Department: Economic Equity and Opportunity
Department Head/Elected Official: Estella Gonzalez, Executive Director
Regular or Supplemental RCA: Regular RCA
Type of Request: Financial Authorization
Project ID (if applicable): N/A
Vendor/Entity Legal Name (if applicable): N/A
MWDBE Contracted Goal (if applicable): N/A
MWDBE Current Participation (if applicable):
Justification for 0% MWDBE Participation Goal: N/A - Goal not applicable to request
Request Summary (Agenda Caption):
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Request for approval of a Payment in Lieu of Taxes Agreement (“PILOT Agreement”) between Harris County (on behalf of itself, Flood Control District and Hospital District) and Argos Global Partner Services Inc. with respect to its application for a Foreign-Trade Zone (FTZ) site and issuance of a Letter of Non-Objection to the designation and/or activation of the proposed FTZ site located at 9311 Bay Area Boulevard, Suite 150, Pasadena, Texas in Harris County Precinct 2 and within the Foreign-Trade Zone #84.
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Background and Discussion:
Argos Global Partner Services Inc. (the “Company”), an Indiana company, has applied for designation and/or activation of a 0.429-acre FTZ site within FTZ #84 and located at 9311 Bay Area Boulevard, Suite 150, Pasadena, TX 77507, in Harris County Precinct 2. The site is owned by Bluff L.P. and will be operated by the Company.
Argos Global Partner Services Inc. provides supply chain management services with customized projects for customers’ needs. With over a decade of experience, the Company has become an expert in the trading of a variety of products, developing customized solutions suiting the needs of their customers and seeking opportunities to streamline logistics operations and achieve cost reduction. The Company currently offers 4 products: (1) Supply Chain Integration for domestic and international companies- consists of managing global suppliers by coordinating orders and delivery schedules, conducting inspection and quality control of products, consolidating shipments, and providing financing tools and varied Incoterms; (2) Trading: the Company imports by order of third parties and on behalf of third parties for different segments and assists local companies in exporting their products; (3) Business Expansion in Brazil - the Company offers a package of services to foreign companies to develop their sales in the Brazilian market through a lean structure and the best cost-benefit; (4) Global Sourcing - the Company develops international suppliers to obtain cost reduction and to implement a reliable supply chain.
For any FTZ application, Harris County requires an applicant to execute a Payment in Lieu of Taxes (“PILOT”) Agreement, wherein the applicant commits each year to pay the County and certain of its taxing entities an amount equivalent to 100% of the taxes that would be owed for all FTZ inventory stored at the FTZ site. When the applicant executes the PILOT Agreement, the proposed FTZ site is then deemed to be in the public interest because the County would not lose revenue. The County may then provide a Letter of Non-Objection to facilitate designation of the site by the FTZ Board of the U.S. Department of Commerce and activation by the Bureau of Customs and Border Protection of the U.S. Department of Homeland Security.
Presently, it is requested and recommended that the Commissioners Court take two actions with respect to the Company’s application for the Foreign-Trade Zone site within FTZ #84:
• Approval for the County Judge to execute the attached PILOT Agreement between the Company and the County, with the County acting on behalf of itself, Harris County Flood Control District, and Harris County Hospital District; and
• Authorization for the County Judge to issue a Letter of Non-Objection to the foreign trade zone site to the Port of Houston Authority as consideration for the Company’s execution of the PILOT Agreement benefiting the County taxing entities.
Expected Impact:
An approved PILOT Agreement with the Company safeguards revenue for County taxing entities while facilitating international commerce.
Alternative Options:
Non-approval of the PILOT Agreement may result in lost revenue for County taxing entities.
Alignment with Goal(s):
_ Justice and Safety
X Economic Opportunity
_ Housing
_ Public Health
_ Transportation
_ Flooding
_ Environment
_ Governance and Customer Service
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Anticipated Court Date: October 8, 2024
Anticipated Implementation Date (if different from Court date):
Emergency/Disaster Recovery Note: Not an emergency, disaster, or COVID-19 related item
Contact(s) name, title, department: Estella Gonzalez, Executive Director, and Judit Haracsek, Director, Economic Development Division
Attachments (if applicable):
1. PILOT Order and Agreement with Argos Global Partner Services Inc. and corresponding Exhibits (FTZ site located at 9311 Bay Area Boulevard, Suite 150, Pasadena, Texas, Harris County Precinct 2)
2. Non-Objection Letter for Argos Global Partner Services Inc.