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HomeMy WebLinkAboutItem 04 - Game Stop ITS MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: BRUNO RUMBELOW, CITY MANAGER MEETING DATE: AUGUST 3, 2010 SUBJECT: PUBLIC HEARING AND CONSIDERATION OFAN ORDINANCE TO PARTICIPATE IN THE TEXAS ENTERPRISE ZONE PROGRAM AND TO CONSIDER THE NOMINATION OF GAMESTOP, INC. TO THE OFFICE OF THE GOVERNOR, ECONOMIC DEVELOPMENT AND TOURISM, AS A TEXAS ENTERPRISE PROJECT RECOMMENDATION: Staff recommends that the City Council recommend GameStop, Inc. to the Office of the Governor, Economic Development and Tourism as a Texas Enterprise Project. FUNDING SOURCE: Economic development incentives in the form of sales and use tax rebates are derived from the state's portion of state sales and use taxes. None of the funding source will involve the local portion of state sales tax. BACKGROUND INFORMATION: GameStop is in the process of purchasing a new facility in Grapevine to accommodate the growth they are experiencing. As a result of their investment in this new facility located at 2200 William D. Tate Avenue, and their commitment to retain jobs in Grapevine, GameStop would like to apply for state sales and use tax incentives within the State Enterprise Zone Program. The Enterprise Zone Program allows for the designation of Enterprise Project Status to companies for 5 years through a competitive selection process by the state following a nomination by the host city by ordinance. The Enterprise Project program is a state program to promote job retention and/or expansion. At the level of investment anticipated by GameStop, it allows for a$500 rebate in state sales and use tax per job per year. GameStop intends to request credit for 500 jobs over the 5 year program for a total of $1.25 million in rebates. GameStop currently has approximately 800 employees and intends to add an additional 60 to 75 employees as a result of the expansion. In order to qualify for the rebate, a minimum of 35% of the new hires must be economically disadvantaged as defined by the State Government Code. GameStop must prove to the State Comptrollers Office that they are meeting the retention and hiring criteria required by state law, prior to rebates.The deadline for submission of the application to the State is September 1, 2010 and the selection process will take approximately 90 days. dt �7 ORDINANCE NO. AN ORDINANCE OF THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS, AUTHORIZING THE CITY OF GRAPEVINE TO PARTICIPATE IN THE TEXAS ENTERPRISE ZONE PROGRAM PURSUANT TO THE TEXAS ENTERPRISE ZONE ACT, CHAPTER 2303, TEXAS GOVERNMENT CODE ("ACT"), IDENTIFYING TAX INCENTIVES, DESIGNATING A LIAISON FOR COMMUNICATION WITH THE INTERESTED PARTIES, AND NOMINATING GAMESTOP, INC. TO THE OFFICE OF THE GOVERNOR ECONOMIC DEVELOPMENT AND TOURISM ("OOGEDT") THROUGH THE ECONOMIC DEVELOPMENT BANK ("BANK") AS AN ENTERPRISE PROJECT ("PROJECT") AND PROVIDING AN EFFECTIVE DATE WHEREAS, the City Council of the City of Grapevine, Texas (the "City") desires to create the proper economic and social environment to induce the investment of private resources in productive business enterprises located in severely distressed areas of the City and to provide employment to residents of such areas; and WHEREAS, the Project is located in the City's jurisdiction in an area not designated as an enterprise zone; and WHEREAS, pursuant to Chapter 2303, Subchapter F of the Act, GameStop, Inc. has applied to the City for designation as an Enterprise Project; and WHEREAS, a public hearing to consider this ordinance will be held by the City Council of the City of Grapevine, Texas on August 3, 2010. NOW, THEREFORE, BE IT ORDAINED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS: Section 1. That the City nominates GameStop, Inc. for Enterprise Project status. Section 2. That the local incentives identified and summarized briefly in the attached Exhibit "A", at the election of the governing body, are or will be made available to nominated Projects in the City of Grapevine. Section 3. That the enterprise zone areas within the City are reinvestment zones in accordance with the Texas Tax Code, Chapter 312. Section 4. That the City of Grapevine City Council directs and designates the City Manager, or his designee, as the City's liaison to communicate and negotiate with the OOGEDT through the Bank and Enterprise Project(s) and to oversee enterprise zone activities and communications with qualified businesses and other entities in an enterprise zone or affected by an Enterprise Project. Section 5. That the City finds that GameStop, Inc. meets the criteria for designation as an Enterprise Project under Chapter 2303, Subchapter F of the Act on the following grounds: (a.) GameStop, Inc. is a "qualified business" under Section 2303.402 of the Act since it will be engaged in the active conduct of a trade or business at a qualified business site within the governing body's jurisdiction, located outside of an enterprise zone, and at least thirty-five percent (35%) of the business' new employees will be residents of an enterprise zone or economically disadvantaged individuals; and (b.) There has been and will continue to be a high level of cooperation between public, private, and neighborhood entities in the area; and (c.) The designation of GameStop, Inc. as an Enterprise Project will contribute significantly to the achievement of the plans of the City for development and revitalization of the area. Section 6. That the Enterprise Project shall take effect on September 1, 2010 and terminate on September 1, 2015. Section 7. That the fact that the present ordinances and regulations of the City of Grapevine, Texas, are inadequate to properly safeguard the health, safety, morals, peace and general welfare of the inhabitants of the City of Grapevine, Texas, creates an emergency for the immediate preservation of the public business, property, health, safety and general welfare of the public which requires that this ordinance shall become effective from and after the date of its final passage, and it is accordingly so ordained. PASSED AND APPROVED BY THE CITY COUNCIL OF THE CITY OF GRAPEVINE, TEXAS on this the 3rd day of August, 2010. APPROVED: ORD. NO. 2 ATTEST: APPROVED AS TO FORM: ORD. NO. 3 Exhibit A Name of Description of - - Availability Local Safes Tax The City may allow sales and use Citywide - On Case 1 Refunds tax refunds. By Case Basis Tax increment Citywide — On Case 2 Financing Tax Increment Financing By Case Basis Exempts goods-in-transit from ad 3 Freeport Exemption valorem taxes Citywide Streamlined process ' Planning and Streamlined Zoning Zoning Commission meet 4 Process simultaneously Citywide Rebate of portion of Hotel Tax on case by case basis depending on Citywide — On Case 5 Rebate of Hotel Tax the nature and impact of ro'ect. BV Case Basis Citywide — Case By 6 Grants Cash grants for project stimulus. Case Basis Impact Fee Recalculation/ Inspection Fee Impact Fee Recalculation/ Citywide — On Case 7 Exemptions Inspection Fee Exemptions By Case Basis City may allow permit applications and supporting materials to be tendered to one department for Streamlined distribution to the appropriate City 8 Permitting departments. Citywide High Quality Fire and Safety and protection of City 9 Police Protection residents. Crime Control District Citywide Crimestoppers, Tourism Crime Community Crime Prevention Network, Citizen's Police 10 Prevention Programs Academy, etc. Citywide Special Public "The T" rail system planning a Transportation commuter rail line from Fort Worth Routes or Reduced through Grapevine to DFW Airport. 11 Fairs. Visitor shuttle service in operation. Citywide Capital Improvements in The City may provide resources for Water and Sewer a capital improvement plan related Citywide— On Case 12 Facilities to water and sewer service. By Case Basis The City is responsible for maintaining and repairing public 13 Road Maintenance streets and alleys inside City limits. Citywide Name of Incentive Description of Incentive Availability Creation or Improvement of Maintain parks and promote healthy 14 Parks lifestyle for City residents. Citywide 15 Promotion and Convention and Visitors Bureau and Citywide Marketing Service Chamber of Commerce 16 Job Training and Offered in conjunction with local Citywide Employment community colleges and technical Services schools. 17 Retraining Program Offered in conjunction with local Citywide community colleges and technical schools. 18 Literacy and Offered in conjunction with local Citywide Employment Skills community colleges and technical Services schools. 19 Vocational Education Offered in conjunction with local Citywide community colleges and technical schools. 20 Customized Job Offered in conjunction with local Citywide Training community colleges and technical schools.