Board of Supervisors Joint Meeting w/ Planning Commission and the Economic Development Authority   10/17/2017

We also have a quorum, so I'll call the EDA to order.

okay and for those of the folks that just came in if you will turn off your cell phones and your laptops if you're not using especially your laptops because of interference with our mics we had that problem at the last meeting so that would be great Wi-Fi turned off yeah that'd be great and with that

Claudette, let's let everyone go around and introduce themselves and we'll do a mic check.

Does that work for you?

Joe Hines, can everybody hear me okay?

Because I'll be presenting in just a second.

Was everybody else okay?

Good, sure.

So we've got it?

All right, and I was going to introduce Lieutenant Walls, who is here from the police department.

Although, there he is standing up in the back.

I didn't spot you at first.

We have enough people in the back.

I didn't see you.

And Brad Sheffield is joining us.

Brad, if you can just get your mic going and we'll be good.

Claudette can let me know if she can't hear you.

Oh, Travis can let me know if he can't hear you.

With that, welcome.

We are thrilled to have all of us together for a meeting.

And it's not very often that we have the opportunity to do this.

And just to get us started with our agenda, I'd like to just remind everybody that this is really an exciting time in Albemarle County for economic development.

We recently endorsed a draft economic development strategic plan, which was the first one in the history of the county.

We approved a joint memorandum of understanding with the City of Charlottesville to collaborate more effectively on regional economy.

We have hired a county executive with a depth of valuable experience in this area and we are ready to begin the selection process for an economic development director.

So to continue our forward progress, we need a strong and cohesive county team.

to help and help from our business community.

We need a positive narrative that reflects forward-looking energy and direction and doesn't dwell on the negatives of the past.

Our community is not well served by continuing that approach.

You all agree I know.

This meeting is an opportunity for all of us to turn the page

continue our education process and find areas of agreement to set the stage for our economic development team.

Doesn't mean we're gonna all agree on every approach and every issue, but we'll be able to embrace a shared understanding of a high level direction on economic development.

The chairs of our three deliberative bodies agreed about the outcome from this meeting.

Continued preparation for implementing the site readiness strategies of our Economic Development Strategic Plan under the leadership of the County Executive and Economic Development Director.

A more in-depth understanding of site selection and the site readiness process as seen by prospective businesses using a case study approach to discuss opportunities and challenges and the joint endorsement of the Board of Supervisors Economic Development Strategic Plan mission and governing principles.

We appreciate your willingness to listen, learn, and engage in a joint discussion around economic development.

Thank you for everybody for attending today.

It's good work.

Thank you very much.

Claudette's gonna be doing a little magic here on the technology, but we appreciate also, I wanna echo Diantha's comments on how exciting it is to have these three groups together for this discussion as we continue to sharpen our focus on site readiness.

You know that we have been putting building blocks in place for this for some time,

We had the Board of Supervisors FY17-19 strategic plan recently adopted that has a number of goals that have to do with site readiness and depend on our ability to get sites ready in order to be successful.

We in March of 2017 brought the results of a study by Bowman Engineering forward to you all

We also, as Diantha mentioned, you all endorsed an economic development, the board endorsed an economic development strategic plan that had site readiness as one of its key goals.

So this is not a new topic.

But it's an area that we are really continuing to try to move the ball on because it is so foundational to everything else that we're trying to do.

So, real quickly, what we're trying to do today, we will be doing a site readiness overview from a site selector's perspective and I'm very pleased to have Joe Hines, Principal at Timmons,

Group to talk to us about that.

Then we're going to shift gears a little bit and do a case study approach to look at a recent site selection process here in Albemarle County so we can take some of the theoretical information that Joe's going to give you and apply it to an actual case and how it played out.

And then we're going to have you all consider an action item, which is the joint endorsement of the Economic Development Strategic Plan mission and guiding principles.

As Diantha mentioned, the board has already done that, and I think that the interest was in having the Planning Commission and the Economic Development Authority join in that endorsement.

So that's what we've got.

As Diantha said, it's a lot of material.

We're not going to probably be able to dive in as deeply as you would like in all cases, but we're going to try to get through it and maybe set the stage for further discussions on this topic.

See a lot of friends out there in the audience as well, too.

Thank you.

My name is Joe Hines.

I am principal and currently director of economic development for Timmons Group.

This is a subject that is near and dear to my heart.

I grew up back

in the late 70s, early 80s.

And my dad did volunteer economic development for Prince Edward County, Virginia, just outside of Farmville.

He helped recruit some very exciting businesses for the area that literally transformed the community.

So for me, I started off at a young age, around 15 or 16 years old, really seeing the impact that economic development could have through the eyes of my father.

And he had a small engineering and surveying firm, was about 20 people at maximum of this height.

and so I kind of developed a passion for them.

So this is something that's very passionate, I'm very passionate about.

Today I'm going to cover a number of different topics and it's gonna be a lot of material to go through in a short period of time.

So please feel free to ask questions during the presentation but please know I'll be working through the slides and be glad to answer questions at the end as well too.

I'm gonna talk a little bit about trends that we're seeing in economic development and some of the top site selection criteria.

I'm gonna talk about some of the market dynamics of why sites need to be prospect ready.

I'm gonna show you some real world examples of how prospects show up and then they need to work through a process fairly quickly, do the competitive market conditions, something of which none of us really can control, and how that timeline is getting shorter, shorter, and shorter.

When my dad was doing it, it was an 18, 24, 36 month lead up time to recruit in industry.

Today it's literally down to months to do that.

The other thing we'll talk about is who is your target audience.

When a prospect shows up, there are a number of different players involved with the prospect recruitment process, and everybody has slightly different objectives, and at the end of the day, what you're trying to do is lure them to your locality, and you're trying to do the best job possible, but you also need to understand the personalities and the dynamics of those players that are in this game.

We'll talk about how sites get ranked, whether you have a tier one or tier two or tier three site.

understanding the basis of the economic development deal there's really three major components there is the actual facility cost the site and infrastructure development cost and the land cost and everything kind of revolves around those and then I'll talk a little bit about the Virginia business ready sites program of which we got involved with Virginia in 2013

saying looking at why we were losing projects and this has become a major initiative within the state.

I was at one of the Go Virginia board meetings yesterday and Steve Moray did a presentation about how this needs to be a top priority for the state of Virginia and Go Virginia is site development.

So a quick overview about Timmons Group.

Most of you are familiar with us.

We do have an office here in Charlottesville.

We were founded in 1953.

We are now over 500 employees.

We're headquartered in Chesterfield and have 12 employees here in the Charlottesville and Albemarle region.

We have invested in this community.

We are very bullish about the upside of Albemarle County and the city of Charlottesville.

Craig Katoski is here.

He is one of the people who runs our office as well and there are a lot of exciting things going on here and we're very excited to be a part of this community moving forward.

Kind of an overview, this is just a quick overview of our services.

We do a number of different things when it comes to what I consider the hard assets, that's the site and infrastructure.

We tried to meld those with what's going on in the marketplace to give you the best odds of success moving forward as a locality and try to increase those odds such that you can land that prospect when they show up.

So where can economic development ultimately lead us?

This is a picture of me doing a master plan presentation in 2006 for what was the future of Rolls Royce site.

The county spent some money doing the master planning and due diligence that essentially took it to a tier three site and that became the basis of which a 21 million dollar incentive negotiation was negotiated with Prospect, with Rolls Royce, and the state.

Quantifying the engineering cost was the most important thing and we had to, you know, you can do a certain amount of work pre-prospect and then you have the post-prospect aspect of it when funds become available when a deal is imminent.

But this ultimately yielded a 500 million dollar investment and 500 jobs announced for Rolls Royce and they're very successful in that particular site.

So some of the trends I want to talk about.

First, the reality is prospects and consultants are looking at regions and not sites or localities specifically.

You have a great regional director in here with Helen Cawthon at the Central Virginia Partnership of Economic Development.

She's one of those regional directors who gets it.

She knows how things go.

She knows how to advance the ball.

And when I look across the landscape of Virginia, you're lucky, and the states in the southeast, you're lucky to have somebody like Helen on board.

These projects literally move in months and not years like I indicated earlier and speed to market matters.

Again, there are market dynamics that are going on behind their decision-making process and then once they've made their decision to move, they need that facility up and running as quickly as possible because a six-month window of advantage, market advantage, can mean the world of difference to a company and that's why they need facilities ready to go in a heartbeat.

the internet has transformed this process like it has a lot of other businesses and incentives do matter but really that kind of comes into play after you become a finalist site so once you become a finalist one thing to keep in mind is you you've come a long way you're in a good spot you might not win this is a binary situation there's one winner and the rest are losers

but the reality is you can learn an awful lot from that process once you've gotten to that point and there are other market dynamics that are somewhat out of your control as to why they might choose your site over another site and then the last item is publicly controlled sites rule in this game and what I mean by publicly controlled is you don't necessarily have to own it

but you can own it.

You have to have an option at a set price or have a sales contract on that piece of property.

So you need to be able to set the price or have the price set so when the prospect goes up comes in and a deal is imminent that price doesn't go up overnight because somebody's trying to excessively profit off of this situation.

So when I look at the site selection magazine's top criteria, really six of the top ten are very controllable.

Workforce has really kind of risen to be one of the top five in all these rankings, but there are various different organizations that do these rankings, but these are consistently the top ten.

What was interesting was I've been tracking this for a number of years, and in 2012, local economic development strategy popped up.

and I think the important thing about that is companies and prospects realize that you have a very healthy community and a community that is growing that is going to be a very advantageous for them long term from in terms of workforce to having places for people to go have lunch take their kids to daycare items like that so they want to know as a community you're continuing to invest in that community over and over and I think that's what's really great about the Albemarle, Charlottesville area is y'all are very good at doing and fostering that type of environment

So how fast are these projects moving?

This is a graphic where I started putting together from literally the time a local regional director or a local economic developer was contacted until an actual project announcement was made.

Because the internet has transformed this process over time, it's getting shorter, shorter, and shorter.

These are nine projects that represent roughly 3.3 billion in investment in over 10,000 jobs, that that timeline is less than five months on average from the time they contact until an announcement is made.

and then on July 30th of a couple years ago Boeing announced another 1.1 billion dollar expansion and 2,000 additional jobs.

So when they show up site readiness is important for your existing businesses as well as it is for the businesses you're trying to recruit because those are the businesses that are looking to expand and a very strong healthy business will look to expand in a community of where they're having a very positive environment and interaction.

So a couple of real world examples here, and I'll go through these fairly quick.

Project Casper Ecme Smoked Fish.

Believe it or not, they're not associated with the Wile E. Coyote companies from Cartoon Days.

But they had their initial contact in early June.

A response less than two weeks later had the first site visit the following week.

They did a short list of sites the week after that.

A second site visit two weeks after that.

They called us up to New York for a negotiating session on August 6th and 7th.

North Carolina had a site in the mix, Penner County, North Carolina, which is ultimately where it went.

and they brought North Carolina contingency and the Virginia contingency in.

We all had breakfast together and looked at each other and then they kicked North Carolina out of the room and they said, okay Virginia, what is the best deal you can offer and we spent two hours with them.

They brought North Carolina in, same thing and then they negotiated back and forth between the two states.

This ended up being related to an infrastructure issue.

Their client was not able to accommodate an infrastructure need because of the process waste

for a smoked fish facility.

So that's why infrastructure does play a very critical role in economic development.

But this was a two and a half month timeline, 27 million dollars, 104 jobs on less than a 20 acre site.

And I think any locality in Virginia would be more than glad to make that announcement on behalf of their citizens.

So not only

are they making not only making decisions quickly once they get up once they make an announcement they want facility up and running this is the vitamin shot project which is in Ashland, Virginia in Hanover County and Craig Craig and I worked very closely on this project

We had to crank out engineering plans.

There were many 10 or 11 o'clock phone calls that there were significant others were probably getting upset with us because they thought we might be talking to the State Farm guy.

But essentially, once they made the announcement, we had motor graders on the site.

literally turned motor graves on and started working and three weeks later after running 24-7 they had a 312,000 acre pad site ready to go and two and a half months later they had the walls up on this facility, 312,000 square foot distribution had the walls up and then eight months later they were substantially complete and moving product in because it was very important to them to have that facility up and running as quickly as possible.

So now who is your target audience, okay?

Really, at the end of the day, the one who stays here is the prospect, okay?

The site selection consultants, they come in representing them, kind of like an attorney representing an individual in some type of legal situation.

Commercial real estate agents or brokers are starting to get into the business because they have a voluminous amount of information and they have these corporate relationships, so they're starting to lean on them for site selection.

And then you have the preferred developers.

Those are the companies that will sign on the dotted line saying I will deliver your Amazon facility by September 1 or sign a $10,000 a day liquidated damages clause because you aren't able to move product in for your Christmas season.

So what are the prospects looking for?

The reality is they're looking for the best business decision possible.

Okay, they have done their analysis and they know generally where their markets are and where they need to go to serve their markets and they do what we call ring maps for the side.

Okay, generally I want to be around Charlottesville and Armel County, Virginia because I need access to Northern Virginia, I need access to Richmond, I need access to other locales.

that can be easily served from here.

They want a community that fits and does something fit with their corporate culture.

Vitamin Chop is a great example.

We had done our site visits over two days, had hit eight different sites, and when we sat down with people from Ashland, you could just tell there was a chemistry there.

that fit with the corporate culture for this particular entity.

There was a CBS News six story that said, why not Petersburg?

And it was one simple question.

They didn't want to be within 25 miles of an existing Amazon facility because they were afraid of a cannibalized workforce.

But they had some commonalities there and they felt welcome and they felt like it was a good community that would embrace them as a corporation.

And they need a curb appeal and sense of place and a place where their employees can have some amenities

to enjoy their day.

So what are the commercial real estate brokers and the site selection consultants looking for?

They're in the site elimination game.

I've heard Chris Lloyd, another site selector say, listen, I've got 3500 localities in the United States and I needed to eliminate down to

the top 10 very quickly usually within 60 days and I got to get down to the next two or three within the 60 days following that.

So it's a site elimination game.

They're looking for any reason to kick sites out.

80 to 90% of that search is done before they actually show up on your doorstep.

They need those ready-to-go sites, the utilities and infrastructure in place that is so important as well as thorough site due diligence and then they're looking for incentives and commission.

What is their paycheck?

The thorough site due diligence is items like do you have a wetlands delineation has been completed and that is valid with Corps of Engineers.

Do I have a geotechnical report where I can quantify what is going to happen on that site or the issues I might deal with in those sites.

It's elements like that that you need to keep in mind because those are elements that can trip up the risk on the schedule for a project when they're trying to get facility out in the ground.

So if I have to wait six months

to get my engineering plans approved, that could be a deal killer for a particular prospect.

So you want to check as many of those boxes as you can prior to them showing up.

So what are the preferred developers looking for?

They want to have the elimination of unknown risk.

They want to be able to quantify what they are going to deal with.

Amazon, we had soft soils that we're going to have to deal with.

We went to the stone quarries and asked them, we need about 300,000 tons of stone dust, we think.

Do you have it available?

We got quotes, three million from one, three and a half million from another.

And lo and behold, they ended up using it all because they were in a time of year construction where they needed the stone dust.

That was a risk that Amazon could quantify and say, yes, we can take that risk.

and we understand what our maximum limit is.

Certainty of schedule.

They need to know that you're going to be able to get a fast track permit done in time when you're dealing with a larger locale like in Chesterfield or in Ricoh County.

You have multiple departments that you're having to deal with.

So being able to get everybody together and in a room and say okay we're going to do everything we can to prioritize reviewing these plans and getting comments back.

We try to preemptively deal with that and you know at Timmons we try to submit at least a 95 to 98 percent set of plans.

on that first go round, but we want to proactively address what all the concerns are.

Control the development costs and then how quickly can I start construction because you saw from the volume shop example once the announcements made they need to be up and running as quickly as possible.

So where do your sites stand?

We have the good fortune and sometimes stress of working with anywhere from six to eight of these projects a year where we're constantly under fast track design build type process trying to get these facilities up and running.

We're involved with a number of recruitment efforts on behalf of locales.

So as we were laying everything out I was like okay what are the commonalities about this because there is a logical process of which you go through for the site development action items and games and and the reality is it takes time and it takes money you know to do this but the the basic elements are a tier one site is you have raw land a willing seller but you really haven't done any due diligence have you zoned it or comp planned it accordingly

that we're moving into a tier two category.

Tier three is where have you quantified this cost?

Have you done a preliminary engineering report?

Do you know it's going to cost you two million dollars to extend water and sewer to site?

It's going to cost you a million dollars for the road in.

Have you quantified what those numbers are and do you understand where those numbers are going to lead you?

Then a tier four site is essentially I have invested in the infrastructure to have the site ready to go.

Okay, and that means I've got infrastructure to the site.

I don't necessarily have to have it on it.

But the objective is you want to be able to build the infrastructure or any additional infrastructure simultaneously while they're building their facility, which is normally a nine to 12 month process.

So you're trying to coincide those elements due to their market demands and your ability to deliver.

And then we have what we call a Tier 5 site, which is essentially pad ready.

Caterpillar showed up.

I call it Five Days of Mayhem for Southampton County.

Caterpillar showed up and they said we need a 200 acre pad ready site.

All environmental issues cleared.

We had 238 acres.

They showed up on Monday, loved the site.

Another prospect took it down literally that Wednesday and Thursday night.

and we had to make a phone call on Friday morning saying the site's off the table.

Well, it ended up being that there was no other site in Virginia that would work or that we could make work.

So Virginia lost that prospect in that process.

So that was a real world example and an aha moment of Virginia of my gosh, we really need to deal with this and they had estimated that project had a 2.4 billion dollar regional impact where it ended up ultimately going in Georgia.

So some of the major considerations I want to kind of reiterate to you or articulate to you before is Tier 0, which means I have nothing.

Somebody had me add a Tier 0 to this because they said, Joe, we have absolutely nothing.

Can you find us a site?

So we used GIS site selection to do that.

Tier 1 is essentially site negotiation.

You're trying to get that land under control.

Tier 2 is getting zoning in place to accommodate that.

Tier 3 is master planning the site.

Tier 4 is making that infrastructure investment.

At that point in time you've gone after substantial grants or you've made a decision to float a bond of which you're going to build the infrastructure to essentially build out that site.

And a Tier 5 is a shovel or pad ready where literally I can let a permit tomorrow and they can go to construction tomorrow on that site.

So we talked about increasing your odds of success, and I call it gambler's odds.

I had a freshman in my freshman suite in college.

There was a young man who was from New Jersey area, and his mom worked at Atlantic City.

He grew up in a single-parent household, and then Tom Conoble was one of those pulled himself up by bootstraps type of guy.

He learned how to professionally gamble at a young age.

He would go home for a weekend, literally, they had a system that they played six-deck blackjack, and if everybody at the table played it the same way, they would win two out of three times, 67% of the time.

He would literally go home for a weekend and come back with three or four thousand dollars, and that's what he used to pay for school.

But the people who understand how to play the systems and how to do that, I call that gambler's odds.

You're increasing your odds of success by understanding the system and how to work the system and manage the system to get you the most favorable outcome.

So when you look at it through those lens,

Essentially a tier three site, my timeline for development is roughly 18 to 36 months.

That doesn't quite coincide with the fastest of them, but I can make it work for some particular prospects.

Rolls Royce in particular, or maybe some auto manufacturers, some bigger entities are looking.

The smaller entities that need to be up and running sooner, they need that product to be ready to go, so a tier four is kind of in that nine to 18 month range, and a tier five is three to six months or less.

So then we look at it in terms of every investment or every step has some investment in it.

So what is that investment on a per acre basis?

You know, it could be to get to a tier three, maybe a thousand acres or a thousand dollars or less on the tier three site.

Okay, but you potentially significantly increase that value of that property by understanding the property, the risk, and the due diligence and the unknowns.

Then when you actually get to tier four, you've made a substantial investment again with the infrastructure investment.

So there are really two basic elements that we look at.

One is called product development, and that's getting in the game.

So if you're tier zero through three, you really don't have a marketable product.

It's like having a car on a car lot that might be lacking an engine, might be lacking a transmission, or some other elements.

It might look good on the surface, and when you pull up, it might look great, but you pop the hood, and there's some things that are just missing.

And it takes a professional to understand what's missing within those cars on the car lot or sites.

Then once you get a car that's ready to go, or a site that's ready to go, I call that the product fulfillment game, where you've got a site where you can proactively market that site, and that's a tier 4, tier 5 level.

That means you are proactively in the game.

I'm going to talk a little bit about the business-ready sites program in Virginia, where Virginia has basically recognized that a tier 4 site is a ready-to-go site,

and that's what they're going to proactively market at the Virginia Economic Development Partnership.

And if the investment has not been made to get to that point, then they realize that the odds of success are pretty minimal.

But that has also led us to generate what is now the Business Ready Sites Program of which we're hoping there's gonna be additional legislative funding in the future moving towards helping localities get sites ready to go and product ready to go to the market.

So as I mentioned earlier, some people have me out of tier zero because they don't have anything.

So we're doing a lot of searches for that.

but really what is the what is the reward that you're looking for you're looking for investment where the locality has their revenue stream comes from the real estate taxes and machinery tools and states revenue stream comes from the jobs but the jobs are good for locality you have an indirect expense and then it comes back to you

via the state income taxes as well.

So when you look at a small site and that's 100 acres or less, you can see the numbers are pretty significant in terms of both investment and jobs.

And I think these are the types of projects that really most everybody would like to see.

You can get into the larger sites and obviously the investment goes up as well as the job creation potential, but the reality is you can make some investment and you can create a very positive impact within your community if you play your cards right.

So really there are three elements that we need to look at as part of the deal.

One is the building or facility cost.

That usually has the greatest certainty.

The day the prospect shows up, he almost knows to the dollar how much his facility is going to cost.

So that's a pretty well known by the prospect day shows up.

The next is site and infrastructure development costs and really that has the greatest variability of it all and that's how much and who pays and that's pretty much what every deal revolves around and then when it comes to land costs that is a one-time hit in their business model okay so they won't price certainty they don't necessarily want that price to go up overnight because that can upset their business model but again it's a one-time hit

So a couple things to keep in mind is not all sites are created equal, okay?

So I can have a property that's listed for $40,000 an acre and I can have a property that's listed for $100,000 an acre and when I look at what my off-site and on-site improvements are, it could be that for that $40,000 an acre site, I have to substantially invest into more infrastructure and site development costs than I do the $100,000 an acre

and we've literally done these analyses as site selectors and for site selectors where you come out and say, okay, hey, this $40,000 acre piece of property and this $100,000 acre piece of property, once I have factored in the other additional costs, they're literally the same costs at the end of the day to our company or our prospect.

Okay, so that's always something to keep in mind is that not all sites created equal, all dirt is not created equal, and it needs to be priced accordingly to accommodate what the infrastructure and site development build out will be.

So this is a real deal.

This is the Aldi project, which we were on the site selection team.

The building cost for $55 million.

They knew that within a couple million a day they showed up.

Site and infrastructure cost would be in 6.2 for the site development, 4.1 for the infrastructure.

and land costs were 3.2 million and so total project costs were roughly 66 million and then they had or 68 million they had an incentive package of 9.2 million they got you at the end of the day and that project cost of 59.3.

So all this leads us to what is going on with Virginia right now and this is why I think timing is great for all the positive things y'all have going on because when we look at the lens of all the communities throughout Virginia and the site readiness program part of what we're trying to do is help foster an environment where people one understand economic development and two are willing to make an investment and we're willing to put skin in the game on behalf of the state

to make that work.

Governor McAuliffe did the first business-ready sites assessment program.

We went through and had 21 different assessments done for the state where we ranked them from tier two, tier three, to tier four and put them in the database.

Then we set aside two million dollars in funding for the program.

These are all the sites that ultimately got selected.

and then we did the second phase which was actually looking at the infrastructure development aspect, what it would take to advance one site from one tier to the other and moving it along the pipeline process because what we don't want to do is sell out of tier four sites or ready to go cars and then have cars sitting on a lot that are still lacking very significant components.

This was the first round of grant awards and what was important about this was there were eight grant awards for the infrastructure and advancing the sites for due diligence.

Three of them and some of them within your central Virginia partnership area

were for private land development for private land developers or private owners and then the other five were for public entities.

So I think they're trying to balance or we're trying to balance that component of it.

So some things to kind of keep in mind as you move forward that communities that are really successful in economic development one are very proactive and intentional about their economic development.

Two, they understand it's a long-term game.

It's not an election cycle buzzword.

And I find myself saying in closed session an awful lot, listen, you could be making a decision today to literally spend hundreds of thousands or millions of dollars on behalf of your citizens.

And the chances are when you come back up for an election, you might not have somebody out there on that particular site.

So you have to recognize that's part of a component of the decision you're making.

And then they'll look at me and say, well, Joe, we want both.

We want to make a long-term investment.

We want short-term wins.

and I'll say okay we'll try to figure out how we can do that.

Third, they have a comprehensive economic development strategy and they execute that plan and I think it's great that y'all have just adopted a new plan and it sounds like from the first time in the history of the county, is that correct?

I think that's a very positive thing and a very positive step in the right direction because as we look at that

as a part of the selection committee on the, or evaluation committee on Virginia Visits for a Sites program, you can tell which localities get it and which localities don't.

You understand your assets and your sites, okay?

Don't try to be something you're not.

That's not everybody can land a Rolls Royce, not everybody can land an auto manufacturer, but people can land smaller projects that really mean a lot and you can have a good portfolio of clients and opportunities and sites.

You need to understand your cost and revenue generators because there's, we can plan so much before the prospect shows up, but the day the prospect shows up, it's like a whole new game.

Okay, you need to understand

what is generating revenue for you and what is not generating revenue for you because every site selection consultant will try to push you to the edge of where you're gonna break and you need to understand what that break point is or that walk point is for your locality.

You need to try to remove the political hurdles or risk for the prospects as much as possible.

And while you might have to issue a conditional or special use permit for maybe a particular prospect, if you can put it into a situation where that's kind of an administrative approval or administrative process, that's less risk for that particular prospect and will keep you in the game.

Now the intent is for them to, for you to control your land to the point that you can understand exactly what they're doing and if they fit within the guidelines of what your objectives are,

then that's great that can work out but if not then maybe they need to move on to another locale or another site.

Please try to identify fast track permitting process of which when a prospect shows up you can say okay we'll guarantee given that you're a you know you're going to create these jobs investment we'll guarantee a seven-day turnaround on comments or review or something like that because that matters that time really matters to them up front because they don't want to wait and have something six weeks later.

And then plain and simple they just get it.

So our model as we see it, as I mentioned, Timmons Group is investing in this market.

We have our office, which is a picture of right, literally right across the street from here.

You got access to a wonderful workforce.

I mean workforce is one of the major drivers right now that is driving where people are going.

You have access to world-class educational facilities.

Right now, at this point in time, what we see is you're kind of lacking regular product.

I think you've got some good product out there.

You just need to maybe take some steps to get a little bit further advanced.

And I think you have a huge upside potential.

And really, it's a good time to start aligning your product with the market.

And I think you're going to see a lot of success in the future.

So I really appreciate y'all's time.

Hopefully, I didn't take up too much of it.

I have one question for you.

Looking at the amount of incentive that was provided in your case study here, let me go back a couple of pages to find it.

On page 12, the key deal points in a real world economic development deal

You gave us an example of building costs of $55 million, site infrastructure development costs equaling $10.3 million, land costs $3.2 million, total project costs $68.5 million, and the incentive package

decided it was 9.2 million, which represents about 15.5%.

So what you're suggesting, that's relatively a low percentage of overall cost, obviously on building a new facility for a company.

But what I think you're suggesting here is it isn't the number that's so much important for a business but it's the nature of the overall effect on the project that either incentivizes them to come in or tends to deter them.

They're not going to make that final business decision at 15.5% on the overall cost because long term that course gets amortized over the life expectancy of the building and then it gets down literally into dollars and cents but initially

That is really important.

Yeah, I think, well, every deal is different, but I think that's a reasonable range to maybe work around or maybe plan towards.

Now, you have to consider a couple of elements.

One, part of those funds were extending water and sewer to the site roughly a mile, which did provide some benefit to everybody along that corridor where they were extending the water and sewer to.

It was roughly a million dollars in incentive to help pay for a road to get into the site because they built on the backside of the site.

So there are other components to those incentives that provided benefit to that locale independent of just direct benefit to that particular prospect.

This was in a locality where it was tobacco commission funding was available, which I know a lot of people would love to stretch that tobacco commission boundary to the rest of Virginia.

But that was I think about maybe, I need to go back and check the numbers, I think the tobacco commission number was maybe close to two million dollars that got put into it.

but no I don't think that's an unusual number to see.

Sure.

In the context of what I mean by master planning is you can look out, we can look as far as we can see in the crystal ball.

And I think Larry Sabato made the comment that he lives by crystal ball so he needs ground glass.

However, you know, there's some points of reasonableness.

There's a three-dimensional aspect of the site that we can deal with.

There's an environmental aspect.

You know, here you're going to have a slope is going to be a concern for a lot of the sites within Albemarle County.

So we can reasonably assess what size facility would sit on that site.

We can also reasonably assess what kind of industries would maybe work given the infrastructure that's currently available.

Do you have 20,000 gallons a day of water and sewer or do you have 200,000 gallons of water and sewer?

Do you have 2 million gallons a day?

of water and sewer.

So part of what we do is the master planning helps us on what I call get smart philosophy, Maxwell Smart.

You try to better understand all the aspects about your site, how much it's gonna cost to build water and sewer to the site and potentially on the site.

And then if you need to go pad ready, how much it's gonna cost to go to that element.

Because the day the prospect shows up, you don't need to be waiting for a 30, 60, or 90 day study to be complete.

It's good to have that information in hand.

I have a question.

So we have, I'm curious about your interpretation of our workforce.

I think hold it a little further away, you're okay.

So we traditionally have a pretty low unemployment rate here.

And we have on average about 1,500 people that come here every year for many, many, many years.

And that low unemployment rate has stayed

Low, even in spite of a lot of folks coming in.

And we already have a lot of people coming in from surrounding communities and jurisdictions to work in Albemarle County.

So when you say we have this ready workforce, could you just talk a little bit about that?

Sure.

One, you have a highly educated workforce.

You're right, you do have a low unemployment number.

But the benefits of that, you have a great community that people feel comfortable moving to.

And Augie Walmiers just put out a book talking about rural Virginia and what's happening in rural Virginia and that essentially people in rural Virginia are moving away and closer to cities and to urban areas.

What I like about this county in particular is 64 provides you good access to smaller communities and nice communities like Waynesboro or Louisa's on Crossroads area as well too.

So you have places for people to move if you create the jobs and opportunities within Charlottesville.

This is a place people like to move to, not a place people like to move from.

I have a number of UVA grads who work for me right now.

I can tell you right now, most everyone of them will move back here if the opportunities exist for them to live back in this community.

I know there's a large Northern Virginia contingency of UVA graduates, a lot of them from your business school, who would love to come back if their opportunity is here.

So I think low unemployment is great, but I also think that's an indicator that people will move here, and this is a great community for a company to land.

So you want your people to be employed here.

Just a thought to piggyback on that.

It seems like to me that our community has, I won't say a large number, but certainly a good number of underemployed.

Can you just speak about that a little bit?

Well just real quickly, Helen is in the audience and I do want to mention that we did a target industry study that did a pretty comprehensive look at our workforce and the underemployment issue is very real for us.

So getting people to a living wage, to jobs that have

career opportunities and full benefits and that they don't have to work two and three jobs.

And that's what I was trying to get at is that that's been my experience.

So we're not necessarily talking about bringing new people in.

What we're trying to do is lift up the people that we have here to some degree.

And what companies will look for is make sure that one, either the skill set is there or it's easily attainable for that for that sector, the people who are within your community.

But again, I think it's an indicator of people want to live here.

Yeah.

even to taking less money than they would be able to take to get places.

Other questions?

I'm interested in the fast track permitting process.

Yeah, I mean, it needs to be a commitment of saying we're going to review the plans and we're going to turn around comments in seven days.

I mean, and so we can keep the process moving forward.

Now, whether you have to go out and hire additional staff or not, you know, you would kind of have to look at that.

But, you know, these big economic development deals are on this fast track.

I mean, each locality maybe on average gets

One of the

keep an eye on that ball and it can't be a wishy-washy answer it needs to be a we will not a we will try and and when it comes to the site selectors world you know they're asking us to put scheduling risk into all of our analysis now because time is money for those guys and if there is anything that has a schedule risk they're gonna try to nail that down before decisions made in other words they'll force you to commit to turning that around in seven days or not but I think

Joe, let me ask a question as well.

We're talking about attracting new business, but it seems to me that doing all of the things that you've described here also positions us to help existing businesses in their expansion plans.

Yeah, and I mentioned earlier on the presentation, I'm sorry I didn't reiterate that towards the end, but you're right, this is not just new, this is for expansion businesses because if a business is looking to expand and they're constrained where they are, you don't want them going next door to the community next door, and I can assure you

that every community in Virginia would be more than glad to have a company that is expanding out of Albemarle County just because they don't have room to expand.

Well, and we could all name businesses that we know we've lost because we didn't have existing businesses we've lost because we didn't to Richmond or wherever.

I'd just like to add one cautionary note, Joe, that you keep talking about Albemarle County, about the labor force, but in my experience, having even done empirical analysis at Dick's Sporting Goods when they opened here, and asking all the employees

by county where they came from.

And it was a combination of Field and Stream and Dick's.

Both populations were there for the opening of Fifth Street Station.

So I imagine there were close to a hundred employees there, seventy-five hundred employees

and the number that were from the county.

Now understand, people can get confused between the city of Charlottesville and the county.

That happens every day, including as we find out through the finance department, even for the tax collectors in the city, not knowing the difference between the two.

But be that as it may, it turned out there were like six of them that were from the city, about the same number from the county.

The rest were coming from as far as Buckingham County.

Louisa, Orange, Green.

they worked at Dick's Sporting Goods.

And I said, why don't you work on the north end?

Oh, I want to work down here because of the opportunities here.

It's like, you want that extra travel through that corridor to get here?

But that was their choice.

My point is that I think one thing we need to be mindful of as we go forward, and I love your presentation, I think it's excellent, is to be talking about smart economic development.

And smart economic development

is for us to be mindful of the fact that we already have a regional labor force.

And so one of the things we want to try to do is not add to more commuters on the highways because the number one concern the members of the planning commission and the board hear about with every single application are the traffic impacts.

We're not building more roads, we're improving them, but we're not expanding the size of them or adding additional highways.

And so more and more cars.

So the last thing we want to do is constantly be working against our best interests in terms of air pollution and in terms of highway deaths, etc.

by having more commuters.

So more we can create a situation where we can have businesses that can actually utilize

our labor population in the city and the county that is absolutely ideal now that's not easy to do no one has a magic formula for that but I do think when we talk about you know attracting jobs good jobs as in the case of Deschute with 154 employees

a large number of those employees would have worked out to coming over the mountain, coming out of the beer alley of 151 in Nelson County, coming from Richmond and other places.

So we need to be mindful of that when we're talking about

Our committing county money for economic development within the county to try to ensure that the job growth is for our employees and will attract people to live in the county.

Just thoughts on that.

Again, it goes back to the initial slide of they're looking at regions, not localities or sites, and you always have an in-commute and an out-commute, and as much as I would like to be able to put gates up, you know, you just can't do that.

But, you know, I think the important thing is if you create those opportunities, hopefully a majority of them will come within your locale, but then the people who are maybe commuting in from Buckingham, maybe get tired of the commute, and they decide to buy a house in Albemarle County because they have a future with exploring good.

So I think that's kind of a win that you need to keep in mind.

But they do look at a 45-minute commute.

It seems to be what everybody looks at for their labor force.

And that does bring in all these surrounding counties, Orange, Louisa, Buckingham, Savannah, Nelson.

You name it, it does bring them all in.

Just to pile onto that with, oh good, it's on.

Back in the 50s, Murray Box and Earlysville, they had orange school buses that brought in workers from Louisa and Buckingham and things because not everybody had a car back then and they wanted, they ran three shifts, 400 people.

They were going to town out there.

And so this is not a new thing as all the whole point of that story.

But also I think I don't know how to quantify it and I think I know Lisa said it was in our target story but there are tens of thousands of the captive trailing spouses and people here doing a lot of work that is way under what their training would be and finding

Yeah, I agree.

Joe, I hope, well, I expect that there will be another conversation after this at a later date, but at a high level, where does your information kind of diverge with the difference of like new land development versus redevelopment?

Actually, Virginia has a really good brownfield redevelopment program, which you can go out and do environmental due diligence and other due diligence about that.

What we see with brownfields is usually they have great bones.

In other words, the infrastructure's there, the roads, water, sewer, all the key components are there.

And it's a flattened out site.

So sometimes it's as simple as demolishing the building,

and taking it down.

Now a lot of people say oh hey you know I have this existing building which I can try to get for prospect and whatnot and I believe that the numbers show about 60 to 65 percent of people or companies show up looking for a building first but then they realize that that building is not going to work and the timelines

to get a brand new facility up and running to meet their specifications are not too different than upfitting an existing building.

So you know while in historic areas where you have historic buildings I think you certainly want to do everything you can to restore those buildings much like the office that we are currently utilizing within Charlottesville.

But then there are some facilities that sometimes it is better

Just a quick follow-up.

I think it depends on the prospect.

Any other questions?

So I'm one of those people who moved here and took the 30% pay cut 25 years ago.

I think I crept back up somewhere.

The thing I just want to ask you to comment on perhaps is a lot of the sites you showed us needed big flat sites, big pad sites, and the ability to construct a factory.

And we have a heck of a lot of hills around here.

We don't have abundant water supply.

Many, many years ago, and folks like Ann Mallek might remember this, there was a

a company that wanted to move here and we didn't have enough water for them because it was gonna take half the water supply just to run their factory.

They went somewhere else.

I won't name that county either.

They built a great big road and a pad and then they didn't come there.

So we have a lot of strengths, but the key is to try to figure out what our limitations are and our strengths are and play to the strengths rather than, because we could, using technology, you know as an engineer, we can bulldoze Albemarle County and make it nice and flat.

Right?

We can do that.

We can damn every stream.

So the question is, I'm not trying to be overly provocative, but sort of, how do you kind of figure out, like, what can you sell?

No, I agree.

And as I mentioned, the facility, 100,000 square foot can fit on roughly 10 or 12 acres.

Okay, so if you have a small site, you can still fit a pretty substantial facility on it.

When it comes to Flattening Mountains, I say we're engineers, we put a man on the moon.

Give them enough time and money we can do anything.

It's a matter of how much time and how much money.

And that's where a lot of these deals revolve around is how much time and how much money.

So be true to yourself.

I mean, you really have to be true to yourself.

There's something unique.

I say every site is like a spouse.

You need to find one prospect that will work for that particular site.

And sometimes it doesn't work out and everybody's moved on 15 years later and you're finding somebody else to work for that site.

So the reality is that you really kind of do need to embrace your assets for who you are because there is somebody

unique out there that does want to come and locate to your locale.

And you might not know who it is today.

We master planed Rolls Royce site.

We had no idea Rolls Royce is even a mix.

Joe, thank you.

I think we are, oh, Lee's giving me the high sign that she's my timekeeper right now, so can you ask him afterwards, Dave?

Is that okay?

This is a great discussion, and Joe, we appreciate your overview.

How some of the factors that Joe outlined for us played out in a recent site selection process in the county.

We called it Project Bravo back in the day, it's known as Deschutes and we wanted to use a case study approach to talk through this and what that allows you to do is really focus on understanding

I want to be very clear.

This is not about re-legislating this issue or re-debating the issue.

or Assigning Blame in the Issue.

I think we're all very focused on this as a learning lesson and so we don't keep looking in the rearview mirror but we look forward down the highway and say okay how does what we did

How do we learn from it?

How do we really kind of take those lessons to heart?

And how do we move ourselves forward?

And I think that the comment about this being about existing business retention is incredibly important.

Susan hears from businesses all the time that say, please, I want to stay in the region.

Help me do that.

So please don't think this is just about business attraction.

So we're going to go through this and we're going to have to stay at a high level because we don't have a ton of time on it but we will have time for questions at the end and if there's anything you want to revisit with Joe before we move on to hopefully endorsing the mission and guiding principles.

So what I'd like to start with is a quick project background.

of kind of where were we, what did we know about this project in the 2014-2015 timeframe when things were occurring.

We were aware that it was a major craft beer producer that was looking for a location in the eastern United States for a new production facility and they wanted to produce and distribute finished product across the eastern, southeastern, midwest U.S. and potentially to Europe.

They had started their look in spring of 2014 and they wanted to begin production in 2017 and they wanted to be in full production by 2019.

The facility was sized at 200,000 square feet on 20 acres, 190,000 barrels initially.

I'll talk a little bit about it.

This is where we ended up when we initially started with the project.

It was a smaller scale and smaller size.

They did want to expand to by 2023 up to 330 barrels.

They wanted to plan for future expansion options.

That was an important possibility to them.

Some of their most important requirements from some of the elements that Joe talked about, obviously being a brewery, highway access, public water sewer, electric power, natural gas, and access to rail was very important to them.

And they were talking about the potential for an onsite brew pub

and some other tourist destination kind of possibilities.

So that was kind of what we knew as we were moving through the project.

I want to talk a little bit about project fit because as Joe talked about, it's really important to evaluate these projects based on how they meet the expectations of our community.

So some of the things that really rose to the top for us and why we were interested in the project.

It was a successful manufacturer in an identified target industry sector.

You all are probably aware that food and beverage manufacturing is one of our target industries and this one had a strong agricultural connection which made it even more interesting to us.

The center could help with the adult beverage cluster that we seem to be attracting here in our region.

The hard facts were very attractive to us also.

They were looking for a capital investment profile between $95 and $100 million.

And that involved, as Joe said, their building, production machinery, equipment and supplies.

That's where the county receives most of its revenues.

But the jobs piece is also very attractive to us.

They were talking about 68 jobs initially, moving to 132 by year 4.

And again, these are the kinds of jobs that are the career ladder, entry level opportunity for advancement jobs that are valuable to our community.

Company Culture, they are a company that felt very akin to and aligned to the things that are important to us.

They have a great corporate philanthropy philosophy.

They get involved in causes across the spectrum, including environmental causes, a lot of things that made them fit very well with us in terms of culture.

They had a very strong improvement track record in sustainability and environmental measures.

They received 2012 Sustainability Award from Central Oregon Environmental Center.

They were named a green power partner by the US EPA.

They had a program to put one billion gallons of water back into the Deschutes River annually.

They purchased or offset 100% of their electrical power.

And they were very focused on recycling their spent grains.

So a lot of things that they did from an environmental perspective.

they had a strong focus on outdoor recreation.

They were very into the biking, pedestrian, alternative transportation kind of things.

Again, things that fit really well with us, hiking, biking, camping, all those kinds of things.

So there were a number of things that from the FIT perspective made it feel like something that we should pursue and take a significant look at.

I'm gonna talk a little bit, there were a lot of things going on in 2014 and 2015 related to this project.

But I wanna just step through some of the key milestones so that we can see, excuse me, destination point, also catalyst for significant tourism activity.

That was another fit piece that was important.

You all probably realize that craft breweries, especially of this magnitude, are magnets for people who are making tourism choices.

So, key milestones.

What were some of the things that were happening?

We, in the spring of 2014, responded to an initial request for prospective sites, did some research, and submitted several development site possibilities to this company.

And really, the first major thing was that in 2012,

14 in April, consultant visited and wanted to look at three of the sites that we had submitted in the development area, none of which were the site that eventually became their focus area.

So their consultant came, took a look around as they were looking at many states and many communities at this point in time.

So period of time passed while they were doing all the kind of homework and assessment and things that Joe was talking about and then we got into the February and March time period and they came back and this time they brought their company representatives with them

and they visited sites in the county and they also asked us to submit some additional sites because the site that the consultant looked at the first time around, none of them really checked all the boxes that they were looking for.

So that was the point at which the I-64-29 interchange area was brought forward to them

as a possible site for their consideration.

So at that point they're still looking at a number of other communities and they're still looking at sites in the county in the development area.

Another thing, so then as we move through they became very intrigued by the I-64-29 site and there were some really specific reasons for that that people probably can

identified with.

The proximity to the east-west north-south transportation network was very appealing to them, proximity to UVA, the ability to be right near nearby significant tourism assets like Monticello, Carter's Mountain, those kinds of things.

The proximity to the recreational assets of Hedge Road Park and Ragged Mountain, the opportunity for bike-ped trail connections into the city.

They were also really intrigued by the authenticity of the site.

You all may or may not know there's an Edgar Allen Poe connection there and some other things that may have that kind of character.

that they really liked, and also the site terrain and just the character of the site.

It was both a challenge, which I'll talk about in a minute, but it was also pretty appealing.

These folks are from Oregon, so they really kind of liked the more rugged, natural feel of the site.

So at that point, it becomes the company's choice about how prospects get narrowed down or sites get narrowed down and not so much ours.

So they came back to us and they asked to do a test fit for that site, which is a little bit along the lines of what Joe was talking about.

Here's the kind of footprint we're looking for.

Here's the kind of bubble diagram things we need to fit on the site.

Can you take a look at it and see what will work?

At that point, what also happened too that was an important change was when we initially gave them the sites, we were obviously giving them sites in the development area, but the size and the capacity of their project increased at that point in time.

So the footprint and the thing that they needed became larger than where they were when we had originally been talking to them.

So then we move into the May timeframe and what's happening there.

When the test fit was done and they looked at the topography of the site, anybody who's familiar with that may realize that it's a steep slope up to a

a flatter portion on the top of the site.

When they laid out their test case it was gonna be challenging fitting into the part of the property in the development area.

So there was a flat piece across the border of the development area and their request to us was would we consider a boundary adjustment to allow that to be in the development area for this particular case.

So there was discussion about that

and you may remember we were in a comp plan update process at that point in time.

We were actually getting pretty close to the end of that process.

So what the board directed staff to do was to include a parcel on the western border of that development area in the comp plan public hearing so that there would be the opportunity to consider a comp plan boundary adjustment in the comp plan update.

During that period of time, after that decision, the company came back and they looked at the site again and they talked to the property owner of the rural area site under consideration and they looked at the topography,

and they also looked at where Hedge Row Park is located.

And what their request at that point was, can we bridge, can we expand the boundary area across the top of the Sweet Spot property and take in more so that we can connect to Hedge Row Park and also have some more flat terrain for what we're looking to do.

So that was the request at that point.

In June, the board adopted the comp plan with no change to the area, but what they did was they adopted a resolution of intent to study a potential boundary adjustment.

So they directed staff to look at the area where the boundary adjustment was being discussed and to come back with a recommendation so they could take action.

It was important to state that the board was very clear that they wanted to follow all the steps of the usual process that this would happen in, but there was a very compressed time frame.

in order to address some of the speed issues that Joe has mentioned happen when a prospect comes forward.

So resolution of intent, a process kicked off, a time frame laid out that had all the steps but was significantly compressed from what we normally do.

So in July and August there were three community meetings held.

There was a Planning Commission work session and the Planning Commission recommended disapproval at that point.

Then it went in September to the board.

The board held their work session, the board did their public hearing, and the board then did a special meeting.

They approved a boundary expansion to include a portion of the proposed site, but not the entire site that had been recommended.

So that's a really quick fly through down memory lane of what happened in terms of how that process laid out.

So what I'd like to do now is kind of marry up the process and what was happening then with what Joe talked to you about, about how the project aligned with target audience expectations.

How were we meeting, not meeting, the things that were really critical for a site location to be successful?

Let's see, I've got all kind of papers here.

Let me see what I can find.

So first of all, let's talk about what happened with the consultant and the broker as they were our first point of contact.

The site elimination, we survived.

We actually stayed in the mix as a site

All the way down to the end.

And as he said, most of that happened before we were even aware we were in competition for this.

So the way that we present as a community to a site selector is very positive in a lot of ways.

Ready-to-go sites.

That was where we started to run into some challenges because as you all are probably remember about this property just from a site perspective we had multiple landowners

They had varying degrees of willingness to sell and they had some widely different price expectations as to the property.

So it became really difficult to talk about a ready to go site when we had multiple people in the process with very different ideas and outcomes of what they were expecting.

Utilities and infrastructure in place.

The gas supply was adequate.

The telecommunications was adequate.

The waste management and spent grain recycling was fine.

Electricity was fine.

There was an option for rail connection possible through Buckingham Branch.

And when I mentioned this, this wasn't all just county staff checking boxes.

We had a lot of meetings with all of the utility providers and they all did tremendous amounts of work.

to assess the situation here.

But we ran into some challenges for adequate water, which is probably not a surprise.

There would have been significant construction necessary and a pretty major hookup fee to get water from Fontaine Research Park, which is the nearest location to this particular site.

and quite frankly, we had a higher water rate compared to other communities that were being assessed.

So water was a big issue for us as was transportation.

Again, no surprise to anybody, that interchange is challenging already and the truck traffic with no crossover, no additional signalization, there was a lot of concern about that interchange.

So utilities infrastructure, there were some opportunities and some real challenges.

thorough site due diligence.

The real challenge there was if we had stayed in the development area, we still would have had to do a rezoning.

But with the site as it was being considered, we would have had to do a comp plan amendment and a rezoning, both lengthy public processes with uncertain outcome.

And when you talk about risk and you talk about uncertainty and you talk about cost, that is a really, really challenging scenario to keep any site selector interested when you've got those factors playing out.

Incentives.

Incentives was something that we talked about.

We never really got to a final place on that because things happened that the decision, that decision didn't come before us.

But certainly we were competing with communities that were putting very considerable incentives on the table.

Quickly, let's look at developers.

How did we look compared to their expectations?

Although we didn't get to a development scenario, they did have the consultant and their in-house staff that obviously looked at development kinds of issues.

And what were we looking at?

Joe told you, here's the things they look at.

Elimination of unknowns and risks.

That was very challenging for us to get a handle on unknowns and risks based on what I just told you.

Unknown land costs, uncertainty about land owners, legislative processes, all tough.

That also impacted certainty of schedule, impacted control of construction costs, and how quickly can I start construction.

So then when you get to the prospects piece.

How did we look to prospects?

Community fit, we nailed.

We were the kind of community that they came back time and time again and said, can you please find another site?

We really love the community.

They were about the things they listed in their perspectives and what they were looking for.

Tell me if this sounds familiar to you.

Beer culture, outdoor culture, architecture and preservation, music scene, bi-local, scenic aspects.

So the community fit, curb appeal, sense of place, employee amenities, all those things we were very strong in.

But ultimately you get down to the site and building fit and the best business decision.

And so when you think about the things that I've talked about and the realities of site selection,

How does that play out?

Joe showed you the site readiness assessment, the tier one through tier five.

Here's where really probably maybe generously we were with this project.

We were at tier one, which means we had land.

We had some willing sellers and some not as willing sellers.

Can I just ask you, if I may, you're raising here one of the great mythologies of Albemarle County and I appreciate your addressing it.

And that mythology is that Albemarle lost to shoot.

And I want to be clear here because I know you're going to give a very clear answer as to which tier Roanoke was in.

The winning bidder for to shoot, but it isn't that Albemarle lost to shoot, it's that Roanoke won to shoot.

And the question is, at what cost?

What were the incentives of packages for that to occur?

So where do you feel, tier-wise, you would place Roanoke understanding their preparation, site preparation, transportation grid was prepared,

$10 million was on the table to locate there.

They were clearly at a tier four or tier five.

They, again, I don't want to get into what they did, what we did, but I think it's fair to say that when you compete with a community that provides, not only controls the land, but gives the land to somebody, that's hard to compete with.

And I think you bring up a good point.

What we're talking through this for

is so that we learn and can address things and be better positioned because continuing to beat ourselves up because of what happened, what didn't happen, whatever is not really very productive unless we understand there were reasons and the reasons aren't that

We're bad and somebody else is good or other things.

There's reasons and factors and issues that we could not, very challenging to overcome even though this project was really appealing to a lot of people.

So I think if you, and Mr. Randolph, just to follow up on that, what tier one means is that you're looking at an extended development timeline under the best of circumstances.

You're looking at multiple years to develop the site into a product that has certainty, control, and eliminates risk.

So when you look at the Gambler's Odds chart that Joe showed you, significantly increasing your odds of risk, where you are when you're in a tier one,

The next kind of territory is that you're looking at a significant development timeline

and you are not really at a prospect ready status.

So I think I'm gonna turn it over to questions in a minute or comments or whatever but if we were to look at the highest level of lessons learned, what do we take from this?

How do we make this a constructive, valuable learning experience going forward?

I think basically we had the community attributes to be very strong

in the areas that are actually more challenging to try to address than things like site readiness.

When you've got the kind of things that we have in this community that are organic and very much a part of what we already are, that's a huge advantage.

But site readiness, we were trying to actively recruit a prospect while trying to bring a tier one site to a readiness level and that is just not going to work.

I think that if we were to go back and say how would we

What would we learn from this?

I think when the project parameters increased, we would have stepped back and said, can we really do this now?

Part of what happens in site selection from both sides of the equation is you fall in love, we fall in love, they fall in love, and you try to make it work.

And sometimes there needs to be the cold reality of

It's not the right time.

It's not the right place.

We are not ready for this yet.

So the idea of trying to do a legislative process while you have an active prospect on the line is just not possible.

So I think that as we bring our new county executive onto the team and a new economic development director onto the team, your direction to them about a very specific site readiness implementation plan is gonna be really important because if we don't do something differently, the next time somebody comes and it could very well be

an existing business, one of our own breweries or somebody ready to take the next step.

We don't want to be stuck with a bunch of tier one sites and be in the same situation again.

So I'm going to pause there and ask if there are questions, comments, you know I think we kind of wanted to do this dissection or whatever it is so that we can all say okay.

Let's learn lessons from DeJute.

I really appreciate your presentation, Lee.

I think that the overall Albemarle community has long awaited truth-telling about that decision that was made.

There was a lot of finger-pointing at the time, some rather nasty comments made of members of the Planning Commission and the Board of Supervisors, but the fact of the matter is it's a piece of mythology

in this community to hold that anyone in Albemarle County elected and appointed government in any way lost to shoot.

It's also a second mythology which I put on my Randolph for Scottsville district Facebook page this week.

Oddly enough, in not anticipation of this meeting,

but it's a piece of mythology that the Western Bypass would have been a better road than solutions 29 because the board received a presentation by Joel D'Annunzio of VDOT clearly spelled out that we have basically doubled the time savings

on Solutions 29 and we've reduced fatalities and injuries as a result of that project.

But that mythology continues to float out there in the business community especially where it's fervently believed in.

that the Western Bypass would have been the superior route.

So I do think it's just very helpful for you today to address this piece of the mythology and put it on the record clearly for people to understand that we did not lose to shoot.

Karen.

I really appreciate your comments, as I know you're very involved during that whole process.

And this case example is obviously in the Sam Miller district.

Since we're in sort of a problem-solving mode, one of the biggest problems, as you know, is the transportation problem.

And I contacted VDOT, asked them to weigh in on it personally, because I felt that we weren't getting enough of that.

I felt it was a real hindrance, and I drive through the intersection every single day, so I know how bad it is.

But one of the challenges is in getting the interchange improved to the point where you really could develop that corner if you want to, or we want to.

Is that one of the criteria for getting approval for transportation funds to do the improvements was jobs affected.

So you end up in this catch-22 because well, you can't have the jobs there because the transportation is terrible and we have all these trucks going across and causing havoc and so how do you overcome that?

Is there some like other magic equation that VDOT would accept where we have like a pledge of X jobs and therefore they will move up the planning because you wouldn't want to have

Joe, do you have any magic thoughts about it?

I think that's a really good point and I think that is a little bit of the chicken and egg that you find yourself in.

I think probably the strategic and intentional focus that Joe talked about is about really looking at sites and what they can deliver to you and seeing where the level of effort is worth it.

The Bowman study that you all got is a starting point for that.

They went through and they looked at how you could assemble parcels into sizes that might make sense and said here's what some of the steps of getting those to readiness are.

Getting that work back out and looking at it and saying okay maybe that 64 interchange is not one we can tackle immediately but maybe there are a couple that are closer

I appreciate your comments too Rick and Lee as well, but you know some of the work has been done.

We've looked at

what target industries we would want to identify and that's a big step.

What would work best here?

You can then use that target industry study to look at site selection process and potential site prep work.

Is that correct, Jeff?

Yes you can, yes.

So what's involved in parsing

There's a multitude of things, and to address your question about VDOT and whatnot, I wouldn't say it's chicken and egg, but both feed each other, you know, when opportunities create themselves.

So let's say you would take an example of Deschutes, and as far as Roarnek was concerned, they lost that in Sierra Nevada a number of years ago, and that actually prepared them for Deschutes, to be quite frank.

We did represent various factions along that deal, the Deschutes deal.

I will tell you this, Deschutes love this community.

okay they if you all things being equal if you had a tier four site like Roanoke did I don't think there's any doubt that shoots within here over Roanoke okay so um but you know Roanoke uh did a lot

from a loss they had earlier to prepare them for the shoots.

And we actually did a site selection study for the Roanoke Regional Partnership looking for sites because they recognized they were lacking product.

We did a GIS site selection study looking for sites because we recognized that your comp plan, you can change your comp plan.

One thing I can't do is I can't take a good piece of dirt and move it.

Okay, but I can stretch my utilities I can stretch my comp plan to incorporate a good piece of dirt and a good piece of dirt or a good site will always remain a good piece of dirt and a good site and Somebody can come along and develop it on this particular situation This the site did have challenges we were aware of the property owner challenges so it had a lot of it had a lot of risk from a site selectors perspective and

They did give y'all a lot of opportunity to try to address those issues, which I think was great.

I think that was indicative of what they thought about the community.

But again, it goes back to at some point in time, they have to make a decision to move.

And it was unfortunate, I think, for the community that that happened.

But again, you got pretty far along.

So pat yourself on the back for the success you had.

It hurts a little bit.

It might not have been exactly what you wanted.

But you learned an awful lot about yourself.

You learned an awful lot about that project that prepares you for the next one.

And while we're all sitting here today, some of your greatest lessons learned are from losses and not from wins.

And I know Dave has something he wanted to add.

It looked like you did, but... Yeah, I did.

Yeah, I just want to say that, Dave, we're going to do that, but I just want to remind everybody we have one more agenda item, and then the Planning Commission does have a meeting that they're going to need to...

I was going to briefly, regarding Karen's Catch-22 idea or problem,

On the Citizens Transportation Advisory Committee we were well aware that that intersection had problems that needed to be fixed even if we didn't have a development project there.

and the reason it wasn't a higher priority and it's actually become a higher priority in recent years is that some of these things are just beyond, mostly beyond air control and it's the way the state funds transportation and it's something we should all be concerned about and as citizens of a fairly populous area that should have some impact on state

policy, we should be well aware of it and pay attention, but I think this is a state issue that can, only a state issue that can really get us out of that catch-22 when you look at it that way.

With the transportation funding.

Hello?

Can you hear me?

So anyway, what I wanted to say really briefly was that when we talk about, for instance, that particular site having potential for sewer, we may have the capacity for sewer.

And yes, Rivanna did their due diligence and gave us an estimate.

But what we know about this community is that it's pretty rocky.

And that area is pretty rocky.

and unless you're really looking into the cost of this more in depth and where the rock is, you can get into a lot of trouble.

I'll briefly say the city project on Shanks Branch which went up exponentially in cost and took an extra year over and above what the engineers designed it because they didn't do specific enough investigation of the rock.

It wasn't a problem of theirs.

Anyway, so that's one of the reasons why I really am very attracted to redevelopment.

Exciting potential.

I'm going to, at this point, turn it back to Lee.

I think we have the last agenda item, trying to get the Planning Commission to their meeting.

I wish we had more time to talk about this, but probably not the last discussion.

We appreciate the opportunity to just kind of lay it out there.

So the last item you all received as an attachment a copy of the mission and the guiding principles that were part of the economic development strategic plan that the board endorsed this summer and I believe it was the hope and the intention of the

Board chairs of the EDA, the Board of Supervisors and Planning Commission, that the Planning Commission and the EDA would join in endorsing that, that it would send a strong signal of cohesion and positive forward-lookingness as we are about to hire a new economic development director and move many of these initiatives forward.

No, but I'm going to make a motion.

I'm going to make a motion before the EDA that we endorse the mission and the guiding principles from the draft economic development strategic plan as presented.

Is there a second?

Second.

Any discussion?

Now I'll call for the question.

All those in favor signify by saying aye.

Aye.

I am at an initial comment that I think this meeting has been very useful.

One of the things I think we learned from Joe was the importance of communications amongst different entities and so the notion of the Planning Commission and the EDA and the Board of Supervisors having future conversations sort of underlies my motion, which is I move that the Planning Commission join with the Board of Supervisors and the Economic Development Authority to endorse the Albemarle County Economic Development mission statement

Is there a second?

Second.

I would like to make a comment, because I feel like we haven't been given much time to ask questions about this, and I do think this discussion's been really helpful.

I guess my comment is, and I don't see it here in the guiding principles, and I think it's what we're hearing today is how can we be proactive to be prepared so we aren't caught off guard?

and in my mind if we're going to identify properties that we should be focused on that have the development potential that we've been talking about today part of that process is going to start at master planning level not the master planning level that we talked about but the master plan level that happens in all of our communities and we have master plans that are outdated and I think it would be really important to identify these areas bring them to the master plan

meetings where we get a lot of community engagement at that level.

And all of that is reflected in our comprehensive plan, which is what you all say, you know, is sort of the guideline that we're going to stay within.

So I would really encourage us all to work together.

I know it takes a lot of staff time, but these should be topics that we're bringing to these communities, not just those that are outdated, but those that are in line waiting.

These should be things that we get input at that level and bring it forward.

And I think

We will create a situation where we aren't caught.

Our God and the community doesn't feel like they were just hearing this for the first time.

I would like to see that reflected somewhere in here.

And my other comment was about this bullet about support for critical infrastructure and it talks about social infrastructure and I guess we've talked a lot about the other types of infrastructure that are barriers to these projects and I think

that should all maybe I'm missing it and it's in here somewhere but that should be a huge focus about how we bring forward site to site what are the barriers and how can we overcome some of those.

Thank you.

I would just like to clarify I think that's a great point the economic development strategic plan that the board approved is a draft and

It is not being finalized until the new economic development director comes on board and can add their expertise to it.

So that is certainly the kind of topic that can still be incorporated into the plan.

Thank you very much because I think you're right on target.

I think most of us, I see a lot of nodding of heads.

So this is a draft, so we'll go back, take your comments at the right time and get this when it's finalized.

You do have a point.

Ann, is that good?

So we had a motion.

Congratulations.

You made history.

I think that is the first time all three bodies have come together in this kind of a supportive gesture.

This is wonderful.

Thank you very much.

Just for the wish list.

And that is I hope there will be many more of the three group meetings because we all will help each other understand where we're going a whole lot better.

So rather than once a year, I hope we'll do it much more frequently.

And for our study list, I would love to have us think about where in this long chain of activities does community investment in amenities that sort of create that cultural whatever.

Great.

Thank you very much, Ann.

So it looks like to me where we are right now, the Board of Supervisors are going into a closed session.

And you all are recessing to your meeting.

Okay.

So let's do this one first, Jim.

Is there a second for that motion?

All those in favor?

Aye.

And we'll sort this out.

We do.

And let me also say thank you and Kim thank you for the work that's been done and Ann as well for the comment that you just made because I think this is a clear path.

Okay, Planning Commission, first I'd just like to say that Rod and I have had a discussion and we're going to ask our respective staffs to set a joint meeting between the EDA and the Planning Commission after the first of the year.

That's great.

Great.

Is there any further discussion, Planning Commission?

I move that the board go into a closed meeting pursuant to section 2.2-3711A, go to Virginia and to subsection 3, to discuss and consider the acquisition of real property in the southern part of the county, where discussion in an open meeting would adversely affect the bargaining position or negotiating strategy of the county.

All right.