Title
Consider/Discuss/Act on a Resolution Approving a Chapter 380 Economic Development and Incentive Agreement by and between the City of McKinney, the McKinney Economic Development Corporation and Emerson Process Management Regulator Technologies, Inc. and Authorizing the City Manager to Execute the Agreement
Summary
MEETING DATE: July 17, 2012
DEPARTMENT: City Manager
CONTACT: Jason Gray, City Manager
RECOMMENDED CITY COUNCIL ACTION:
· Approval
ITEM SUMMARY:
· The City Manager's office has completed negotiations with Emerson on the terms of the incentive agreements for Emerson's relocation of its headquarters to the Gateway site. The MEDC provides the bulk of the financial incentives while the City's incentives are aimed primarily at expediting the development process. The terms are embodied in a Chapter 380 Economic Development and Incentive Agreement having the following primary terms:
· MEDC conveys 10 acres of Gateway property to Emerson at no cost; plus 2 additional acres at a reduced cost.
· MEDC and City assist on the subdivision/zoning processes and share on certain portions of the cost of utility infrastructure.
· Emerson commences construction of headquarters/R&D facility: $15MM cost and 128,000 square feet beginning in 3Q of 2012 (Groundbreaking is July 24, 2012).
· Emerson to receive Certificate of Occupancy by March 31, 2014.
· If project has not received a Certificate of Occupancy by March 31, 2014, subject to one 90-day extension, MEDC may elect to require Emerson pay MEDC $4MM for site.
· If no Certificate of Occupancy received by March 31, 2014, MEDC may elect to require Emerson to convey the parcel back to MEDC and raze the site of any incomplete improvements.
· Emerson is exempt from certain cross-access and parking provisions in newly-filed restrictive covenants governing entire Gateway parcel; however Emerson pays for maintenance of certain other common features in Gateway complex.
· City/MEDC has certain approvals on architectural aspects of Emerson buildings.
· Emerson pays for title insurance on 12 acre parcel as partial consideration for 2 additional acres conveyed.
· City waives impact fees; Emerson pays other permit, inspection and development fees.
· MEDC grants $1MM incentive if Emerson's Certificate of Occupancy is received by March 31, 2014.
· Emerson's transfer of the building/land to an unrelated entity prior to 2019 will trigger financial clawbacks, including the repurchase of the Emerson site on SH 5.
BACKGROUND INFORMATION:
· On October 18, 2011 the City, MEDC and Emerson announced the relocation of the Emerson Process Management Regulator Technologies, Inc.'s corporate headquarters to the Gateway site
FINANCIAL SUMMARY:
· Included in Item Summary
BOARD OR COMMISSION RECOMMENDATION:
· MEDC to consider approval at its July 17, 2012 Board Meeting