Isle of Wight extends M&M Milling agreement
Published 6:16 pm Wednesday, July 27, 2022
Isle of Wight County supervisors have agreed to give M&M Milling 15 additional months to meet its obligations under a 2019 economic development agreement and avoid having to repay grant money.
The Arkansas-based producer of corn cob residue, which is used as a binding agent in the manufacture of plywood, had received $50,000 in state funding via the Governor’s Agriculture and Forestry Industries Development Fund and over $63,000 in water system upgrades from Isle of Wight in 2019 in exchange for opening its first East Coast location at the former Franklin Equipment site on Carver Road near the county’s border with the city of Franklin.
Per the original agreement, M&M had until Sept. 30 of this year to invest at least $2.3 million in site improvements, hire at least 15 full-time permanent employees and purchase at least $2.3 million, or 575,000 bushels, of Virginia-grown corn. A clause in the agreement requires partial to full repayment of the grants if the county or state deems M&M unlikely to meet at least 50% of its obligations by the Sept. 30 deadline.
To ensure M&M was upholding its end, the agreement required the company to submit three progress reports, one due Oct. 1, 2020, for the site’s first 18 months in business, one due Sept. 30, 2021, for the site’s second year and a final report due Sept. 30, 2022.
“Although we have made progress on the grant targets, we will not meet the goals prior to the Performance Date of September 30, 2022,” states a June 10 letter to the county from Property Manager Anne Thompson.
Thompson’s letter blames the delay on the COVID-19 pandemic, which she contends has resulted in “extreme hardship” to the company’s clients, causing them to slow their production. The issue, she contends, is not the $2.3 million in site improvements but rather the required new jobs and Virginia-sourced corn purchases.
To date, she states, the company has created five jobs – two less than the seven required to meet the 50% threshold – and has purchased 290,000 bushels of Virginia corn at a cost of $1.6 million since 2019.
“We had hopes to add an entirely new line with additional product but were unable to do so due to COVID and the decreased demand,” Thompson wrote. “We are continuing to explore new options and add new customers and product lines. Our hope is to bring on an additional product which will require additional labor.”
Isle of Wight supervisors voted unanimously on July 21 to approve the 15-month extension as one of a slate of approvals included in the meeting’s consent agenda. Had they not done so, the Virginia Department of Agriculture and Consumer Services would have been tasked with calculating the repayment amount owed to the county and state following the Sept. 30 deadline, according to Isle of Wight County Economic Development Director Chris Morello.