The Buda Economic Development Corporation (BEDC) uses office space at City Hall and pays the City for it each year. Currently, the BEDC pays the full year in one payment on October 2.

The BEDC plans to move out of City Hall during the coming year. It has asked to pay for the first three months up front, and then pay month by month until it leaves. This amendment makes that change.

The amendment changes only when the BEDC pays. It does not change the rate the BEDC pays, how that rate is calculated, or the rules for ending the agreement.

The City and Buda Economic Development Corporation (BEDC) entered into a Facility Use Agreement for office and storage space on March 21, 2018. Section 4 of the agreement establishes the annual base license compensation, subject to annual CPI adjustment. Section 5 establishes the BEDC's annual payment for O&M costs, calculated on a rolling three-year average. Sections 4.3 and 5.3 make both amounts payable in full on October 2 of each year.

A first amendment was approved in 2023 to expand their footprint in City Hall. 

In February 2026, Council approved a Second Amendment (Resolution No. 2026-R-09) that lets either party give notice to end the agreement. After that notice, the arrangement becomes month-to-month, and the BEDC must give at least 30 days' notice before it moves out.

That amendment set up month-to-month occupancy but did not say how the BEDC would pay for it. The payment terms in the original agreement are still written for one annual payment. This third amendment fills that gap.

The third amendment does the following:

• First three months. The BEDC pays for October, November, and December 2026 on October 2. This payment is not refundable.
• After the first three months. Starting January 1, 2027, the BEDC pays one month at a time, on the first of each month, for as long as it stays.
• Last payment. The BEDC pays for the full month in which it moves out. Payments are made in whole months and are not split by day.
• No change to the rate. The monthly amount is simply one-twelfth of what the BEDC already owes for a year. The yearly rate is still set the same way it always has been.

For the coming year, the BEDC owes $52,749.67 for the space and $10,877.97 for its share of operating costs, or $63,627.64 total. That works out to $5,302.30 per month, and $15,906.90 is for the first three months due October 2.

The City collects the same monthly rate either way. What changes is that the City receives the money as the EDC uses the space instead of all at once in October. How much the City collects in total depends on when the BEDC moves out.

Without this amendment, the BEDC would pay for a full year in October and the City would have to sort out a refund when the EDC left. Once the BEDC moves out, the space returns to City use.

Pros:

• The BEDC pays only for the months it is in the building.
• The first three months are guaranteed, so the City has a known minimum.
• Avoids a refund process if the BEDC moves out mid-year.
• Whole-month billing keeps the calculation simple.

Cons: 

• The City will not know the final amount collected until the BEDC sets a move-out date. The FY27 Budget assumes a move out date in March 2027.
• Monthly review will be required instead of an annual review.

• Take no action. The BEDC would owe a full year on October 2 for space it does not expect to use all year, and the City would face a refund question later. Not recommended.
• Bill monthly for the whole year. More flexible for the BEDC, but the City loses the guaranteed first three months.
• Approve as presented. Recommended.