HomeMy WebLinkAbout2004-6-6824167
532260VIncen6ves
ORDINANCE NO. 2004-6-6824
AN ORDINANCE AUTHORIZING AND APPROVING THE CITY OF PADUCAH
GRANTING CERTAIN ECONOMIC INCENTIVES TO AAA FABRICATORS, LLC., AND
AUTHORIZING TRANSFER OF FUNDS FROM COMMISSION CONTINGENCY FOR SAID
PROJECT
WHEREAS, the City of Paducah finds that economic development through the attraction of new
and expanding industry is a valid public purpose, positively impacting the entire community by stimulating
the local economy, expanding the tax base and eliminating and/or preventing high rates of unemployment;
and
WHEREAS, the City of Paducah finds, that in order to competitively compete for new, high
quality employers and to induce significant expansion by existing industry, certain reasonable economic
incentives are necessary; and
WHEREAS, upon receiving offers of certain economic incentives, AAA Fabricators, LLC, has
declared its willingness to execute binding agreements committing it to the development of a
manufacturing company within the corporate boundaries of the City of Paducah; and
WHEREAS, the economic incentives to be provided to AAA Fabricators are in conformity with
the "Guidelines For Providing Economic Incentives To Qualified Projects Located Within The Boundaries
Of The City Of Paducah" previously adopted by the City of Paducah on January 20, 2004, by Municipal
Order No. 1035; and
WHEREAS, the City of Paducah, in consideration of the aforesaid commitment, approves and
authorizes the following economic incentives to AAA Fabricators, LLC.
NOW THEREFORE, BE IT ORDAINED BY THE CITY COMMISSION OF THE CITY OF
PADUCAH, KENTUCKY, AS FOLLOWS:
The City of Paducah, participating equally with the County of McCracken, (the "County") will:
Section 1. Recitals and Authorization. The City hereby approves providing AAA Fabricators,
LLC, ("AAA Fabricators") with a $150,000.00 cash grant to offset the costs of renovating and equipping
the former NES Building located at 3885 Coleman Road, Paducah, McCracken County, Kentucky, (the
"Project Site") and relocating AAA Fabricator's manufacturing facility to the Project Site; the City share
being $75,000.00. Further the City hereby approves the Memorandum of Understanding to be entered
into among the City, the County, Greater Paducah Economic Development Council ("GPEDC") and
AAA Fabricators (the "Agreement") in substantially the form attached hereto as Exhibit A and made
part hereof. It is determined that it is necessary and desirable and in the best interests of the City to
enter into the Agreement for the purposes therein specified, and the execution of the Agreement is
hereby authorized and approved. The Mayor of the City is hereby authorized to execute the
Agreement, together with such other agreements, instruments or certifications which may be
necessary to accomplish the transaction contemplated by the Agreement with such changes in the
Agreement not inconsistent with this Ordinance and not substantially adverse to the City as may be
approved by the official executing the same on behalf of the City. The approval of such changes by
said official, and that such are not substantially adverse to the City, shall be conclusively evidenced by
the execution of such Agreement by such official.
Section 2. Conditional Authorization. The adoption of this Ordinance is predicated upon AAA
Fabricators executing the Agreement and all other legally necessary documents to bind AAA Fabricators to
its commitment to establish and locate the manufacturing facility at the Project Site, meet or exceed its
stated investments in capital, building, and equipment, and use its best efforts to meet or exceed the
employment and payroll schedules, all as set forth in the Agreement.
Section 3. Transfer of Funds. The Finance Director is hereby authorized and directed to transfer
the sum of $75,000.00, from the Commission Contingency Fund and other unexpended budgetary line
items.
Section 4. Severability. If any section, paragraph or provision of this Ordinance shall be held
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to be invalid or unenforceable for any reason, the invalidity or unenforceability of such section,
paragraph or provision shall not affect any of the remaining provisions of this Ordinance.
Section 5. Compliance With Open Meetings Laws. This City Commission hereby finds and
determines that all formal actions relative to the adoption of this Ordinance were taken in an open
meeting of this City Commission, and that all deliberations of this City Commission and of its
committees, if any, which resulted in formal action, were in meetings open to the public, in full
compliance with applicable legal requirements.
Section 6.onflicts. All
C ordinances, resolutions, orders or parts thereof in conflict with the
provisions of this Ordinance are, to the extent of such conflict, hereby repealed and the provisions of
this Ordinance shall prevail and be given effect.
Section 7. Effective Date. This Ordinance shall be read on two separate days and will become
effective upon summary publication pursuant to KRS 424.
I
Introduced by the Board of Commissioners, May 25, 2004
Adopted by the Board of Commissioners, June 8, 2004
Recorded by City Clerk, June 8, 2004
Published by The Paducah Sun, June 14, 2004
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Ord\Incentives AAA Fabricators
EXHIBIT A
MEMORANDUM OF UNDERSTANDING
169
This is a Memorandum of Understanding (Agreement) by and between AAA
FABRICATORS, LLC, a Kentucky limited liability company ("AAA Fabricators"), the
GREATER PADUCAH ECONOMIC DEVELOPMENT COUNCIL ("GPEDC"), the CITY
OF PADUCAH, KENTUCKY ("City"), and MCCRACKEN COUNTY, KENTUCKY
("County").
WHEREAS, AAA Fabricators proposes to acquire, install, and equip a manufacturing
facility in the former NES Building located at 3885 Coleman Road, Paducah, McCracken
County, Kentucky, (the "Project"); and
WHEREAS, AAA Fabricators development of the Project will have a positive impact on
the entire community by stimulating the local economy, expanding the tax base, and eliminating
and or preventing high rates of unemployment; and
WHEREAS, in order to induce the acquisition, installation and equipping of the Project
by AAA Fabricators, the City, County, and GPEDC have agreed to provide certain economic
incentives to AAA Fabricators for purposes of defraying the costs of acquiring, installing, and
equipping the Project; and
WHEREAS, it is deemed necessary and advisable that this Agreement be entered into by
the parties setting forth their agreement with respect to the acquisition, installation, and
equipping of the Project and the economic incentives to be provided to defray the costs thereof;
C,
and
WHEREAS, the economic incentives to be provided to AAA Fabricators are in conformity with
the "Guidelines For Providing Economic Incentives To Qualified Projects Located Within The Boundaries
Of The County Of McCracken and the City of Paducah" previously adopted by the County and City.
NOW, THEREFORE, AAA Fabricators, City, County and GPEDC agree to the
following:
A. AAA Fabricators commits to:
1. Acquiring, installing, and equipping a manufacturing facility in the former
NES Building located at 3885 Coleman Road, Paducah, McCracken
County, Kentucky.
2. Hire a minimum of 15 net new employees within 1 year.
3. Hire a minimum of 25 employees by year 5.
4. Achieve total annual plant payroll within one year in excess of
C, I $500,000.00.
5. Achieve a total annual plant payroll by year 5 exceeding $860,000.00.
6. Invest over $1.5 million in capital, building, and equipment in the Project.
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170
53226CityIncentives
B. The City, County, and GPEDC commit to:
1. The City will provide a cash grant to AAA Fabricators of $75,000.00 to
defray the costs of acquiring, installing, and equipping the Project.
2. The County will provide a cash grant of $75,000.00 to defray the costs of
acquiring, installing, and equipping the Project.
3. GPEDC will use best efforts to secure the maximum amount of KIDA
incentives on behalf of AAA Fabricators.
4. GPEDC will use its best efforts to secure the maximum amount of state
training incentives on behalf of AAA Fabricators.
5. GPEDC will use its best efforts to expedite local permitting of the Project
C. Recapture:
AAA Fabricators agrees that in the event it fails to either meet the required levels
of employment or investment for the Project by the end of the third year, unless
another time has been mutually agreed to, then the cash grant funds provided
above by the City and County shall be fully reimbursed, plus interest calculated by
using New York prime rates. The City and County further agree that in the event
the failure to attain or maintain the required levels of employment or investment
by AAA Fabricators, in spite of the its good faith best efforts, were the result of
unavoidable and unforseen circumstances, including, but, not limited to an Act of
God or national emergencies, then the City and County, at their sole discretion,
may: (a) seek a pro rata reimbursement, or (b) waive any reimbursement.
D. Payroll Tax Sharing_
The City hereby agrees that as the "host" municipality it will share with the
County (50)% of all payroll taxes generated from the Project for a period of 25
years. The taxes will be collected during the Fiscal year and paid annually no later
than September 1 of each year.
E. Miscellaneous Provision:
This Agreement represents the entire understanding and agreement reached
between the parties, and all prior covenants, agreements, and presentations are
merged herein. This Agreement shall be fully binding upon the parties hereto and
shall be deemed fully enforceable in accordance with the terms and provisions
hereof. Neither party shall assign this Agreement without first obtaining the
written consent of the other parties, which written consent shall not be
unreasonably withheld. If any provision of this Agreement shall be held invalid
under any applicable laws, such invalidity shall not affect any other provision of
this Agreement than can be given affect without the invalid provision, and, to this
end, the provisions hereof are severable.
if
532260tyIncenfives
IN WITNESS WHEREOF the parties hereto have set their hands on the day and year
first above written.
c
AAA FABRICATORS, LLC
Signature:
Title:
Date:
MCCRACKEN COUNTY, KENTUCKY
Signature:
Title:
Date:
413
CITY OF PADUCAH, KENTUCKY
Signature:
Title:
Date:
GREATER PADUCAH ECONOMIC
DEVELOPMENT COUNCIL
Signature:
Title:
Date:
171