The special called meeting of February 23, 2000, having been duly publicized, was called to order at 7:00 P. M. by Mayor Jones.

Members present were Mayor Jones and Councilmembers Baggott, Carpenter, Mottel, Sullivan, and Smith. Councilmember McDowell was absent.

Also in attendance were Charles B. Martin, City Administrator; John P. Potter, Jr., Director of Finance; Kelly Zier, City Attorney; Steve Matthews of Sinkler and Boyd, P. A.; and Donna B. Young, City Clerk.

Whereas, the City of North Augusta, South Carolina (the "City") is currently in litigation against the Consolidated School District of Aiken County (the "School District"); and

Whereas, in the case of The Consolidated School District of Aiken County v. City of North Augusta, the Mayor and City Council of the City of North Augusta, C.A. No.: 97-CP-02-14 (the "TIF Lawsuit"), the School District has challenged the validity of a tax increment financing district (the "TIF District"), created pursuant to the South Carolina Tax Increment Financing Law, S.C. Code Ann. § 31-6-10 et seq. (the "TIF Law") by the City, by and through its governing body which is the Mayor and City Council of the City (the Mayor, the City Council and the City being herein referred to as the City Defendants);

The City, the Mayor and the City Council consent and agree to the following terms of settlement and on the condition that the Court enter its order, on the consent and at the joint request of the parties, finding, ordering and entering judgment as follows:

1. The City through its Ordinance No. 96-10 (the "TIF Ordinance") adopted on December 16, 1996, duly and validly created the TIF District in accordance with the provisions and requirements of S.C. Const. art. X, § 14(10) and the TIF Law.
2. The School District made objection to the establishment and creation of the TIF District, pursuant to S.C. Code Ann. § 31-6-80, on September 5, 1996.
3. The School District withdraws its objection with respect to those portions of the TIF District outlined in red on the map of the TIF District attached as Exhibit A hereto (such area outlined in red being referred to herein as the "Original Consent Zone"), and with respect to any other portion of the TIF District consisting of not more than five acres in total to be designated by the City pursuant to paragraph 4 below.
4. The City may, at any time or times during which the TIF District is in existence, designate by ordinance of the City Council one or more parcels or portions of parcels (which may or may not be contiguous to one another) totaling not more than five acres (the "Designated Commercial Acreage"). Any such ordinance designating all or a portion of the Designated Commercial Acreage shall be effective upon its delivery by the City to the School District and to the County Treasurer. No acreage may be so designated until the development thereof is planned for non-residential use ("non-residential use" being defined as neither single-family, multi-family, owner-occupied nor rental residential property). From and after the time of such designation, such Designated Commercial Acreage shall for all purposes be treated as part of the Original Consent Zone; and the initial equalized assessed value thereof shall be as previously calculated and certified by the Aiken County Auditor as the most recently ascertained assessed value thereof as of the date of adoption of the TIF Ordinance, in the same manner as all other properties in the Original Consent Zone.
5. At the time it designates any Designated Commercial Acreage, the City shall become obligated to pay to the School District the amount of $30,000, payable over time and solely from the amounts allocated to the special tax allocation fund created for the TIF District pursuant to the TIF Law as a result of the application of the School District’s millage rate to the incremental assessed value of the Designated Commercial Acreage.
6. With respect to all real properties located in the TIF District that are neither in the Original Consent Zone nor in the Designated Commercial Acreage, the Aiken County Treasurer shall distribute to the School District the taxes collected thereon as a result of the application of the School District’s millage rate, whether such tax collection is attributable to the initial equalized assessed value thereof or to the increase in assessed value after the adoption of the TIF Ordinance. With respect to all real properties located in either the Original Consent Zone or in the Designated Commercial Acreage (from and after the time of its designation in accordance with paragraph 4 above), the County Treasurer shall distribute to the City’s TIF District special tax allocation fund the taxes collected thereon as a result of the application of the School District’s millage rate to the increase in assessed value thereof after the adoption of the TIF Ordinance, and the County Treasurer shall distribute to the School District the taxes collected thereon as a result of the application of the School District’s millage rate to the initial equalized assessed value thereof. Provided, however, that no taxes collected as a result of the application of the School District’s millage rate to the increase in assessed value of real properties located in either the Original Consent Zone or in the Designated Commercial Acreage shall be distributed to the City’s TIF District special tax allocation fund before the issuance of obligations under the TIF Law by the City, nor shall any such taxes be so distributed after the termination of the TIF District in accordance with the TIF Law and the TIF Ordinance.
7. If at any time during the existence of the TIF District, the City proposes to include in the TIF District or in another tax increment financing district that may be created by the City, any or all of those properties outlined in blue on the map of the TIF District attached as Exhibit A hereto (such area outlined in blue being referred to herein as the "Supplemental Consent Zone"); the School District shall consent thereto pursuant to the TIF Law. Any such inclusion of all or a portion of the Supplemental Consent Zone shall be made in accordance with the procedures set out in the TIF Law with respect to the amendment of the TIF District or the creation of an additional tax increment financing district. If the City does so include any or all of the Supplemental Consent Zone in a tax increment financing district, then the Aiken County Treasurer shall distribute to the School District the taxes collected thereon as a result of the application of the School District’s millage rate to the initial equalized assessed value thereof and the County Treasurer shall distribute to the appropriate special tax allocation fund of the City the taxes collected thereon as a result of the application of the School District’s millage rate to the increase in assessed value thereof after the inclusion of such property in a tax increment financing district. Provided, however, that no taxes collected as a result of the application of the School District’s millage rate to the increase in assessed value of real properties located in the Supplemental Consent Zone shall be distributed to the City’s special tax allocation fund before the issuance of obligations under the TIF Law by the City with respect to the tax increment financing district in which all or a portion of the Supplemental Consent Zone is included, nor shall any such taxes be so distributed after the termination of such tax increment financing district in accordance with the TIF Law and the ordinance that created such tax increment financing district.
8. Distribution of the taxes collected on real properties located in the TIF District as the result of the application of the millage rates of any taxing entity other than the School District shall be in accordance with the TIF Law regarding such distribution and shall not be affected in any way by the settlement of this lawsuit or by this Ordinance.
9. The TIF Lawsuit shall be dismissed with prejudice.

And it is further ordained that the attorneys representing the City, the Mayor and the City Council are authorized to make joint motion with the attorneys representing the School District, requesting the dismissal of the TIF Lawsuit on the terms stated above and to consent on behalf of the City, the Mayor and the City Council to such dismissal; such authorization being contingent on the passage of a resolution by the governing body of the School District in substantially the form of this Ordinance and approving the terms of settlement described herein.

Please see Item #1 above for the ordinance text.

There being no further business, Council adjourned.

APPROVED THIS ______ DAY OF Respectfully submitted,

______________________, 2000.

Donna B. Young

City Clerk

_______________________________

Mayor Lark W. Jones