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102119mHARNETT COUNTY BOARD OF COMMISSIONERS Minutes of Regular Meeting October 21, 2019 The Harnett County Board of Commissioners met in regular session on Monday, October 21, 2019, in the Commissioners Meeting Room, County Administration Building, 420 McKinney Parkway, Lillington, North Carolina. Members present: Gordon Springle, Chairman Howard Penny, Vice Chairman Mark B. Johnson, Commissioner Barbara McKoy, Commissioner Member absent: Joe Miller, Commissioner Staff present: Paula Stewart, County Manager Dwight Snow, County Attorney Kimberly Honeycutt, Finance Officer Margaret Regina Wheeler, Clerk Chairman Springle called the meeting to order at 6:00 pm. Commissioner Johnson led the Pledge of Allegiance and invocation. Chairman Springle called for any additions or deletions to the published agenda. Mrs. Stewart requested to delete from the agenda the Harnett County Sheriffs Office's request for permission to accept a Governor's Highway Safety Grant with funding for 50% of the cost for one Deputy position. Mrs. Stewart also requested to add to the agenda for consideration Harnett County Cooperative Extension's request for approval to accept the 2019/2020 North Carolina Tobacco Trust Fund Commissioner Southern Pea Project Grant for $32,500. Vice Chairman Penny moved to approve the agenda as amended. Commissioner Johnson seconded the motion that passed 4 - 0. Commissioner McKoy moved to approve items on the consent agenda. Vice Chairman Penny seconded the motion, which passed 4 - 0. 1. Minutes: October 15, 2019 Work Session October 7, 2019 Regular Meeting October 1, 2019 Work Session August 27, 2019 Work Session August 13, 2019 Work Session May 14, 2019 Work Session October 21, 2019 Regular Meeting Minutes Harnett County Board of Commissioners Page 1 of 6 2. Budget Amendments: 16 Detention Public Safety Code 7504390 547010 7504390 350480 59 Emergency Services Code 1104411 529090 1104411 330310 Payment of Claims Service Charge Concessions Emergency Supplies State 108 Cooperative Extension Code 1104995 502020 1104995 505010 1104995 507030 1104995 507010 1104995 526010 1104995 531010 1104995 531020 1104995 531030 1104995 548000 1104995 350430 1104995 584000 1104995 330210 142 Sheriff Public Safety Code 2104590 598500 2103900 390990 143 Sheriff Capital Reserve Code 5104310 555000 5103900 390982 478 Veterans Service Code 2504185 544000 2504185 544000 2504185 544000 2504185 544000 2504185 544000 2504185 519090 2504185 526010 2504185 539090 2504185 539090 2504185 330210 CC&R Salaries & Wages Part-time FICA Workman's Compensation Unemployment Insurance Materials & Supplies Training/Mileage Training/Meals Training/Lodging Dues & Subscription Indirect Cost Non Capital Assest Info Tech Federal Revenue — CCR&R 750,000 increase 750,000 increase 1,000 increase 1,000 increase 3 decrease 1 decrease 330 decrease 90 decrease 1,548 decrease 1,575 decrease 500 increase 1,000 increase 510 decrease 67 decrease 1,350 increase 1,274 decrease Sheriff's Capital Reserve 139,632 increase Federal Asset Forfeiture Fund Balance 139,632 increase Capital Outlay Equipment Transfer from Special Revenue M. Teachy G. Winderweedle G. Harrington E. Sperico M. Warren TBA Treatment Providers Materials & Supplies NCAOC Computer Cost Corrisoft SAMHSA Federal Grant 139,632 increase 139,632 increase 16,269 increase 14,180 increase 5,257 increase 12,500 increase 7,800 increase 13,914 increase 843 increase 337 increase 3,600 increase 74,400 increase October 21, 2019 Regular Meeting Minutes Harnett County Board of Commissioners Page 2 of 6 260 CCCC Code 1105920 602020 1103900 390990 481 Veterans Services Code 2504185 519090 2504185 519090 2504185 519090 2504185 519090 2504185 531030 2504185 531020 2504185 531010 2504185 531040 2504185 531050 2504185 504010 2504185 526010 2504185 523040 2504185 330210 Youth Services Code 1105870 502020 1105870 503030 1105870 505010 1105870 505050 1105870 506010 1105870 506020 1105870 506040 1105870 507010 1105870 507030 1105870 521030 1105870 525010 1105870 528010 1105870 531030 1105870 547030 1105870 532030 1105870 532050 1105870 330310 1105870 380890 1105870 390510 611 Board of Education Code 4705913 553000 4705913 519040 4705913 599000 CCCC-Capital Outlay Fund Balance Appropriated G Harrington G Winderweedle M Teachy Skip Green Lodging Meals Training -Mileage Training -Transportation NADCP Conference Fees Travel -Admin Materials & Supplies Drug Kits BJA Federal Grant Salaries & Wages — Part-time 401(k) FICA State Retirement — General Medical Insurance Dental Insurance Life Insurance Unemployment Worker's Compensation Uniforms Vehicle Supplies — Fuel Athletic & Program Supplies Training — Lodging Indemnity Payment Cellular Service Postage State Other Revenue In Kind Fuel Tank Removal Asbestos Testing Contingency 160,000 increase 160,000 increase 25,200 increase 56,400 increase 47,124 increase 6,000 increase 1,080 increase 320 increase 41 increase 800 increase 1,490 increase 184 increase 3,081 increase 8,280 increase 150,000 increase 2,013 decrease 12 increase 154 decrease 727 decrease 20 increase 10 decrease 20 decrease 10 decrease 65 decrease 100 decrease 500 decrease 19 decrease 176 decrease 2,296 decrease 252 increase 252 decrease 5,000 decrease 1,000 decrease 58 decrease 91,006 increase 2,125 increase 93,131 decrease October 21, 2019 Regular Meeting Minutes Harnett County Board of Commissioners Page 3 of 6 620 Board of Education Code 5905910 555000 5903900 390981 Capital Outlay Equipment 1,021,528 increase Transfer From — General Fund 1,021,528 increase 621 General Fund Code 1109910 599000 Contingency 1,021,528 decrease 1109800 598500 Interfund Transfer — Capital Reserve 1,021,528 increase 843 Cooperative Extension Code 1104995 502010 Salaries & Wages 4,301 decrease 1104995 502050 Longevity 695 decrease 1104995 507030 Worker's Compensation 591 decrease 1104995 507010 Unemployment 76 increase 1104995 505050 Retirement 1,084 decrease 1104995 506040 Life Insurance 61 decrease 1104995 506010 Group Insurance 875 decrease 1104995 505010 FICA 382 decrease 1104995 506020 Dental 38 decrease 1104995 503030 Supplemental Retirement 86 decrease 1104995 504010 Mileage 173 decrease 1104995 531010 Training — Mileage 273 increase 1104995 531030 Lodging 2,561 increase 1104995 531020 Meals 899 increase 1104995 531040 Training/Transport/Rental Car 2,192 increase 1104995 531050 Registration 2,725 increase 1104995 544095 Incentives 40 increase 1104995 330210 Adolescent Parenting Revenue Federal 480 increase 3. Tax rebates, refunds and releases 4. Harnett County Tax Department requested approval of Property Tax Exemption/Exclusion Late Applications. The Tax Department stated that these applications meet all qualifications per General Statutes and are approved for the exemption/exclusion they are applying for, beyond being late. 5. Harnett Regional Water requested approval of a new water purchase contract with the Town of Angier. Harnett Regional Water will continue to supply water to the Town of Angier as they have since 1977. 6. Harnett County Emergency Services requested approval of the Emergency Medical Services Medical Director contract between County of Harnett and Sean Samuel Ray, M.D. effective November 1, 2019. Dr. Ray replaces Erin M. Wirths, D.O., who resigned from this position. October 21, 2019 Regular Meeting Minutes Harnett County Board of Commissioners Page 4 of 6 7. Harnett County Emergency Services requested approval to accept the 2019 Tier II LEPC Grant in the amount of $1,000 from the NC Department of Public Safety Emergency Management Division. No county matching funds are required and this is a reimbursable grant. Harnett County's Local Emergency Planning Committee will use these funds for the purposes of hazardous materials emergency response planning, training and exercises. 8. Harnett County Cooperative Extension requested approval to accept the Child Care Block Grant in the amount of $28,661 from the Chatham County Partnership for Children to continue providing training and workshops for childcare providers across Harnett County. No county matching funds are required. Chairman Springle opened the floor for informal comments by the public, allowing up to 3 minutes for each presentation up to 30 minutes. - Sylvia McLean of 287 Bethea Road in Lillington addressed the Board on behalf of the Shawtown Community Concerned Citizens. No appointments were made. Commissioners discussed the need to be able to vet applications prior to considering them for appointment. Harnett County Cooperative Extension Director Tim Mathews presented Cooperative Extension's request for approval to accept the 2019/20 North Carolina Tobacco Trust Fund Commission Southern Pea Project Grant for $32,500. Harnett County Cooperative Extension will use the funds to purchase two additional pea shellers to be used at multiple farms in 2020. Vice Chairman Penny moved to approve to accept the grant for $32,500 as presented. Commissioner McKoy seconded the motion that passed 4 - 0. Harnett County General Services Director Barry Blevins petitioned the Board for a public hearing to allow citizens an opportunity to comment on transportation needs and the proposed 5311 Community Transportation Program application to be submitted to the North Carolina Department of Transportation. The Section 5311 program intends to enhance the access of people in non -urbanized areas to health care, shopping, education, employment, public services and recreation. Section 5311 assists in the maintenance, development, improvement and use of public transportation systems in non -urbanized areas. Mr. Blevins noted the public hearing is an annual requirement for these funds. The total estimated amount requested for FY2021 is $285,696 for Administration and $325,000 for Capital (Vehicles & Other) totaling $610,696 and requiring $75,356 in matching funds. Mr. Blevins said they are anticipate purchasing five new vehicles in the following year, four with wheel chair lifts and one minivan. Chairman Springle called to order a public hearing on the matter and opened the meeting for comments from the public. Seeing no one move Chairman Springle closed the public hearing. Commissioner McKoy moved to approve the application and resolution to apply for the FY2021 funding and $75,356 in matching funds. Commissioner Johnson seconded the motion that passed 4 - 0. October 21, 2019 Regular Meeting Minutes Harnett County Board of Commissioners Page 5 of 6 Coley Price, Assistant County Manager, petitioned the Board for a public hearing concerning a proposed agreement to extend economic incentives to Pallet Consultants of North Carolina, Inc., a North Carolina Corporation which intends to lease, upfit and reuse the industrial building located at 2 Dinan Road, Dunn, Harnett County, NC 28334, in order to establish and operate a pallet manufacturing facility. Mr. Price explained the proposed economic incentive package would include five annual incentive grants to be paid to PCNC from any available fund sources of the County, which will be calculated to be in amounts equal to a portion of the property taxes to be paid by PCNC, assuring a positive return on investment for the County. This facility project site with machinery and equipment will include a capital investment of approximately $3.7 million. During the five (5) year incentive period, fifty (50) full time jobs with an average annual wage of $38,360.00 will be created as a result of the operation of this manufacturing facility. Chairman Springle called to order a public hearing on the matter and opened the meeting for comments from the public. Seeing no one move Chairman Springle closed the public hearing. Vice Chairman Penny moved to approve a Resolution to Enter Into An Incentive Agreement With Pallet Consultants of North Carolina, Inc. Commissioner Johnson seconded the motion that passed 4 - 0. (Attachment 1) Mrs. Stewart presented the following reports: - Harnett County Veterans Services Activities Report — September 2019 - Harnett County Public Health Activities Summary — September 2019 - Interdepartmental Budget Amendments Mrs. Stewart noted, at the direction of the Board, staff mailed 8 ounces of Harnett County native soil to the North Carolina National Guard Museum to be placed in the footings of the WW1 monument site in France and at the State Capitol. She also announced that JCPC would receive additional funding. Commissioners previously adopted a Resolution Supporting Juvenile Crime Prevention Council Allocation Expansion. Commissioners and staff wore pink in recognition of Breast Cancer Awareness Month. Mrs. Stewart shared information about the annual campaign and Harnett County's efforts to increase awareness about the disease, to educate all citizens about the risk factors, detection and treatment and our commitment to support breast cancer research. There was no new business or need for closed session. Vice Chairman Penny moved to adjourn the meeting at 6:17 pm. Commissioner Johnson seconded the motion that passed 4 - 0. Gordon Spring' t Regina : eler, Clerk Octo o - r 21, 2019 Regular Meeting Minutes Harnett County Board of Commissioners Page 6 of 6 ATTACHMENT 1 NORTH CAROLINA HARNETT COUNTY RESOLUTION TO ENTER INTO AN INCENTIVE AGREEMENT WITH PALLET CONSULTANTS OF NORTH CAROLINA, INC. THAT WHEREAS, the County of Harnett ("County") has made economic development in Harnett County a major priority in an effort to recruit new industry and businesses to the County, to replace displaced industry previously located in the County, to retain and/or expand current industry located in the County, to provide local job opportunities for citizens of the County, and to increase the County tax base; and WHEREAS, Pallet Consultants of North Carolina, Inc. ("PCNC") is a North Carolina corporation with its principal office located at 810 NW 13th Ave., Pompano Beach, Florida 33069; that PCNC has decided to locate a pallet manufacturing facility (the "Facility") which will be located at 2 Dinan Road, Dunn, NC 28334, with the intent to apply for the County's economic development incentives. PCNC will enter into a long term lease of an approximate 4.01 acre real property tract upon which is located an approximate 41,920 square feet industrial building which will be renovated and upfitted by PCNC into its Facility which is projected to become operational no later than December 2019. In developing this Facility in Harnett County, PCNC plans to invest $3,700,000 and create approximately 50 full-time jobs; and WHEREAS, based upon PCNC's location of its pallet manufacturing Facility in Harnett County, the establishment of a direct investment tax base, and the creation of 50 full-time jobs, the County is willing to appropriate certain economic incentives in the form of monetary grants to PCNC pursuant to the provisions of N.C. General Statutes § 158-7.1 which allows counties to make appropriations for the purpose of aiding and encouraging the location and/or expansion of manufacturing enterprises and industrial and commercial facilities in the County; and WHEREAS, the County and PCNC have negotiated an economic development incentive package which includes incentives to be paid to PCNC in the form of a grant of a maximum eighty percent (80%) of County ad valorem taxes paid by PCNC over a 5 year period, which said incentive payments or portions thereof are dependent on PCNC's performance of various incentive conditions including the creation and maintenance of 50 full-time jobs that meet certain wage levels pursuant to a job creation 5 year schedule. That an instrument entitled "Pallet Consultants of North Carolina, Inc. and Harnett County, North Carolina Incentive Agreement" ("Incentive Agreement") which is attached to this Resolution as Exhibit A has been prepared for agreement between the parties to comply with the provisions of N.C. General Statutes § 158-7.1; that pursuant to N.C. General Statutes § 158-7.1(c) and a published Notice of Hearing, a public hearing was held on October 21, 2019 concerning the terms of the proposed Incentive Agreement; that subsequent to the close of said public hearing and after deliberations, it is the desire of the Harnett County Board of Commissioners to approve the appropriation of this Incentive Agreement with PCNC subject to those terms contained within said Agreement. NOW, THEREFORE, BE IT RESOLVED by the Harnett County Board of Commissioners that the Incentive Agreement attached hereto as Exhibit A between the County and PCNC is hereby approved, and that the proper officials of the County are hereby authorized to enter into the Incentive Agreement with PCNC. 2 This the 21st day of October, 2019. ATTEST: Mar a et Regin heeler, Clerk COUNTY OF HARNETT By: 3 Gordon Springle, Harnett County Board of Commissioners an EXHIBIT A PALLET CONSULTANTS OF NORTH CAROLINA, INC. and HARNETT COUNTY, NORTH CAROLINA INCENTIVE AGREEMENT Dated as of October , 2019 INCENTIVE AGREEMENT THIS INCENTIVE AGREEMENT is dated as of October , 2019 (as supplemented or amended, the "Agreement"), and is between PALLETT CONSULTANTS OF NORTH CAROLINA, INC., a North Carolina Corporation ("PCNC") and HARNETT COUNTY, NORTH CAROLINA, a public body politic and a political subdivision of the State of North Carolina (the "County"), with each being referred to as a "Party", and both being referred to cumulatively as the "Parties". RECITALS: The purpose of this Agreement is to describe certain incentives to be provided by the County to PCNC in connection with the PCNC's location of a manufacturing facility in the County. NOW, THEREFORE, for and in consideration of the mutual promises and covenants contained in this Agreement, the parties hereby agree as follows: ARTICLE I DEFINITIONS; RULES OF CONSTRUCTION 1.01. Defmitions. For all purposes of this Agreement, unless the context requires otherwise, the following terms shall have the following meanings: "Abandonment of Operations" means that for a period in excess of two (2) weeks PCNC's level of Full Time Employees or Direct Investment goes below twenty percent (20%) of the guaranteed minimum levels of Performance Commitments for Full Time Employees or projected amounts of Direct Investment. "Business Day" means any day that is not a Saturday or a Sunday, or a day on which banks in the State are required by law to be closed. "Change in Use" means any reduction in or diversion of use of the Facility which would not provide the guaranteed Performance Commitments of Full Time Employees, as set forth in Article II which are less than an Abandonment of Operations. "Closing Date" means the date on which this Agreement is first executed and delivered by the parties. "Direct Investments" means the original tax value of all building improvements and machinery and equipment placed by PCNC on the ad valorem tax rolls, regardless of the funding sources for said property. 2 "Facility" means the manufacturing facility intended to be leased, renovated and occupied by PCNC on the site, as more particularly described in Exhibit A. The number of "Full Time Employees" means the number of employees hired who will be paid on the basis of forty (40) hours per week or two thousand eighty hours (2080) per year, who are paid average wages of thirty eight thousand three hundred and sixty dollars ($38,360) per year, or eighteen dollars and forty four cents ($18.44) per hour, and who are provided health insurance coverage by PCNC with PCNC paying at least fifty percent (50%) of the premiums for such coverage. "Incentives" means the various incentive payments from all sources referred to in this Agreement to PCNC. "Performance Commitments" means the levels of Full Time Employees to be hired by PCNC in relation to PCNC's operations in the Facility pursuant to Article II of this Agreement. "State" means the State of North Carolina. 1.02 Rules of Construction. Unless the context otherwise indicates: (a) Words importing the singular shall include the plural and vice versa, and words importing the masculine gender shall include the feminine and neuter genders as well; (b) All references to Articles, Sections or Exhibits are references to Articles, Sections and Exhibits of this Agreement; (c) All references to officers are references to County officers; and (d) The headings and Table of Contents herein are solely for convenience of reference and shall not constitute a part of this Agreement nor shall they affect its meanings, construction or effect. ARTICLE II PCNC'S PERFORMANCE COMMITMENTS In return for the Incentives set forth herein, which are a competitive necessity for PCNC to choose to locate its Facility in the County, PCNC commits to certain Performance Commitments related to jobs created and incrementally increased taxes in the County. For the County to provide incentives to support the location of the Facility in the County there must be a competitive offer from another potential location for this Facility, and but for the provision of the incentives contemplated by this Agreement, PCNC would not locate its Facility in the County. Previous to the execution of this Agreement, PCNC has provided to the County evidence of a competitive alternative location for this Facility, which is satisfactory in the County's discretion. 3 The Parties acknowledge and agree that the consideration for the County to enter into this Agreement is the expectation that PCNC will meet or exceed these Performance Commitments. Specifically, PCNC agrees to meet or exceed the following Performance Commitments: (a) PCNC will create and maintain in the Facility for the term of this Agreement, jobs for at least fifty (50) Full Time Employees, with this number of jobs being created in the following amounts no later than December 31 of each of the following years: (b) 2020 29 2021 17 2022 0 2023 4 2024 0 Total Full time Employees 50 PCNC agrees that the average wage level of all Full Time Employees in the Facility shall be no less than eighteen dollars and forty-four cents ($18.44) per hour. Benefits will be provided which will include, but not be limited to, PCNC providing health insurance coverage for its employees, with PCNC paying at least fifty (50%) of the cost for such coverage. (c) PCNC is expected to make and maintain initial Direct Investments in building leasehold renovations or construction and personal property equal to approximately three million seven hundred thousand dollars ($3,700,000), and the taxable property resulting from these Direct Investments as purchased and located at the Facility site on a phased basis shall remain in the County subject to ad valorem tax assessments for the remaining full term of this Agreement. Direct Investments shall not include the current property tax valuations of the land and building in which the Facility will be located as those valuations are shown on the property tax records of the County as of the date of the date of this Agreement which is three hundred forty one thousand eight hundred and ninety dollars ($341,890). It is understood that Direct Investments will be made over a period of time on a phased basis from the date of this Agreement through December 31, 2024. PCNC's failure to make this anticipated level of Direct Investments, will not constitute a default under this Agreement, but the amounts of annual incentive grants will be affected based on the formula set forth in Section 3.01 of this Agreement. 4 Confirmations of PCNC's attainment as to Performance Commitments shall be as follows. The amount of Direct Investments shall be the amount of the tax value for the Facility real property leased by PCNC over the initial value of $341,890.00 and for all property owned by PCNC in the County as shown on the Business Real and Personal Property Tax Listings, for each year that new investments are made. The number of Full Time Employees and average wage level shall be determined by the data shown on filings of fourth quarter NCUI Form 101 with the N.C. Employment Security Commission as to unemployment compensation taxes. The County may in its discretion require other documentation to verify the attainment of these Performance Commitments. ARTICLE III CASH INCENTIVES 3.01 Economic Development Incentive Grants. The County commits to pay to PCNC grants in the future pursuant to its Economic Development Incentive Grant program. These future grants are estimated be in the total cumulative amount of seventy six thousand five hundred thirty four dollars ($76,534), based on current projections by PCNC of Direct Investments and Full Time Employees. But the total cumulative amount may vary if there is a Change in Use or Abandonment of Operations. The County shall pay to PCNC five annual installments of Incentives. The amount of each annual installment of Incentives shall be calculated as eighty percent (80%) of property taxes paid by PCNC attributable to its Direct Investments, unless such amount is reduced by a Change in Use attributable to a short fall in Full Time Employees, as set forth in Section 3.02 below. The above calculation of annual installments of Incentives is used for convenience and to assure that the County realizes a positive return on its investment in and inducement of this project, and does not represent a refund of property taxes paid. The first annual installment of Incentives shall be paid in 2021 for PCNC's attainment of Performance Commitment as of December 31, 2020 for Full Time Employees and the amount as of January 1, 2021 for Direct Investments. Future annual installments of Incentives shall be paid in each of the next four (4) years. For each year when an annual incentive grant is to be paid for the previous year, PCNC will provide to the County no later than March 31 of that year a letter stating how many employees were on the payroll of PCNC and the amount of capital investments made by PCNC in improvements to the Facility and in personal property as of December 31 of the prior year. That letter will have as an attachment the NCUI Form 101 which was filed by PCNC for the fourth quarter of the previous year. Each annual installment of Incentives will be paid within thirty (30) days after PCNC has paid its property taxes for each grant year. 3.02 Reduction in Amounts of Grants. If a Change in Use occurs in any year of the term of this Agreement during which Incentives are being paid pursuant to Section 3.01 above whereby the number of Full Time Employees for the prior year (if applicable for that year) is less than the Performance Commitments, any annual installments of Incentives pursuant to Section 3.01 which are payable in that year shall be reduced. The amount of reduction of annual 5 installments of Incentives grant shall be calculated as the same percentage by which there is a shortfall in Full Time Employees. For example, at the end of 2020, if PCNC is ten percent (10%) short in the number of Full Time Employees, then the amount of the annual installment of the Incentives grant for 2021 shall be reduced by ten percent (10%). 3.03 Abandonment of Operations. If in any year of the term of this Agreement PCNC has an Abandonment of Operations, the County shall have no further obligation to pay annual installments of Incentives for any year following an Abandonment of Operations. 3.04 Source of Funds. The Parties agree that the Incentives payments to be made by the County pursuant to this Article III may be paid from any fund source of the County's choosing which is not restricted as to the use of those funds. ARTICLE IV CONSTRUCTION OF FACILITY The Parties agree that construction of renovations to the Facility shall be solely PCNC's responsibility. PCNC shall cause the construction to be carried on in accordance with all applicable State and local laws and regulations. PCNC shall insure (1) that the Facility does not encroach upon nor overhang any easement or right-of-way and (2) that the Facility, when erected, will be wholly within any applicable building restriction lines, however established, and will not violate applicable use of other restrictions contained in prior conveyances or applicable protective covenants or restrictions. PCNC shall cause all utility lines, and streets serving the Facility, which are located within the metes and bounds of the site on which the Facility is located, to be completed in accordance with health department standards and other applicable regulations of any governmental agency having jurisdiction. PCNC shall pay all taxes and all charges for utility services furnished to or used on or in connection with the Facility. PCNC shall bear all risk of loss to and condemnation of the Facility. PCNC shall observe and comply promptly with all current and future orders of all courts and regulatory bodies having jurisdiction over the Facility or any portion thereof (or be diligently and in good faith contesting such orders), and all current and future requirements of all insurance companies writing policies covering the Facility or any portion thereof. ARTICLE V INDEMNIFICATION PCNC hereby agrees to indemnify, protect and save the County and its officers, directors and employees harmless from all liability, obligations, losses, claims, damages, actions, suits, proceedings, costs and expenses, including reasonable attorneys' fees, arising out of, connected with, or resulting directly or indirectly from the Facility or the transactions contemplated by or 6 relating to this Agreement, including without limitation, the possession, condition, construction or use thereof, insofar as such matters relate to events subject to the control of PCNC and not the County. The indemnification arising under this Article shall survive the Agreement's termination. ARTICLE VI TERMINATION OF AGREEMENT PCNC shall have the option of terminating this Agreement upon failure of the County, to make incentive payments, as provided for in Article III of this Agreement. The County shall have the option of terminating this Agreement upon an Abandonment of Operations by PCNC, which option shall be executed by giving written notice to PCNC. In any event, the above terms notwithstanding, this Agreement shall terminate at the end term of this Agreement, which is defined as the period of time from the date of this Agreement until the last annual installment of Incentives is paid pursuant to Section 3.01 of this Agreement. ARTICLE VII ADJUSTMENTS OF PERFORMANCE TARGETS The Parties to this Agreement agree that if PCNC determines in the future that it can significantly exceed the Performance Commitments of Direct Investment or of Full Time Employees, but will need less than the Performance Commitments of the other measure, all parties will negotiate in good faith to amend the agreed upon Performance Commitments and formulations for reductions set forth in Article III of this Agreement. ARTICLE VIII TEMPORARY REDUCTIONS IN PERFORMANCE COMMITMENTS Notwithstanding anything herein to the contrary, if PCNC shall be prevented or delayed from fulfilling, or continuing to fulfill, either or both of the Performance Commitments as set forth in herein, by reason of a: (a) Government moratorium; (b) Delay in obtaining any governmental or quasi -governmental approvals, permits or certificates, despite reasonable efforts by PCNC to obtain same; (c) Enemy or hostile governmental or terrorist action; 7 (d) Act of God, including but not limited to hurricane, tornado, snowstorm, windstorm, earthquake or flood, fire or other extreme weather conditions or other casualty; (e) Strike, lockout or a labor dispute involving entities other than PCNC which causes PCNC an inability to obtain labor or materials; (f) Delay in funding from any state or local government incentive to or for the benefit of PCNC; or; (g) Any other event, other than normal business exigencies, which is beyond the reasonable control of PCNL. then the Performance Commitments for the year(s) in which such event occurred shall be equitably reduced to reflect the effect of such event. The Parties shall negotiate in good faith to make an equitable reduction in the Performance Commitments for an affected year(s). However, if the Parties cannot in good faith reach an agreement as to such adjustment, the Parties agree to submit this issue to binding arbitration on an expedited basis. ARTICLE IX ASSIGNMENTS No Party shall sell or assign any interest in or obligation under this Agreement without the prior express written consent of the due Party. Provided, however, that this Agreement may be assigned by PCNC to a wholly owned subsidiary of PCNC, without the consent of the County, provided that PCNC will guarantee the performance by the Subsidiary of the obligations due under this Agreement. ARTICLE X LIMITED OBLIGATION OF COUNTY NO PROVISION OF THIS AGREEMENT SHALL BE CONSTRUED OR INTERPRETED AS CREATING A PLEDGE OF THE FAITH AND CREDIT OF THE COUNTY WITHIN THE MEANING OF ANY CONSTITUTIONAL DEBT LIMITATION. NO PROVISION OF THIS AGREEMENT SHALL BE CONSTRUED OR INTERPRETED AS DELEGATING GOVERNMENTAL POWERS NOR AS A DONATION OR A LENDING OF THE CREDIT OF THE COUNTY WITHIN THE MEANING OF THE STATE CONSTITUTION. THIS AGREEMENT SHALL NOT DIRECTLY OR INDIRECTLY OR CONTINGENTLY OBLIGATE THE COUNTY TO MAKE ANY PAYMENTS BEYOND THOSE APPROPRIATED IN THE COUNTY'S SOLE DISCRETION FOR ANY FISCAL YEAR IN WHICH THIS AGREEMENT 8 SHALL BE IN EFFECT. NO PROVISION OF THIS AGREEMENT SHALL BE CONSTRUED TO PLEDGE OR TO CREATE A LIEN ON ANY CLASS OR SOURCE OF THE COUNTY'S MONEYS, NOR SHALL ANY PROVISION OF THE AGREEMENT RESTRICT TO ANY EXTENT PROHIBITED BY LAW, ANY ACTION OR RIGHT OF ACTION ON THE PART OF ANY FUTURE COUNTY GOVERNING BODY. TO THE EXTENT OF ANY CONFLICT BETWEEN THIS ARTICLE AND ANY OTHER PROVISION OF THIS AGREEMENT, THIS ARTICLE SHALL TAKE PRIORITY. ARTICLE XI MISCELLANEOUS 11.01 Governing Law. The Parties intend that this Agreement shall be governed by the law of the State of North Carolina. 11.02 Notices. (a) Any communication required or permitted by this Agreement must be in writing except as expressly provided otherwise in this Agreement (b) Any communication shall be sufficiently given and deemed given when delivered by hand or five days after being mailed by first-class mail, postage prepaid, and addressed as follows: • (1) If to the County, to: County Manager Harnett County Government 420 McKinney Pkwy. P.O. Box 759 Lillington, NC 27546 (2) If to PCNC, to: Kevin Gutierrez Pallet Consultants of North Carolina, Inc. 810 NW 13th Ave. Pompano Beach, FL 33069 (c) Any addressee may designate additional or different addresses for communications by notice given under this Section to the other. 11.03 Non -Business Days. If the date for making any payment or the last day for performance of any act or the exercising of any right shall not be a Business Day, such payment shall be made or act performed or right exercised on or before the next preceding Business Day. 9 11.04 Severability. If any provision of this Agreement shall be determined to be unenforceable, that shall not affect any other provision of this Agreement. 11.05. Entire Agreement; Amendments. This Agreement, including Exhibit A, which is incorporated herein and made a part hereof, constitutes the entire contract between the parties, and this Agreement shall not be changed except in writing signed by all the parties. 11.06. Binding Effect. Subject to the specific provisions of this Agreement, this Agreement shall be binding upon and inure to the benefit of and be enforceable by the Parties and their respective successors and assigns. 11.07. provisions. Time. Time is of the essence in this Agreement and each and all of its 11.08. Liability of Officers and Agents. No officer, agent or employee of the County or PCNC shall be subject to any personal liability or accountability by reason of the execution of this Agreement or any other documents related to the transactions contemplated hereby. Such officers, agents, or employees shall be deemed to execute such documents in their official capacities only, and not in their individual capacities. This Section shall not relieve any such officer, agent or employee from the performance of any official duty provided by law. 11.09. Counterparts. This Agreement may be executed in several counterparts, including separate counterparts. Each shall be an original, but all of them together constitute the same instrument. IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed in their corporate names by their duly authorized officers, all as of the date first above written. 10 HARNETT COUNTY, NORTH CAROLINA By: ATTEST: Margaret Regina Wheeler, Clerk This instrument has been preaudited in the manner required by The Local Government Budget and Fiscal Control Act Kimberly Honeycutt Finance Officer Harnett County, North Carolina 11 Gordon Springle, Chairman Harnett County Board of Commissioners PALLETT CONSULTANTS OF NORTH CAROLINA, INC. By: [SEAL] Gustavo Gutierrez, President EXHIBITS: A - Facility description 13 EXHIBIT A FACILITY DESCRIPTION The Facility is a current industrial building located at 2 Dinan Road, Dunn, NC 28334 which stands on a real property tract composed of 4.01 acres (County Parcel ID No. 0215160001). The building was initially constructed in 1979 and has approximately 41,920 square feet. The property has been purchased and is currently owned by 2 Dunn Realty, LLC, a North Carolina Limited Liability Company, pursuant to deeds recorded in Book 3734, Pages 961 and 964, Harnett County Registry. PCNC plans to enter into a long-term lease agreement with 2 Dunn Realty, LLC on the above described real property. PCNC intends to conduct renovations on the building in order to establish a pallet manufacturing facility. 2 Dunn Realty, LLC and PCNC anticipate a capital investment of approximately $3.7 million for site purchase, site renovations and the installation of manufacturing machinery, equipment, and fixtures. During the 5year incentive period, 50 full time jobs with an average annual wage of $38,360.00 will be created as a result of the operation of this manufacturing facility. 14