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FRIES — The Town of Fries passed a resolution in support of an application by Grayson County to seek acceptance into Virginia's Enterprise Zone Program.
Fries Town Manager Brian Reed brought the resolution to council during its regular meeting Sept. 1 and briefly explained what the county hopes to do.
Reed noted that the state accepts applications every five to six years for the program and that very few spots were open in this year's application period.
The program — which was established by the General Assembly in 1982 — is a partnership between state and local governments in which both parties seek to improve economic conditions within a targeted area of distress.
Grayson County Administrator Jonathan Sweet spoke about the program to the Town of Independence — which the county is also looking to for support — and noted that only two spots will be available throughout the state.
Because Grayson is a “distressed county,” Sweet felt it would place high on the list of candidates.
The program complements other local, state and federal economic development activities to create an improved climate for private sector investment, development and expansion, and focuses limited resources on the targeted areas.
If the county is accepted into the program, it is allowed three “zones,” which must be subsets of the county. Sweet noted last month that each town would be one of those zones, while a third zone could be determined later.
If accepted into the program, the county would be eligible to receive two state incentives to qualified businesses and investors located in one of the enterprise zones.
The Enterprise Zone Job Creation Grant offers qualified businesses in an enterprise zone cash grants for permanent net new jobs created over a four-job threshold.
“Qualifying jobs must provide health benefits and pay at least 1.75 times the federal minimum wage rate,” the program explains. “Positions created over the four-job threshold that pay at least $12.69 per hour are eligible for a maximum grant of $500 grant per position per year for up to five years.”
Positions created above the four-job threshold — that also meet those same criteria — are eligible for a maximum grant of $800 per position per year for up to five years.
Non-grant-eligible positions include retail, personal service and food and beverage service.
Businesses must qualify for the grants annually and can receive grants for a maximum of 350 jobs.
The Real Property Investment Grant offers cash grants to qualified investors making qualified investments in industrial, commercial or mixed-use properties within an enterprise zone.
Investors are eligible for 20 percent of the investment, with a cap set at $100,000 for companies investing less than $5 million in qualified real property investments.
If a company invests more than $5 million, the maximum grant is increased to $200,000.
The county has offered to foot the bill of $3,500 to apply, and asked that each town simply support moving forward.
Reed explained the program a little more during Fries' council meeting, noting that if the county was accepted into the program, the entire Town of Fries would be designated as an enterprise zone.
“It puts you on the map,” Reed told council. “Prospective businesses look for enterprise zones to develop because of the incentives.”
Reed added that the program could help potential development of the old mill site.
With no further comments, Council Member Kenny Brooms motioned to accept the resolution. It was seconded by Council Member Gary Sumner and passed unanimously.
Along with the resolution, council also had a list of potential incentives the town could offer to match the state incentives.
The list was not official, but included:
• an eight-year prorated tax incentive given to commercial or industrial businesses located in an Enterprise Zone. The business must provide documentation of improvements to property or buildings and show an increase in assessed property value of 40 percent or more. The increase in assessed property tax will be exempted by 80 percent for years one through four, 60 percent for year five, 40 percent for year six and 20 percent for year seven.
• commerce and industry businesses will receive a tax credit for job creation over a five-year period. The credit will be based on the number of jobs created.
• new industrial and commercial buildings — or substantial reconstruction of existing buildings — are eligible for a rebate of all zoning or building permit fees with the creation of a minimum of 10 new jobs. Jobs must be full-time and continuous in nature for a period of one year.
• new industrial and commercial water and sewer service connections will receive reduced fees based on cost of installation, not to exceed town cost.
Reed noted that the list contains potential incentives that could be tweaked as the town saw fit later on.
Grayson will hold a public hearing Wednesday at 2 p.m. in the courthouse boardroom to solicit input on the Enterprise Zone application, which is expected to be submitted to the Department of Housing and Community Development by Oct. 1.
Proposed zone boundaries and incentives will be available for discussion at the public hearing. All interested citizens are invited to attend.
For more information, contact Sweet at (276) 773-2471.