COUNTY OF ALBEMARLE
Avon Court Industrial Access Fund Request
Adopt a Resolution to Request Industrial Access Funding and authorize necessary agreements
Tucker, Foley, Davis, Graham, Kelsey, Stimart
LEGAL REVIEW: Yes
June 6, 2007
ACTION: X INFORMATION:
Section 33.1-221 of the Code of Virginia, as amended, provides for a program commonly known as the Industrial Access Fund Program, under Virginia’s Economic Development Access Fund. The use of Economic Development Access funds is limited to: (1) providing adequate access to economic development sites on which new or substantially expanding manufacturing, processing, research and development facilities, distribution centers, regional service centers, corporate headquarters or other establishments are planned; and (2) improving existing roads that may not be adequate to serve the establishments as described in (1).
Representatives of the Avon Court Industrial Park have made a request to the County to support use of Industrial Access Funds to lengthen and widen Avon Court, located off of Avon Extended. This park is presently zoned Light Industrial and is being actively marketed by its owner for industrial uses. The park will include as many as 10 lots, with buildings ranging in size from 10,000 to 24,000 square-feet. The attached request asks that the County apply to the state for a “bonded project” whereby the Board will guarantee to the state that qualifying industries will locate in Avon Court within a five-year period sufficient to cover the state’s participation in improving the access road. The Avon Court representatives will, in turn, enter into an agreement with the County to meet all the obligations of the program and provide a surety to the County to guarantee that no County funds will be at risk by the Board’s action if the project does not meet the state’s requirements and the County is required to reimburse the state’s costs.
Goal 5 - Fund the County’s Future Needs.
A County policy on the application of the Industrial Access Program was adopted in 1993 and established a policy to support project requests on a first-come, first-serve basis. Two other criteria were established: 1) All property adjoining a proposed industrial access road shall be currently zoned for industrial uses that will qualify under the state’s industrial access program, and 2) all costs and potential obligations of the program shall be borne by the applicant such that no local funds are in any way involved in such a project.
Since 1993, the federal government passed the North American Free Trade Agreement (NAFTA), which opened the market for some manufacturing to move to cheaper labor markets in Mexico; the US continues to experience an out-migration of major industry. Since 1990 Albemarle County has experienced an average annual decline of 4.6 % in basic industry jobs, specifically in manufacturing, representing a total loss of 3,200 jobs in this sector. However, supporting industry and service sectors are continuing to grow, keeping pace with population growth, and have no place to locate or expand in the development areas. Several are operating in the rural areas as non-conforming uses or in violation of the zoning ordinance. Some are electing to leave the county. An analysis of county land zoned for light industrial uses indicates only 0.1% of the total acreage, or 477acres, is considered under-utilized with a building value of $20,000 or less. This number does not reflect land taken by critical slopes, flood plains, or non-conforming uses valued greater than $20,000 such as a single-family residence. Therefore this percentage of underutilized light-industrial zoned land is likely much less than 477 acres. Additionally, the average-size LI parcel is 6 acres, and the median is 2.7 acres – prohibitively undersized for most operations to develop. The Avon Court project provides smaller-sized spaces, within the development area, for the local-serving, supporting businesses (landscaping companies, auto repair, parts supply, warehousing and distribution), as well as sectors of basic industry such as research and development, or precision-production work for the medical or aerospace industry – important sectors for our economy for paying higher wages.
Staff does not foresee any budget impact. Because an eligible establishment is not yet constructed or under firm contract, this program requires Albemarle County to guarantee by bond or other acceptable surety that such will occur. The maximum time limit for such bond shall be five years, beginning on the date of the allocation of the economic development access funds by the Commonwealth Transportation Board. The County manages this liability by requiring the property owner to enter into an agreement with the County which obligates the owner to reimburse the County if the program requirements are not met and to assure this agreement with a proper bond.
Staff recommends adopting the attached resolution to request industrial access funding and recommends that the County Executive be authorized to enter into agreements necessary for the Industrial Access Funds and assuring the County is protected from default by the property owner after review and approval of these agreements by the County Attorney.
Attachment A: Resolution to Request Industrial Access Funding
Attachment B: Project Letter of Request from Red Light ManagementAttachment C: 1993 Albemarle County Policy on the use of the Industrial Access Program