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R-92-1772 - 12/10/1992WHEREAS, the City of Round Rock and the Port of Corpus Christi Authority of Nueces County, Texas entered into a Subzone Affiliation Agreement on the 18th day of May, 1989; and WHEREAS, this Agreement was established because no foreign trade zone existed at the Austin port of entry; and WHEREAS, the City of Round Rock is now part of the newly established Foreign Trade Zone of Central Texas, Inc. (Foreign Trade Zone No. 183); and WHEREAS, the City of Round Rock wishes to thank Tom Moore and the Port of Corpus Christi Authority for extending us the opportunity and encouragement to participate in foreign trade zone activity; and WHEREAS, the City wishes to terminate the Agreement pursuant to Article III, paragraph (f); Now Therefore BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS, That the Subzone Affiliation Agreement established in 1989 be terminated and that written notice hereof be given to the Port of Corpus Christi Authority of Nueces County, Texas as provided in said Agreement. RESOLVED this 10th day of December, 1992. RESOLUTION NO. 1 1 11. IQ/ E LAND, City Secretary 2/11 MIKE ROBINSON, Mayor City of Round Rock, Texas OAT CORPUS CInIAIISTII Mr. Joe Vining City of Round Rock 221 East Main Street Round Rock, TX 78664 TSM /mcd November 2, 1992 Thomas S. Moore ' Manager Foreign Trade Zone #122 RECEIVED NOV 0 6 1992 CITY OF ROUND ROCK PLANNING DEPARTMENT Re: Subzone Affiliation Agreement Dear Mr. Vining: Congratulations on the approval of the Foreign Trade Zone of Central Texas Inc.. We wish you every success with your new zone. The Foreign Trade Zones Board has stated its policy to consider requests for zone /subzone status primarily as part of the Grantee in the Port of Entry when one is available. What we were trying to reach by the Subzone Affiliation Agreement between the Port of Corpus Christi Authority, Grantee of FTZ #122, and the City of Round Rock has been properly superceeded by the Grant of Authority to FTZ #183. Therefore, it seems fitting that we dissolve that affiliation agreement at this time. The FTZ program is growing in its usefulness, especially as �Je enter the realm of the North American Free Trade Agreement, because the industrial competitiveness attainable under NAFTA will demand raw materials from world sources which will not be privileged under NAFTA and may, therefore, benefit by FTZ administration. The communities prepared to give the best service in this area stand to prosper most. It was an honor to work with your community and we hope that the Port of Corpus Christi can be of service to you in the future. Port of Corpus Christi Authority 222 Power Street • P.O. Box 1541 • Corpus Chaste. Texas 78403 • 512.882.5633 • Fax 512-882 -7110 SUBZONE AFFILIATION AGREEMENT THIIS AGREEMENT is made and entered in triplicate originals this /O e day of 1989, by and between the City of Round Rock, Texas ( "City ") and the Port of Corpus Christi Authority of Nueces County, Texas ( "Port "): WITNESSETH: WHEREAS, the Port has previously applied for and been awarded a Foreign -Trade Zone under the provisions of the Foreign - Trade Zone Act of 1934 as amended [Public Law 98 -573, 19 U.S.C.A., Sec. 81 (c) et seq.] (the "Act "), the said Foreign Trade Zone now being designated as Port of Corpus Christi Foreign Trade Zone No. 122 (The "Port's Zone "); and WHEREAS, one of the purposes of the Port's Zone under the Act is to create jobs; and WHEREAS, the City has sought various ways to improve the business climate throughout the City for the purpose of creating new jobs, increasing business activity and improving the economic climate in the City; and WHEREAS, under 15 CFR $400.304 a foreign trade subzone may be established in an area separate from an existing foreign trade zone for one or more of the specialized purposes of storing, manipulating, manufacturing, or exhibiting goods if the U. S. Foreign Trade Zone Board finds that existing or authorized zones Page 2. will not serve adequately the convenience of commerce with respect to the proposed purposes of the subzone; and WHEREAS, the City has determined that it is in its best interest to request the Port to assist in providing Foreign Trade Subzones under the Port's Zone to those businesses located within the Round Rock area desiring same; and WHEREAS, the Port has determined that it is in its best interest to assist in providing Foreign Trade Subzones under the Port's Zone to those businesses located in the Round Rock area, the Round Rock area is hereinafter defined as the City Limits of Round Rock and its Extraterritorial Jurisdiction; and, desiring to apply for the same because such Foreign Trade Subzones can reasonably be expected to generate revenue and good will for the Port. NOW, THEREFORE, for and in consideration of the premises and the hereinafter set out covenants, conditions and obligations, the parties hereto agree as follows: The Port Agrees: ARTICLE I. (a) To assist the City by offering a Foreign Trade Subzone under the Port's Zone to any Interested Company on the same basis as companies in the Corpus Christi area. For purposes of this agreement the term "Interested Company" means any business located in the Round Rock area interested in obtaining a Foreign Page 3. Trade Subzone under the Port's Zone which is recommended to the Port by the City pursuant to Article III(a) hereof, and which. in the Port's opinion, is qualified to obtain such subzone status. (b) To participate in an analysis of the economic benefits of Foreign Trade Subzone status based on data provided to the Port by any Interested Company. (c) To supervise in the preparation of an application package for a Foreign Trade Subzone under the Port's Zone for any Interested Company, it being understood that the Port cannot assure any company that its application will be granted and that the processing of such application normally requires one year or more. (d) To file an application for a Foreign Trade Subzone under the Port's Zone with the U.S. Foreign Trade Zone Board with regard to the Interested Company. (e) To furnish information to any Interested Company regarding the benefits and requirements of being a subzone. (f) To provide each Interested Company which acquires a Foreign Trade Subzone under the Port's Zone with a copy of its customized operations manual. Page 4. (g) To supervise in the preparation of activation documents for each Interested Company which has been granted a Foreign Trade Subzone and which desires to activate same. (h) To assist each Interested Company in beginning participation in its Foreign Trade Subzone as soon as the activation for same is approved by the U. S. Customs Service. (i) To enter into a Subzone Operator Agreement substantially in the form attached hereto as Exhibit B with any Interested Company granted a Foreign Trade Subzone under the Port's Zone. ARTICLE II. (a) The City agrees to protect, indemnify, defend and hold the Port harmless from any and all claims, liability, cost, expense, damage or loss of whatever nature, directly or indirectly resulting from, arising out of, in connection with, or related to a reduction of any local tax revenue, including but not limited to. tax revenue payable to Williamson or Travis County, the Round Rock Independent School District or the City, resulting from the establishment of a Foreign Trade Subzone under the Port's Zone in the Round Rock area. (b) All promotions of Foreign Trade Sub_ones in the Round Rock area shall be at the initiative and cost of the City. Page 5. ARTICLE III. (a) City understands that a Foreign Trade Subzone under the Port's Zone shall only be available to companies located in the greater Round Rock area. The City shall submit a written request signed by the Mayor and the President of the Interested Company addressed to the Port requesting that the Port enter into negotiations with such company for consideration of Foreign Trade Subzone status, which written request shall authorize, and City and the Interested Company shall agree to pay for, the expenditure of funds for travel to the City by a member of the Port's Foreign Trade Zone staff. Such written authorization for the expenditure of funds may contain such limitations as the City deems appropriate. It is understood that the Port reserves the right to discontinue negotiations with any Interested Company when in the opinion of the Port such company is not a viable candidate for subzone status. (b) All travel expenses incurred by the Port in the development of each Foreign Trade Subzone in the Round Rock area shall be borne by the Interested Company responsible for such subzone and such expenses, to the extent such expenses are authorized in the written request described in paragraph (a), above, or any other written instrument delivered to the Port by the City are hereby guaranteed by the City. Page 6. (c) Except as provided in this agreement or as otherwise specifically requested in a writing delivered to the Port by the City, no costs in the establishment of a Foreign Trade Subzone under the Port's Zone in the Round Rock area shall be at any cost or expense to the City. (d) It is understood that whenever any interested Company becomes a Foreign Trade Subzone it will come under the supervision of the U. S. Customs. (e) All parties agree to comply with all applicable provision of the Act and the rules and regulations of the U. 5. Foreign Trade Zone Board, the Secretary and the Treasurer of the United States, and the U. S. Customs Service and,all state, local and federal directives applicable to Foreign Trade Zones as they affect any of the parties hereto. (f) This agreement may be terminated by either party giving thirty (30) days written notice of termination to the other party, with the understanding that neither the Port nor the City shall have any further obligations hereunder after the date of such termination; provided, however that termination of this agreement shall not affect any Subzone Operator Agreements which have theretofore been entered into pursuant to this agreement. (g) It is understood that each Interested Company will pay in advance to the Port the application fee shown on the Port's Zone Fee Schedule in effect at the time such application is made Page 7. and thereafter will pay to the Port the other fees shown on said fee schedule, as in effect from time to time, it being expressly understood that said fee schedule is amended by the Port from time to time. A copy of said fee schedule as in effect on the date hereof is attached hereto as Exhibit A for reference purposes only. The actual fees due and payable shall be those fees shown on the Port's Zone Fee Schedule at the time the fees are due. (h) It is understood that each Interested Company granted a Foreign Trade Subzone under the Port's Zone will be required to deliver a bond payable to the U. S. Customs solely at the cost of such Company, and at no expense to the Port or City in an amount designated by the District Director. of Customs and to enter into - a Subzone Operator Agreement substantially in the form attached hereto as Exhibit 8, and made a part hereof by reference. (i) It is understood that no services requested by City ro€ ;‹,e( any Interested Company shall be an expense of the Port. (j) it is understood that the Port is not acting as City's agent when performing its obligations hereunder and that the City is not acting as the Port's agent when performing its obligations hereunder. Page 8. ATTEST: WITNESS the signature of the parties this the /O A'day of , 1989. B ne Land, City Secretary PORT OF CORPUS CHRISTI AUTHORITY OF NUECES COUNTY, TEXAS By: By: Harry G. Plomarity, Executive D'rector Thomas S. Moore, Manager Foreign Trade Zone No. 122 THE CITY OF ROUND ROCK, TEXAS Mike Robinson, Mayor Page 9. EXHIBIT A FOREIGN TRADE ZONE #122 FEE SCHEDULE DATED: Foreign Trade Zone #122 has adopted the following fee schedule for Foreign Trade Subzones of Foreign Traoe Zone #122. Fees for potential Subzones that do not fit into one of the listed categories will be negotiated between the Subzone Operator and the FTZ #122 Manager. Fees by category are: 1. Manufacturing Subzones: The following is a schedule of Manufacturing Subzone fees: Application Fee Activation Fee Alteration /Relocation Fee Annual Fee Travel Expenses 2. Refinery Subzones: The following is a schedule of Refinery Subzone fees: Application Fee Activation Fee Alteration /Relocation Fee Annual Fee $15,000 $ i3O00 $ 1.500 $25.000 See 3 Below $15,000 $ 3,000 $ 1,500 $.60 multiplied by the daily per barrel] design capacity of the refinery." Travel Expenses See 3 below. 'Example: 100,000 bbls. x $.60 = $60,000 Annual Fee. 3. Travel Expenses: The Subzone Operator shall reimburse the Port For travel expenses incurred by the Port's FTZ representatives (1) at the request of the Subzone Page 10. Operator. and (ii) in making two unscheduled visits per year to the Subzone Operator's subzone For the purpose of insuring compliance with U. S. Customs regulations. 4. Any extended legal costs or unusually high expenses involved with unforeseen, complex issues will be proportionally shared by the Subzone Operators involved in the issue. The application fee is due on or before mailing of the Subzone Operator's application for a foreign trade subzone to the U. 5. Foreign Trade Zone Board. The activation fee is due on or before mailing of the Subzone Operator's activation documents to the U. 5. Customs Service. The annual fee is due on or before the Effective Date of the Subzone Operator's Subzone Operator Agreement and each anniversary date thereof. All of the foregoing fees shall be deemed to have been earned when paid and, as such, are nonrefundable. The foregoing fees are subject to change from time to time by the Foreign Trade Zone ##I22 in its sole discretion and without notice to any Subzone Operator. DATE: December 8, 1992 SUBJECT: City Council Meeting, December 10, 1992 ITEM: 10.D. Consider a resolution dissolving the agreement with the Port of Corpus Christi. STAFF RESOURCE PERSON: Joe Vining STAFF RECOMMENDATION: Approval The resolution dissolving the agreement with the Port of Corpus Christi will be presented at the meeting.