City of Canyon Commission Meetings

AGENDA NOTICE OF MEETING Notice is hereby given that the governing body of the City of Canyon will meet at 5:30 p.m. on the 24th day of August, 2015, in the Commission Chambers of City Hall at 301 16th Street in the City of Canyon to discuss the following agenda items: 1. Call to Order. 2. Invocation. 3. Pledge of Allegiance. 4. Approval of the Minutes of the Meeting of August 17, 2015. 5. Public Forum – Comments from Interested Citizens. 6. Second and Final Reading of Resolution No. 15-2015 Approving a Project Funding Agreement between Lone Star Dairy Products LLC and the Canyon Economic Development Corporation (“CEDC”) for the Purpose of Funding Financial Incentives for New Jobs in Canyon, Texas 7. Budget Work Session. 8. Hold Second Public Hearing on Proposed Tax Rate and 2015-2016 Budget. 9. Adjournment. Randy Criswell, City Manager I certify that the above Notice of Meeting was posted on the bulletin board of the Civic Complex of the City of Canyon, Texas on the 21st day of August 2015. Gretchen Mercer, City Clerk City of Canyon City Commission Meeting August 17, 2015 The City Commission of the City of Canyon met in regular session at 5:30 p.m. in the City Commission Chambers of the Civic Complex. Mayor Quinn Alexander presided over the meeting with the following Commissioners in attendance: Mayor Pro-Tem Gary Hinders, David Logan, Justin Richardson, and Joe Shehan. Also present were the following City Staff: City Manager Randy Criswell, Assistant City Manager Chris Sharp, City Secretary Gretchen Mercer, Assistant City Manager for Special Projects Jon Behrens, Business and Community Development Director Evelyn Ecker, Director of Code Enforcement Danny Cornelius, Librarian Sandra Munger, Parks and Recreation Director Brian Noel, Golf Course Manager John Haun, Police Chief Dale Davis, Fire Chief Mike Webb, Director of Public Works Dan Reese, Swimming Pool Manager Andrew Neighbors, and City Attorney Chuck Hester. Item 1. Call to Order. Mayor Alexander called the meeting to order at 5:35 p.m. Item 2. Invocation. Commissioner Richardson gave the invocation. Item 3. Pledge of Allegiance. Canyon Swim Team members Ryanne Higgins, Rylee Higgins, Rebekah Higgins, Aidan Pope, Tyler Troyer, and Deanne Rice led the Pledge of Allegiance. Item 4. Approval of Minutes of the Meeting of August 3, 2015. Commissioner Shehan moved, duly seconded by Mayor Pro-Tem Hinders, to approve the minutes of August 3, 2015. Motion carried unanimously. Item 5. Public Forum – Comments from Interested Citizens. No Comment was made. Item 6. Consider and Take Appropriate Action on all Matters Incident and Related to Calling a Bond Election for the November 2015 Election for Construction of a Family Aquatic Center, Including the Adoption of Ordinance No. 1024 Pertaining Thereto. City Manager Randy Criswell presented Ordinance No. 1024 for consideration. Mr. Criswell stated that with all the public interest for the construction of an Aquatic Center, and the feasibility study completion, the next step was to call an Election and allow the citizens of Canyon to decide if they want to fund a new Family Aquatic Center. Mr. Criswell said the Commission had previously expressed interest in Plan B of the feasibility study, as recommended by the Pool Committee, which had a cost of 6 million dollars. . City Commission Meeting August 17, 2015 Page 2 of 5 Mayor Pro-Tem Hinders stated that he felt this issue should be delayed until a May election, giving time for decisions to be made on the City Hall Study and any potential additional debt issued for water improvements, because those things would also have significant impact on taxes and water rates, and he didn’t believe the public should vote on the aquatic facility without having all of that information. After discussion, Commissioner Logan moved, duly seconded by Commissioner Richardson to adopt Ordinance No. 1024 calling for a Bond election in the amount of $6,000,000 to fund the construction of a Family Aquatic Center. Motion carried 4 to 1 with Commissioner Hinders voting against. ORDINANCE NO. 1024 AN ORDINANCE CALLING A BOND ELECTION TO BE HELD IN THE CITY OF CANYON, TEXAS, MAKING PROVISIONS FOR THE CONDUCT OF THE ELECTION AND RESOLVING OTHER MATTERS INCIDENT AND RELATED TO SUCH ELECTION. Item 7. First Reading of Resolution No. 15-2015 Approving a Project Funding Agreement Between Lone Star Dairy Products LLC and the Canyon Economic Development Corporation (“CEDC”) for the Purpose of Funding Financial Incentives for New Jobs in Canyon, Texas. Business and Development Director Evelyn Ecker presented Resolution No. 15-2015 for its first reading. Mrs. Ecker said Lone Star Dairy Products LLC expect to have a $3.9 million annual payroll and no less than 50 employees. Mrs. Ecker stated the Job Incentive Package will consist of ten total installments over a 10 year period, not to exceed $850,000. Mrs. Ecker said installments would be payable when the plant opens for production and subsequent installments payable on the anniversary date of the first installment. Mrs. Ecker said if the workforce drops below 50 full time employees, the incentive would be reduced accordingly as approved in Project Funding Agreement No. 2. Commissioner Hinders asked if a “smell control” could be added to the Job Incentive agreement. City Manager Criswell advised that language of that nature would be more appropriate in the industrial waste permit. City Attorney Chuck Hester and Commissioner Shehan stated their agreement with Mr. Criswell’s advice. This being the first reading of Resolution No. 15-2015, no action is required. RESOLUTION NO. 15-2015 RESOLUTION APPROVING PROJECT FUNDING AGREEMENT NO. 2 BETWEEN LONE STAR DAIRY PRODUCTS LLC AND CANYON ECONOMIC DEVELOPMENT CORPORATION (“CEDC”) FOR THE PURPOSE OF FUNDING FINANCIAL INCENTIVES FOR NEW JOBS IN CANYON, TEXAS. Item 8. Consider and Take Appropriate Action on Adoption of Payment in Lieu of Taxes Agreement with Lone Star Dairy Products LLC. City Commission Meeting August 17, 2015 Page 3 of 5 City Manager Randy Criswell presented a Payment in Lieu of Taxes Agreement with Lone Star Dairy Products LLC and the City of Canyon. Mr. Criswell said the basic points are:  100% property tax abatement for 10 years on eligible property as defined by the agreement  No tax abatement on trucks or trailers  No tax abatement on construction work in progress  Tax abatement starts on January1 of the year immediately following completion of the facility  A Payment In Lieu of Taxes will be made to the City totaling $680,000 over the 10- year period of the Agreement After discussion, Mayor Pro-Tem Hinders moved, duly seconded by Commissioner Shehan, to adopt the Payment in Lieu of Taxes agreement with Lone Star Dairy Products LLC, as presented. Motion carried unanimously. Item 9. Consider and Take Appropriate Action on Modification to Deed of Trust from Canyon Economic Development Corporation to the City of Canyon. City of Canyon Attorney Chuck Hester presented the Commission with a Modified Deed of Trust. Mr. Hester said since Lone Star Dairy Products LLC is securing a large loan, the lender is requiring title insurance and the title company has made certain requirements concerning subordination of the City’s lien and removal of certain provisions of the Deed of Trust relating to insurance, assignment of rents and improvements. Mr. Hester said the Deed of Trust being considered by the commission is for the purpose of addressing those title requirements and will facilitate the conclusion of the real estate transaction with Lone Star. After discussion, Commissioner Logan moved, duly seconded by Commissioner Richardson to approve the Modification to Deed of Trust as presented. Motion carried unanimously. Item 10. Consider and Take Appropriate Action on Interlocal Agreement with Randall County for Participation in Construction of New Parking Lot in 1500 Block of 6th Ave. City Manager Randy Criswell presented an Interlocal Agreement with Randall County committing Randall County to assist with the cost of the construction of the parking lot currently under construction at the site of the old CISD Administration Building. Mr. Criswell said the County has expressed interest in contributing $300,000. Mr. Criswell said the agreement also addressed future maintenance of the parking lot. Mr. Criswell said the County will address the agreement at their August 25, 2015 Commissioners Court. After discussion, Commissioner Richardson moved, duly seconded by Commissioner Logan to approve the Interlocal Agreement with Randall County regarding the construction of the parking lot in the 1500 Block of 6th Ave. Motion carried unanimously. Item 11. Consider and Take Appropriate Action on Resolution No. 16-2015, A Resolution Denying Southwestern Public Service Company’s Proposed Rate Increase. City Commission Meeting August 17, 2015 Page 4 of 5 City Manager Randy Criswell presented Resolution No. 16-2015 for consideration. Mr. Criswell said counsel has been working to settle this rate case that was filed in December 2014, but have not been able to reach a settlement. Mr. Criswell said it was the recommendation of counsel to deny the rate case which will send it to the Public Utility Commission for resolutions. After discussion, Commissioner Shehan moved, duly seconded by Mayor Alexander to adopt Resolution No. 16-2015 as presented. Motion carried unanimously. RESOLUTION NO. 16-2015 A RESOLUTION BY THE CITY OF CANYON, TEXAS (“CITY”) DENYING SOUTHWESTERN PUBLIC SERVICE COMPANY’S PROPOSED INCREASE IN RATES SUBMITTED IN ITS APPLICATION ON DECEMBER 8, 2014; REQUIRING REIMBURSEMENT OF REASONABLE LEGAL AND CONSULTANT EXPENSES; FINDING THAT THE MEETING COMPLIES WITH THE OPEN MEETINGS ACT; MAKING OTHER FINDINGS AND PROVISIONS RELATED TO THE SUBJECT; AND DECLARING AN EFFECTIVE DATE Item 12. Budget Work Session. No discussion. Item 13. Hold Public Hearing on Proposed Tax Rate and 2015-2016 Budget. Mayor Alexander opened the public hearing. There being no comment, Mayor Alexander closed the public hearing. Item 14. Executive Session Pursuant to Texas Government Code §551.087 Economic Development Negotiations, and §551.074, Personnel Matters (City Engineer, Municipal Court Judge, Alternate Municipal Court Judge, City Attorney, and City Manager). Mayor Alexander indicated the Commission would adjourn into executive session at 6:46 pm Item 15. Consider and Take Appropriate Action on Items Discussed in Executive Session. Upon returning from executive session at 8:37 pm, the following action was taken. Commissioner Shehan moved, duly seconded by Mayor Alexander to contract with the City Engineer, Brandt Engineering as is. Motion carried unanimously. Commissioner Richardson moved, duly seconded by Commissioner Logan to appoint Municipal Court Judge Bob Splawn for two years and increase his monthly salary from $1600 a month to $1650 a month. Motion carried unanimously. Commissioner Richardson moved, duly seconded by Mayor Pro-Tem Welch to appoint Alternate Municipal Court Judge, Jerry Bigham, for two years. Motion carried unanimously. City Commission Meeting August 17, 2015 Page 5 of 5 Mayor Pro-Tem Hinders moved, duly seconded by Commissioner Logan to continue the contract with City Attorney Chuck Hester and increase his monthly compensation from $6700 to $7000 a month. Motion carried unanimously. Commissioner Logan moved, duly seconded by Commissioner Richardson to continue the contract with City Manager Randy Criswell with a 3% increase. Motion carried unanimously. Item 16. Consider Meeting Dates for September. Commissioners set the calendar to have one Commission meeting in September on Tuesday, September 8, 2015. Item 17. Adjournment There being no further business, Commissioner Logan moved this meeting be adjourned. ______________________________ Quinn Alexander, Mayor ATTEST: ________________________________ Gretchen Mercer, City Secretary REGARDING ITEM 6 AGENDA To: Randy Criswell, City Manager; Mayor and City Commission From: Evelyn Ecker, Executive Director Canyon Economic Development Corp. Date: August 19, 2015 Re: Consider and Take Appropriate Action on Second and Final Reading of Resolution No. 15-2015 Considering the Job Creation Incentive Package for Lone Star Dairy Producers, LLC. This is the second and final reading of Resolution No. 15-2015 for the job incentive package for Lone Star Dairy Producers, LLC. The employment model submitted in the application process calls for no less than 50 employees with a projected annual payroll of $3.9 million. If the work force drops below 50 full time employees, the incentive shall be reduced accordingly to the approved language in Project Funding Agreement No. 2 It is the recommendation of staff to approve Project Funding Agreement No. 2 for the job incentive package with regards to the Lone Star Dairy Producers, LLC. project. City of Canyon  RESOLUTION NO. 15-2015 RESOLUTION APPROVING PROJECT FUNDING AGREEMENT NO. 2 BETWEEN LONE STAR DAIRY PRODUCTS LLC AND CANYON ECONOMIC DEVELOPMENT CORPORATION (“CEDC”) FOR THE PURPOSE OF FUNDING FINANCIAL INCENTIVES FOR NEW JOBS IN CANYON, TEXAS. WHEREAS, on June 11, 2015, the Board of the CEDC held a public hearing regarding the use of sales and use tax revenues collected pursuant to the Development Corporation Act of 1979, TEX. LOC. GOVT. CODE CH 505 (“the Act”), pursuant to a request from LONE STAR DAIRY PRODUCTS LLC, for the purpose of securing employee financial incentives in connection with construction of a plant for production of milk products. The Board of the CEDC has recommended approval of the agreement: and, WHEREAS, the City Commission of the City of Canyon, Texas, finds it to be in the public interest to approve Project Funding Agreement No. 2 between the CEDC and LONE STAR DAIRY PRODUCTS LLC for financial incentives to create new jobs; and, NOW, THEREFORE, BE IT RESOLVED BY THE CITY COMMISSION OF THE CITY OF CANYON, TEXAS; That the Project Funding Agreement No. 2 above-described is approved and the officers designated by the CEDC Board of Directors are authorized to execute Project Funding Agreement No. 2 with LONE STAR DAIRY PRODUCTS LLC and fund the job incentives pursuant to such agreement. INTRODUCED at the First Reading on the 17th day of August. 2015, and Adopted on the Second Reading on the 24th day of August, 2015. QUINN J. ALEXANDER, MAYOR ATTEST: Gretchen Mercer, City Clerk (resolution.___-2015)  CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT NO 2. LONE STAR DAIRY PRODUCTS LLC This CANYON ECONOMIC DEVELOPMENT CORPORATION PROJECT FUNDING AGREEMENT NO. 2 (this "Agreement"), dated as of __________, 2015 (the "Effective Date"), is made by and between the Canyon Economic Development Corporation ("CEDC"), a Texas non-profit corporation duly organized and existing pursuant to the TEXAS DEVELOPMENT CORPORATION ACT, and Lone Star Dairy Products LLC, a Delaware limited liability company (hereinafter referred to as "Second Party"). 1. Purpose. The purpose of this Agreement is to facilitate the proper use of funds held and administered by the CEDC, a tax supported non-profit corporation whose primary income is from sales tax collected within the City of Canyon and dedicated exclusively to economic development. The sales tax supporting CEDC is authorized as a local option under Chapter 504 and 505 TEX. LOC. GOV'T CODE, formerly TEX. REV. CIV. STAT. ART. 5190.6 §4B, the primary purpose of which is the developing, stabilizing, diversifying, and expanding the economy through the retention, recruitment, expansion, and employment opportunities of the citizens of Canyon and the surrounding area and to enhance the quality of life of the citizens of Canyon and the surrounding area. 2. Project Development. The project and performance requirements to be implemented by means of this Agreement are described as follows (the "Project"): (a) Second Party shall construct a new food grade dairy ingredients plant (the "Plant") on the Land (as defined below) to be conveyed to Second Party by CEDC at no cost to Second Party as provided in the Canyon Economic Development Corporation Funding Agreement No. 1 dated June 23, 2015, and executed by CEDC and Second Party (the “Funding Agreement No. 1”). (b) The improvements shall be constructed on the following land (the "Land") to be conveyed by CEDC to Second Party: 15 acres, more or less, in Section 35, Block B-5, H.&GN Ry. Co. Survey, Randall County, Texas, more specifically described in Exhibit "A" attached hereto and incorporated herein by reference for all purposes. (c) The improvements shall be constructed at Second Party's expense except to the extent funding is made available under this Agreement and any other grant or economic development incentive approved by the CEDC or another entity. 3. Funding and Financial Incentives. The CEDC will provide the following funding and financial incentives for the Project in two phases, to-wit: (a) Phase One is Funding Agreement No. 1, relating to conveyance of the Land for the Plant site without cost to Second Party. Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 1 26023315v3 56360.001.00  (b) Phase Two is this Agreement providing for financial incentives to the Second Party by CEDC in consideration of employment of workers at the Plant by Second Party. (c) The job incentives referred to in Section 3(b) above shall consist of total payments over a 10 year period (as such period may be extended as necessary to fund any CEDC revenue deficiencies as provided in Section 13) in an aggregate amount not to exceed $850,000, which amount shall be payable in annual installments of $85,000, as follows: (i) the first installment shall be payable on the date the Plant first opens for production (the “Production Date”); and, (ii) subsequent installments shall be payable on each anniversary of the Production Date. 4. Employment. In the event the work force employed by the Second Party (and/ or any affiliate of Second Party) with respect to the Plant should drop below 50 full time employees during any year occurring after the Production Date for a period of sixty (60) or more consecutive days as to each position of employment under the 50 full time employee threshold, the annual funding of the job incentives ($85,000) shall be reduced by $1,417.00 per each such position for the year in question. Upon the expiration of each year during which funds are provided (or payable but for any deficiency in CEDC revenues) by CEDC to Second Party hereunder, Second Party shall be deemed to have irrevocably earned such funds and Second Party shall not be obligated to return or refund any such amounts to CEDC as a result of any Default, failure by CEDC to employ a certain number of employees, or any other reason or occurrence, in subsequent years. 5. Conditions. All other terms and provisions of this Agreement notwithstanding, the obligations of the parties hereto are expressly made contingent upon the following: (a) approval of the financial incentives by the CEDC Board; (b) approval of the financial incentives by the Canyon City Commission; and (c) compliance with the requirements of the Texas Development Corporation Act. Execution and delivery of this Agreement by the CEDC shall be conclusive evidence of such approvals and compliance 6. Representations, Warranties and Covenants by Second Party. Second Party represents, warrants and covenants as follows: (a) Second Party is authorized to do business in Texas, is in good standing in the State of Texas and shall remain in good standing in the State of Texas during the term of this Agreement. Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 2 26023315v3 56360.001.00  (b) The execution, delivery and performance of this Agreement by Second Party have been duly authorized by Second Party. Second Party's designated agent or officer executing this Agreement is duly authorized and empowered to execute this Agreement and bind Second Party to the covenants, warranties and other terms of this Agreement. Second Party's execution and delivery of this Agreement and the performance thereof does not violate (i) any law, rule, or regulation applicable to Secured Party, (ii) any of the provisions of Second Party's organizational documents, or (iii) any material contract, instrument, or agreement to which Second Party is a party or by which it may be bound at the time this Agreement is executed. The authority of the agent whose signature that appears below is evidenced by a resolution or certificate furnished to CEDC or attached to this Agreement. (c) No litigation or governmental proceeding is pending, or to the knowledge of Second Party, threatened against Second Party or affecting its operations or business that would have a material adverse effect on Second Party's business, properties, or operations taken as a whole (a "Material Adverse Effect"). (d) To Second Party's knowledge, no drawing, plan certificate or statement delivered by Second Party to CEDC in connection with this Agreement or any transaction contemplated by this Agreement, when taken as a whole, contains any untrue statement of a material fact or fails to state a material fact necessary to keep the statements contained therein from being materially misleading in the light of the circumstances under which such statements were made after giving effect to any supplements thereto. (e) There are no bankruptcy proceedings or other insolvency proceedings currently pending or contemplated affecting the Second Party. The Second Party has not been informed of any intent to initiate involuntary bankruptcy proceedings against Second Party. (f) To its knowledge Second Party has acquired and maintained, or will acquire and maintain, all necessary rights, licenses, permits, and authority to carry on its business in Texas and to perform the terms of this Agreement, except to the extent that the failure to do so would not have a Material Adverse Effect. (g) The funds provided by CEDC hereunder shall be utilized solely for the development, financing and/or operation of the Project. (h) Second Party shall pay all material taxes and assessments due and owing to all taxing authorities having jurisdiction over Second Party's property and business operations, except to the extent being contested in good faith. In addition, Second Party shall timely pay all material employment, income, franchise, and other taxes due and owing by Second Party to all local, state, and federal entities except to the extent being contested in good faith. Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 3 26023315v3 56360.001.00  (i) Second Party agrees that with regard to all programs and activities arising out of this Agreement, the Second Party will not intentionally discriminate against any person upon the basis of race, color, national origin, gender, or disability. 7. Representations and Warranties by CEDC. CEDC represents, warrants, and covenants as follows: (a) CEDC is a Texas non-profit corporation duly organized and validly existing pursuant to the Texas Development Corporation Act. (b) CEDC has the power and authority to execute, deliver and perform its obligations under this Agreement. (c) The execution, delivery and performance of this Agreement by CEDC have been duly authorized by CEDC and all necessary approvals have been obtained. CEDC's designated agent or officer executing this Agreement is duly authorized and empowered to execute this Agreement and bind CEDC to the terms of this Agreement. CEDC's execution and delivery of this Agreement and the performance thereof does not violate (i) any Texas or municipal law, rule, or regulation applicable to CEDC, (ii) any of the provisions of CEDC's organizational documents, or (iii) any material contract, instrument, or agreement to which CEDC is a party or by which it may be bound at the time this Agreement is executed. No consent or authorization of, filing with, notice to or other act by or in respect of, any governmental or regulatory authority or any other person or entity is required in connection with the execution, delivery, performance, validity or enforceability of this Agreement, except for those that have been validly obtained by CEDC and are in full force and effect. The authority of the agent whose signature that appears below is evidenced by a resolution or certificate furnished to Second Party or attached to this Agreement. 8. Default. If any of the following events shall occur and be continuing, CEDC, at the sole discretion of its board of directors, may by written notice to Second Party terminate this Agreement (each of the following being a "Default"): (a) the filing of bankruptcy proceedings or the appointment of a receiver of Second Party or any material part of its assets or property and failure of such bankruptcy or receivership to be discharged within sixty (60) days of filing; or (b) the adjudication of Second Party as a bankrupt; or (c) a material change in the equity ownership of Second Party shall occur which results in a Material Adverse Change in the nature of Second Party's business and operations; or (d) the occurrence of any default by Second Party under Funding Agreement No. 1 (after giving effect to (i) any grace periods and cure rights contained therein, and (ii) any waivers given with respect thereto); or Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 4 26023315v3 56360.001.00  (e) there shall occur a material breach by Second Party of any representation, warranty or covenant contained in this Agreement and such breach remains uncured for a period of 120 days after delivery of written notice of such breach by CEDC to Second Party, or such longer period as may be required to cure such breach if Second Party is diligently pursuing a cure of such breach. Subject to the rights of CEDC under Section 4, the failure of Second Party (and/or any affiliate of Second Party) to maintain a work force of a certain number of employees shall not constitute a breach or default under this Agreement. 9. Reporting; Verification Rights. Second Party agrees to provide the following reports and access in connection with the Project: (a) Second Party shall provide periodic reports as reasonably requested by the CEDC to the extent necessary to confirm Second Party’s compliance with the terms of this Agreement. (b) During normal business hours and upon prior written notice, Second Party shall allow a representative of the CEDC reasonable access to its employee payroll records to verify compliance with this Agreement. CEDC agrees to maintain the confidentiality of all reports, records and other materials provided by Second Party under this Section 9 and otherwise under this Agreement, and CEDC shall not disclose any of them or any information included therein without the prior written consent of Second Party. Such information shall be used only for the purpose of administering this Agreement and CEDC’s funding obligations under this Agreement and for no other purpose; provided however, CEDC may upon prior notice to Second Party, if required by legal process or the office of the Attorney General, provide such documentation to a third party as is required by the Attorney General or pursuant to such legal process. 10. Remedies. If a Default shall have occurred and be continuing, CEDC may, as its sole and exclusive remedy hereunder or otherwise, by written notice to Second Party, terminate this Agreement, whereupon Second Party shall (as its aggregate liability as a result of such Default and with respect to this Agreement) return all funds provided by the CEDC to Second Party under this Agreement attributable to the year in which such termination occurs (if any) within thirty (30) days following Second Party’s receipt of such written termination notice. The rate of interest on all funds paid by the CEDC to Second Party subject to refund shall be five percent (5%) per annum from the date of Default until the day of payment of such funds. 11. Delay; Force Majeure. (a) In the event of unforeseeable delays in the performance of this Agreement by Second Party, and upon a reasonable showing by Second Party that it has in good faith commenced and is diligently and continuously pursuing the correction, removal, or abatement of such delays by using its best efforts, CEDC shall excuse any such delay. Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 5 26023315v3 56360.001.00  (b) Second Party shall not be liable or responsible to CEDC, nor be deemed to have defaulted under or breached this Agreement, for any failure or delay in fulfilling or performing any term of this Agreement, when and to the extent such failure or delay is caused by or results from acts beyond Second Party's reasonable control, including, without limitation, the following force majeure events ("Force Majeure Events"): (a) acts of God; (b) flood, fire, earthquake or explosion; (c) war, invasion, hostilities (whether war is declared or not), terrorist threats or acts, riot or other civil unrest; (d) government order or law; (e) actions, embargoes or blockades in effect on or after the date of this Agreement; (f) action by any governmental authority; (g) national or regional emergency; (h) strikes, labor stoppages or slowdowns or other industrial disturbances; and (i) shortage of adequate power or transportation facilities. Second Party shall give notice within 30 days of the Force Majeure Event to CEDC, stating the period of time the Force Majeure Event is expected to continue. Second Party shall use diligent efforts to end the failure or delay and ensure the effects of such Force Majeure Event are minimized. Second Party shall resume the performance of its obligations as soon as reasonably practicable after the removal of the cause. 12. No Waiver. Any waiver provided by CEDC to Second Party of a Default by Second Party shall not be deemed to constitute a continuing waiver or a waiver of any other existing or future Default by Second Party even if the Default is of the same or a similar nature. Any delay by the CEDC in providing notice of a Default to Second Party, shall in no event be deemed or constitute a waiver of such Default by CEDC or waiver of any of its rights and remedies available under this Agreement or at law or in equity. 13. Liability. Second Party specifically agrees that CEDC shall be liable to Second Party for the amount of money budgeted and committed to the Project pursuant to this Agreement. CEDC shall not be liable or held responsible for any other direct or indirect costs, attorney's fees, expenses, court costs, actual or consequential damages, direct or indirect. It is further stipulated and agreed that CEDC shall only be required to pay the amount of the Project cost out of its sales tax revenues held and administered pursuant to the Development Corporation Act for the fiscal year in which the funding under this Agreement is due together with unencumbered funds then on hand and from no other source. It is specifically agreed, that in the event actual total sales tax revenues collected by CEDC for any year during which this Agreement is to be performed should be less than the total amount of all grants to all contracting parties for that year, then in that event, Second Party shall receive a prorated payment based upon the ratio the grant awarded under this agreement bears to the total CEDC grants for that calendar year, less CEDC's customary and usual administrative costs and expenses; however, and notwithstanding anything herein to the contrary, CEDC shall be liable for any such deficiency and shall pay the amount of such deficiency, if and as revenues and unencumbered funds of the CEDC are sufficient to pay the deficiency in question, which amount shall be paid upon the next occurring anniversary of the Production Date if funds are then available. The term of this Agreement shall be extended as necessary for Second Party to receive all amounts to which it would have been entitled during any year, but for any deficiencies in the revenues or unencumbered funds of CEDC in such year. In the event of any revenue shortfall, CEDC will provide written notice to all contracting parties Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 6 26023315v3 56360.001.00  affected by the revenue shortfall along with such documentation as will allow Second Party to ascertain its pro-rata share of the funding to be provided. 14. Integration; Amendment. This Agreement, together with the submittals by Second Party constitutes the entire agreement of the parties hereto and supersedes any oral, written or contemporaneous agreements between the parties relating to the matters covered by this Agreement. Except as otherwise provided herein, this Agreement cannot be modified or amended without a writing signed by the parties hereto. 15. No Joint Venture. No term or provision of this Agreement or an act of CEDC in the performance of this Agreement shall be construed as making or constituting Second Party or its employees, or agents, partners or joint ventures of the CEDC or employees of the CEDC. This Agreement is not for the benefit of any third party. 16. Further Assurances. Each of the parties hereto shall execute and deliver such additional documents, instruments and conveyances, and take such other actions and do such other things, as may be reasonably necessary to carry out the provisions and purposes of this Agreement and give effect to the transactions contemplated hereby. The termination of this Agreement as provided herein may be upon the written, mutual agreement of the parties or pursuant to Section 10 or Section 17 hereof. 17. Expiration; Second Party Termination. This Agreement shall expire and the obligations of the parties hereunder shall terminate upon the later to occur of the following dates (such later date, the “Expiration Date”): (a) the tenth anniversary of the Production Date, and (b) the date on which CEDC has paid to Second Party all amounts due and owing to Second Party hereunder, including (without limitation) payments to be made by CEDC for deficiencies in prior years. Second Party may terminate this Agreement at any time prior to the Expiration Date upon thirty (30) days’ prior written notice to CEDC and return to CEDC all funding provided hereunder by CEDC to Second Party attributable to the year during which such termination occurs. 18. Counterparts. This Agreement may be executed in a number of identical counterparts each of which shall be deemed an original upon execution by both parties. 19. Governing Law; Etc. This Agreement is made pursuant to the laws of the State of Texas and shall be governed and interpreted under the laws of the State of Texas. Venue in any litigation arising out of the execution or performance of this Agreement shall be in the court of appropriate jurisdiction in Randall County, Texas and in no other Venue. Second Party, by signing this Agreement, consents to and waives any objections to in persona jurisdiction in Randall County, Texas. 20. Severability. In the event one or more of the provisions contained in this Agreement should, for any reason, be held invalid, illegal, or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement. This Agreement shall be construed as if such invalid, illegal, or unenforceable provision had not been contained herein. Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 7 26023315v3 56360.001.00 21. Binding Effect. This Agreement shall be binding upon the parties hereto, their successors and (where permitted) assigns. This agreement may not be assigned by either party without the specific prior written consent of the other, which consent shall not be unreasonably withheld or conditioned, provided that Second Party may assign this Agreement as collateral to any Financing Entities that provide financing to Second Party. CEDC will cooperate in good faith to accommodate any such collateral assignment by Second Party to any such Financing Entities and will execute and deliver such commercially reasonable documents as may be requested by such Financing Entities, including granting to such Financing Entities the right to notice of Defaults, step-in rights, and the opportunity to cure Defaults. CEDC acknowledges and agrees that Second Party may at any time mortgage the Land to any Financing Entities. Provided however, that in the event Second Party transfers all or substantially all its assets to another entity or merges with another entity to the extent that the underlying purpose of this Agreement cannot, in the reasonable discretion of the CEDC's board of directors, be accomplished, the CEDC shall have the option to suspend its performance under this Agreement or terminate this Agreement. 22. Business Practices. Second Party represents that no member of the board of directors of the CEDC or member of the governing body of the City of Canyon or any officer or employee of the City of Canyon or CEDC will be compensated in any manner with respect to directly or indirectly bringing the parties together for the purpose of this Agreement or participation in the negotiation or formation of this Agreement. No finder's fee or other origination fee of any type will be paid or will become payable to any officer or employee of the City of Canyon, member of the governing body of the City of Canyon, or the governing body of the CEDC with regard to the formation or performance of this Agreement. 23. Notices. All notices from one party to the other party required or permitted by this Agreement shall be delivered personally or sent by certified mail postage prepaid addressed to the party at the address shown on the signature page. All notices shall be deemed given on the date so delivered or deposited in the mail unless otherwise provided. Either party may change its address by sending written notice of such change to the other party in the manner provided by this Agreement. 24. Survival. All representations, warranties, covenants, and agreements of the parties as well as all rights and benefits of the parties pertaining to the transaction contemplated by this Agreement shall survive the original execution date of this Agreement. [SIGNATURE PAGE FOLLOWS] Project Funding Agreement No. 2 – Lone Star Dairy Products LLC 8 26023315v3 56360.001.00 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed and delivered by their proper and duly authorized officers as of the Effective Date. Second Party: LONE STAR DAIRY PRODUCTS LLC By: Name: Title: Address Phone Number By: Name: Title: Address Phone Number Project Funding Agreement No. 2 – Lone Star Dairy Products LLC Signature Page 26023315v3 56360.001.00  CEDC: CANYON ECONOMIC DEVELOPMENT CORPORATION By: Randy Croslin, President/Chairman 301 16th Street, Canyon, Texas 79015 Address Phone Number Project Funding Agreement – Lone Star Dairy Products LLC Signature Page 26023315v3 56360.001.00  EXHIBIT A Legal Description of Land Project Funding Agreement – Lone Star Dairy Products LLC 26023315v3 56360.001.00  AGENDA To: Mayor and City Commission From: Randy Criswell, City Manager Date: August 19, 2015 Re: Budget Work Session ________________________________________________________________________ At the last budget work session, no further changes were made. This will be an opportunity for further discussion if there is anything specific that you’d like to address. City of Canyon  AGENDA To: Mayor and City Commission From: Randy Criswell, City Manager Date: August 12, 2015 Re: Hold Public Hearing on Proposed Tax Rate ________________________________________________________________________ As required by State Law and by the City Charter, we must conduct two public hearings on the tax rate. We’ve already held one, so tonight is the required Second Public Hearing on the Tax Rate. As a reminder, the proposed tax rate is unchanged from the current rate of $0.39083/$100 valuation. The 2015 Effective Tax Rate is $0.37251. Adopting the existing rate equates to an increase over the Effective Rate of 4.9%. Tonight we need to conduct the Second Public Hearing on the Tax Rate. City of Canyon