Title
Resolution - A Resolution of the City Council of the City of Mansfield, Texas, Approving the Master Development Agreement (MDA) for the Reserve between the City of Mansfield, the Board of Directors of Tax Reinvestment Zone Number One, and Stillwater Capital, LLC; Authorizing the City Manager or His Designee, and the Chairman of the Board of Directors of Tax Increment Reinvestment Zone Number One to Execute the Agreement; Finding that the Meeting at Which this Resolution is Passed is Open to the Public as Required by Law; And Declaring an Effective Date (TIRZ #1)
Requested Action
To Consider Approving the Resolution
Recommendation
To Approve the Resolution
Description/History
Stillwater Capital has under contract approximately 173.67 acres for the development of The Reserve, which will be a walkable, urban, mixed-use project, including office, hospitality, retail, residential, restaurant, entertainment, and medical uses. The City seeks to incentivize the development through the use of Tax Increment Reinvestment Zone Number One (TIRZ #1).
Key Terms of the Agreement
Scope of Work: Stillwater Capital will develop the project according to the Master Plan, which includes a canal, parks, water features, and public infrastructure. The City will contribute to the cost of public improvements through the TIRZ.
Duration: The agreement continues until the final payment is made to the developer or earlier termination by mutual agreement or default.
Public Contributions: The City will deposit funds into the Canals at the Reserve Account to cover the design and construction costs of public improvements. The developer will also be responsible for a private investment in the project.
Responsibilities:
- City of Mansfield: Fund public improvements, including roads, utilities, and canals, as outlined in the agreement.
- Developer (Stillwater Capital): Complete construction of private and public components of The Reserve as per the approved Master Plan and submit payment requests for completed work.
Funding Mechanism: The City will establish a Canals at the Reserve Account, and funds will be disbursed to the developer based on approved invoices for public improvements.
Termination Clause: The agreement may be terminated by mutual consent, breach, bankruptcy, or legal changes rendering the agreement invalid.
Financial Implications
Funding for public improvements is sourced from the TIRZ and will be deposited into the Canals at the Reserve Account. The developer is responsible for private investment in the project.
Benefits to the City
The Reserve will diversify the local economy, create jobs, and expand the tax base in Mansfield significantly with new sales taxes and property taxes. The expected taxable value for the private investment will exceed $1.5 billion. It will also enhance commercial activity and provide public amenities like parks and open spaces.
Payment Process
Stillwater will request payments from the city for work done on public infrastructure. The City will carefully review each request to ensure it is reasonable and within the budget before releasing funds.
Oversight
The City will monitor the project’s progress and ensure that public funds are being used appropriately. If either the city or the developer doesn't meet their obligations, the agreement allows for termination or renegotiation.
Justification
TIRZ #1 was established by the City of Mansfield in 2006, with Tarrant County joining in 2008. Since then, private investment has continued at a steady rate, thus providing funds for enhanced infrastructure projects within the zone. As new major developments are considered within the zone, like Stillwater Capital's, funding from the TIRZ can be used to support major infrastructure needed throughout the master development. It is projected that the Canals at the Reserve project alone will surpass $1.5 billion in taxable value over the next twenty-five years. Using the city's current tax rate, it is expected to generate over two-hundred million dollars into the TIRZ and general fund alone over the next twenty-five years. By the expiration of the TIRZ, the development will yield nearly $10 million per year in general fund revenue.
Funding Source
TIRZ #1
Prepared By
Jason Moore, Executive Director, Economic Development