Title
Resolution - A Resolution Authorizing the City of Mansfield, Texas to Enter into a Chapter 380 Agreement with Bloomfield Homes, L.P. for the Purpose of Promoting Economic Development within the City of Mansfield, Texas; and Approving Other Matters Related Thereto
Requested Action
The City Council approve a resolution authorizing the City to enter into a Chapter 380 Agreement with Bloomfield Homes, L.P. for the purpose of reallocating sales tax revenue to the City of Mansfield, Texas which is currently being paid outside the City of Mansfield, Texas.
Recommendation
Staff recommends the approval of the Resolution.
Description/History
Bloomfield Homes, L.P. approached the City with an offer to partner with the City in the reallocation of the sales tax it pays on building materials purchased. The terms of this Chapter 380 Agreement are identical to the terms in the agreement City Council approved on October 26, 2015 with First Texas Homes, Inc. Currently, Bloomfield Homes pays sales tax at the location it purchases building materials. Texas Rule 3.288 of the Texas Administrative Code would allow Bloomfield Homes to elect how they pay sales tax if they assume full responsibility for reporting and paying sales tax to the Texas Comptroller’s Office. Bloomfield Homes has proposed that it will assume full responsibility of paying and reporting the sales tax that they are required to pay under Rule 3.288, and in so doing, the City will receive sales tax on building materials that are being used in the City of Mansfield, Texas. The City is currently not receiving sales tax revenue on these purchased materials; it is being paid in other cities where the materials are purchased.
Justification
In return for the partnership, the City will receive 60% of all sales tax revenue on the materials used in the City of Mansfield, Texas and Bloomfield Homes will receive the remaining 40% in the form of a grant. There is no cost to the City of Mansfield, Texas with the exception of the administrative expense in disbursing the grant funds to Bloomfield Homes, L.P. The revenue to the City over the term of the agreement is expected to be $117,138.74 at a minimum, with the potential to reach $175,649.54. Bloomfield Homes would receive a minimum of $78,092.49 and potentially $117,099.69 over the term of the agreement.
Funding Source
N/A
..Prepared By
Peter Phillis, Deputy City Manager
817-276-4261