R-05-05-26-12D1 - 5/26/2005RESOLUTION NO. R -05-05-26-12D1
WHEREAS, Simon Property Group, L.P. ("Simon") is one of the
largest retail shopping center development companies in the world, and
WHEREAS, Simon has expressed to the City of Round Rock ("City")
its desire to locate a Premium Outlet Mall in the City which will
attract shoppers from outside of the area and provide hundreds of new
jobs, and
WHEREAS, §380.001 Local Government Code provides that a
municipality may establish a program ("Program") to promote local
economic development and to stimulate business and commercial activity
in the municipality, and
WHEREAS, the City Council has determined that the Program
described in Exhibit "A" will meet the goals set forth in said §380.001
and will be of mutual benefit to both parties, Now Therefore
BE IT RESOLVED BY THE COUNCIL OF THE CITY OF ROUND ROCK, TEXAS,
That the Mayor is hereby authorized and directed to offer to Simon
a §380.001 Program in exchange for Simon .locating a Premium Outlet Mall
in the City of Round Rock, and
BE IT FURTHER RESOLVED
That the offer of the Program shall be as generally outlined in
Exhibit "A" attached hereto and incorporated herein for all purposes.
The City Council hereby finds and declares that written notice of
the date, hour, place and subject of the meeting at which this
Resolution was adopted was posted and that such meeting was open to the
public as required by law at all times during which this Resolution and
the subject matter hereof were discussed, considered and formally acted
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upon, all as required by the Open Meetings Act, Chapter 551, Texas
Government Code, as amended.
RESOLVED this 26th day of May, 20
CHRISTINE R. MARTINEZ, City Secret
2
Ci
ry
Mayor
of Round Rock, Texas
EXHIBIT A
The terms of the §380.001 Program to be offer to Simon in exchange for Simon's
locating a Premium Outlet Mall in the City of Round Rock are as generally outlined below:
1. The City agrees to make program payments to Simon calculated on the basis of
sales and use tax revenues actually received by the CITY from taxable sales
generated by the Premium Outlet Mall as follows:
a. The City will retain all of the sales and use tax revenues derived from the
one-half cent of the tax devoted to the reduction of ad valorem property
tax;
b. The City will retain all of the sales and use tax revenues derived from
annual gross taxable sales up to $275 per square foot of gross leasable
area;
c. The City will make program payments to Simon equal to the sales and use
tax revenues derived from annual gross taxable sales in excess of $275 per
square foot of gross leasable area;
d. The total amount of program payments to Simon will not exceed the cost
of the construction of needed extensions to Oakmont Dr. and Teravista
Blvd., currently estimated to be $3,266,604 on a Net Present Value Basis
(discounted at 6%.
2. The term of the Program shall not exceed eight years.
DATE: May 20, 2005
SUBJECT: City Council Meeting - May 26, 2005
ITEM: 012.D.1. Consider a resolution establishing an Economic Development
Program pursuant to Section 380 of the Local Government Code.
(Simon Project)
Department: Administration, Legal
Staff Person: Jim Nuse, City Manager
David Kautz, Assistant City Manager
Steve Sheets, City Attorney
Justification:
The Project is a Destination Retailer, meaning it attracts commerce from outside of the City. It
will generate substantial sales and property taxes, create jobs and diversify our sales tax base.
This agreement details responsibilities of the parties and the funding of the internal roads. At
the City's option, the internal road improvements will be funded from the 1% general sales tax
generated by the Project over a period not to exceed 8 years or from the 4B Corporation. The
Project must meet certain performance standards to receive funding for the roads.
Funding:
Cost: Present Value Estimate $3,266,604
Source of funds: General Fund (from sales tax revenue generated by The Project) or from
the 4B Corporation (at the City's option)
Outside Resources: N/A
Background Information:
To facilitate development of the Simon / Chelsea Premium Outlet Mall (the Project) on a tract
of land east of IH 35 and north of Chandler Road, the City and the Round Rock Transportation
System Development Corporation (4B Corporation) proposes to fund construction of certain
road improvements. These road improvements include IH 35 frontage road improvements and
new road construction internal to the project tract.
Public Comment: N/A