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HomeMy WebLinkAboutItem 09 - Gaylord Texan Economic Development ���� � -1--,--�- � �,, MEMO TO: HONORABLE MAYOR AND MEMBERS OF THE CITY COUNCIL FROM: BRUNO RUMBELOW, CITY MANAGER 1�� MEETING DATE: NOVEMBER 3, 2009 SUBJECT: GAYLORD TEXAN ECONOMIC DEVELOPMENT AND INCENTIVE AGREEMENT RECOMMENDATION: . City Council considered approving an Economic Development and Incentive Agreement with Opryland Hotel - Texas Limited Partnership for the development of a swimming pool complex on Lot 1, Block 1, Opryland Fourth Addition, authorize staff to execute said agreement, and take any necessary action. BACKGROUND: The construction of this pool facility will enhance the current operations at the hotel by filling a critical need for additional pool facilities for their guests. It does, however, pose financial issues to Gaylord in the current economic times. To help mitigate the financial exposure to Gaylord, they have requested that the City consider reducing the Water and Wastewater Impact Fees for this site by applying the fees only to the footprint of the pool and associated buildings totaling 20,674 SF. This agreement and its treatment of impact fees is consistent with agreements entered into by the City providing incentive packages for the original Gaylord Hotel Complex development and the Great Wolf Lodge development. Staff recommends approval. � GAY LORD ENTERTAI[�IMENT` Sennect Westhrook.Sruior L'iu Prtsidr�u,Dr+�clo/nnru/,De.ci�u td Conserv�aion October 6, 2009 Mr. Bruno Rumbelow City Manager City of Grapevine P. O. Box 95104 . Grapevine, TX 76099 Re: Gaylord Texan -Swimming Poot Complex -Lot 1, Btock 1, Opryland Fourth Addition Dear Bruno: In our recent discussions, I have nated our critical nesd for a pool facility to enhance our guests exper�ence at the hotel. We have devefoped a prefiminary plan for a poo! compiex on the referenced tract. This pooC complex is a costly undertaicing far us in these uncertain economic times. ln an effort to limit our financial exposure, we are asking the City of Grapevine to reduce the up fror�f fe+es for the development of the swimming pooi cornplex. Specifically, �e request'that tf�e application of the Wafer and Wastewater I�pact Fees be Gmited to the foatprint of the buiiding and pool totaling approximatety 20,674 square feet. This approach of applying #he impact fees to the foot print of the prop:osed ' sf.ructures is similar to the City's a,pproach used with our hotet site devetopment. ; as we11 as#he Great Woif Lodge development. The proposed facility does not utilize the entire '10+ acres of Lot 'I. Upon later d�vel�pmenf of fhe balance of Lot 9, additionai impact fees would be addressed. This approach wilf resuit in an impact fee cost foi-the proposed development on Lot 1 of approximafely$ 3,200. Gayt�nt Entertainineiit t:omfra� One Ga}'lorci Dtive,Nas}tirille,TN 3721�t . TrJc}+hcwe b15-:��6-b436 'Faau�iile G15-11(rG5i7 Eu�aiL•bu�stbroo�aylar3e�tOt[tainii�Qnt.ci�in We appreciate the City's continued support of our hotei and look forward to the � successful development of this addition to the Gaylord experience. If you have any questions, please call me at 615.316.6436. Si ly, Bennett Westbrook Senior Vice President ' Development , Design & Construction cc: Matt Singleton File � � � �. �� � �� � �� . � �� ECONOMIC DEVELOPMENT AND INCENTIVE AGREEMENT THIS ECONOMIC DEVELOPMENT AND INCENTIVE AGREEMENT (the "Agreement"), is made and entered into as of the day of , 2009, by and between the CITY OF GRAPEVINE, TEXAS, a home rule municipality located in the counties of Tarrant, Dallas and Denton, Texas (the "City"), and Opryland Hotel—Texas Limited Partnership, a Delaware limited partnership in good standing authorized to do business in the State of Texas ("Developer"). RECITALS: Developer plans to develop approximately 10.12 acres of property in the City as more particularly described as Lot 1, Block 1, Opryland 4t" Addition, Grapevine, Tarrant County Texas (the "Property") on which Developer plans to construct a water park(generally referred to herein as the "Project"); and Developer has requested that the City authorize certain incentives, grants, fee waivers, and consideration as provided herein (collectively referred to as the "Incentives") with respect to the Project; and The City is authorized by Chapter 380 of the Texas Local Government Code to provide economic development incentives to support the expansion of local business activity, ` employment and development; and For the public purpose of promoting economic development and diversity, increasing employment, reducing unemployment and underemployment, expanding commerce and stimulating business and commercial activity in the State of Texas, Dallas, Denton and Tarrant Counties and the City, the City desires to offer the Incentives to Developer as more particularly described in this Agreement; and The Agreement and Incentives are authorized by, and in accordance with Chapter 380 of the Texas Local Government Code. NOW, THEREFORE, for and in consideration of the promises, covenants and agreements set forth herein, the receipt and sufficiency of which are hereby acknowledged, the City and Developer (collectively,the "Parties") agree as follows: Section I. The representations, covenants and recitations set forth in the foregoing recitals are material to this Agreement and are hereby incorporated into and made a part of this Agreement as though they were fully set forth in this Section I. Section II. Page 1 , � The Incentives A. To qualify for the Incentives provided for herein, Developer must also meet the conditions set forth in the following subparagraphs: i. Obtain the necessary building permit(s) and commence construction on the Project no later than 12 months from the date of this Agreement; and ii. The City will have the right to terminate this Agreement, in whole or in part, if Project is not co5mmenced, completed, opened, or operated during the Term in accordance with the requirements of foregoing by the deadlines specified therein, by giving written notice thereof to Developer. All incentives provided for herein are wholly subject to Developer's compliance with the terms and conditions of this Agreement. B. Subject to the qualifications set forth in Section II.A. above, the City agrees to provide the following Incentives. The City shall calculate water and sewer impact fees to be paid by Developer for the Project based upon building permit application, which fees shall be applied as follows: Commercial Fee applied to acreage of water park pool and building �`' structure footprint- # acres x $6,749.00/acre '`� Section III. SALES AND USE TAX SEPARATED CONTRACT All construction contracts comprising the "Project" shall require that the respective contractor enter into a separated contract with the State of Texas for the purpose of Sales Tax Collection on eligible project costs in accordance with Texas Tax Code Secs. 151.056, 151.311 and 321.208. Section IV. Miscellaneous A. All construction on the Project will be in accordance with applicable codes, regulations and ordinances of the City, and all applicable State and Federal laws, rules and regulations. B. This Agreement may not be assigned, transferred, conveyed, or exchanged, in whole or in part, by either party without the written consent of the other party; provided, however, that Developer may assign this Agreement to an entity controlled by the members of Developer and may be collaterally assigned to any Project construction or permanent lender. In the event of an approved assignment, the assigning party shall provide written notice of the assignee, including assignee's address and contact information. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and (subj ect to approval of the other party) assigns. °""""`� Page 2 a.. _.�� .�,.�� n. C. The individuals executing this Agreement on behalf of the respective parties below represent to each other that all appropriate and necessary action has been taken to authorize the individual who is executing this Agreement to do so for and on behalf of the party for which his or her signature appears, that there are no other parties or entities required to execute this Agreement in order for the same to be an authorized and binding agreement on the party for whom the individual is signing this Agreement and that each individual affixing his or her signature hereto is authorized to do so, and such authorization is valid and effective on the date hereof. a. This Agreerr�nt is executed by the parties hereto without coercion or duress and for substantial consideration, the sufficiency of which is forever confessed. b. This Agreement may be executed in a number of identical counterparts, each of which shall be deemed an original for all purposes. c. In case any one or more of the provisions contained in this Agreement shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision thereof, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein. d. Each signatory represents this Agreement has been read by the party for which this Agreement is executed and that such party has had an opportunity to confer with its counsel. e. Time is of the essence in this Agreement. The parties agree this Agreement has been drafted jointly by the parties and their legal representatives. D. The Developer agrees to and does hereby indemnify, defend and hold the City, its employees, representatives and agents, (collectively, the "Indemnified Parties") harmless of and from any and all losses, costs, claims, damages, injury, expense or liability (including, without limitation, reasonable attorneys' fees and court costs and expenses) arising by reason of injury to or death of persons, damage to property or claims for liens for work or labor performed, materials or supplies furnished arising out of or in connection with the performance of the work on the Project undertaken or performed by or on behalf of the Developer (collectively, the "Indemnified Matters"), provided that Developer shall not be required to indemnify, defend or hold the Indemnified Parties harmless from the Indemnified Parties' gross negligence or intentional misconduct. E. Powers. Page 3 (i) The City hereby represents and warrants to Developer that the City has � full constitutional and lawful right, power and authority, under currently applicable law, to execute and deliver and perform the terms and obligation of this Agreement, and all of the foregoing have been or will be duly and validly authorized and approved by all necessary City proceedings, findings and actions. Accordingly, this Agreement constitutes the legal, valid and binding obligation of the City, is enforceable in accordance with its terms and provisions and does not require the consent of any other governmental authority. (ii) Developer hereby represents and warrants to the City that Developer has full lawful right, power and authority to execute and deliver and perform the terms and obligations of this Agreement �..nd all of the foregoing have been or will be duly and validly authorized and approved by all necessary actions of Developer. This Agreement constitutes the legal, valid and binding obligation of Developer, and is enforceable in accordance with its terms and provisions. F. Authorized Parties. Whenever under the provisions of this Agreement and other related documents and instruments or any supplemental agreements, any request, demand, approval, notice or consent of the City or Developer is required, or the City or Developer is required to agree or to take some action at the request of the other, such request, demand, approval, notice or consent, or agreement shall be given for the City, unless otherwise provided herein, by the City Mayor or his designee and for Developer by any officer of Developer so authorized (and, in any event, the officers executing this Agreement are so authorized); and any Party shall be authorized to act on any such request, demand, approval, notice or consent, or agreement. � r G. Default. (i) A Party shall be deemed in default under this Agreement (which shall be deemed a breach hereunder) if such Party fails to materially perform, observe or comply with any of its covenants, agreements or obligations hereunder or breaches or violates any of its representations contained in this Agreement. (ii) Before any failure of any Party to this Agreement to perform its obligations under this Agreement shall be deemed to be a breach of this Agreement, the Party claiming such failure shall notify, in writing, the Party alleged to have failed to perform of the alleged failure and shall demand performance. No breach of this Agreement may be found to have occurred if performance has commenced to the reasonable satisfaction of the complaining Party within thirty (30) days of the receipt of such notice; provided, however, if such matter is such that it cannot be cured within thirty (30) days, no breach may be found to have occurred if the Party has commenced the cure thereof within thirty (30) days and diligently pursues the completion thereof provided that such cure shall in any event occur within ninety (90) days after written notice of the breach. Upon a breach of this Agreement, the non-defaulting Party, in any court of competent jurisdiction, by an action or proceeding at law or in equity, may secure the specific performance of the covenants and agreements herein contained, may be awarded damages for failure of performance, or both; provided however, that the City's sole remedy hereunder for Developer's failure to complete the Project shall be to withhold the Incentives. � Except as otherwise set forth herein, no action taken by a Party pursuant to the provisions of this Page 4 ��.�. �.�„ ,a..<�.� �,��,,,., ,� -�.,�-A �.�. Section or pursuant to the provisions of any other Section of this Agreement shall be deemed to constitute an election of remedies and all remedies set forth in this Agreement shall be cumulative and non-exclusive of any other remedy either set forth herein or available to any Party at law or in equity. Each of the Parties shall have the affirmative obligation to mitigate its damages in the event of a default by the other Party. (iii) Notwithstanding anything in this Agreement which is or may appear to be to the contrary, if the performance of any covenant or obligation to be performed hereunder by any Party is delayed as a result of circumstances which are beyond the reasonable control of such Party which circumstances may include, without limitation, pending or threatened litigation, act of God, war, acts of civil disabedience, fire or other casualty, shortage of materials, adverse weather conditions (such as, by way of illustration and not limitation, severe rain storms or below freezing temperatures, or tornadoes, labor action, strikes or similar acts) the time for such performance shall be extended by the amount of time of such delay. The Party claiming delay of performance as a result of any of the foregoing "force majeure" events shall deliver written notice of the commencement of any such delay resulting from such force majeure event not later than ten (10) business days after the claiming Party becomes aware of the same, and if the claiming Party fails to so notify the other Party of the occurrence of a "force majeure" event causing such delay, the claiming Party shall not be entitled to avail itself of the provisions for the extension of performance contained in this Section. H. This Agreement, and any exhibits attached hereto, may be amended only by the mutual agreement of the Parties evidenced by a written amendment, by the adoption of an ordinance or resolution of the City approving such written amendment, as provided by law, and by the execution of such written amendment by the Parties or their successors in interest. I. Severability. If any provision, covenant, agreement or portion of this Agreement, or its application to any person, entity or property, is held invalid, such invalidity shall not affect the application or validity of any other provisions, covenants, agreements or portions of this Agreement and, to that end, all provisions, covenants, agreements or portions of this Agreement are declared to be severable. J. Texas Law. This Agreement shall be construed in accordance with the laws of the State of Texas, and any actions concerning this Agreement shall be brought in either the Texas State District Courts of Tarrant County, Texas or the United States District Court for the Northern District of Texas. K. Notice. Any notice to be given or served hereunder or under any document or instrument executed pursuant hereto shall be in writing and shall be (i) delivered personally, with a receipt requested therefore, or (ii) sent by telecopy facsimile; or (iii) sent by a nationally recognized overnight courier service; or (iv) delivered by United States registered or certified mail, return receipt requested, postage prepaid. All notices shall be addressed to the Parties at their respective addresses set forth below, and shall be effective (a)upon receipt or refusal if delivered personally or by telecopy facsimile; (b) one (1) business day after depositing with such an overnight courier service or (c) two (2) business days after deposit in the United States mails, if mailed. A Party may change its address for receipt of notices by service of a notice of such Page 5 � change in accordance with this Section. All notices by telecopy facsimile shall be subsequently confirmed by U.S. certified or registered mail, return receipt requested. If to the City: City of Grapevine 200 South. Main Street P. O. Box 95104 Grapevine, Texas 76099 Attn: City Manager Fax: (817)410-3002 with a co�y to: John F. Boyle, Jr. Boyle & Lowry, L.L.P. 4201 Wingren, Suite 108 Irving, Texas 75062-2763 Fax: (972) 650-7105 If to Developer: with a copy to: L. Interpretation. This Agreement has been jointly negotiated by the Parties and shall not be construed against a Party because that Party may have primarily assumed responsibility for the drafting of this Agreement. ,,,� ...<. IN WITNESS WHEREOF, the City Council of the City of Grapevine, Texas, and Grapevine Equity Partners, LLC have authorized and caused this Agreement to be executed and delivered on this the day of , 2009. THE CITY OF GRAPEVINE, TEXAS, a Texas home rule municipality By: Bruno Rumbelow City Manager ATTEST: Linda Huff City Secretary APPROVED AS TO FORM: �"` ,�` Page 6 „ . . �.,����= >� ,���,� �.�� .a,��; City Attorney OPRYLAND HOTEL—TEXAS LIMITED PARTNERSHIP, a Delaware limited partnership By: Opryland Hospitality, Inc., its General Partner By: Title: ACKNOWLEDGEMENT: STATE OF TENNESSEE COUNTY OF Before me, the undersigned, on this day personally appeared , of Opryland Hospitality, Inc., in its capacity as the general partner of OPRYLAND HOTEL — TEXAS LIMITED PARTNERSHIP, a Delaware limited partnership, proved to me through the presentation of a valid Tennessee driver's license to be the person whose name is subscribed to the foregoing instrument and acknowledged to me that he/she executed the same for the purposes and consideration therein expressed. Mr./Ms. furthermore attested that he/she is signing this agreement in his/her capacity as of Opryland Hospitality, Inc., in its capacity as the general partner of OPRYLAND HOTEL — TEXAS LIMITED PARTNERSHIP, a Delaware limited partnership, and that such capacity makes his signature valid to bind the partnership. GIVEN iTNDER MY HAND AND SEAL OF OFFICE, this_day of , 2009. (Notary Seal) Notary Public in and for the State of Tennessee Print Name: My Commission Expires: Page 7