September 30, 2005.
Also enclosed, on CD, is the entire City of La Porte CAFR for fiscal year ending September
30,2005.
Should you have any questions or comments regarding the report or any other issues, please
feel free to give me a call.
Enclosures
c: (without CD)
David Turkel, Ha. Co. Ec. Dev. Administrator
David Hawes, Consultant
Lindsay Pfeiffer, TIRZ Board Chairman
604 W. Fairmont Pkwy. · La Porte, Texas 77571 · (281) 471-5020
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CITY OF LA PORTE, TEXAS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the fiscal year ended
September 30,2005
Prepared by:
Department of Finance
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COMBINING FINANCiAL STATEMENTS
NONMAJOR GOVERNMENTAL FUNDS
Debt Service Fund
Debt service Fund is used to pay interest and extinguish debt of the outstanding General Obligation Issues of
the City.
Special Revenue Funds
Special revenue funds are used to account for specific revenues that are legally restricted to expenditure for
particular purposes. .
Grant Fund - This fund is used to account for funds received from another government or organization to be
used for a specific purpose, activity or facility.
Community Investment Fund - This fund is used to account for funds received and expended on community
beautification and revitalization programs.
Hotel/Motel Occupancy Tax Fund - This fund is used to account for the accumulation of resources f~om the
Hotel/Motel Tax assessment levied by the City. These monies are to be spent to promote the development or
progress of the City within the guidelines set forth on disposition of revenues collected under the authority of the
Texas Hotel Occupancy Act (Article 1269; Vernon's Texas Civil Statutes).
Tax Increment Reinvestment Zone One Fund (TIRZ) - This fund is used to account for the disposition of
property taxes collected on specific parcels within the boundaries of the TIRZ for the exclusive benefit of the
City's capital improvement programs.
Capital Projects Funds
Capital projects funds are used to account for the acquisition and construction of major capital facilities other
than those financed by proprietary funds.
Capital Improvements Fund - This fund is used to account for capital projects that are normally small in nature
and effect the general operation of the City.
Transportation and Other Infrastructure Fund - This fund is used to account for the construction and expansion
of roads, bridges, sidewalks and other major infrastructure capital improvements.
1998 General Obligation Bonds Fund - This fund is used to account for the proceeds and expenditures related
to drainage and street improvements throughout the City.
2000 Certificate of Obligation Bonds Fund - This fund is used to account for the proceeds and expenditures for
construction of the community library.
2000 General Obligation Bonds Fund - This fund is used to account for the proceeds and expenditures for
construction to. renovate the city hall building, public swimming pool and two fire stations.
. ..
2002 General Obligation Bonds Fund - This fund is used to account for the proceeds and expenditures for the
construction of a wastewater treatment plant.
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CITY OF LA PORTE, TEXAS
Combining Balance Sheet
Nonmajor Govarnmental Punds
September 30, 2005
ASSETS
Cash and cash equivalents
Investments
Due from others
Taxes receivable
Grant receivable
Other receivables
Accrued interest receivable
Total assets
LIABILITIES AND FUND BALANCES
Liabil.ities:
Accounts payable
Accrued salaries payable
Retainage payable
Due to others
Unearned Revenue
Totall.iabilities
Fund Balances:
Reserved for:
Municipal Court Building Security
Municipal Court Technology Fee
Park Zone
Confiscated funds
Debt Service
Unreserved
Total fund balances
T otalliabilities and fund balances
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Special Revenue Funds
Hotel/Motel Tax Increment
Section 4B Community Occupancy Reinvestment Capital
Grant Sales Tax Investment Tax Zone One (TIRZ) Totals Projects
$ 13,887 $ 1,319,979 $ 35,479 $ 339,132 $ 64,953 $ 1,773,430. $ 409,441
9,545 1,708,419 45,946 439,183 85,097 2,288,190 530,234
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4,716
354,590
65
378,087
541,130
15,493
4,618,243
186,540
11,567
3,226,505
576
150,626
2,974
781,289
3,590
947,981
311
81,736
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545
198
1,195
1,217
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1,955 258,601
1,217
3,190
2,642
5,814 261,791
2,642
3,187
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2,412
198
91,088 91,088
60,591 60,591
144,625 144,625
60,491 60,491
18,105 3,226,505 81,538 778,877 150,609 4,255,634 686,190
374,900 3,226,505 81,538 778,877 150,609 4,612,429 686,190
$ 378,087 $ 3,226,505 $ 81,736 $ 781,289 $ 150,626 $ 4,618,243 $ 947,981
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CITY OF LA PORTE, TEXAS
Combining Statement of Revenues, Expenditures, and Changes in Fund Balances
Nonrriajor Governmental Funds
For The Year Ended September 30, 2005
Special Revenue Funds
Hotel/Motel Tax Increment
Section 48 Community Occupancy Reinvestment Capital
Grant Sales Tax Investment Tax Zone One (TIRZ) Totals Projects
REVENUES
Property taxes $ $ $ $ $ 36,865 $ 36,865 $
Donations 30,000
Intergovernmental 980,087 70,626 1,050,713 50,034
Sales taxes 1,058,708 1,058,708
Other taxes 243,179 243,179
Interest 166 61,111 2,267 17,252 3,212 84,008 23,691
Miscellaneous 144,984 1,490 146,474
Total revenues 1,125,237 1,119,819 72,893 261,921 40,077 2,619,947 103,725
EXPENDITURES
Current:
Administration' , 983,838 75,391 172,418 23,262 1,254,909
, Capital Outlay 458,627 . 1,440 460,067 700,070
Debt Service:
Principal
Interest
Interest and fiscal charges
Total expendi!ures 983,838 458,627 75,391 173,858 23,262 1,714,976 700,070
, Exces~,(deficiency) of revenues over
'expenditures 141,399 661,192 (2,498) 88,063 16,815 904,971 (596,345)
OTHER FINANCING SOURCES (USES) ~-
Proceeds from sale of long-term debt J
Transfers in 231,735 1,000 232,735 1,222,726
Transfers out (280,050) (95,750) (375,800) (775,911 )
Total other financing sources (uses) 231,735 (280,050) (94.150) (143,065) 446,815 [,
Net change in fund balances 373,134 381,142 (2,498) (6,687) 16,815 761,906 (149,530)
Fund balances-beginning 1,766 2,845,363 84,036 785,564 133,794 3,850,523 835,720 !
Fund balances--,-ending $ 374,900 $ 3,226,505 $ 81,538 $ 778,877 $ 150,609 $ 4,612,429 $ 686,190 If
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CITY OF LA PORTE, TEXAS
Tax Increment Reinvestment Zone One Special Revenue Fund
Schedule of Revenues, Expenditures and Changes in Fund Balances
Budget and Actual
For The Year Ended September 30,2005
Variance with
Final Budget
Budgeted Amounts Actual Positive
Original Final Amounts (Negative)
REVENUES
Property taxes $ 15,000 $ 15,000 $ 36,865 $ 21,865
Interest 2,030 2,030 3,212 1,182
Total revenues 17,030 17,030 40,077 23,047
EXPENDITURES
Current:
Administration 33,000 32,850 23,262 9,588
Capital Outlay
Total expenditures 33,000 32,850 23,262 9,588
Excess (deficiency) of revenues over
expenditures (15,970) (15,820) 16,815 32,635
Net change in fund balances (15,970) (15,820) 16,815 32,635
Fund Balances-beginning 133,794 133,794 133,794
Fund Balances-ending $ 117,824 $ 117,974 $ 150,609 $ 32,635
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Expenditures for TIRZ Fund for Budget Year 2004-05
City of La Porte Services
Personnel
Barr, Stephen
Sterling, Brian
Rodriguez, Issac
Dolby, Michael
Wolny, Shelley
Williams, LeAnn
Powell, Kathy
Felty, Susan
Joerns, John
Lanclos, Melisa
Fringe Benefits
Subtotal Personnel
Plus 5% per contract
Total Personnel
Audit - Null Lairson
Agenda Meeting Supplies
Paper / Copies
Postage
Total Agenda Meeting Supplies
Hours Rate Amount
4.0 44.63 178.52
3.0 24.65 73.95
1.0 14.12 14.12
2.0 39.39 78.77
2.0 24.46 48.92
2.0 20.34 40.68
10.0 29.27 292.69
1.0 11.94 11.94
10.5 53.11 557.70
25.5 14.31 364.96
340.43
2,002.68
100.13
2,102.81
5,000.00
77.49
56.40
133.89
Professional Services
Hawes, Hill & Associates
Askins & Armstrong
Andrews/Kurth
Total Professional Services
Food / Refreshments
LPISD Educational Facilities
GRAND TOTAL
2,622.97
100.00
142.00
2,864.97
43.37
13,077.58
23,222.62
AGENDA ITEM 6:
AGREEMENT BETWEEN THE CITY, TIRZ AND REDEVELOPMENT AUTHORITY
On August 14, 2002 the La Porte Redevelopment Authority and TIRZ approved the first
agreement for services by and between the City, TIRZ and Redevelopment Authority. Prior to
this date, on May 20, 2002, Council passed and approved Ordinance 2002-2554 for this
agreement.
Section II and Section VI of the Tri-Party Agreement (attached) between the City, Zone and
Authority describes the services the Redevelopment Authority may furnish. Since the Authority
has no employees this agreement allows the City to provide these services.
The agreement provide for the Authority to compensate the City, at cost plus 5% annually, upon
termination, or as otherwise provided for in writing, for services performed by the City on behalf
of the Authority. For outside or vendor services, payment will be made within 30 days of
invoice date. The agreement term is for 1 year with the option for two I-year renewals and
includes provisions for termination by either party.
We are requesting the Redevelopment Authority and TIRZ Board approve the first I-year
renewal for the agreement approved on May 9,2005.
La Porte City Council approved this agreement on April 24, 2006.
AGREEMENT FOR SERVICES 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
THIS AGREEMENT (this "Agreement"), effective as ofMav 9.2005 is made by and between the
CITY OF LA PORTE, TEXAS, a municipal corporation and a home-rule city in the State of Texas (the
"CITY"); REINVESTMENT ZONE NUMBER ONE, CITY OF LA PORTE, TEXAS, a reinvestment zone
created by the City pursuant to Chapter 311, Texas Tax Code (the "ZONE"); and the LA PORTE
REDEVELOPMENT AUTHORITY, a nonprofit local government corporation organized and existing under
the laws of the State of Texas (the "AUTHORITY").
RECITALS
WHEREAS, the CITY, ZONE, and AUTHORITY have previously entered into an Agreement; and
WHEREAS, the CITY and the ZONE desire to secure services of the CITY to assist the AUTHORITY
in its duties described in its Agreement with the CITY and ZONE;
NOW, THEREFORE, for and in consideration of the mutual undertakings herein contained, the
AUTHORITY and CITY agree as follows:
I.
CITY agrees to assist the AUTHORITY in its scope of services as defined by Section II and Section VI of the
"AGREEMENT BY AND BETWEEN THE CITY OF LA PORTE, TEXAS, REINVESTMENT ZONE
NUMBER ONE, CITY OF LA PORTE, TEXAS, AND THE LA PORTE REDEVELOPMENT
AUTHORITY" for a term of one (1) year commencing with an option to renew this agreement for two
additional one (1) year terms, subject to the agreement of both parties. This agreement is subject to
termination at any time without cause by either party giving ninety (90)-day written notice to the other.
II.
CITY shall receive compensation for services referred to in Section I above in an amount equal to the direct
salary costs plus 5% of City personnel performing services anticipated by this agreement. Payment for these
services shall be made annually, upon termination, or otherwise agreed to in writing by both parties.
Reimbursable expenses such as consultant's fees, supplies and materials shall be billed at cost plus 5% and
paid within thirty (30) days of invoice or as determined by separate agreement with consultant or provider.
III.
CITY will procure, to AUTHORITY'S account, supplies, materials, equipment, and services, utilizing funds
allocated in AUTHORITY'S approved budget (Tax Increment Reinvestment Zone Fund), for the services
provided by the CITY on behalf of AUTHORITY. CITY shall conform to all applicable purchasing laws of
the State of Texas in the procurement of all supplies and materials necessary for the services provided.
IV.
CITY is retained by AUTHORITY only for the purpose and to the extent set forth in this Agreement, and
City's relation to AUTHORITY, during the period of this Agreement, is that of an independent entity, and
CITY shall be free to dispose of such portion of his entire time not required to satisfy the terms ofthis
Agreement in any manner he deems advisable. CITY shall not be considered an employee of AUTHORITY.
V.
CITY shall be required to operate within the current guidelines of its governing body and shall notify
AUTHORITY of any possible conflicts with such guidelines, as soon as practicable after the occurrenCe of
said possible conflicts.
VI.
,
CITY hereby assumes entire responsibility and liability for any and all damage or injury of any kind-ornature
whatever to all persons, whether employees of CITY or otherwise, and to all property caused by, resulting
from, arising out of, or occurring in connection with the services provided for in this Agreement and if any
person shall make a claim for any damage or injury as herinabove described, whether such claim may be
based upon the AUTHORITY'S alleged active or passive negligence or participation in the wrong or upon any
alleged breach of any statutory duty or obligation on the part ofthe AUTHORITY, the CITY agrees to
indemnify and save harmless the AUTHORITY, its agents, servants, and employees from and against any and
all loss, expense, damage, or injury that the AUTHORITY may sustain as result of any such claims and the
CITY agrees to assume, on behalf of the AUTHORITY, the defense of any action at law or in equity, which
may be brought against the AUTHORITY upon'such claim and to pay on behalf of the AUTHORITY, upon
its demand, the amount of any judgment that may be entered against the AUTHORITY in any such action.
VII.
Before commencing the services, the CITY shall procure and maintain liability insurance, at its own expense,
and procure and maintain workers' compensation and employee liability insurance in accordance with the
laws of the State of Texas. The CITY agrees that nothing contained in this paragraph shall limit or release the
CITY from its obligations otherwise provided for in this Agreement, including assumption ofliabilities and
indemnifications to the AUTHORITY.
If the CITY fails to procure and maintain at least the above insurance, the AUTHORITY shall have the right
to procure and maintain the said insurance for and in the name ofthe CITY, and the CITY shall pay the cost
thereof and shall furnish all necessary information to make effective and maintain such insurance.
VIII.
The CITY for the compensation provided for herein, hereby agrees to pay and shall hold the AUTHORITY
harmless against the payment of all contributions, taxes, or premiums which may be payable under Federal,
State, or Local laws arising out of the performance of the work.
IX.
If either the CITY or AUTHORITY believes it has a claim of any nature whatsoever against the other party, it
shall give the other written notice ofthe amount, whenever possible, and nature of such claim within forty-five
(45) days (or such other time limits as may be expressly set forth in the Agreement) of the occurrence of the
event upon which such claim is based. In default of such notice the claim is waived.
x.
All matters relating to the validity, performance, interpretation, or construction of this Agreement or the
breach thereof shall be governed by the laws ofthe State of Texas.
IN WITNESS WHEREOF, the parties to these presents have hereunto set their hands and seals the day
and year first above written.
CITY O~A .PORTE ~
By: ~L_ \~
Alton E. Porter, Mayor
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Martha A. Gillett, CIty Secretary
:~: PORTE RE2kf1~~RITY
V'ic..e. President, Board of Directors
REINVESTMENT ZONE NUMBER ONE,
::TY OF LAP~1tI ~.
'Vi c..e., Chairperson, Board of Directors
H:\My Docurnents\Documents\TIRZ\Redevlopment Authority Agreement.doc
II.
SCOPE OF SERVICES BY AUTHORITY
To the extent of available funds and subj ect to the limitations of this Agreement, the services
(- that the Authority may furnish consis:t of,. among other things, the following:
A. Mana~ement and Administrative Services and Consultants. The Authority will
provide management and acio:!in.istrative services for the Zone and t:{1e Pill. The servi~es ~thout
lllnitation may include the following: .
C.-
, l.Provide the staff and administrative services that are necessary to manage the
Zone and the Pill and provide or supervise the services and the Proj ects;
2. Provide management, financial and program monitoring systems for the
adririnistration of the Zone. and the Pill;
3. Provide any required reports to the City and the Zone' concerning the
administration of the Zone;
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4. Subject to the t.eims of this Agreement, recruit, hire, pay and supervise the
consult~ts and any work force that the Authority will utilize to furnish services required for the
development or redevelopment of the Z9~e;
5. Provide staff to participate in meetings concerning the administration of the
Zone and the Pill in all its capacities, including the services to the Zone Board when managing the
Zone;
6. Provide liaison and coordination between the Zone, the City, the County, the
School District, other Taxing Units, property owners, and other per"sons and groups interested in the
redevelopment acti\.:'itie,s of the Zone and the Pill;
7. Supe,rvise and monitor the'performance of consultants and subcon,tractors who
are employed by the Authority; ,
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8. _ Assist in briefmg Developers, property owners and other persons concerning
proposed activities and developments that would complement public and private development
activities in the Zone;
, 9. Function as the information/complaint center for all matters relating to the
administration of the Zone and advise the Zone Board ~d the City in a timely manner of any
problems 'concerning ,the Zone and the PID; and
10. 'Provide engineering, planning, legal, [mancial, real estate, and other services
through consultants engaged by the Authority as may be requested by the Zone Board or the City.
B. Services With Respect to the Plans and Enlargement of the Zone.
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, 1. Act as consultant to the Zone in the implementation and amendment of the
Plans in accordance with applicable law.
2. The Authority will review areas for addition to the Zone jiS requested by the
Zone Board and will provide information with respect to any proposed enlargement that may be
required by the Zone Board including. if requested, the information required for a preliminary Project
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Plan and a preliminary Financing Plan with respect to the enlargement of the Zone.
C. Ta,'( and Assessment Rolls.
1. , Assist the Zone Board and the City with respect to the preparation of special
tax rolls relating to the Zone. The Authority will analyze property uses in the Zone. compare them to
the records of the Appraisal District, and attempt to reco'ncile the tax rolls of the Appraisal District
with the actual land uses.
2. Assist the City in securing a tax roll for the Zone each year, and assist the
Zone Board, the City, and the Appraisal District in having the Zone tax rolls correctly reflect the total
appraised value ot'real property in the Zone for that year. and 'showing separately the Tax Increment
Base and the Captured Appraised Value. The Authority. will assist the Zone Board and the City in
advising all Taxing Units participating in the Zone with respect to the Captured Appraised Value and
the amount of Tax Increment of each Taxing Unit which is to be paid into the Tax Increment Fund as
required by the TIRZ A~t. .
3. Assist the City in preparing the PID Assessment rolls, noticing and conducting
hearings, and collecting the PID Assessments.
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D. Construction ofProiects. The Authority may construct infrastructure, buy equipment
and supplies, and deal in refll estate as necessary to implement the Plans and as permitted by the
TIRZ Act and the Pill Act:
1. To the extent funds are available, the Authority may design and construct
Projects identified in the Plans that meet the qualifications of the TIRZ Act and the pm Act as
applicable; and .
2. To the extent funds are available, the Authority may buy, sell, lease and
otherwise deal in real estate within the Zone.
E. Subcontractors. The Authority may provide the services required by this Agreement
through staff, subcontractors, and/or Gonsultants subject to the conditions of this Agreement.
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VI.
ACCOUNTING A.1'fD AUDITS
A. Accounts. records. and accounting reports. The Authority will maintain books of
. records and accounts in which full, true, and proper entries will be made on all dealings, transactions, .
business, and matters that in any way affect or pertain to the_operation of the Zone and th~ Pill, and
the allocation and application of funds provided hereunder. All such records shall be maintained in
'accordance with generally accepted accounting principles and shall be clearly identified and readily
accessible. The Authority shall provide free access to the books and recordS at all times to the City
and the Zone or their representatives and shall permit them to examine and audit the same and make
copies thereof. The Authority shall further allow the City. and the Zone and their representatives to
make inspections of all work data, documents, proceedings, and activities related to this Agreement.
Such right of access and audit shall; continue for a period of three years from the date of final
payment under this Agreement. The Authority will operate on the basis ofllie same fiscal year as the-
City.
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B. Audit. At the end of each fiscal year (beginning with the fiscal year or fraction
thereof during which this Agreement is executed), the Authority will have an audit prepared by an
independent Certified Public Accountant for that fiscal year that shall be submitted to the Authority,
the Zone and the City within 120 days after the end of the fiscal year. The AuthoritY shall furnish
copies of the audit to the City Manager 'and the Zone Board.
C. Authority Depositorv. Any moneys received from investing and reinvesting the
moneys paid by the City and the Zone to the Authority shall remain ill the Pill Revenue Flllld and the
TIRZ Revenue Fund, as applicable, until used by the Authority for one of the purpose"s permitted by
this Agreement, and may be commingled with other moneys of the Authority; provided that these
funds shall be accounted for separately. Such funds shall be invested and reinvested by the Authority
only in investments that would be eligible for investment by the City pursuant to the provisions of
the Public Funds Investment Act (Chapter 2256, Texas Government Code). Such funds will be
secured by the depository bank in the same manner as City funds are required to be secured at the
City. depository' and in accordance with applicabl~ law and City procedures..
C_.
--
REQUEST FOR CITY COUNCIL AGENDA ITEM
Agenda Date Requested: A ri
Appropriation
Requested By:
Source of Funds:
Department:
Account Number:
Report:
Resolution:
Ordinance:
Amount Budgeted:
Exhibits: Agreement for Services
Amount Requested:
Exhibits: Sections I. IT and IV of Tri-party Agreement
Budgeted Item: YES NO
Exhibits:
SUMMARY & RECOMMENDATION
The Agreement for Services 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 is going to expire
on May 9,2006.
This Agreement is to secure services of the City to assist the Authority in its duties described in its
Agreement with the City and Zone.
The Agreement provides for two I-year renewals.
After Council approval, this I-year renewal will be presented to the TIRZ/ Authority Board for approval.
Action Required by Council:
Approve renewal of Service Agreement for a term of one (1) year per Section 1.
Approved for City Council A2enda
~~
if-12 -D?
Date I
AGENDA ITEM 7:
CONSIDER APPROVAL OR OTHER ACTION REGARDING A
DEVELOPMENT AGREEMENT BY AND BETWEEN THE REINVESTMENT
ZONE NUMBER ONE, CITY OF LA PORTE, TEXAS ("LAPORTE ZONE")
AND LA PORTE REDEVELOPMENT AUTHORITY ("LA PORTE
AUTHORITY") AND THE CITY OF LA PORTE, TEXAS (THE "CITY") FOR
THE DESIGN AND CONSTRUCTION OF THE SOUTHEAST SANITARY
SEWER TRUNK MAIN AND LIFT STATION FACILITIES
Prior correspondence to Council and the TIRZ/Redevelopment Authority noted that the
developer of Lakes at Fairmont Greens could not secure financing for the development
because of significant up front costs associated with the trunk sewer and lift station, even
though the TIRZ/ Authority could eventually reimburse the developer. With this cost
center removed, the developer was able to secure financing. During 05-06 budget
preparation, Council approved $645,000 for the construction of the trunk sewer and lift
station based on the understanding that the TIRZ/ Authority would reimburse the City
from future increment.
This agreement, between the City and TIRZ/ Authority provides for the City to advance
the funds ($645,000) for the trunk sewer and lift station and act as construction manager
for the TIRZ/ Authority. The agreement further provides for the TIRZ/ Authority to
reimburse the City in the future.
Also, attached is additional information provided to City Council on agenda
items 7 & 8.
T FOR CITY COUNCIL AGENDA ITEM
Appropriation
(
Requested By:
Source of Funds:
Department:
Account Number:
Report: X Resolution:
Ordinance:
Amount Budgeted:
Exhibits: Memorandum with Exhibits
Amount Requested:
Exhibits: Draft Development Ae:reement
Budgeted Item: YES
NO
Exhibits: Draft TTtiJity Rxtenl>ion Agreement
SUMMARY & RECOMMENDATION
Prior correspondence to Council and the TIRZlRedevelopment Authority noted that the developer of Lakes at Fairmont Greens
could not secure financing for the development because of significant up front costs associated with the trunk sewer and lift
station, even though the TIRZ/ Authority could eventually reimburse the developer. With this cost center removed, the
developer was able to secure financing. During 05-06 budget preparation, Council approved $645,000 for the construction of
the trunk sewer and lift station based on the understanding that the TIRZI Authority would reimburse the City from future
increment.
The first agreement, between the City and TIRZIAuthority provides for the City to advance the funds ($645,000) for the trunk
sewer and lift station and act as construction manager for the TIRZI Authority. The agreement further provides for the
TIRZI Authority to reimburse the City in the future.
(
The second agreement is a Utility Extension Agreement (UEA) that establishes the City's oversight and control over the design
and construction of the trunk sewer and lift station. The design and construction contracts would be let/owned by the
developer with the City issuing joint checks to the developer/designer or engineer and developer/contractor as certain approvals
and milestones are met.
New cost estimates are being prepared by the developer's engineers. The agreements provide for the possibility that the
bids may exceed budgeted funds (see Section 8 of the UEA).
These agreements have been circulated for comment by the party's and by the City's attorneys. It is anticipated that the
TIRZIAuthority will consider approval at the May 24 meeting and the Council at June 12 meeting.
Attached are 3 approaches being looked at for this project. They each have advantages/disadvantages and of course there is a
wide cost differential and opinion on the appropriate final design approach. While the base proposal is the lowest, there is
some concern over long term maintenance trade-offs and some unanswered questions on the depth ofline segments near and
along McCabe Road.
For these reasons we are still working with the developer and design engineers on a final design approach. In fact we may
consider bidding alternates.
Therefore, certain terms of the UEA may change to cover these options.
The key issue is to reinforce what was noted in the February 27 presentation to Council. These costs upon final approach and
bid opening may exceed the original estimate that was provided and budgeted last year.
Action Required by Council:
(
A
7';~
Date
DEVELOPMENT AGREEMENT
This Development Agreement (this "Agreement") is made as of ,2006, by and
between the REINVESTMENT ZONE NUMBER ONE, CITY OF LA PORTE, TEXAS (the
"Zone "), a tax increment reinvestment zone created by the City pursuant to Chapter 311 of the
Texas Tax Code, as amended, acting by and through its governing board of directors (the "Zone
Board"), LA PORTE REDEVELOPMENT AUTHORITY, a nonprofit local government
corporation formed by and on behalf of the City of La Porte, Texas (the "Authority"), and CITY
OF LA PORTE, TEXAS a home-rule city (the "City ").
RECITALS
WHEREAS, pursuant to Chapter 311 of the Texas Tax Code, the City Council of the City
created the Zone in the City; and
WHEREAS, the Zone Board adopted a Project and Financing Plan (as defined below in Section
1.1), as amended, that provides that the Zone will undertake to make certain acquisitions and
improvements in the Zone, and was approved by the City Council; and
WHEREAS, the Texas Tax Code provides that the Zone may enter into agreements as the Zone
Board considers necessary or convenient to implement the Project and Financing Plan and
achieve its purposes; and
WHEREAS, the City and the Zone have contracted with the Authority as a nonprofit, Texas
local government corporation pursuant to the provisions of Chapter 431, Subchapter D, TEX.
TRANS. CODE, to carry out the purposes of the Zone, including administration, supervision,
construction, financing and other duties, and committed the revenues of the Zone to the
Authority for such purposes, all as more particularly set forth in the Agreement Between the
City, the Zone and the Authority, dated July 9,2001 (the "Tri-Party Agreement"); and
WHEREAS, the City wishes to make certain improvements to its sanitary sewer system within
the Zone, to further development within the Zone and to carry out the purposes of the Zone as
described in the Project and Financing Plan, and for the reimbursement of the City for such
improvements in accordance with such Plans; now, therefore,
AGREEMENT
For and in consideration of the mutual promises, covenants, obligations, and benefits of this
Agreement, the Zone, the Authority and the City contract and agree as follows:
ARTICLE 1
GENERAL TERMS
1.1 Definitions. The terms "Agreement," "Authority, " "City," "Zone," "Zone Board,"
and "Tri-Party Agreement" have the meanings set forth in the preamble hereof, and the
following capitalized terms shall have the meanings provided below, unless otherwise defined or
the context clearly requires otherwise. For purposes of this Agreement the words "shall" and
"will" are mandatory, and the word "may" is permissive.
Act shall mean the Increment Financing Act, Chapter 311, Texas Tax Code, as amended.
Authority Bonds shall mean any bond, note or other obligation issued or incurred in one or more
series pursuant to Article V, secured by Tax Increment or funds deposited in the Revenue Fund,
including refunding bonds.
City Advances shall mean any funds advanced by the City pursuant to Section 5.1, and shall
include any interest payable thereon.
City Improvements shall mean the improvements described in Article 3 hereof.
County shall mean Harris County, Texas.
LPISD shall mean the La Porte Independent School District.
Net Tax Increment shall mean the annual collections of the Tax Increment, less (i) any amounts
required to be disbursed to LPISD for the payment of project costs related to educational
facilities incurred directly by LPISD, and (ii) amounts reasonably required or anticipated to be
required for the administration and operation of the Zone, including a reasonable operating
reserve.
Parties or Party shall mean the Zone, the Authority and the City as parties to this Agreement.
Plan shall mean the final project plan and reinvestment zone financing plan for the Zone, as
amended, as approved by City Council.
Revenue Fund shall mean the special fund established by the Authority and funded with Tax
Increment payments made by the City pursuant to the Tri-Party Agreement (which payments are
attributable to incremental ad valorem property taxes paid on the Project and other properties in
the Zone).
Tax Increment shall mean funds deposited in the Revenue Fund by the City pursuant to the Tri-
Party Agreement, comprised of funds received pursuant to those certain Interlocal Agreements or
similar agreements between the City, the County and the Zone; the City, and the Zone and;
between the City, LPISD and the Zone.
Taxing Unit shall mean individually and collectively the City, the County, and LPISD.
1.2 Singular and plural; gender. 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.
Likewise, any masculine references shall include the feminine, and vice versa.
ARTICLE 2
REPRESENT A TIONS
2.1 Representations of the Authority. The Authority hereby represents that:
(A) It 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) It 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) will not, to the best of its knowledge, violate any applicable judgment, order, law or
regulation, and (iii) does not constitute a default under, or result in the creation of, any lien,
charge, encumbrance or security interest upon any assets of the Authority under any agreement
or instrument to which the Authority is a party or by which the Authority or its assets may be
bound or affected.
(C) This Agreement has been duly authorized, executed and delivered by the
Authority and, constitutes a legal, valid and binding obligation of the Authority, enforceable in
accordance with its terms.
(D) The execution, delivery and performance of this Agreement by the Authority does
not require the consent or approval of any person which has not been obtained.
2.2 Representations of the City. The City hereby represents that:
(A) It 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) It 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) will not, to the best of its knowledge, violate any applicable judgment, order, law or
regulation, and (iii) does not constitute a default under, or result in the creation of, any lien,
charge, encumbrance or security interest upon any assets of the City under any agreement or
instrument to which the City is a party or by which the City or its assets may be bound or
affected.
(C) This Agreement has been duly authorized, executed and delivered by the City
and, constitutes a legal, valid and binding obligation of the City, enforceable in accordance with
its terms.
(D) The execution, delivery and performance of this Agreement by the City does not
require the consent or approval of any person which has not been obtained.
2.3 Representation of the Zone. The Zone hereby represents that:
(A) The Zone is duly authorized, created and existing 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 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) will not, to the best of its knowledge, violate any applicable judgment, order, law or
regulation, and (iii) does not constitute a default under, or result in the creation of, any lien,
charge, encumbrance or security interest upon any assets of the Zone under any agreement or
instrument to which the Zone is a party or by which the Zone or its assets may be bound or
affected.
(C) This Agreement has been duly authorized, executed and delivered by the Zone
and, constitutes a legal, valid and binding obligation of the Zone, enforceable in accordance with
its terms.
(D) The execution, delivery and performance of this Agreement by the Zone does not
require the consent or approval of any person which has not been obtained.
ARTICLE 3
THE PROJECT
3.1 The City Improvements. The City Improvements are intended to enhance the
proposed implementation of a development within the Zone as a whole, as more fully described
in the Plan.
3.2 City Improvements description. The City Improvements consist of improvements
to (working on description) The City Improvements shall include all engineering, legal and
other consultant fees and expenses related to such City Improvements.
3.3 Additional Projects. This Agreement does not apply to any projects not
specifically defined herein unless this Agreement is amended to provide for the design and
construction of such additional projects.
ARTICLE 4
DUTIES AND RESPONSIBILITIES OF THE CITY
4.1 Construction manager. The City agrees to act as construction manager for any
contracts entered into with respect to the City Improvements including all materials and services
as and when required in connection with the construction of the City Improvements. The City
will obtain all necessary permits and approvals from governmental officials and agencies having
jurisdiction, and provide supervision of all phases of construction of the City Improvements so as
to cause the construction to be performed in accordance with the Plan.
4.2 Design of the Citv Improvements. The City shall prepare or cause to be prepared
the plans and specifications for the City Improvements. City Improvements shall be designed in
accordance with City standards applicable to similar public improvements within the City.
4.3 Construction contracts. The Authority shall negotiate and award all contracts for
the City Improvements from among contractors qualified and approved by the City and shall be
the owner ofthe facilities until completion of the contract, subject to the duty ofthe City to act as
construction manager in accordance with Section 4.1, above, and to guarantee all payments to
the contractor, in accordance with Section 5.1, below.
4.4 Completion. Upon completion of a contract for the construction of the City
Improvements, the City shall provide the Authority with a final cost summary of all costs
associated with such contract, and show that all amounts owing to contractors and subcontractors
have been paid in full evidenced by customary affidavits executed by such contractors. The
Authority shall immediately upon certification of the completion of any City Improvements
convey them to the City for incorporation into the City public works system for all purposes.
ARTICLE 5
PROJECT FINANCING AND FUNDING
5.1 The City Advances.
(a) In connection with the construction of the City Improvements, the City agrees to
provide sufficient funds as such become due for all costs thereof (the "City Advances"),
constituting "project costs," as defined in the Act, including costs of design, engineering,
materials, labor, construction, and inspection fees arising in connection with the City
Improvements, all payments arising under any contracts entered into pursuant to this Agreement,
all costs incurred in connection with obtaining governmental approvals, certificates or permits
required as a part of any contracts entered into in accordance with this Agreement, and all related
legal fees and out-of-pocket expenses incurred on behalf of the Authority in connection
therewith. City Advances shall further include any amounts advanced by the City in connection
with the administration of the Authority and the Zone and the design and construction of the City
Improvements.
legal fees and out-of-pocket expenses incurred on behalf of the Authority in connection
therewith. City Advances shall further include any amounts advanced by the City in connection
with the administration of the Authority and the Zone and the design and construction ofthe City
Improvements.
(b) Interest on each City Advance shall accrue at a rate equal to the prime commercial
lending rate of Chase Manhattan Bank, National Association, or any successor to its
commercial banking activities, plus one percent per annum, compounded semiannually, whether
such costs, fees, or expenses are paid or incurred before or after the effective date of this
Agreement. 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 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).
(c) The City shall act as guarantor of the obligations of the Authority with respect to any
contracts awarded in the name of the Authority as provided in Section 4.3, above, and any such
contract shall provide that the contractor may look for payment only to the City, or to funds
provided to the Authority by the City specifically for the purpose of making payments to such
contractor. The City agrees to timely make such payments to allow for payment in accordance
with the terms of the applicable construction contract.
5.2 Repayment ofCitv Advances.
(a) In consideration of the construction of the City Improvements, the Authority shall
begin repaying the City Advances, and shall continue such repayment until repaid in full, on the
earliest date that funds are available from any of the following sources, and solely from such
sources:
(i) proceeds from the sale of the Authority Bonds, as set forth in subsection (b), and
(ii) the Net Tax Increment, subject to the limitations set forth in subsection (c).
(b) As provided herein, the Authority shall issue one or more series of Authority Bonds at
the earliest feasible date, which Authority Bonds will be secured by a pledge of the Revenue
Fund. The net proceeds of the Authority Bonds shall be deposited to a special fund of the
Authority, and shall be used by the Authority to reimburse the City for the full amount (or such
portion thereof as is deemed by the Authority as supportable by available Tax Increment as
provided below) eligible City Advances, plus interest. Such Authority Bonds shall be sold
within 120 days (or such other period as may be agreed by the Parties) of a written request
therefor from the City; provided that the City's Net Tax Increment (based upon the tax valuation
of the Zone as certified or estimated by the Harris County Appraisal District, or its successor)
expected to be generated with respect to available Tax Increment is sufficient to support the
applicable Authority Bonds bearing interest at the then-current rate of interest as determined by
the Authority's financial advisor for comparable issues, after taking into account the portion of
the City's Net Tax Increment required to pay any outstanding Authority Bond issued for any
under the Plan pursuant to reimbursement agreements approved by the Authority, either now or
during the life of the Zone.
(c) In addition to the City's right to reimbursement from Authority Bond proceeds,
upon request from the City, the Authority shall reimburse the City for City Advances, plus
interest, from the City's Net Tax Increment (computed as above) accumulated in the Revenue
Fund and available in accordance with the priorities described in Section 5.3, below.
(d) At such time as funds are available to pay all or any portion of the City Advances
made hereunder, the Authority shall hire a certified public accountant to calculate the amount
due the City and prepare and submit a report to the Authority certifying (1) the amount due the
City for the City Advances being repaid with interest calculated thereon, and (2) that funds are
available to make such payment. Such report shall be approved at the earliest practicable time,
but not later than 90 days after submission by the City of the records required therefor. The
Authority shall make payment to the City within 30 days of approval of the auditor's report.
(e) The Authority shall provide to the City, upon the written request of the City, and on
the earliest date such information is available after the date of such request, certified copies of all
statements of revenue and the sources of such revenue of the Zone and Authority the intended
use of which is to verify the availability of funds for repayment of the City Advances, if
applicable, under this section.
5.3. Priorities. Amounts deposited in the Revenue Fund shall be applied in the
following order of priority (i) disbursement to LPISD, if applicable, for educational facilities in
accordance with the Interlocal Agreement with LPISD, the City and the Zone; (ii) administrative
costs of the Zone and the Authority; (iii) amounts pledged or required for the payment of
outstanding Authority Bonds, including Authority Bonds in the process of issuance and
refunding Authority Bonds, and (iv) payments to the City pursuant to Section 5.2(c), above.
5.4. Multiple developers and the City. The Authority has entered into other
agreements with developers of land within the Zone for the financing of Zone Improvements,
and may enter into others. It is the intention of the parties that each developer shall be
responsible for the creation of Tax Increment required for its own reimbursement. In such case,
the Tax Increment generated within a developer's project as defined in the applicable
reimbursement agreement shall not be considered in determining whether sufficient Net Tax
Increment exists for the issuance of Authority Bonds, or direct payment of available Net Tax
Increment, for reimbursement of City Advances unless the applicable developer shall give its
written consent thereto. The net proceeds of Authority Bonds issued to reimburse multiple
developers and the City shall be allocated based upon the proportion of Tax Increment generated
by each developer, or such other method as the developers may agree upon, and any unallocated
Tax Increment shall be used for calculation of the City's Net Tax Increment and reimbursement
of City Advances.
ARTICLE 6
DEFAULT
6.1 Default
(a) If any Party does not perform its obligations hereunder in substantial compliance
with this Agreement, in addition to the other rights given the other Parties under this Agreement,
such non-defaulting Parties may enforce specific performance of this Agreement or seek actual
damages incurred by the City for any such default.
(b) The Party alleging default shall provide written notice to the other party of such
default, and the defaulting party shall have 60 days to remedy the default prior to the declaration
of any default hereunder.
ARTICLE 7
GENERAL
7.1 Inspections. audits. The City agrees to keep such records with respect to the City
Improvements and all costs associated therewith as may be required by the Authority, the Zone,
or by State and federal law or regulation. The City shall allow the Zone access to, and the Zone
shall have a right at all reasonable times to audit, all documents and records in the City's
possession, custody or control relating to the City Improvements that the Authority deems
necessary to assist the Authority in determining the City's compliance with this Agreement.
7.2 City operations and employees. All personnel supplied or used by the City in the
performance of this Agreement shall be deemed employees, contractors or subcontractors of the
City and will not be considered employees, agents, contractors or subcontractors of the Zone or
the Authority for any purpose whatsoever. The City shall be solely responsible for the
compensation of all such contractors and subcontractors.
7.3 Personal liability of public officials. legal relations. To the extent permitted by
State law, no director, officer, employee or agent of the Zone or the Authority shall be personally
responsible for any liability arising under or growing out of the Agreement. THE PARTIES SHALL
INDEMNIFY AND SAVE HARMLESS EACH OTHER AND THEIR RESPECTIVE OFFICERS.
REPRESENTATIVES. AND AGENTS FROM ALL SUITS. ACTIONS. OR CLAIMS OF ANY CHARACTER
BROUGHT FOR OR ON ACCOUNT OF ANY INJURIES OR DAMAGES RECEIVED BY ANY PERSON.
PERSONS. OR PROPERTY RESULTING FROM THE NEGLIGENT ACTS OF SUCH PARTY. OR ANY OF ITS
AGENTS. OFFICERS. OR REPRESENTATIVES IN PERFORMING ANY OF THE SERVICES AND ACTIVITIES
UNDER THIS AGREEMENT. The expenses of the Zone or the Authority with respect to this section
or Section 7.15, below, shall be satisfied from uncommitted City Net Tax Increment.
7.4 Notices. Any notice sent under this Agreement (except as otherwise expressly
required) shall be written and mailed, or sent by electronic or facsimile transmission confirmed
by mailing written confirmation at substantially the same time as such electronic or facsimile
transmission, or personally delivered to an officer of the receiving party at the following
addresses:
La Porte Redevelopment Authority
604 W. Fairmont Parkway
La Porte, Texas 77571
Attn: John Joems
Reinvestment Zone Number One
604 W. Fairmont Parkway
La Porte, Texas 77571
Attn: John Joems
City of La Porte
604 W. Fairmont Parkway
La Porte, Texas 77571
Attn: City Manager
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 Authority, the Zone, or the City, as the case may be.
7.5 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 Zone, the Authority and
the City. No course of dealing on the part of the Parties, nor any failure or delay by one or more
of the Parties, with respect to exercising any right, power or privilege under this Agreement shall
operate as a waiver thereof, except as otherwise provided in this section.
7.6 Invalidity. In the event that any of the provisions contained in this Agreement
shall be held unenforceable in any respect, such unenforceability shall not affect any other
provision of this Agreement.
7.7 Successors and assigns. All covenants and agreements contained by or on behalf
of a Party in this Agreement shall bind its successors and assigns and shall inure to the benefit of
the other Parties, their successors and assigns.
7.8 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. 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.
7.9 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, as such laws are now in effect.
7.10 Entire Agreement. THIS WRITTEN AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN 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.
7.11 Term. This Agreement shall be in force and effect from the date of execution
hereof for a term expiring on the date that the City Advances have been repaid in full, or January
1 of the year following the expiration of the Zone.
7.12 Time of the essence. Time is of the essence with respect to the obligations of the
Parties to this Agreement.
7.13 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 conditioned, withheld or delayed.
7.14 Counterparts. This Agreement may be executed in multiple counterparts, each of
which when so executed and delivered shall be deemed an original, but such counterparts
together shall constitute but one and the same instrument.
7.15 Legal costs. If any Party hereto is the prevailing party in any legal proceedings
against another Party brought under or with relation to this Agreement, such prevailing Party
shall additionally be entitled to recover court costs and reasonable attorneys= fees from the non-
prevailing Party to such proceedings.
7.16 Further assurances. Each Party hereby agrees that it will take all actions and
execute all documents necessary to fully carry out the purposes and intent of this Agreement.
7.17 Effect of Tri-Party Agreement. The obligations of the Parties hereunder are
specifically conditioned upon the approval, execution, and effectiveness of the Tri-Party
Agreement.
[EXECUTION PAGE FOLLOWS]
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly executed as
of , 2006.
REINVESTMENT ZONE NUMBER
ONE, CITY OF LA PORTE, TEXAS
CITY OF LA PORTE, TEXAS
By:
Name:
Title:
By:
Mayor
Attest:
City Secretary
LA PORTE REDEVELOPMENT
AUTHORITY
By:
Name:
Title:
AGENDA ITEM 8:
CONSIDER APPROVAL OR OTHER ACTION REGARDING A UTILITY
EXTENSION AGREEMENT BY AND BETWEEN THE REINVESTMENT ZONE
NUMBER ONE, CITY OF LA PORTE, TEXAS ("LA PORTE ZONE") AND LA PORTE
REDEVELOPMENT AUTHORITY ("LA PORTE AUTHORITY") AND THE CITY OF
LA PORTE, TEXAS (THE "CITY"), AND 65 LA PORTE, LTD., A TEXAS LIMITED
LIABILITY PARTNERSHIP (THE "DEVELOPER")
This agreement is a Utility Extension Agreement (UEA) that establishes the City's oversight and
control over the design and construction of the trunk sewer and lift station. The design and
construction contracts would be let/owned by the developer with the City issuing joint checks to
the developer/design and developer/contractor as certain approvals and milestones are met.
New cost estimates are being prepared by the developer's engineers. Both agreements provide
for the possibility that the bids may exceed budgeted funds (see Section 8 of the UEA).
Also, attached is additional information provided to City Council on agenda items
7&8.
(
T FOR CITY COUNCIL AGENDA ITEM
Appropriation
Requested By:
Source of Funds:
Department:
Account Number:
Report: X Resolution:
Ordinance:
Amount Budgeted:
Exhibits: Memorandum with Exhibits
Amount Requested:
Exhibits: Draft Development Ae:reement
Budgeted Item: YES
NO
Exhibits: Draft Utility Rxten~ion Agreement
SUMMARY & RECOMMENDATION
Prior correspondence to Council and the TIRZIRedevelopment Authority noted that the developer of Lakes at Fairmont Greens
could not secure financing for the development because of significant up front costs associated with the trunk sewer and lift
station, even though the TIRZ/ Authority could eventually reimburse the developer. With this cost center removed, the
developer was able to secure fmancing. During 05-06 budget preparation, Council approved $645,000 for the construction of
the trunk sewer and lift station based on the understanding that the TIRZI Authority would reimburse the City from future
increment.
The first agreement, between the City and TIRZIAuthority provides for the City to advance the funds ($645,000) for the trunk
sewer and lift station and act as construction manager for the TIRZ/ Authority. The agreement further provides for the
TIRZ/ Authority to reimburse the City in the future.
(
The second agreement is a Utility Extension Agreement (UEA) that establishes the City's oversight and control over the design
and construction of the trunk sewer and lift station. The design and construction contracts would be let/owned by the
developer with the City issuing joint checks to the developer/designer or engineer and developer/contractor as certain approvals
and milestones are met.
New cost estimates are being prepared by the developer's engineers. The agreements provide for the possibility that the
bids mav exceed budgeted funds (see Section 8 of the UEA).
These agreements have been circulated for comment by the party's and by the City's attorneys. It is anticipated that the
TIRZ/Authority will consider approval at the May 24 meeting and the Council at June 12 meeting.
Attached are 3 approaches being looked at for this project. They each have advantages/disadvantages and of course there is a
wide cost differential and opinion on the appropriate final design approach. While the base proposal is the lowest, there is
some concern over long term maintenance trade-offs and some unanswered questions on the depth ofline segments near and
along McCabe Road.
For these reasons we are still working with the developer and design engineers on a final design approach. In fact we may
consider bidding alternates.
Therefore, certain terms of the UEA may change to cover these options.
The key issue is to reinforce what was noted in the February 27 presentation to Council. These costs upon final approach and
bid opening may exceed the original estimate that was provided and budgeted last year.
Action Required bv Council:
(
A
?;~
Date
DRAFT #6
1
UTILITY EXTENSION AGREEMENT
THE STATE OF TEXAS:
COUNTY OF HARRIS:
This Development Agreement (this "Agreement") is made as of , 2006 by and between
the REINVESTMENT ZONE NUMBER ONE, CITY OF LA PORTE, TEXAS (the "La Porte Zone''), a tax
increment reinvestment zone created by the City pursuant to Chapter 311 of the Texas Tax Code, as amended, acting
by and through its governing board of directors (the "Zone Board''), LA PORTE REDEVELOPMENT
AUTHORITY, a nonprofit local government corporation formed by and on behalf of the City of La Porte, Texas
(the "La Porte Authority ''), and CITY OF LA PORTE, TEXAS, a home-rule city (the "City '') and 65 LA
PORTE, LTD., a Texas limited liability partnership (the "Developer '').
AGREEMENT
1. All references to The Project hereunder shall, for the purposes of this agreement, refer to the Southeast Sanitary
Sewer Trunk Main and Lift Station Facilities anticipated by the Preliminary Design Report, T.e. & B. Job No.
13-l450l-00l/Dated October 1997 together with any modifications or phased construction approved, in writing,
by the City acting as construction manager for the, Zone Board, and La Porte Authority. The Project Engineer
shall be the Professional Engineering firm authorized by the City to design the Project.
2. Developer is the owner of certain property in the City of La Porte, Harris County, Texas, identified as Lakes at
Fairmont Greens; a Subdivision of 135.4 acres of land Located in the W.P. Harris Survey A-30 and the J. Hunt
Survey A-35, City of La Porte, Harris County, Texas. The property is further defined by "Exhibit A" attached
hereto and incorporated herein by reference. City's utility main(s) presently do not extend to Developer's said
property. Developer has requested the extension of City's utility main(s) identified as the Project to serve
Developer's said property.
3. City hereby agrees to the design, construction and installation of the Project to said property commencing at the
nearest existing utility main(s) of sufficient size and capacity. Thence along/through public rights-of-way
and/or easements to and through said Developer's property. Provided, however, that should City not possess all
necessary rights-of-way and/or easements to complete the Project, Developer shall be solely responsible for
obtaining said additional rights-of-way and/or easements at no cost to City on City approved forms.
4. City agrees to advance funds to the La Porte Zone and La Porte Authority to pay all costs related to the design,
construction and installation or-said Project including necessary appurtenances in conformance with City's
standards and specifications for said utility main(s). Costs shall include all engineering fees for survey, design,
contract documents, bidding, construction staking, construction inspection, and preparation and submittal of
DRAFT #6
2
final record drawings upon completion of construction. The La Porte Zone and La Porte Authority agree to
reimburse the City for said costs according to terms and provisions of a separate agreement.
5. The Developer recognizes that the Zone and Authority have authorized the City to act on their behalf as the
construction manager of the project.
6. It is recognized that the developer has retained the services of a Professional Engineering firm to design the
infrastructure for the development identified as the Lakes at Fairmont Greens (Exhibit A). Furthermore, it is
recognized that certain efficiencies exist in utilizing the same Professional Engineering firm to design the
Project and all parties agree to utilize the same firm as the Project Engineer with the following stipulations.
a.) Developer has provided to the City a copy of the Professional Engineering Services Agreement, scope of
services and fee for services which have been approved by the City in a letter dated
b.) Progress payments shall be made by the Authority jointly to the Developer and Engineer according to the
fee schedule supplied pending successful completion of each milestone.
c.) The City shall have final authority regarding any design decisions relating to the Project and any progress
payments to the Developer and Project Engineer.
7. Upon final approval of the Design Drawings for the Project, the Developer shall have the Project Engineer
furnish for the Project Contracting and Construction and Project Closeout Services as defined in Exhibit B to
this agreement. Additionally, the City may require special conditions to be included in the project manual.
The Developer agrees that the City shall have reView and approval authority during the bidding and
construction phase services provided by the Developer's Engineer.
8. Subject to the provisions of this agreement, City hereby agrees to the design, construction and installation of
the Project according to the plans and specifications to be prepared by the Project Engineer and approved by the
City. Upon final approval of plans and specifications, Developer will solicit no less than three (3) competitive
bids for construction of the project each from a contractor with demonstrated experience in construction of
public utility mains, lift stations and related infrastructure. When received, the Project Engineer shall tabulate
the bids and a copy of said tabulation shall be provided to City. The Developer shall recommend and City shall
approve the selection of a contractor based on the competitive bids and City shall authorize construction of said
Project. City, in its approval of the contractor, may take into account the overall costs for installation of other
public infrastructure to serve Section I of the Lakes at Fairmont Greens.
9. The City has available $645,000 for the Project. In the event the Project costs, after bid opening, are estimated
to be greater than the amount available, the parties shall have the following options:
DRAFT #6
3
a) The City, the Zone Board, the La Porte Authority or the Developer may elect to pay the additional
costs of the Project or any Combination of City, Zone Board, La Porte Authority or Developer
may provide funding for additional costs for the Project.
b) City may withhold approval and elect not to proceed with the letting of the contract
and terminate this agreement as provided below.
c) City may withhold approval and request Developer to re-advertise for bids for construction of the
Project in accordance with the approved drawings and specifications in the same manner as before
and under the same conditions.
d) City may negotiate a reduced Scope of Work to be agreed upon by all parties
prior to re-bid or acceptance of alternate bids for the Project.
10. Upon receipt of a "notice to proceed" the Developer shall authorize the contractor to construct the
"Project." Progress payments shall be made based on monthly submittal of work performed less 10%
retainage. Said monthly submittal shall be reviewed and approved by City and Project Engineer.
a.) Progress payments shall be made by the Authority jointly to the Developer and the Contractor.
b.) The City shall have final authority regarding any progress payments to the Developer and Contractor.
11. During construction the City shall have the right to inspect the contractor's work for compliance with the plans
and specifications. Work not in compliance shall not be approved for payment. It is agreed and understood that
the Developer shall be responsible for maintenance of the Project until final acceptance of the construction and
installation of the Project and other public infrastructure installed by Developer to serve Section 1 of the Lakes
at Fairmont Greens by City, at which time maintenance responsibilities of the Project shall be transferred to
City.
12. Upon execution of this agreement and compliance with terms herein, Developer agrees to begin construction
thereof as soon as the same may be let for contract as herein provided. Developer shall require the contractor
under such contract to diligently pursue the construction of the project to completion.
IN WITNESS WHEREOF, the Parties to these presents have executed this agreement in several counterparts, each
of which shall be deemed an original, in the year and day first mentioned above.
DRAFT #6
ATTEST:
BY:
NAME:
TITLE:
ATTEST:
BY:
NAME:
TITLE:
ATTEST:
BY:
NAME:
TITLE:
4
65 LA PORTE, L TD
DEVELOPER
BY:
NAME:
TITLE:
REINVESTMENT ZONE NUMBER ONE,
CITY OF LA PORTE
BY:
NAME:
TITLE:
REDEVELOPMENT AUTHORITY,
CITY OF LA PORTE
BY:
NAME:
TITLE:
ATTEST:
BY:
NAME:
TITLE: City Secretary
APPROVED AS TO FORM:
City Attorney
DRAFT #6
5
CITY OF LA PORTE, TEXAS
BY:
NAME: Alton Porter
TITLE: Mayor
EXHIBIT A
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LAKES AT
FAIRl.l.ONT GREENS
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Exhibit B
to
UTILITY EXTENSION AGREEMENT
By and between the "La Porte Zone," the "La Porte Authority," the "City"
. and 65 La Porte, LTD.
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Contracting ~ConStrucJfon
. Bidding I C.ontracting for const~ction
. Pre-constructIon meeting coordination
. Shop draWing ~view and approv~1
___... . Perio~ic site visit~t.ion I proJect reviews
. Contractor pay application review
.'--
ION r,JE;SIGN and agentS will provide administration and Clssistance during.. the . bidding and
construction pnase of the project . During the bidding phase, these services will include:
~As~ernble' fJ prOject manuarthat will inc,ude: instruction to~k:Jdef'$; '8 projJosalfo,m pnd'
hnlt price bid $heet; general conditions with dLlties .of the C!J!ltractor, the. engineer. and
the Ow,her cjefined; $cope of work; forms for payment tJnd perf9rmanee bonds; ancf, the .
standard form of agroemeni between Owner ami contractor; . .
~ cqordinati~n with the Owner to./nclude specific ~struction and cOntracting
TflqUJrements In the proj~t manual; .' . '
~ Manage and'administerthebidding process to: contact bidders to invite their quotes; .
distributeJJ1e project manual; anc:J, answer bidders questions;
~ Check references 9f COf1tr.actors, as needed; _
~ Hold a pre-bid conference and receiue and open bids at OUf office, per the schedule
dictated by the OWner; - - . .
~ Prepare ~lbidtabulation and revieW the bid tabulation in conjunction with the Owner, and
based on our review ?'!r? other factors, . make' a recommendation for contract award; and,
~ Execute.the contract between the Owner and C<?ntractor.
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During the construction pha~e of the proj~ctJ these services wi!; include:
~ Review and approve ,shop drawings and material submittals;
ION DEsJGN GROUP 2800 N,HENOERSONAVENUE,STUOJO 100 , DAtLAS,TX 75206 -
214.370.3470 TEl 214,370..3083 FJ>:X. BRYAN@lONDESIGNGRouP.NET .
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~ Receive and respond to RFl's;
~ Prepare and administer change orders, as needed;
~ Review and certify contractor's applications for payment;
~ Perform a minimum of three site visits per month to evaluate and/or assess RFl's,
change Orders, or other construction and engineering issues that warra!?t on-site
observation and assess the progress of the work to aid in review and cerofication of pay
applications; and. .
~ Coordinate work as necessary with the geotech empioyed by the Owner.
In addition to bidding and construction administration services,loN DESIGN and agents will
provide field surveying services as follows: - .
~ One construction staking event for utilities and pavement; and,
~ One iot comer staking event upon completion of construction.
Deliverables: One project manual will be delivered to the Owner for his use; reproduction costs
for the drawings and project manual to be distributed to each bidder Will be cOnsidered a
reimbursable expense. A digital bid tabulation spreadsheet Will be d~livered electronically to the
Owner withIn three. working days of opening all received bids. ION DESIGN will make .~ written
recommendation for contract award after the bid. tabulation and other factorS have been
reviewed. Documents to support RFI responses, change orders, and pay applications wil1 be
produced as needed.
/
Project Closeout (proposed as hourly services at direction of Owner)
· Project review with agency /Owner for constniction closeol!t
· Assistance to Owner on contract closeout
· Preparation of Record drawings for Owner/agency
At the conclusion of the project, closeout activities include preparation of record drawings and
transfer of file information for archive with !he review agency and awner.
.
ION DESIGN GRoup 2800 N. HENDERSON AVENUE, SruolO 100 DALlAS. TX 75206
214..370.3470 TB.. 214.370..3083 FAX BRYAN@lONDESIGNGROUP.NET
AGENDA ITEM 9:
CONSIDER APPROVAL OR OTHER ACTION REGARDING A DEVELOPMENT
AGREEMENT BY AND BETWEEN THE REINVESTMENT ZONE NUMBER ONE, CITY
OF LA PORTE, TEXAS ("LA PORTE ZONE") AND LA PORTE REDEVELOPMENT
AUTHORITY ("LA PORTE AUTHORITY") AND THE CITY OF LA PORTE, TEXAS
(THE "CITY") AND PORT CROSSING LAND, L.P. ("DEVELOPER")
This item related to the development of Port Crossing (formerly known as Texas Import/Export) as
presented by National Property Holdings.
The Development Agreement between the "Zone", "Authority" and the "Developer" is in the form
prepared and approved by our Bond Counsel, Andrews/Kurth.
Several items are being refined at this point:
. Exhibit "A" - Project Site - Being developed
. Exhibit "B" - the eligible items
o A draft form of Exhibit "B" follows
o The references to Project Plan and Harris County Agreement will be removed and
estimated costs filled in
o Export Drive will be removed - it is not eligible
. Language is being reviewed to address Harris County's concern expressed in a letter dated
May 11, 2006 regarding a commitment to build two additional lanes (letter attached).
Also, enclosed is a draft TIRZ Model for this development, which is the expected (TIRZ) pro forma
for this development, based on certain assumptions. The model was prepared by The Financial
Advisors - First Southwest.
"." ,
, : l
,
Sylvia R. Garcia
Commissioner
Downtown Office
1001 Preston, Suite 950
Houston, TX 77002
Tel: 713.755.6220
Fax: 713.755.8810
Baytown Annex
701 W. Baker Road,
Suite 104 '
Baytown, TX 77521
Tel: 281.427.7311
Fax: 281.837.1290
Clear Lake Annex
16603 Buccaneer Lane,
Suite 100.
Houston, TX 77062
Tel: 281.488.4678
Fax: 281.286.7450
Raul C. Martinez Annex
1001 S. Sgt. Macarlo
Garcia Dr., Suite 102
Houston, TX 77011
Tel: 713.924.3975
Fax: 713.924.3971
Jim Fontano Annex
14350 Walllsvllle Road
Houston, TX 77049
Tel: 713.455.8104
Fax: 713.451.6714
Kyle Chapman
Pasadena Annex
7330 Spencer Hwy
Pasadena, TX 77505
Tel: 281.479.7770
Fax: 281.479.3075
rr'nl-r-@--[l-'--~I-1f.I~ 1
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ASS{ C!:'-y r-A,t,NAGER j
C~.:F:CE. ,j
May 11, 2006
Mr. John Joems
Assistant City Manager
City of La Porte
1322 S. Broadway
La Porte, TX 77571
Re: City of La Porte, TIRZ #1
Harris County Interlocal Agreement (the "Agreement")
Dear Mr. Joems:
I am responding to your letter of April 6th requesting clarification from Harris
County Precinct Two regarding "Engineering Related Issues" for the above-
referenced TIRZ proj eat in the La Porte area.
. You asked whether Harris County would be willing to forgo managing
projects that include Harris County participation. The Agreement
states that Harris County has the option to choose whether or not to
manage the construction of projects under the Agreement. Under the
terms of the Agreement, Harris County would be willing to waive the
opJton of managing a project ~~lYlfno direCt fulldInglS required fro'ni
Harris County for that specific project. Prior written approvat frO!ll
'Precinct Two IS required for each project that is not to be managed by
Hams County. ',' ,- ,. , .,.._--.
~::=-:2-~--
. You asked if Harris County would agree to Powell Road being
constructed initially as a 3-lane roadway instead of the 4-lane roadway
with a center lane median as described in Exhibit A to the Agreement.
The county is agreeable to this approach provided the Developer's
Agreement notes that the addition of two lanes will be considered a
future requirem~nt, if right-of-way needed for such future expansion is
acquired at the time the right-of-way needed for the ,initial construction
is acquired (a total 'of 100 feet of right-of-way) and Harris County is
, 1?rovide~}l c<?l?y <?! the D~y~~op~_~="0 A~i3~~="~!'!ttnK_}*C
-~-c commitment t~ de~elop the two a4cl~lio:nal~_an.~,_ ,mo_ . ,
~
Mr. John Joems
Page 2
May 9, 2006
Your remammg concerns regarding amendments to the Agreement for
changing the increments contributed by Harris County and the cap on
increments will require Commissioner's Court approval. Your
recommendation to remove the Fairmont Parkway Overpass listed on Exhibit
A is not a problem for us; however, I believe that it too will require
Commissioner's Court approval.
Please do not hesitate to contact my Deputy Commissioner, Roel Garcia, at
713-455-5473 should you require additional information.
Sincerely,
~
Sylvia R Garcia, Commissioner
Harris County Precinct Two
SRG:RG:dv
cc: Roel Garcia
DRAFT
EXHIBIT "B" ELIGIBLE ITEMS
In Project
Plans/Guidelines
Harris County
Elhdble3
Est. Costs
1
Street System
- Powell Rd (100' Rowi
- Powell Rd (60' Row)
- Abandon Powell Rd.
- Weems Blvd.2
- Export Dr. (Requested)
-v
-V
-V
-V
No
-V
-V (Called Powell Rd. South)
Silent
-V (Called Powell Rd.)
No Not Eligible
Water Dist. System
- Onsite 8" & 12" Public Mains
- Offsite Segment Crossing SH 146 (12")
Yes/Implied
-V
No
No
Sanitary Sewer System
- Lift Station/Force Main
- Onsite Public Mains> 8"
- Offsite Public Mains
-V
Yes/Implied
-V
No
No
No
Drainage Projects
- Extension ofHCFCD Facilities
- Stormwater Detention/Channels
· Acquisition
· Construction
-V
-V
-V
-V
-V
-V
Sidewalks
- Along Major Roadways
(Discuss locations and/or swapping
For pedestrian trail)
-V
-V
1
2
3
Includes storm sewer and curb & gutter
Proposed 3-lane (2 & 1 continuous turning lane) vs. 4-lane with median; will require Harris County
approval and consideration for future expansion.
Waiting on decision/action by Harris County:
· To manage the projects they participate in
· To increase the project participation amounts and remove the total cap for participation.
l
\
Development Costs for La Porte Property
9/13/2005
Development CateQorv Units Unit Costs Totals
( cO) ~Iearing 45AC $3,000.00 lAC $135,000
(CD )VDetention 202,000 CY $3.00 ICY $606,000
I to) vDrainage Channels 9,000 CY $5.00 ICY $45,000
vWater Lines 12,000 LF $18.00/LF $216,000
/Sanitary Sewer 11,000 LF $25.00 ILF $275,000
Lift Station 1 LS $50,000.00 ILS $50,000
Force Main 3,000 LF $10.00/LF $30,000
v Storm Sewer 9,000 LF $50.00 ILF $450,000
Manholes 60 EA $1,200.00 lEA $72,000
Inlets 60 EA $700.00 lEA $42,000
Box Culverts 240 LF $400.00 ILF $96,000
@D) vi Paving 40,000 SY $40.00 ISY $1,600,000
p~er 1 LS $50,000.00 ILS $50.000
$3,667,000
Contingencies @ 10% $366,700
Engineering Costs @ 15% J605.055 .'
Total Costs $4,638,755
Average Dev. Cost per Acre for Approx. 255 Acres $18,191
Average Dev. Cost per Sq. Ft. for Approx. 255 Acres $0.42
Page 1 of 1
Joerns, John
From: David Hawes [dhawes@hhcllp.com]
Sent: Wednesday, May 03, 2006 1 :00 PM
To: Joerns, John
Subject: FW: La Porte TIRZ
Attachments: La Porte TIRZ CF Model.pdf
FYI
David
From: Karlos Allen [mailto:KALLEN@firstsw.com]
Sent: Tuesday, May 02,20065:14 PM
To: dhawes@hhcllp.com
Cc: Drew Masterson
Subject: La Porte TIRZ
David:
Attached is the first draft of the La Porte TIRZ Model. Please note the following differences in our model from the
revenue schedule you sent:
. We assumed a collection rate of 95%;
. Our cash flows are net the City Administrative Cost estimated 5% of Collections (Capped at $25,000 for
the City and School District); and
. The County projected cash flows are based on 75% of the current tax rate ($0.3999), which equals
$0.2999 (please note your model had $0.417).
Please give us a call with your questions and concerns regarding the attachment.
Thanks
~ I First Southwest CompaWi
== I Investment Bankers Since 1946
Karlos Allen
Analyst
1021 Main Street
Suite 2200
Houston, TX 77002
713.654.8636
Neither First Southwest Company nor any of its affiliates (collectively, "First Southwest") is responsible
for any recommendation, solicitation, offer or agreement or any information about any transactions,
customer account or account activity in this communication. Confidential or time-sensitive security-
related communications should not be transmitted to First Southwest via the Internet as there can be no
assurance of actual or timely delivery, receipt and/or confidentiality. Neither can there be any assurance
that messages transmitted by electronic mail will not be corrupted, lost, deleted or modified. First
Southwest reserves the right to refrain from processing or executing electronic mail until verification of
the information is obtained in another format acceptable to First Southwest.
5/18/2006
....
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DEVELOPMENT AGREEMENT
Between
REINVESTMENT ZONE NUMBER ONE
CITY OF LA PORTE
and
LA PORTE REDEVELOPMENT AUTHORITY
and
HOU:25362 13. 1
Draft 1/23/2006
DEVELOPMENT AGREEMENT
This Agreement ("Agreement"), effective as of January _, 2006, 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 "Citv")
pursuant to Chapter 311 of the Texas Tax Code, as amended, acting by and through its governing
body, the Board of Directors (the "Zone Board"), LA PORTE REDEVELOPMENT
AUTHORITY ("La Porte Authoritv"), a local government corporation created and organized
under the provisions of the Texas Transportation Corporation Act, Chapter 431, Subchapter D,
Transportation Code, and authorized and approved by the City pursuant to Resolution No. 2000-
2457 adopted on December 11, 2000, acting by and through its governing body, the Board of
Directors (the "La Porte Board") and [NATIONAL PROPERTY HOLDINGS, INC (the
"Developer") .
RECITALS
WHEREAS, by Ordinances No. 99-2325 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 "Proiect Plan") and submitted the final Project Plan to the City Council of
the City for approval; and
WHEREAS, the City Council approved the final Project Plan by Ordinance No. 99-2352;
and
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 July 9, 2001, and approved as Ordinance No. 2001-2498 (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
HOU:2536213.1
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 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.
"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.
"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
2
HOU:2536213.!
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 ofthe 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 August
23, 1999 and as thereafter amended and approved by the City Council.
"Project Site" shall mean the area known as Port Crossing, located in certain tracts
described in Exhibit A, and all improvements located thereon.
"Public Improvements" shall have the meaning provided in Article 3 of this Agreement.
"Residential Site" shall mean that part of the Project Site that is planned for residential
use and further described in Exhibit D.
"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.
3
HOU:2536213.1
"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.
(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.
4
HOD :2536213.1
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 carryon 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 ofthe State and 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 by requisite corporate action, (ii) will
not, to the best of its knowledge, violate any 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.
5
HOU:2536213.1
(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 ofthe 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
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.
6
HOU:2536213.1
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.
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,
(A) 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
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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
(B) 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.
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.
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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
compnsmg 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 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 five (5) 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.
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(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) Subject to the limitations described in Section 6.1 (B) hereof, interest on
each Developer Advance shall accrue at the prime rate of lPMorgan Chase Bank.
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 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.
(0) 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, 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
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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;
(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 $ 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 La Porte 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
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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 La Porte Zone in an amount equal to
the product of (i) the total amount of such expenses budgeted in the La Porte 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.
The insurance, at a minimum, must include the following coverage's and limits of
liability:
Coverage
Limit of Liability
Worker's Compensation
Statutory
Employer's Liability
Bodily Injury by Accident $100,000 (each accident)
Bodily injury by Disease $500,000 (policy limit)
Bodily injury by Disease $100,000 (each employee)
Comprehensive General Liability:
Including Broad Form Coverage,
Contractual Liability, Bodily and
Personal Injury, and Completed
Bodily Injury and Property Damage, Combined
Limits of $500,000 each Occurrence and $1,000,000
Aggregate
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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)
$500,000 Combined Single Limit per Occurrence
Professional Liability Coverage (for
professional service contract only)
$500,000 per occurrence $1,000,000 aggregate
Defense costs are excluded from the face amount of the policy. Aggregate Limits are per
12 month policy period unless otherwise indicated.
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 2006 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.
(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.
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(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.
(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
14
HOU:2536213.1
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 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 F AUL T 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 3D-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
3D-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
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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
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, DEATH, DAMAGE, OR LOSS TO PERSONS OR
PROPERTY SUSTAINED IN CONNECTION WITH OR INCIDENTAL 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 APPLICATION 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.
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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 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
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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
transmission, or personally delivered to an officer of the receiving party at the following
addresses:
CITY
City Manager
City of La Porte
604 West Fairmont Parkway
La Porte, Texas 77571
FAX: 281-842-1259
with a copy to:
City Attorney
City of La Porte
604 West Fairmont Parkway
La Porte, Texas 77571
FAX: 281-842-1259
LA PORTE ZONE
Reinvestment Zone Number One, City of La Porte,
c/o Hawes Hill Calderon LLP
2500 Tanglewilde, Suite 260
Houston, Texas 77063
Attn: David Hawes
FAX: (713) 541-9906
LA PORTE AUTHORITY
La Porte Redevelopment Authority
c/o Hawes Hill Calderon LLP
2500 Tanglewilde, Suite 260
Houston, Texas 77063
Attn: David Hawes
FAX: (713) 541-9906
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DEVELOPER
Attn: Russell Plank
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 Agreement shall operate as a waiver thereof, except as otherwise
provided in this Section.
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 may sell or otherwise transfer the Project with the prior written consent of the
La Porte Authority and the La Porte Zone. Provided, however, any such purchaser or assignee
must specifically assume all of the obligations 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.
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 contlict 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
19
HOU:25362I3.1
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 Third Party Beneficiaries. This Agreement shall not bestow any rights upon
any third party, but rather, 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.
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.
20
HOU:2536213.1
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.
21
HOU:25362 13. 1
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be duly
executed as of the _ day of ,2006.
REINVESTMENT ZONE NUMBER ONE,
CITY OF LA PORTE
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
THE STATE OF TEXAS ~
~
COUNTY OF HARRIS ~
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is subscribed to the
foregoing instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the _ day of
2006.
Notary Public in and for
The State of Texas
(SEAL)
HOU:2536213.1
LA PORTE REDEVELOPMENT AUTHORITY
By:
Name:
Title:
ATTEST:
By:
Name:
Title:
THE STATE OF TEXAS S
S
COUNTY OF HARRIS S
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is subscribed to the
foregoing instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the _ day of
2006.
Notary Public in and for
The State of Texas
(SEAL)
HOU:2536213.!
DEVELOPER
By:
Name:
Title:
THE STATE OF TEXAS S
S
COUNTY OF HARRIS S
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is subscribed to the
foregoing instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the _ day of
2006.
Notary Public in and for
The State of Texas
(SEAL)
HOU:2536213.!
EXHIBIT A
PROJECT SITE
(Property Description)
A-I
HOU:2536213.1
DRAFT
EXHIBIT "B" ELIGIBLE ITEMS
In Project
Plans/Guidelines
Harris County
Elie:ible3
Est. Costs
1
Street System
- Powell Rd (100' Row)2
- Powell Rd (60' Row)
- Abandon Powell Rd.
- Weems Blvd?
- Export Dr. (Requested)
...j
...j
...j
...j
No
...j
...j (Called Powell Rd. South)
Silent
...j (Called Powell Rd.)
No Not Eligible
Water Dist. System
- Onsite 8" & 12" Public Mains
- Offsite Segment Crossing SH 146 (12")
Yes/Implied
...j
No
No
Sanitary Sewer System
- Lift Station/Force Main
- Onsite Public Mains> 8"
- Offsite Public Mains
...j
Yes/Implied
...j
No
No
No
Drainage Projects
- Extension ofHCFCD Facilities
- Stormwater Detention/Channels
· Acquisition
· Construction
...j
...j
...j
...j
...j
...j
Sidewalks
- Along Major Roadways
(Discuss locations and/or swapping
For pedestrian trail)
...j
...j
1
2
3
Includes storm sewer and curb & gutter
Proposed 3-lane (2 & 1 continuous turning lane) vs. 4-lane with median; will require Harris County
approval and consideration for future expansion.
Waiting on decision/action by Harris County:
· To manage the projects they participate in
· To increase the project participation amounts and remove the total cap for participation.
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 , 2006. 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 JPMorgan Chase Bank as described in the Development Agreement for the period
described in 6.1 (B) of the Development Agreement 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.
C-1
HOU:25362 13. I
AGREED TO this
day of
,2006.
LA PORTE
REDEVELOPMENT AUTHORITY
By:
Name:
Title: Chairman Board of Directors
ATTEST:
By:
Name:
Title: Secretary, Board of Directors
THE STATE OF TEXAS S
S
COUNTY OF HARRIS S
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is subscribed to the
foregoing instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the _ day of
2006.
Notary Public in and for
The State of Texas
(SEAL)
C-2
HOU:2536213.1
REINVESTMENT ZONE NUMBER ONE,
CITY OF LA PORTE
By:
Name:
Title: Chairman Board of Directors
ATTEST:
By:
Name:
Title: Secretary, Board of Directors
THE STATE OF TEXAS ~
~
COUNTY OF HARRIS ~
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is subscribed to the
foregoing instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the _ day of
2006.
Notary Public in and for
The State of Texas
(SEAL)
C-3
HOU:2536213.1
DEVELOPER
By:
Name:
Title:
THE STATE OF TEXAS S
S
COUNTY OF HARRIS S
BEFORE ME, the undersigned authority, on this day personally appeared
, known to me to be the person whose name is subscribed to the
foregoing instrument and acknowledged to me that he executed the same for the purposes and
consideration therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this the _ day of
2006.
Notary Public in and for
The State of Texas
(SEAL)
C-4
HOU:2536213. )
EXHIBIT D
RESIDENTIAL SITE
D-l
HOU:2536213.1
\>J
The TIRZ Improvements
Exhibit B
The TIRZ Improvements
Phase I Phase" Total
Estimated Estimated Estimated
Costs Costs Costs
$1 ,077 ,000 $718,000 $1,795,000
$841,000 $0 $841,000
$0 $0 $0
$587,000 $381,000 $968,000
$0 $225,000 $225,000
$320,000 $0 $320,000
$35,000 $316,000 $351,000
$137,000 $0 $137,000
$308,000 $0 $3OS,Ooo
$0 $66,000 $66,000
Streets wi Storm Systems
PowellRd (100' ROW)
Powell Rd (60' ROW)
Abandon Powell Rd.
Vllharton \Neems Blvd.
McCabe Rd.
water Distribution System
12" Public Mains
Ofrsite Segment Crossing SH 146 (12')
Sanitary Sewer System
Lift Stationl Force Main
Public Mains S"-1Z'
Offisite PUblic Mains
Drainage Projects
Storrnwater Detention/Drainage
-Acquisition of 32 ac.
-Construction: Excavation
-Construction: Storm Sewer
$2,300,000 $0 $2.300.000
$1,360,000 $0 $1.360,000
$1 ,232,000 $0 $1 ,232,000
$120,000 $0 $120,000
$300,000 $0 $300.000
$120,000 $0 $120,000
$1,047,000 $256,000 $1 ,303,000
$9,784,000 $1,962,000 $11,148,000
Sidewalks
Sidewalks/Pedestrian Trails along Major RoadwayslDrainageways
Landscaping
Along Major Roadways
Clearing
Public ROWand Easements
Engineering (16%)
TOTAL ESTIMATED COSTS
Note: The La Porte Redevelopment Authority and Tax Increment Reinvestment Zone recognize
that the Harris County Interlocal Agreement requires that Powell Road be constructed as a four
lane roadway when traffic conditions warrant.
B-1
AGENDA ITEM 10:
RECEIVE REPORT FROM DAVID HAWES ON THE PROPOSED PUBLIC
IMPROVEMENT DISTRICT NUMBER ONE
See attached material.
City of La Porte
Interoffice Memorandum
To:
TIRZ I La Porte Redevelopment Board
David Hawes, Board Consultant
From:
John Joerns, Assistant City Manager
cc:
Debra B. Feazelle, Ex-Officio
Cynthia Alexander, Ex-Officio
Knox Askins, Ex-Officio
Date:
September 1, 2004
Subject:
Request for PID
Mr. Fogarty has been informed of the reimbursement level approved by the Redevelopment
Authority at its last meeting. Preparations are being made to finalize that agreement - no
significant changes/issues have surfaced.
Mr. Fogarty has since requested (through David Hawes) consideration of a PID (Public
Improvement District) to assist him in recouping some expenses that the Authority's
reimbursement will not cover. At this time there has been no discussion of the level of PID
assessment he is seeking.
Pill's are allowable per the adopted Guidelines and Tri-Party Agreement. In fact, a PID may be
a successful way of addressing future maintenance issues for the detention basins; perimeter
fencing, landscaping, etc. Staff has been in discussions with Mr. Fogarty regarding these items.
The collection of a PID assessment levied by the City would be easier and preferable than
relying on a Homeowners' Association to undertake this kind of maintenance activity.
I anticipate that a discussion regarding the creation of a PID will be on the next
TIRZ/Redevelopment Authority agenda (Tentatively September 22,2004).
JJ/ml
c: Mayor and City Council
Page 1 of11
The Attorney General's
HANDBOOK ON ECONOMIC DEVELOPMENT LAWS FOR TEXAS CITIES
Volume 1
VII. Economic Development
Through Infrastructural
Improvements
,
Public Improvement Districts
Myni9j~.9J M(l.tlag~ment Di~triQ.t~
Public Improvement Districts
Cities often need to make certain improvements to their infrastructure to facilitate economic
growth within an area. New businesses may choose not to locate where there are inadequate
streets, substandard utility service, or other public facilities or services that are inferior. It is also
difficult for existing businesses to prosper in areas that have poor public infrastructure. Texas law
provides a number of ways to finance needed public improvements, including the use of special
assessments. Public Improvement Districts (PIDs) offer cities a means for undertaking such a
project.
The Public Improvement District Assessment Act allows any city to levy and collect special
assessments on property that is within the city or within the city's extraterritorial jurisdiction
(ETJ).(525) The statute authorizing the creation ofPIDs is found in Chapter 372 of the Local
Government Code. The public improvement district may be formed to accomplish any of the
following improvements:(i261
. water, wastewater, health and sanitation, or drainage improvements (including
acquisition, construction, or improvements of water, wastewater, or drainage
improvements);
. street and sidewalk improvements (acquiring, constructing, improving, widening,
narrowing, closing, or rerouting sidewalks, streets, or any other roadways or their
rights-of-way);
. mass transit improvements (acquisition, construction, improvement, or rerouting of
mass transportation facilities);
. parking improvements (acquisition, construction, or improvement of off-street
http://www.oag.state.tx.us/AG_Publications/txts/ED_ch07.htm
11/9/2004
Page 2 of 11
parking facilities);
. library improvements (acquisition, construction, or improvement oflibraries);
. park, recreation, and cultural improvements (the establishment or improvement of
parks) ;
. landscaping and other aesthetic improvements (erection of fountains, distinctive
lighting, and signs);
. art installation (acquisition and installation of pieces of art);
. creation of pedestrian malls (construction or improvement of pedestrian malls);
. similar improvements (projects similar to those listed above);
. supplemental safety services (supplemental safety services for the improvement of the
district, including public safety and security services); or
. supplemental business-related services (supplemental business-related services for the
improvement of the district, including advertising and business recruitment and
development).
The nine steps involved in creating a public improvement district are as follows:
Step 1. The city or a group of the affected property owners must initiate a petition that calls
for a deimed area ofthe city to be declared a public improvement district.(527)
The petition must state:cgs)
1) the general nature of the proposed improvements;
2) the estimated cost of the improvements;
3) the boundaries of the improvements;
4) the proposed method of assessment, which may specify included or excluded classes of
assessable property;
5) the proposed apportionment of costs between the public improvement district and the
municipality as a whole;
6) whether the district will be managed by the municipality, by the private sector, or by a
partnership of the two;
7) that the persons signing the petition request or concur with the establishment of the
district; and
8) that an advisory board may be established to develop and recommend an improvement
plan to the governing
http://www.oag.state.tx.us/AGPublications/txts/EDch07.htm
- -
11/9/2004
Page 3 of 11
body of the municipality.
The petition is sufficient if it meets two conditions. First, it must be signed by owners of more
than 50 percent of the taxable real property value that is subject to assessment under the proposal.
Second, the petition must also include signatures from more than 50 percent of the number of
taxable property owners who would be assessed, or include signatures from owners of more than
50 percent of the surface area to be assessed under the proposal.
Step 2. After receiving a petition to establish a public improvement district, the governing
body of the city may appoint an advisory board to develop an improvement plan for the
PID. (529)
Texas statutes do not provide a set number of members for the advisory board. The membership
on the board, however, must be sufficient to meet two criteria. First, it must be composed of
taxable real property owners who represent more than 50 percent of the appraised value of taxable
real property that is subject to assessment. Second, this board must include representation by more
than 50 percent of the property owners who would be liable for assessment, or include more than
50 percent of the owners of taxable surface area under the proposed plan.
Upon initiation of the PID by petition, the governing body of the city should prepare a report on
whether the improvements are feasible and whether the plan should be augmented by other
authorized improvements. (530) The feasibility report may be conducted using the services of
municipal employees or outside consultants. The purpose of the report is to determine whether an
improvement should be made as proposed by the petition, or in combination with other
improvements authorized under Chapter 372 of the Local Government Code.
Step 3. A public hearing on the advisability of the improvements must be conducted after
meeting statutory notice requirements.illll
After the feasibility study is completed, a public hearing must be held by the governing body of
the city to determine the advisability of the proposed improvements. Notice ofthe public hearing
must be published in a newspaper of general circulation in the municipality more than 15 days
prior to the date of the hearing. Additionally, notice of the PID must be mailed more than 15 days
prior to the date of the hearing to the owners of property within the proposed PID. The notice
must contain the following information:
1) the time and place of the hearing;
2) the general nature of the proposed improvements;
3) the estimated cost of the improvements;
4) the boundaries of the proposed district;
5) the proposed method of assessment; and
6) the proposed apportionment of cost between the improvement district and the
municipality as a whole.
The municipality must make findings regarding items 2) through 6) by resolution from
http://www.oag.state.tx.us/AG_Publications/txts/ED_ch07.htm
11/9/2004
Page 4 of 11
information gathered at the public hearing. Additionally, the municipality must make findings (by
resolution) regarding the advisability of the proposed improvements.
Step 4. The governing body of the city must adopt a resolution by majority vote authorizing
the creation of a PID.(532)
The authorization oft4e PID must be done within six months of the public hearing on the PID.
The authorization is effective once notice of the resolution is published in a newspaper of general
circulation in the municipality. If any part of the improvement district is located in the
extraterritorial jurisdiction (ETJ) of the municipality, the notice must also be published once in a
newspaper of general circulation in the city's ETJ.
Step 5. Twenty days after authorization of the PID, the city may begin construction of the
improvements. (533)
Construction may not begin, however, if within the 20 day-period a protest petition is filed. Such a
petition must be signed by owners representing at least two-thirds of the taxable surface area of
the district or by two-thirds of all the land owners in the district. In response, the governing body
ofthe city may choose to assess only part or none ofthe area of the district. (534) The area to be
assessed may not, in any case, be increased beyond the boundaries described in the original
notices unless an additional notice and public hearing are provided. L53~1
Step 6. A five-year on-going service and assessment plan must be developed.QJJ51
The service and assessment plan must defme the annual indebtedness and projected costs of the
improvements for the PID. The plan must also be reviewed and updated annually for purposes of
determining an annual budget for the PID. The plan may be prepared by the municipality or by the
PID advisory board, if one is appointed.
In addition, the governing body ofthe city must prepare an assessment plan.U.m The assessment
plan must provide that at least ten percent of the cost of the improvements is covered by
assessments against taxable property within the PID. Assessments must be based upon the special
benefits that accrue to the property because of an improvement.(538) Costs may be assessed in any
manner that results in equal shares of the cost being absorbed by similarly benefitted properties
within the PID. Assessments may be adjusted annually upon review of the service plan. The city
is responsible for payment of assessments against exempt municipal property within the district.
(539) Payment of assessments by other tax exempt jurisdictions must be established by contract.
Step 7. The city must provide notice and a hearing to determine the total cost of the
improvements and to prepare an assessment roll.(540)
A copy of the proposed assessment roll must be filed with the city secretary. Notice ofthe public
hearing on the roll must be mailed to affected property owners. The notice must also be published
in the newspaper in the same manner that notice was given for the creation ofthe PID, except that
at least ten days' notice must be provided. An additional statement must be included in this notice
that written or oral objections will be considered at the public hearing. At the public hearing, the
governing body must hear and rule on any objections that are raised.(~m
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11/9/2004
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Step 8. After all the objections have been heard and considered, the governing body may
levy, by ordinance the special assessment against the taxable properties within the district.
(542)
The ordinance must include the method of payment and may provide for installment payments to
meet annual costs and retire any indebtedness for the improvements within the district. The
assessment is a first and prior lien against the property, superior to all other liens and claims
except liens for state, county, school district, or city ad valorem taxes.L~4)}
The costs of the improvements called for under the district may be paid from available general
funds of the municipality, any special assessments levied, and from proceeds of the sale of general
obligation bonds and related revenue bonds, temporary notes, and time warrants. (,5J._42
Step 9. The governing body may make additional assessments against property within the
district to correct omissions or mistakes regarding the costs ofthe improvements.c545)
Before such an additional assessment may be assessed, the city must provide the same type of
notice and public hearing that was required for the original assessment.
A public improvement district may also be dissolved after public notice and a public hearing has
been held.-(2:1Q). The notice and hearing requirements are the same as those required to create a
PID. A petition requesting dissolution must be filed with the city secretary and must contain the
signatures of at least the same number of property owners required to create the PID. If the district
is dissolved, it stays in effect until it has paid off any indebtedness that remains for the
improvements.
Municipal Management Districts
L.__~.,.,,,.'m.
Municipal management districts are a relatively new statutory vehicle that allows commercial
property owners to enhance a defmed business area. The districts, also called downtown
management districts, are created within an existing commercial area to finance facilities,
infrastructure, and services beyond those already provided by individual property owners or by the
municipality. The improvements may be paid for by a combination of self-imposed property
taxes, special assessments, and impact fees, or by other charges against property owners within
the district. The creation of such a district does not relieve a city from providing basic services to
an area included within the district. A district is created to supplement, not to supplant, the
municipal services available to the area. A number of Texas cities have used municipal
management districts to provide much-needed funding to enhance the economic vitality of the
business centers within the municipality.
The statutes governing municipal management districts are located in Chapter 375 of the Local
Government Code. An area is eligible for designation as a municipal management district if it is
devoted primarily to commercial development or business activity.c547) A district may include the
extraterritorial jurisdiction of a city, if the city has a population of at least 25,000 and if the area
has an assessed valuation of $500 million or more according to the appraisal district. A municipal
management district is considered a governmental agency and a political subdivision of the state.
(548)
http://www.oag.state.tx.us/AGyublications/txts/ED_ch07.htm
11/9/2004
-.....-._"~-~""-""'''''....-~...~..'''',..-=_.....
HAWES H I LLCALDERON
LLP
October 25, 2004
i:" \ L=
f'lN~ ') -
uL,l L (
To:
City Secretary, City of La Porte
From:
David Hawes
Subject:
Petition for the Creation of the Lakes at Fairrnont Green Public
Improvement District
Dear Madam:
In accordance with Chapter 372 of the Texas Local Government Code, attached
is an original petition requesting the creation of a public improvement district
within the corporate limits of the City of La Porte.
Thank you for your attention to this matte~../S1iould you have any questions,
please contact me or Mr. John Joerns, A~ City Manager.
/.'" rh
Attachment: /lf7' . J ../ f
1. Original Petition . IO{7-1 f7
2500 Tanglewilde Street, #260
Houston. Texas 77063
P.O. Box 22167
Houston, Texas 77227.2167
Office 713.541.0447
Fax 713.541.9906
www.naweshillcalderon.com
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