City, county may partner to lure firms

Published 12:00 am Friday, September 14, 2007

COURTLAND—The City of Franklin and Southampton County are considering joining forces to apply for admission to a program aimed at encouraging new business by providing state and local tax relief, regulatory flexibility and infrastructure development.

Virginia’s Enterprise Zone Program is a partnership between state and local governments in which both parties seek to improve economic conditions within a targeted area. Four of Virginia’s 30 available zones will expire later this year, and the city and county are weighing the possibility of putting together a joint application for the designation.

After hearing presentations during the Aug. 27 City Council and Board of Supervisors meetings, those governing bodies agreed to hold separate public hearings at their meetings Sept. 24.

The public hearings will give citizens a chance to comment on a proposal put together by Franklin Southampton Economic Development Inc., which is heading up the local effort.

The presentation by the local economic development organization calls on local governments to provide incentives that would supplement those offered by the state for communities involved in the Enterprise Zone Program.

Jim Bradshaw, a consultant for FSEDI, told Southampton’s Board of Supervisors such incentives could include property investment and job creation grants that would piggyback on those offered by the state. Local governments also could offer to waive utility connection, permit and electric fees for companies that choose to locate within a new enterprise zone. They also could provide workforce training, reimbursement of property and machinery and tools taxes or even architectural assistance.

Those local incentives would be in addition to the state incentives offered through the program, he said. Such state incentives as job creation grants and real estate investment grants are intended to reduce a company’s cost of locating within a targeted area to the point where that community becomes competitively attractive to new industries.

The state’s job creation grants could reimburse employers in the zones for up to $800 per employee each year for up to five years. The real estate grants could be worth as much as $250,000 per new, expanded or rehabilitated facility, for a period of five years.

With so much potential state help available, there is naturally quite a bit of interest throughout the commonwealth in earning the enterprise zone designation.

“It’s a very competitive situation,” said John J. Smolak, president and chief executive officer of FSEDI.

In fact, it is likely that the four communities whose zones are expiring will be among those vying for the designation.

Under the Enterprise Zone Grant Act, the governor can designate up to 30 zones across the state for periods of up to 20 years. Awards, which will be made by the Virginia Department of Housing and Community Development, will be based on an evaluation of each application, as well as “fiscal distress criteria.”

Those criteria focus on the potential zone’s unemployment rate, median adjusted gross income and number of public school students receiving free or reduced-price lunches, according to the FSEDI presentation.

Three potential zones would be included in the joint application between Franklin and Southampton, Bradshaw said.

Those zones would include the Southampton Business Park, on Route 58 west of Franklin; the Turner Site and industrial corridor, south of Route 671 just outside of Franklin; and a combination site that would include the Cypress Cove Industrial Site and the Pretlow Industrial Park, straddling Route 58 on the border of Franklin and Southampton County.