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Fort Worth Council Report: American Airlines expansion

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AMERICAN AIRLINES EXPANSION

The council approved a proposed reinvestment zone and enhanced community facilities agreement with American Airlines for its headquarters and road improvements along Trinity Boulevard.

Dating back to Nov. 10, 2015, the council approved a tax abatement agreement with American Airlines and the Dallas/Fort Worth Airport Board for development of a corporate headquarters facility on property at the airport located within the city of Fort Worth. The city agreed to abate a maximum of 75 to 90 percent of the incremental real and personal property from the site for a period of one year, provided the company expend at least $200 million in real property improvements on the reinvestment zone by Dec. 31, 2019.

American Airlines now wishes to expand the original zone to allow additional buildings in the expansion. This requires a portion of it to be built to the north of the existing reinvestment zone on land controlled by the company.

As part of the project, American Airlines will also be spending an estimated more than $1.65 million on the construction of deceleration lanes, signaling, and sidewalk and street light improvements on Trinity Boulevard and American Boulevard. American Airlines has agreed to provide at its expense, all necessary right-of-way and easements across the property they control.

The Fort Worth Economic Development Department has recommended helping with the cost of the public infrastructure (road improvements) through an Enhanced Community Facilities Agreement (ECFA) in the amount of $950,000.

All work must be completed by Dec. 31, 2019.

The tax abatement amendment and ECFA are expected to be on the June 13 agenda.

HIGH-SPEED RAIL SITE

Having already authorized the creation of a multijurisdictional local government corporation with the city of Dallas and other local government entities for the DFW Core Express High-Speed Rail Connection between Fort Worth and Dallas, now comes the decision where to base it.

The council, in its work session June 6, was given a briefing on the possibility of several possible sites. They include the Intermodel Transportation Center, Central Rail Station, East Sundance, Southside, Butler Place, Texas and Pacific Station, and East Lancaster.

“It’s a large train system and we’re trying to figure out how to squeeze that into downtown Fort Worth,” said Brad Lonberger of Gateway Planning Group.

The group will make its recommendations in July.

Along with a high-speed system that would get travelers from Fort Worth to Dallas in a matter of minutes, the hope is to include Houston, Austin and San Antonio in the routes. The proposed route between Fort Worth and Dallas would also have a stop in Arlington.

“You are the lynch pin,” said Michael Morris of the North Central Texas Council of Governments. “It all comes through here.”

TRAFFIC EQUIPMENT UPDATE

The council authorized a purchase agreement with Iteris Inc, for traffic signal equipment and services using the Texas Smart Buy Cooperative Contract for an amount up to $1.75 million for the first year for the Transportation and Public Works Department (TPW).

TPW will use this agreement to purchase traffic signal communication network wireless radios to provide TPW staff remote capability to monitor and manage traffic signals, traffic flow and traffic issues efficiently in order to minimize dispatch of technicians to the site. The agreement will also be utilized for the purchase of vehicle detection equipment, wireless radio accessories, upgrades, repairs and installation services.

SMITH & NEPHEW ABATEMENT

In its work session, the council heard a presentation from Director of Economic Development Robert Sturns concerning a tax abatement for Smith & Nephew Biotherapeutics.

Smith & Nephew is a British-based multi-national firm with 15,000 employees worldwide with sales over $4.6 billion in 2016. They feature advanced medical products and healthcare services for orthopedics reconstruction, advanced wound management, sports medicine, and trauma and extremities applications.

The company is looking for expansion of an existing site at 4900 W. Vickery.

Sturns said the proposal is for a tax abatement of up to 55 percent over five years, along with the company being nominated for Texas Enterprise Designation in the September round of applications.

In return, Smith & Nephew would make a property capital investment of about $25.7 million by Dec. 31, 2018, for expansion, along with retaining approximately 83 existing jobs and hiring up to 100 more with an average wage of $64,000 by 2022. Of these, a minimum of 40 percent would be Fort Worth residents and a minimum of 30 percent would be Fort Worth central city residents.

In addition, the company would be called upon to spend 35 percent or $1.225 million of hard construction costs with Fort Worth minority/women-owned businesses, 35 percent or $5 million annually with Fort Worth companies, and 25 percent or $3.57 million annually with Fort Worth minority/women-owned businesses.

Sturns said the project could bring in tax revenue of about $715,000 to the city.

The project is still very much competitive, Sturns said. The company is looking at two other possible locations in New Jersey and one in Curacao.

“We are excited about the prospect of expanding Fort Worth’s footprint in the biotech industry,” Sturns said.

The public hearing on the proposal will be in the June 13 council agenda.

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