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98. RESOLUTION NO. 2005-..9..:l-R A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF SAN MARCOS, TEXAS APPROVING A CHAPTER 380 ECONOMIC DEVELOPMENT GRANT AND LOAN AGREEMENT WITH JOHN Q. HAMMONS, TRUSTEE REGARDING THE HOTEL AND CONFERENCE CENTER PROJECT; AND DECLARING AN EFFECTIVE DATE. RECITALS: 1. The City Council has adopted a Resolution dated May 3, 2005 approving an Economic Development Incentives Policy as contemplated by Chapter 380 of the Texas Local Government Code. 2. John Q. Hammons, as Trustee of the Revocable Trust of John Q. Hammons dated December 28, 1989, as amended and restated ("JQH"), and the City are pursuing ajoint project (the "Project") whereby (i) JQH would construct and operate a full service upscale hotel (the "Hotel") of at least ten (10) stories in height with a minimum of two hundred fifty (250) guest rooms and (ii) the City would construct, and lease to JQH, a fIrst class conference center facility and related improvements (the "Conference Center") adjacent to the Hotel, which Conference Center would contain one large ballroom sufficient to lawfully accommodate one thousand (1,000) people for a banquet style event. 3. JQH and City have identifIed a fifteen (15) acre tract of land located in San Marcos, Hays County, Texas (the "Desired Project Site") as the preferred site for the Project. 4. While JQH and City have not reached a definitive agreement concerning the parties' respective obligations relating to the Project, and neither currently has any obligation one unto the other with respect thereto, JQH and City believe that, due to market conditions and competitive forces, it is imperative that the Desired Project Site be acquired immediately. 5. Gilmore-Austex Properties, Ltd. ("Gilmore"), has offered to (i) sell a ten (10) acre portion of the Project Site (the "Hotel Site") to JQH for $2,000,000.00 and (ii) donate a fIve (5) acre portion of the Project Site (the "Conference Center Site") to the City. 6. JQH has requested that the City, pursuant to Chapter 380 of the Texas Local Government Code and the City's Economic Development Incentives Policy, make (i) a $500,000.00 grant (the "Grant") to JQH and (ii) a $1,500,000.00 loan (the "Loan") to JQH, to facilitate the acquisition of the Hotel Site by JQH. 7. The City Council has determined that the potential construction and operation of the Hotel and Conference Center on the Desired Project Site would have significant economic development benefits to the community including generating additional tax revenue and enhancing employment opportunities within the City and that therefore it is appropriate to make the Grant and Loan pursuant to the terms of the attached Agreement to facilitate the acquisition of the Hotel Site by JQH in efforts to further the Project, notwithstanding the fact that the parties have yet to reach any definitive agreement concerning same. 8. The City's Economic Development Incentives Policy authorizes the City Council to make grants and loans for the purpose of promoting local economic development and to stimulate business and commercial activity in the City, and that such grants or loans can be used to facilitate the acquisition or improvement of real property, the acquisition of equipment or facilities, or other purposes directly related to economic development.