HomeMy WebLinkAboutC2023-286 - 11/14/2023 - Approved BUSINESS INCENTIVE AGREEMENT BETWEEN
THE CORPUS CHRISTI B CORPORATION AND CORPUS CHRISTI PATCH, INC.
FOR THE DEVELOPMENT OF AN ENTERTAINMENT VENUE
This Business Incentive Agreement for Capital Investments and the development of an
entertainment venue ("Agreement") is entered into between the Corpus Christi B
Corporation ("Corporation") and Corpus Christi PATCH, Inc. ("Company"), a Texas non-
profit corporation.
WHEREAS, the Texas Legislature in Chapter 501 et seq. of the Local Government Code
(Development Corporation Act of 1979) (the"Act") empowered local communities with the
ability to adopt an optional local sales and use tax as a means of improving the economic
health and prosperity of their citizens;
WHEREAS, on November 8, 2016, residents of the City passed Proposition 1, Adopt
Type B Sales Tax to Replace Expiring Portion of Type A Sales Tax, which authorized the
adoption of a sales and use tax to be administered by a Type B Corporation at the rate of
one-eighth of one percent to be imposed for 20 years with use of the proceeds for (1)
50% to the promotion and development of new and expanded business enterprises to the
full extent allowed by Texas law, (2) $500,000 annually for affordable housing, and (3)
the balance of the proceeds for the construction, maintenance and repair of arterial and
collector streets and roads;
WHEREAS, the 1/8th cent sales tax authorized by passage of Proposition 1 was
subsequently enacted by the City Council and filed with the State Comptroller of Texas,
effective April 1, 2018, to be administered by the Corpus Christi B Corporation Board;
WHEREAS, the Corpus Christi B Corporation exists for the purposes of encouraging and
assisting entities in the creation of jobs for the citizens of Corpus Christi, Texas;
WHEREAS, the Company has proposed a development project to revitalize that Ritz
Theatre, located at 715 N Chaparral, Corpus Christi, Texas 78401, and has requested
funding to assist with stabilizing and securing the building to prevent further deterioration
before the larger project can proceed;
WHEREAS the proposed project is a necessary step in the ultimate revitalization and
development of an iconic entertainment venue;
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Type B Business Incentive Agreement
SCANNED
WHEREAS, Section 501.073 of the Act requires the City Council to approve all programs
and expenditures of the Corporation; and
WHEREAS, the Board determined that it is in the best interests of the citizens of Corpus
Christi, Texas that business development funds be provided to Company, through this
Agreement with Company, to be used by Company to develop the Project;
In consideration of the covenants, promises, and conditions stated in this Agreement,
Corporation and Company agree as follows:
1. Effective Date. The effective date of this Agreement ("Effective Date") is the latest
date that either party executes this Agreement, so long as the Agreement has been
approved by the City's City Council. Company understands that this Agreement is
dependent upon the approval of City Council.
2. Term. The term of this Agreement is for two years beginning on the Effective Date.
3. Performance Requirements.
a. Company agrees to use these funds to pay for the creation of certain
improvements allowed under Section 501.103 and 505.152 of the Texas Local
Government Code needed for the Project.
b. Company agrees to provide the Corporation with a sworn certificate by an
authorized representative of the Company, certifying the amount used for
improvements.
c. Company will provide the Corporation with a detailed list of expenditures each
year within 30 days of the anniversary of the Effective Date until construction is
complete.
d. During the term of this Agreement, Company will invest at least$230,000 toward
securing and stabilizing the building in accordance with the Scope of Work, which
is attached hereto as Exhibit A and incorporated by reference.
e. Company will expend at least $230,000 on the improvements listed in Exhibit
A, with the highest priority being securing and stabilizing the building, on or before
June 30, 2023.
4. Grant Award.
a. The Corporation will grant Company the amount of $230,000.
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Type B Business Incentive Agreement
b. The Corporation will provide the funding within 30 days' after receipt of a
qualified request for such funding from Company, but no earlier than the 61st day
after the public hearing held at the Corporation's meeting on October 16, 2023.
5. Utilization of Local Contractors and Suppliers. Company agrees to exercise
reasonable efforts in utilizing local contractors and suppliers in the construction of the
Project, except where not reasonably possible to do so without added expense,
substantial inconvenience, or sacrifice in operating efficiency in the normal course of
business, with a goal of 50% of the total dollar amount of all construction contracts and
supply agreements being paid to local contractors and suppliers. For the purposes of this
section, the term "local" as used to describe manufacturers, suppliers, contractors, and
labor includes firms, businesses, and persons who reside in or maintain an office within
a 50-mile radius of Nueces County. Company agrees, during the construction of the
Project, to maintain written records documenting the efforts of Company to comply with
the Local Requirement, and to provide an annual report to the City Manager or designee,
from which the City Manager or designee shall determine if Company is in compliance
with this requirement. Failure to substantially comply with this requirement, in the sole
determination of the City Manager or designee, shall be a default hereunder.
6. Utilization of Disadvantaged Business Enterprises ("DBE'). Company agrees to
exercise reasonable efforts in utilizing contractors and suppliers that are determined to
be DBEs, including minority business enterprises, women-owned business enterprises
and historically-underutilized business enterprises. In order to qualify as a business
enterprise under this provision, the firm must be certified by the City, the Regional
Transportation Authority or another governmental entity in the jurisdiction of the home
office of the business as complying with state or federal standards for qualification as
such an enterprise. Company agrees to a goal of 30% of the total dollar amount of all
construction contracts and supply agreements being paid to DBEs, with a priority made
for DBEs which are local. Company agrees, during the construction of the Project, to
maintain written records documenting the efforts of Company to comply with the DBE
Requirement, and to provide an annual report to the City Manager or designee, from
which the City Manager or designee shall determine if Company is in compliance with this
requirement. Failure to substantially comply with this requirement, in the sole
determination of the City Manager or designee, shall be a default hereunder. For the
purposes of this section, the term "local" as used to describe contractors and suppliers
that are determined to be DBEs, including minority business enterprises, women-owned
business enterprises and historically-underutilized business enterprises includes firms,
businesses, and persons who reside in or maintain an office within a 50 mile radius of
Nueces County.
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Type B Business incentive Agreement
7. Living Wage Requirement. In order to count as a permanent full-time job if required
under this agreement, the job should provide a "living wage"for the employee. The target
living wage under this agreement is that annual amount equal or greater than poverty
level for a family of three, established by the U.S. Department of Health and Human
Services Poverty Guidelines, divided by 2,080 hours per year for that year.
8. Health Insurance. In order to count as a permanent full-time job if required under this
agreement, an employer shall certify that it has offered a health insurance program for its
employees during the term of the Agreement. The health insurance program must comply
with all applicable laws.
9. Warranties. Company warrants and represents to Corporation the following:
a. Company is a non-profit corporation duly organized, validly existing, and in good
standing under the laws of the State of Texas, has all power and authority to carry
on its business as presently conducted in Corpus Christi, Texas.
b. Company has the authority to enter into and perform, and will perform, the terms
of this Agreement to the best of its ability.
c. Company has timely filed and will timely file all local, State, and Federal tax
reports and returns required by laws to be filed and all taxes, assessments, fees,
and other governmental charges, including applicable ad valorem taxes, have
been timely paid, and will be timely paid, during the term of this Agreement.
d. Company has received a copy of the Act and acknowledges that the funds
granted under this Agreement must be utilized solely for purposes authorized
under State law and by the terms of this Agreement.
e. The person executing this Agreement on behalf of Company is duly authorized
to execute this Agreement on behalf of Company.
f. Company does not and agrees that it will not knowingly employ an
undocumented worker. If, after receiving payments under this Agreement,
Company is convicted of a violation under 8 U.S.C. Section 1324a(f), Company
shall repay the payments received under this Agreement to the City, with interest
at the Wall Street Journal Prime Rate, not later than the 120th day after the date
Company has been notified of the violation.
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Type 6 Business Incentive Agreement
10. Compliance with Laws. During the Term of this Agreement, Company shall observe
and obey all applicable laws, ordinances, regulations, and rules of the Federal, State,
county, and city governments.
11. Non-Discrimination. Company covenants and agrees that Company will not
discriminate nor permit discrimination against any person or group of persons, with regard
to employment and the provision of services at, on, or in the Project, on the grounds of
race, religion, national origin, marital status, sex, age, disability, or in any manner
prohibited by the laws of the United States or the State of Texas.
12. Force Majeure. If the Corporation or Company is prevented, wholly or in part, from
fulfilling its obligations under this Agreement by reason of any act of God, unavoidable
accident, acts of enemies, fires, floods, governmental restraint or regulation, other causes
of force majeure, or by reason of circumstances beyond its control, then the obligations
of the Corporation or Company are temporarily suspended during continuation of the
force majeure. If either party's obligation is affected by any of the causes of force
majeure, the party affected shall promptly notify the other party in writing, giving full
particulars of the force majeure as soon as possible after the occurrence of the cause or
causes relied upon.
13. Assignment. Company may not assign all or any part of its rights, privileges, or duties
under this Agreement without the prior written approval of the Corporation and City. Any
attempted assignment without approval is void and constitutes a breach of this
Agreement.
14. Indemnity. Company covenants to fully indemnify, save, and hold
harmless the Corporation, the City, their respective officers,
employees, and agents ("Indemnitees") against all liability, damage,
loss, claims, demands, and actions of any kind on account of personal
injuries (including, without limiting the foregoing, workers'
compensation and death claims), or property loss or damage of any
kind, which arise out of or are in any manner connected with, or are
claimed to arise out of or be in any manner connected with Company's
activities conducted under or incidental to this Agreement, including
any injury, loss or damage caused by the sole or contributory
negligence of any or all of the Indemnitees. Company must, at its own
expense, investigate all those claims and demands, attend to their
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Type B Business Incentive Agreement
settlement or other disposition, defend all actions based on those
claims and demands with counsel satisfactory to Indemnitees, and pay
all charges of attorneys and all other costs and expenses of any kind
arising from the liability, damage, loss, claims, demands, or actions.
15. Events of Default by Company. The following events constitute a default of this
Agreement by Company:
a. The Corporation or City determines that any representation or warranty on
behalf of Company contained in this Agreement or in any financial statement,
certificate, report, or opinion submitted to the Corporation in connection with this
Agreement was incorrect or misleading in any material respect when made;
b. Any judgment is assessed against Company or any attachment or other levy
against the property of Company with respect to a claim remains unpaid,
undischarged, or not dismissed for a period of 120 days.
c. Company makes an assignment for the benefit of creditors.
d. Company files a petition in bankruptcy or is adjudicated insolvent or bankrupt.
e. If taxes owed by Company become delinquent, and Company fails to timely and
properly follow the legal procedures for protest or contest.
f. Company changes the general character of business as conducted as of the
date this Agreement is approved by the Corporation.
g. Company fails expend at least $230,000 on the improvements listed in Exhibit
A, with the highest priority being securing and stabilizing the building, on or before
June 30, 2023, or fails to comply with one or more terms of this Agreement.
16. Notice of Default. Should the Corporation or City determine that Company is in
default according to the terms of this Agreement, the Corporation or City shall notify
Company in writing of the event of default and provide 60 days from the date of the notice
("Cure Period") for Company to cure the event of default.
17. Results of Uncured Default by Company. The following actions must be taken for
any default that remains uncured after the Cure Period.
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Type B Business Incentive Agreement
a. Company shall immediately repay all funds paid by Corporation to it under this
Agreement.
b. Company shall pay Corporation's reasonable attorney fees and costs of court
to collect amounts due to Corporation if not immediately repaid upon demand from
the Corporation.
c. Upon payment by Company of all sums due, the Corporation and Company shall
have no further obligations to one another under this Agreement.
18. No Waiver.
a. No waiver of any covenant or condition, or the breach of any covenant or
condition of this Agreement, constitutes a waiver of any subsequent breach of the
covenant or condition of the Agreement.
b. No waiver of any covenant or condition, or the breach of any covenant or
condition of this Agreement,justifies or authorizes the nonobservance on any other
occasion of the covenant or condition or any other covenant or condition of this
Agreement.
c. Any waiver or indulgence of Company's default may not be considered an
estoppel against the Corporation.
d. It is expressly understood that if at any time Company is in default in any of its
conditions or covenants of this Agreement, the failure on the part of the
Corporation to promptly avail itself of the rights and remedies that the Corporation
may have, will not be considered a waiver on the part of the Corporation, but
Corporation may at any time avail itself of the rights or remedies or elect to
terminate this Agreement on account of the default.
19. Company specifically agrees that Corporation shall only be liable to Company for the
actual amount of the money grants to be conveyed to Company, and shall not be liable
to Company for any actual or consequential damages, direct or indirect, interest, attorney
fees, or cost of court for any act of default by Corporation under the terms of this
Agreement. Payment by Corporation is strictly limited to those funds so allocated,
budgeted, and collected solely during the grant term of this Agreement. Corporation shall
use its best efforts to anticipate economic conditions and to budget accordingly.
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Type B Business Incentive Agreement
However, it is further understood and agreed that, should the actual total sales tax
revenue collected for any one year be less than the total amount of grants to be paid to
all contracting parties with Corporation for that year, then in that event, all contracting
parties shall receive only their pro rata share of the available sales tax revenue for that
year, less Corporation's customary and usual costs and expenses, as compared to each
contracting parties' grant amount for that year, and Corporation shall not be liable to for
any deficiency at that time or at any time in the future. In this event, Corporation will
provide all supporting documentation, as requested. Payments to be made shall also
require a written request from Company to be accompanied by all necessary supporting
documentation.
20. The parties mutually agree and understand that funding under this Agreement is
subject to annual appropriations by the City Council; that each fiscal year's funding must
be included in the budget for that year; and the funding is not effective until approved by
the City Council.
21. Notices.
a. Any required written notices shall be sent mailed, certified mail, postage
prepaid, addressed as follows:
Company:
Corpus Christi PATCH, Inc.
Attn: Cheryl Votzmeyer-Rios
P.O. Box 187
Corpus Christi, Texas 78403
Corporation:
Corpus Christi B Corporation
Attn.: Executive Director
1201 Leopard Street
Corpus Christi, Texas 78401
b. A copy of all notices and correspondence must be sent the City at the following
address:
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Type B Business Incentive Agreement
Corpus Christi B Corporation
c/o City of Corpus Christi
Attn.: City Manager
P.O. Box 9277
Corpus Christi, Texas 78469-9277
c. Notice is effective upon deposit in the United States mail in the manner provided
above.
23. Amendments or Modifications. No amendments or modifications to this Agreement
may be made, nor any provision waived, unless in writing signed by a person duly
authorized to sign Agreements on behalf of each party.
24. Relationship of Parties. In performing this Agreement, both the Corporation and
Company will act in an individual capacity, and not as agents, representatives,
employees, employers, partners, joint-venturers, or associates of one another. The
employees or agents of either party may not be, nor be construed to be, the employees
or agents of the other party for any purpose.
25. Captions. The captions in this Agreement are for convenience only and are not a
part of this Agreement. The captions do not in any way limit or amplify the terms and
provisions of this Agreement.
26. Severability.
a. If for any reason, any section, paragraph, subdivision, clause, provision, phrase
or word of this Agreement or the application of this Agreement to any person or
circumstance is, to any extent, held illegal, invalid, or unenforceable under present
or future law or by a final judgment of a court of competent jurisdiction, then the
remainder of this Agreement, or the application of the term or provision to persons
or circumstances other than those as to which it is held illegal, invalid, or
unenforceable,will not be affected by the law or judgment, for it is the definite intent
of the parties to this Agreement that every section, paragraph, subdivision, clause,
provision, phrase, or word of this Agreement be given full force and effect for its
purpose.
b. To the extent that any clause or provision is held illegal, invalid, or unenforceable
under present or future law effective during the term of this Agreement, then the
remainder of this Agreement is not affected by the law, and in lieu of any illegal,
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Type B Business Incentive Agreement
invalid, or unenforceable clause or provision, a clause or provision, as similar in
terms to the illegal, invalid, or unenforceable clause or provision as may be
possible and be legal, valid, and enforceable, will be added to this Agreement
automatically.
27. Venue. Venue for any legal action related to this Agreement is in Nueces County,
Texas.
28. Sole Agreement. This Agreement constitutes the sole Agreement between
Corporation and Company. Any prior Agreements, promises, negotiations, or
representations, verbal or otherwise, not expressly stated in this Agreement, are of no
force and effect.
29. Survival of terms of Agreement and obligations of parties. The terms of this
Agreement and the obligation of the parties relating to Section 14 shall survive the
termination of this Agreement.
(Remainder of this page intentionally left blank)
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Type B Business incentive Agreement
Corpus Christi B Corp
oration
Y
B : Zt. ,/,( al/'' n
Leah Pagan Of rri
President
Date: /aZ-//-07,3 proved as to form:IQ1 311 73
Attest: a-/kil
Assistant City Attorney
By: For City Attorney
Re ecca Huerta
Assistant Secretary
Corpus Chriti PATCH, inc:, ilza�c Oink
LLsY COdRCIL �" ;j
By: ,�/� .47.� �.S
Cheryl Votzmdyer-Ri•
Executive Director , ' ..'"•00.. 111eauggiewatieri1' ' v "
Date: p c >>" /2
THE STATE OF TEXAS
COUNTY OF NUECES
This instrument was acknowledged before me on t() I 2S , 2023, by
Chery Votzmeyer-Rios, Executive Director of Corpus Christi PATCH, Inc., a Texas non-
profi• orporation, • i-h t of the corporation.
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NO ►
Not.ry ' Y P MARTHA ARELIA
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St. e of Texas 4 f=f��� Notary Public ►
4 1%s4 �. F STATE OF 023.2027
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Type B Business Incentive Agreement
Exhibit A
OTJ
SCOPE OF WORK
Project Name: The Ritz Theatre Corpus Christi
Project Number 11587.00
Harvey Grant Scope of Work
Prior to issuing a bid,bidding contractors should review the entire Ritz Theatre Corpus Christi—Building
Assessment Report prepared by OTJ Architects and dated June 28,2023,as it provides supplemental
information to below list They should also conduct a site visit to make their own assessment of the extents of
areas of damage,quantities and area takeoffs,etc_and should consult with ownership. If after this site visit.
additional information is needed,OTJ Architects can provide additional clarity as required.
The following items should be carried out under the Harvey Grant Scope of Work.
1. Immediate Action Items
a. Patch/seal cracks observed on the brick veneer at the exterior of the building.As a temporary
measure,an elastomeric sealant can be used to fill cracks and prevent additional water
perpetration at those areas. It should be noted that when final repairs to the exterior masonry are
made,this sealant should be removed to allow for repointing.
b. Seal holes located on the facade of canopies to stop moisture seepage into the building. As a
temporary measure,a foil-faced insulation board can be rut to fit each hole and sealed into the
opening. These closures will be removed when a canopy is reconstructed.
c. Temporarily close all window openings with new cut-to-fit plywood or foil-faced insulation board
and seal around edges of openings with detail sealant to stop incidental water intrusion. These
temporary closures will be removed when windows are reinstalled into the building. The windows
at the rear penthouse should also be sealed in temporarily.
d. Improve the surface grading and drainage near the north and south elevation entrances to divert
water away from building
e. Improve fitment and seals at exterior doors,reducing the amount of water penetration occurring
during wind-driven rain events.
f. Repair ongoing roof teaks identified at lower roof located on the west elevation(mechanical room,
storage room,dressing room).
g. Repair ongoing roof leaks identified at lower roofs located on the south elevation(dressing room).
h. Install temporary,portable dehumidifiers at locations within the interior to help reduce high levels
of humidity and reduce moisture in interior building elements. These dehumidifiers should
discharge their condensate water to a drain to reduce maintenance requirements associated with
emptying reservoirs. The existing electrical service may need to be modified to safely
accommodate the electrical load requirements from the dehumidifiers.
i. Repair personnel access ladders to roof from main stairs and catwalk.
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Type B Business Incentive Agreement
OTJ
2. Immediate Structural Concern Items
a. Provide a sidewalk tunnel for the length of the building and extending the entire width of the
sidewalk in front of the building. This scaffolding will have a roof and parapet which will catch and
contain anything that falls off the facade The scaffolding system must be designed and inspected
by a registered professional engineer with windstorm certification in the state of Texas. The basic
wind speed shall be 150 mph OTJ also recommends providing signage on the front of the
structure indicating the exciting changes corning to the theatre and installing architectural lighting
on top of the structure to illuminate and highlight the facade.
b. Provide netting at the areas of plaster damage within the ceiling to prevent the future fall of
material to occupied areas below.
3. Roof and Parapet Walls Repairs
a. Install and match terracotta coping units on top of exposed parapet walls,ensure these are
adequately secured to resist wind uplift.
b. Remove deteriorated mastic behind termination bar and bitumen membrane.
c. Fasten termination bar to fully support and seal vertical membrane edge.
d. Replace poorly adhered areas of sealant at edge termination.
e. Install regletted counterflashing above termination bar to improve roof leak-resistance and
durability.
f. Improve roof slope at identified areas with severe water ponding and divert water into scuppers to
deviate risk of premature membrane deterioration_
g. Remove waterproofing mastic at parapet top and backside,clean to bare brick,and install a
waterproof coating It should be noted that the existing waterproofing mastic may be asbestos
containing. This(and other building components as appropriate)should be evaluated by a
qualified professional and addressed appropriately
4. Additional Repair Items
a. Repair the lour terracotta roofs above mezzanine level restrooms at the eastern end of the
building.
b. Reconnect or replace missing downspouts throughout the building
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Type B Business Incentive Agreement