Res 2024-021 approving a Chapter 380 Economic Development Incentive Agreement with Buc-ee’s San Marcos, LLC that provides incentives in the form of refunds of 50 percent of sales taxes generated by the company

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ARTICLE IV ECONOMIC INCENTIVES 4.1 Proiect-Economic Development Grant. Provided the conditions precedent set forth in Section 2.1 are satisfied, for a fifteen(15) year period commencing on the Tax Payment Effective Date, City agrees to pay to Developer an economic development grant in the form of monthly payments made solely from Sales Tax Revenues collected at the Project as allowed by Chapter 380 of the Texas Local Government Code,and as more particularly set forth in Subsection 4.1(a)below. The Grant Payments shall be payable to Developer as provided hereinafter,unless this Agreement is earlier terminated pursuant to the terms hereof. Developer understands and agrees the City is not certifying or otherwise encumbering any funds for the Grant Payments. Developer agrees not to make any claims against City for any monies other than those from Sales Tax Revenues from the Project. Nothing in this Agreement shall require City to make payment from revenue sources other than from Sales Tax Revenues from the Project. 4.2 City's Chapter 380 Payments. In consideration for the perfonnance by Developer of its obligation under this Agreement,the City shall make monthly grant payments to Developer in the amount of fifty percent(50%)of the Sales Tax Revenues. For illustrative purposes,the City's current sales tax rate is 1.5 percent. As such, the City's grant payment to Developer would equal 50 percent of 1.5 percent, minus any fees deducted by the Texas Comptroller. Such monthly Grant Payments shall constitute the grant payment due and payable to Developer. Such monthly Grant Payments will be paid monthly for a period of fifteen(15)years begirming on the Tax Payment Effective Date.At the conclusion of each month during the Project Term, Developer shall provide an invoice to the City stating the amount of the Grant Payment due for such month and the documented basis for such calculation. Thereafter,the City will pay the Grant Payment within thirty days of the receipt of the invoice or within sixty days after the end of the month covered by the invoice, whichever is later until all payments are made in accordance with this Agreement. If the City disagrees with the invoice calculations, the parties shall consult to determine the correct amount for the Grant Payment. In recognition that Grant Payments are calculated and paid after taxes have been assessed and paid to the City, and therefore always run in arrears, the term of this Agreement shall be deemed to include any payments otherwise due and payable to Developer which extend beyond the original teen of the Agreement. Within thirty(30) days after the City makes the last (twelfth) Grant Payment of each year of the Project Term,the City and Developer shall consult to determine if there is any difference between (1) the total amount of Grant Payments paid for the previous twelve month period, and(2)the total amount of such payments that are to be made under this Agreement based on the sales tax actually collected by the City on taxable sales at the Project (minus any fees deducted by the Comptroller and any refund by Developer or refunds required to be made by the City) for that one year period.If necessary,the parties shall then conduct a reconciliation.If,based on actual sales tax receipts,the amount of Grant Payments paid are less than the amount that should have been paid(based on the provisions of this Agreement) during such twelve (12) month period, the City shall pay the difference to Developer within sixty (60) days of the reconciliation calculation. If the amount of Grant Payments paid by the City exceeds the amount that should have been paid during that period, the City shall be entitled to a credit against the next Grant Payment(s) due to Developer in the amount that the total Grant Payments for that period exceeded the amount required by this Agreement. If the amount paid for the last year of the Project Term exceeds the amount that this Agreement requires,Developer shall pay an amount equal to such excess to the City within sixty(60)days of the reconciliation calculation. 4.4 Payment from Current Revenues. Any payments required to be made by the City under this Agreement will be paid only from current revenues or other funds lawfully available to the City for such purpose in each fiscal year during the Term. 4.5. Modification of Sign Standards. The City agrees to allow deviations from certain requirements under the San Marcos Development Code applicable to the construction of the Freestanding Pole Sign under Section 3.5(a) and shown in Exhibit D as follows: Economic Development Agreement