3811 RESOLUTION NO, 3, 311
A RESOLUTION AUTHORIZING THE MAYOR AND CITY
CLERK TO EXECUTE ON BEHALF OF THE CITY OF
LITTLE ROCK A CONTRACT FOR THE PAYMENT OF
CERTAIN SUMS OF MONEY IN LIEU OF TAXES AND
FOR OTHER PURPOSES
WHEREAS, THE ARMSTRONG RUBBER COMPANY has submitted to
the CITY OF LITTLE ROCK, ARKANSAS a proposal under the terms
of which it offers to make a payment of money in lieu of taxes
on certain lands , buildings , and industrial machinery and equip-
ment (including replacements thereof) owned by the City of
Little Rock and leased by it to The Armstrong Rubber Company,
which taxes would be due if The Armstrong Rubber Company, and
not the City, were the owner of said property; and
WHEREAS, the Board of Directors finds that the said
proposal is fair and reasonable and should be accepted;
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS
OF THE CITY OF LITTLE ROCK, ARKANSAS :
Section 1. The Mayor and City Clerk are hereby autho-
rized and directed to execute on behalf of the City of Little
Rock the following contract with The Armstrong Rubber Company:
Page 1
AGREEMENT FOR THE PAYMENT OF MONEY IN
LIEU OF TAXES
WHEREAS, the City of Little Rock, Arkansas (hereinafter
referred to as "City") , proposes to issue Industrial Development
General Obligation Bonds under the provisions of Amendment No. 49
to the Constitution of the State of Arkansas in the principal
amount of $1,500 ,000.00, and Industrial Development Revenue Bonds
under the provisions of Act No . 9 of the First Extraordinary
Session of the Sixty-second General Assembly of the State of
Arkansas , approved January 21, 1960, in the principal amount of
$3 ,000 ,000 .00 for the purpose of securing and developing industry
in the City of Little Rock by assisting The Armstrong Rubber
Company (hereinafter referred to as "Armstrong19) to construct
and equip an industrial plant for the manufacture of rubber pro-
ducts (hereinafter called "Project") ; and
WHEREAS , the City proposes to lease the said Project to
Armstrong; and
WHEREAS, title to the lands constituting the site for
the said Project , the buildings and improvements constructed
thereon, and the industrial machinery and equipment including
replacements thereof installed therein, shall be and remain in
the City until the Bonds of both issues shall have been fully
retired by Armstrong from lease rentals ; and
WHEREAS, Armstrong as Lessee is required to pay all
taxes which may become due on the said Project ; and
4
Page 2
r
WHEREAS, the said lands , buildings , and industrial machinery
and equipment including replacements thereof , so long as the City
shall hold title thereto, is exempt from taxes under the holding
of the Supreme Court in the case of Wayland v. Snapp, 232 Ark. 57,
334 SW(2d) 633 , with the result that no taxes are due to be paid
by Armstrong as Lessee ; and
WHEREAS , the City has indicated a reluctance for the
several taxing authorities to lose all tax revenues which other-
wise they would receive if the said lands , buildings , and in-
dustrial machinery and equipment, including replacements thereof,
were privately owned ; and
WHEREAS, Armstrong understands that as Lessee it will
have no obligation to pay taxes , but desires , nevertheless, as
an inducement to the City to issue the said Bonds , to make a
payment in lieu of the taxes which would otherwise be due if
Armstrong, and not the City, were the owner;
NOW, THEREFORE, in consideration of the premises , to
induce Armstrong to undertake the said Project and to induce the
City to issue the said Bonds , Armstrong and City agree :
1. Armstrong will pay, and City will accept , in lieu
y
of all taxes on the lands , buildings , and industrial machinery
and equipment including replacements thereof during the term
of this Agreement , owned by the City and leased to Armstrong the
sums of money in t1- years as follows :
(a) 1969 $22,050 1974 $33 ,075
1970 24, 255 1975 35, 280
1971 26,460 1976 37 ,485
1972 28, 655 1977 39, 690
1973 30,870 1978 41,895
I
Page 3
(b) In each of the years 1979 through 1992,
inclusive, the sum of $44, 100 ;
(c) No payment will be made or required in the
years 1967 and 1968 .
Armstrong will make the payment on the first day
of April and on the first day of October, in equal amounts,
in each year but reserves the right to make monthly, rather than
annual payments , and if it elects to make monthly payments it
will pay one-twelfth (1/12th) of the specified annual payment on
the first business day of each month in the respective years .
2. The said annual payments are intended to be , and
will be accepted in lieu of all ad valorem taxes on the said
lands , buildings , and industrial machinery and equipment and re-
placements thereof during the term of this Agreement , owned by
the City and leased to Armstrong which would have to be paid
to the State of Arkansas , Pulaski County, the City of Little
Rock, school districts and/or any and all other political sub-
divisions of the State of Arkansas if the said properties were
not exempt from ad valorem taxes under the provisions of Article
16, Section 5 of the Constitution of the State of Arkansas as
interpreted by the Supreme Court of the State of Arkansas in the
case of Wayland v. Snapp, supra .
3 . If by reason of a change in the Constitution, a
change by the Supreme Court of the State of Arkansas in its inter-
pretation of the Constitution or otherwise, Armstrong is required
to pay any tax which the payments specified herein are intended
Page 4
•
to be in lieu of (as defined in paragraph 2 hereof) , Armstrong
may deduct the aggregate of any such payments made by it from
the amount herein agreed to be paid in lieu of taxes and need to
pay only the difference to the City . In no event shall Armstrong
be required to pay in any year an amount greater than that which
it would be required to pay in taxes as the owner of the said
properties .
4. This Agreement shall terminate upon the final
termination of the term demised to Armstrong, and the taxes due
for the year in which this Agreement shall terminate shall be
prorated.
IN TESTIMONY WHEREOF, the parties hereto have caused this
instrument to be executed and attested by their respective
officers and officials this day of , 1967 .
THE ARMSTRONG RUBBER COMPANY
By :
Title :
ATTEST :
Secretary
(S E A L) CITY OF LITTLE ROCK, ARKANSAS
By :
Mayor
ATTEST:
City Clerk
(S E A L)
Page 5
Section 2. This resolution shall be in full force and
effect from and after its adoption.
ADOPTED : July 17 , 1967 .
APPROVED :
.1/
a` or
ATTEST:
'Y:73Ez e
City Clerk
Page 6