Economic Development Authority Meeting   9/19/2023

We have a quorum and we had Stephen on.

Yes, so Stephen is participating remote virtually and he has medical reasons.

So I think we need to have a vote.

to approve his participation.

So motion to allow Director McNaughton to participate remotely.

Director Mccullum?

Aye.

Director Morrill?

Aye.

And Director Johnson?

Aye.

OK.

Matters from the public.

Do we have any members of the public?

No, sir.

I wouldn't have signed up.

OK. August 22nd, minutes.

I think that's a reasonable adjustment to the minutes.

Is there a second?

Second.

All right.

All in favor?

Aye.

All right.

And then the financial report was in your practice.

If you have questions, if anybody has any questions,

That's the answer to the question for now.

We'll be working on the transition and work through the financial.

All right, so on to new business.

The first item is the resolution authorizing the issuance of the bond anticipation note and bond issuance.

Thanks, Jacob.

I'll hand it over to you.

Thank you so much.

Good afternoon, it's a pleasure to be here today.

My name is Jacob Sumner.

I'm the interim chief financial officer for the county and today I'll be presenting to the authority a resolution authorizing the issuance of bond anticipation notes and a bond issuance.

The presentation that you're getting ready to see may look familiar as part of the process to getting to this stage and before you today is approval by the board of supervisors ahead of time before it comes to the EDA.

So if you tuned into the Board of Supervisors meeting previously, some of this information may look familiar.

I do want to note, I do have some some folks supporting in the audience today.

We do have Chris Culp from Hutton.

He is our bond counsel for the county.

We also have David Rose and AJ Allen from Davenport & Company.

They are the county's financial advisors.

They have helped us get to this point as far as the legal documents, the

financing package, financing component.

We also have some staff in the room here today that have been a critical component as part of this as well.

We have Daniel Green, who is our chief of treasury, and then his deputy, Heather Taylor.

She don't think she's joining us in person today.

We also have Tia Mitchell, who's our senior budget analyst.

So without further ado, we'll go to the next slide.

And Jacob, may I interject?

We also have counsel, bond counsel to the EDA with us, Mr. Jim Bowling.

So this financing that's before the EDA today is a little bit different than some of our financing or issuances that we've done previously.

This is one financing that's really broken down into two different issuances.

So why is that?

Why is this different than our typical capital improvements financings that we brought to the EDA before?

One is the two issuances that you see here, the ones listed A and one listed B.

The first one is our bread and butter capital improvement funding.

This is the bond proceeds that we look to help fund our capital improvement projects.

And a part of the $178 million of financing, $118 million would be for these capital improvement projects.

Of that $118 million, about $40.2 million are project expenditures we've already incurred.

Projects that have been underway for the past year or so, we've already expended the funds, and as soon as we issue these bonds, we reimburse ourselves for these capital expenditures.

The remaining, 77.8, are what I'm going to call future funding of our capital.

So it's really for projects that are in the construction phase, that are currently under construction, or are we looking to finish within the next couple of years?

So this makes sure that we have cash on hand for these bonds or for these projects that we could then

expand as we are and incur those expenditures.

An example of that would be our courts project.

So a good portion of that $77.8 million, about $34 million, would be for our courts project.

We started construction, started some demolition, started some of the work, but we won't have a lot of those expenditures until we actually start erecting a building.

And so once we are in that construction phase, we'll see a lot more expenditures.

The financing structure for this first issuance is that it is a non-taxable issuance and it have a 20-year maturity.

This is the typical structure that we have for our long-term debt.

This is also included, the debt service that we anticipate on this is included in our

Five-Year Financial Plan, County's Five-Year Financial Plan, and also part of our financial models and our projections, which I'll show you some projections particularly related to financial policies.

Next couple of slides.

The second issuance is one at the bottom.

This is one that's a little bit that is different than what we've discussed in the past.

This is a bond anticipation note.

This is for the up to or not to exceed $60 million.

This is for the acquisition of the Rivanna Station Futures property.

I understand there's been a couple of updates on the Rivanna Station Futures project.

So this is the funding source to secure that property.

Its structure is different than the first one.

This one is a taxable issuance, and it is a five-year maturity.

So you'll notice that one of the differences is in the timing of a 20-year maturity versus a five-year maturity.

The reason why this is a five-year maturity is it gives us flexibility as we are looking to engage with partners to help with funding for the project.

and before we convert this anticipation note into long-term debt, this gives us an opportunity to have that conversation with outside partners.

If this was a 20-year note, we would not have that flexibility to refinance, refund this issuance until later on and through the maturity of the 20-year issuance.

So that's really why this one is structured that way.

I would be remiss if we didn't take a minute to talk about our financial policies, especially as we're looking to take on $178 million worth of debt.

We want to make sure that we maintain our debt ratios.

And you'll see on the screen here that there are essentially three policies, two of them are ratios, that are approved by the Board of Supervisors.

And that we want to make sure that as part of good stewards and good fiscal management that we maintain a compliance with these policies.

The first one is our debt to assess value ratio.

So we want to make sure that our long term obligations do not exceed 2% of our estimated market value or taxable property within the county.

The second ratio is our debt service to revenues.

There's a lot of words in here on the calculation of the revenues, but it's essentially the journal fund revenues and the school revenues less the transfer between the two.

And that ratio for debt service should not exceed 10%.

The last sentence here on the slide is a statement about our payout ratio.

And you'll see that the word intense is in bold text here, and that is intentional.

The payout ratio shows our intention that we expect to pay within a 10-year time horizon, 60% of our payouts.

of our tax board debt and lease payments.

And you'll see that in a few minutes.

So I'm giving a little precursor on intents because we have a little short term blip that you'll see that is directly related to the bond anticipation.

So one of the things that we look at when we're doing our

Our long-term projection is being very forward-focused.

One is to make sure we are maintaining our policies now with our current debt service and our current assessed value and our current revenues.

But also we want to make sure that we are setting ourselves up for success in the future.

So that's what this time horizon is.

You can see it's a 10-year time horizon from FY24 to FY33.

And this is the assessed value of taxable income.

The debt service, excuse me, as a percentage of assessed value.

There are some assumptions built into here.

So as we are planning and looking forward, we need to make sure that we have some broader assumptions that we include into our base.

And so, for instance,

This includes our current debt that the county has already been obligated to.

It includes this debt issuance that we're before the EDA today.

It also includes some future funding, future debt funding and assumptions there on our future capital projects.

So there's an assumption built into here that every other year we would have a debt issuance that would help support a capital plan.

There is also in around year 28, fiscal year 28, there is the assumption, we want to plan for the worst and hope for the best, but one of the assumptions here is that if we were to not have partners come to the table to help us with the Rivanna Station Futures property,

Could we absorb and take on the full debt burden and debt load in the county's financials?

That's what this assumption does.

It is assuming that we would convert that five year note to a longer term 20 year debt.

And this is really putting a little bit of a stress test on that worst case scenario.

And as you can see, even with all those assumptions built in, we are hovering between the one and one and a half percent marker, which is definitely below our target.

The second one is the debt service as a percentage of revenues, and the same assumptions apply here on the debt side.

You'll see, particularly in that 28 to 29 change, a little bit of a spike, and that is the conversion of that five-year band, which is an interest-only payment for those first five years.

to a longer term structure, which is principal and interest.

So that pushes up our annual debt service once you include principal and interest.

And you can see even in that worst case scenario, we're looking at hitting about the eight percent of our revenues.

This is one of the policies and metrics that we closely monitor because we want to make sure we have some headroom between our 10% cap or 10% policy and where we're actually occurring.

Part of that is to make sure that we have flexibility in case there are unforeseen economic realities that may occur.

There are things out there that we want to make sure we have capacity to respond to in case we need to.

The last financial policy-related slide is our debt service.

There it is.

It's our payout ratio.

And I mentioned earlier that that statement had the words intense.

And you can see within the first five years, we are just below our target of 60%.

But that's okay.

That's okay because

We are just below the 60% mark because of the ban.

The ban includes, is interest only.

So we're not paying down any of the principal over those five years.

And this payout ratio is how it looks at how we're paying down our principal over time.

So once you see we transition from FY28 to 29, with the assumption that we've,

transition the ban into a longer term debt, we do come back above that target.

We've worked closely with our financial advisors and the rating agencies understand the nature of these financings.

And so there's no concern that we have, that this would have any issues with our rating or this would have any issues with the credit that we get, but it's because of the nature of the short term.

So the next steps this is like so this is one step in the journey to actually issuing these bonds.

So today there will be a resolution before you for action today.

After that, we will be in October engaging with the rating agencies, because this is a public issuance.

So we'll be engaging with them to attain a credit rating and looking to sell either late November, I'm sorry, late October, early November, and moving to a bond closing about the middle of November.

So that's our anticipated timeline.

That's all the formal remarks and slides I have.

I have a question regarding the, with this amount of debt and the, of course, interest rates, how would that be impacted?

May I ask her to talk about as far as the assumptions that we've built in or

So I think we've been pretty conservative on our assumptions to date.

One of the things that is it's hard to play the market.

Sometimes you just need to go to the market when you when you need to go as far as for funding.

This is probably about the opportunity we would need to go to be able to make sure we have the proceeds in hand to almost lost capital projects to do the closing.

At the five year mark, I'm not for sure where interest rates are going to be.

I'm not for sure where they're going to be six months from now.

But I would say we have come from a historic low and have from an interest rate environment and there's an opportunity that we'll have to address when we come to that.

The good thing is we know that we have

The five-year mark.

We do.

I'm looking at my associates in the audience.

It is, you all have to tell me how, I believe it's after year two, we can essentially

Yeah.

So that's so that's the point where you could start if you said, OK, here's where we are.

We're going to somebody else is going to put 20 million dollars into this.

And like a

Pardon me, this is new to me.

So the way we've structured it, there wouldn't be a prepayment penalty if we paid it after that two year mark.

Now, when we do go to

I'm making the assumption that there is a portion of this we would need to convert to a long-term debt.

It would be a very similar process to what you've seen with the capital projects where we would be issuing long-term debt.

Kind of what is it?

Is it a percentage of the total loan like you would in a commercial loan?

I would say Jacob, the way we think about this,

If you say let's say $60 million, I think it's going to be between 1 and 2% of let's say the cost.

Yes.

So number one, it is negotiable.

But number two, it goes to the underwriters, whoever they are.

It goes to those folks like ourselves that are your advisors.

It goes to the rating agencies that put rating on it.

So it's no different than the current 170, you know, the current financing that is the series A that Jacob is talking about.

But let me make it

a year plus ago is because we see the 60 million as a real opportunity.

It's an investment opportunity economic development wise in the county.

So to Jacob's point, we think that over the next several years, there is going to be offsetting revenues.

And so as a result of that, rather than go today and go right into structuring something that's rigid, we're keeping it quite flexible.

Michael Scribe has set this up.

So the idea that we had was, yes, it's five years technically, but we can prepay

what may happen to us, us meaning the county in terms of revenues and opportunities.

So I think that's important.

I think the other thing you mentioned that you're relatively new.

So this for me with you is about 35 years of getting in this chair.

So we actually, while we're doing a sizable and maybe to me it's a record debt that we're doing.

When you look at overall the debt profile of the county, it's actually considered modest.

It's actually on the low side.

So for example, that 2% that Jacob talked about as your policy, that is considered very strong by the rating agencies.

So there we are hovering, even in the worst case, at about one to one and a half percent.

That is extraordinarily strong for a local government.

As it relates to the growth of that assessed value is much lower than what the recent history has been of assessed value for the county.

What do you consider modeling?

Is it a percentage of the total?

One or two percent of the overall.

Well, I mean, I mean, that's a lot of between one and two percent of a loan of this size is significant.

But it's what the market is out there.

In other words, it is.

So the market, for example, if we were doing a corporate finance, corporate finance is seven percent.

We in the world of municipal finance are between 1% and 2%.

That's really because our markets are that much more efficient.

And the other good news here for you is you're so highly rated.

So we will know exactly what the cost of issuance is once we actually sell these bonds.

The way we sell them, I think that's also because we sell them, we call them competitively.

What we do is we put that into the market

on a date certain.

So as Jacob said, for example, it might be Tuesday at 11 o'clock on October 20th or whatever.

Let's assume that's a Tuesday.

And so what we care about is the overall cost of money.

Whoever provides us the lowest overall cost of money

our world works.

So then we'll be able to come back to this EDA, IDAs and the county and say, okay, this is what the underwriter was willing to work for.

But what we care about is the underwriter might've wanted 1%, but their all in cost of money might've been lower than someone else that says we'll work for half a percent, but the interest rate they want all in is higher.

So that's how

So each one is negotiated individually?

It's not negotiated.

It's actually put out into the marketplace.

And whoever is willing to give us the all-in lowest cost of money wins the bid.

That's how it works.

So they build in some money for themselves.

but what we work with is what is the lowest all in cost to the county.

That's how we look at that.

But it's a lot less than what I'm saying is if you're in the corporate world, they build in something that's literally six to seven times higher because the markets are not as efficient and typically the credits are not as good.

So for us, we're AAA rated.

So from our perspective,

All three of the nature rating agencies have us as AAA.

In fact, I remember when we got our first AAA, we had a big press conference.

Bob Tucker, we put it out there and got it all out there.

That was a big deal.

But now we're all AAAs.

So we're really in a good mode.

And when Jacob did his numbers, for example, we did those numbers.

If the markets hold in there, we're basically probably three quarters of a percentage point lower

and what we even did for the numbers that you're seeing.

So I feel like we're in a good mode from a market time frame just as well.

We are when you take away where we were like a year ago and when the markets hit there, they're real low with regard to, you know, basically the post pandemic or getting out of the pandemic.

We're basically at 40 to 50 year lows.

So when I started in 1980, we are basically

away from that little small period, we're at the lowest point we've been in some full years.

So we think we're at a good time.

But we also have the ability to prepay it even on the other piece, that 20-year loan, we've got the ability to refinance that if we, meaning the collective we, want to for savings purposes or what have you.

So we've kept that flex

So I want to just clarify something as we're talking about this, because you're sort of talking about the collective we, but I think it's also important to segregate the Albemarle County we from the EDA we, because this is an Albemarle County obligation.

They are the ones who are borrowing the money.

The EDA is not, I mean, we're acting as a conduit.

So the county is making the decisions that it wants to make.

You know, they've evaluated all this.

The board has signed off on it.

The staff has signed off on it.

So we're acting as a conduit.

We need to make sure, but it's not necessarily our call as to what the right amount of money is or what the fees are or things like that.

Chief of Bowling knows if we were in North Carolina, there would be no EDA conduit.

We'd be doing it as the county where Jeff came from.

That's when we used to work for Jeff.

That would be just the county would borrow that money with the city.

Here we have that one extra step.

So that always begs a lot of times the question, well, if the county doesn't make the

the IDA, you've got both in Virginia.

Are you liable?

Are you, the answer, Mr.

That's the important question.

Yeah, but I do think it's worthwhile to think through these things because there may be points where we will be the ones who are borrowing the money for potential projects.

Understanding this is, I mean, it's a good opportunity for us to think through and see how these things work is there may be an opportunity

and Rivanna Station, who knows for us to actually borrow money to do something.

And so we would be under those circumstances once we've got an evaluation of those costs.

Anything else?

Other questions from the board?

But you have essentially a point of order.

Director McNaughton has not engaged in this discussion.

Yes.

And I think he had indicated before that he intended to recuse himself from this consideration.

I do hear you.

Yeah, yeah.

Yeah, yeah.

I think I said everything I wanted to say in my email to you.

As you can see, you don't have any legal liability and the county doesn't have any legal liability.

And I do want to say one thing about

the legal craftsmanship that we're involved with here because I think it's a kind of a marvelous thing if you think that we're still using a financing device that Chris Culp and his team created over 20 years ago and it still works.

Normally you'd see much more paper

than you're seeing in this issue.

Really, what you have here, and Chris, you stop me if I misspeak, is a souped up, very fancy credit line deed of trust, to put it in your perspective, that the county had the foresight over 20 years ago to set up to finance its capital improvement program.

and it served you very, very well over the years when you sit back and reflected of all the capital improvements that you've made using this essentially two agreements that were signed in 2003 and I assume that we can keep on using that financing.

Still works, might as well.

So I wanted to pass that on to Chris because it's interesting to see something that's so effective and has that kind of age to it.

All right.

Anything else, Chris?

You had before you the resolutions for action.

Just a quick overview.

It does approve the parameters along the lines that Mr. Sumner mentioned about maximum principal amount, interest rate parameters, and PERM.

It approves the forms of the documents.

The documents were included as part of the agenda package.

The role mentioned, we are on a series of supplements to the master agreements from 2003, supplemental trust agreement that provides for the details related to the bond issue, the supplement to the financing agreement, which is the county's agreement subject to annual appropriations to pay the debt service on the bonds, the POS preliminary official statement, which is going to be used to market the bonds and the public sale.

And so those are the main documents that will be the financing documents for this.

It is a streamlined approach because we have in place these master agreements.

And so the resolution authorizes, this board is approving the forms of those, delegating to officers to finalize those when we get to the pricing and have final information to approve those final changes and then to exceed those.

documents, and the county board adopted a very similar resolution last week approving the same forms of documents and the same parameters for the bond issue that is before you for your consideration.

So that's a quick overview.

Any questions for Chris?

All right.

Is there a motion?

$178 million, probably ought to read it.

I knew the economic development authority of Albemarle County, Virginia to adopt a resolution as presented related to the plan to finance the cost of certain projects of Albemarle County's capital improvement plan and costs of Albemarle County requiring a certain real property through the issuance of one or more series of revenue obligations in aggregate principle not to exceed $178 million.

and to authorize the Chair, Vice Chair, Secretary-Treasurer and Assistant Secretary-Treasurer to execute and deliver all documents and take any action to describe the resolution to affectionate this issue.

Thank you.

Is there a second?

Second.

All right.

Is there any discussion on the motion?

Hearing none, can we call the roll?

Aye.

Dr. Mottola?

Aye.

Aye.

All right.

The resolution passes.

Mr. Chairman, with your permission, I'm going to take my leave.

It was a pleasure being here.

And if any of you have any questions about these bonds, just give me a call and I'll have the call to you to find out the answer, if I don't know.

All right, thanks, sir.

Yes.

Yes.

Thanks, everybody.

That was a really exciting first item.

I am pleased and honored to introduce Shannon Holland.

She is the director of the Go Virginia Region 9.

Portia of Virginia, she and the director of Nelson County, Nelson County's economic development tourism office will be going through the next item on our agenda, which is a match for a Go Virginia grant related to the wine industry.

To quickly give an overview of how I think we can...

That will begin with Shannon giving just a brief overview of the Go Virginia program.

The authority heard a presentation related to a Go Virginia grant at our last meeting that

would benefit from some clarity and some additional information.

So Shannon is gonna give us just a broad overview of what the state program is.

I wanted to spend a minute talking about some local and statewide wine industry data, which is pretty interesting to go through.

Yes.

OK.

We're right on schedule today.

All right.

Take two.

Here we go.

So for this item, we'll look at state

and local wine industry data.

Maureen and I will review the grant proposal itself.

We'll have some time for Q&A and then we'll consider a resolution.

So I'll turn it over to Shannon for the first section of the presentation.

Do you want to advance or this is going to work still?

OK, great.

Well, thank you for having me and I appreciate J.T.

opening the opportunity.

My goal here is just to give you a high level view of what Go Virginia is.

Thank Albemarle County and the EDA for working with this program and showing you at the end of this quick slideshow some of the outcomes of the projects you have funded just to demonstrate the value of local participation.

So I am the director of Go Virginia Region 9.

My role is to help the county activate this program within our region.

The overarching goal of Go Virginia program, it's a statewide economic development initiative funded by the General Assembly that drives collaboration between local government, business, and higher education.

And we do it by offering grant opportunities for that collaboration.

Programs overseen statewide by a board in Richmond and the Department of Housing and Community Development.

And some important things to know about these grants is that it must be led by non-profit entities or public entities, localities, for example.

And in the case coming up, you know, Nelson County has offered to take that role.

It must involve at least two localities.

So it's important for that collaboration that a minimum of two local governments are involved in these projects.

And the more involved, the better for the project is viewed and to get approved.

We also have to make sure that local up to higher education and businesses at the table as well.

And it must link to our strategic plan, what we call our growth and diversification plan.

Here's a visual of what Go Virginia Region 9 is.

Obviously, you know where Albemarle County is, but we do extend up to Fauquier, Nelson, and Louisa.

We are led by a council that is private sector led.

You may recognize our chair and vice chair.

Our chair is Ethan Dunstan.

Jim Chang is our current vice chair.

And our support organization is the Central Virginia Partnership, which essentially serves as our fiscal administrative agent and great partners for these projects.

The types of funding we have are basically for regional projects that serve our region only, or we can go back to the state for bigger project money where we collaborate with another region like Northern Virginia, which is region seven and access a bigger pot of money.

Either way, it has to tie to our strategic plan called our growth and diversification plan.

The statewide program is organized among four frameworks, meaning the types of grants we can look at to drive economic growth, talent development,

grow existing businesses as scaling up clusters, entrepreneurship and site readiness.

And then every region identifies the traded sectors in their region that are going to generate the highest paying jobs and the greatest opportunity throughout the region.

The target traded sectors for region nine are listed here.

These five sectors have stayed the same since our original growth plan in 2017.

And we look at the data every two years and update it.

So we're in the process of doing that again.

This is a slide I just want to use to demonstrate the importance of local government participation.

Since 2017, when our original growth plan came out, we have awarded over six point, this is a blue square of the pie, maybe hard to see, but over almost

Virginia dollars, those are state dollars that came to our region, but they were leveraged by local match on the gray piece of pie there about 4.8 and other not like private sector federal funds and other types of leverage so total leverage is almost 9.3 million.

For every dollar of Go Virginia that is leveraged by locality money, we also bring in additional funds to our region, and this only captures what we know for our grant applications.

We've had several grant applications in our region and statewide that have also leveraged follow-on federal funding, so other opportunities, but I did just want to again also note that we track the average annual wages in our region, and

No surprise to you all in here, it continually goes up, but as measured Q3 2022, that's 57,946.

And these projects have retained or attracted or kept 1,290 jobs in our region.

Those are self-reported numbers.

So I pulled some

Summaries just to demonstrate the value of these projects in our region.

The ones, I pulled eight projects that Albemarle County and the EDA participated in.

Four are complete and four are active.

And you can see sort of the outcomes from these projects.

Now I can't report them for Albemarle County only or the EDA only because they are regional projects where we have different localities participating.

But remember,

The localities have to be at the table, have to demonstrate that they are interested in these projects.

The SEVA Biohub generated a biotechnology impact report in a sort of sub-regional for Charlottesville, Albemarle with San Luis, and also a strategic plan.

And then they came back for another grant to drive the biotech cluster in our region, which you know is very important.

And I'll go through these quickly.

I'm glad to share these slides and have further discussion if you'd like to see these details.

And then for active projects that are currently in play right now, these are four projects that are being developed.

And Venture Central is winding down, but you can see these are their committed outcomes.

So these are the things that they have to commit to up front.

And we spend a year or two years working with them on a regional basis

That's right.

Yes.

And so I wanted to get through that first.

I know you guys are bottom line on top people and want to get to the action.

So that's sort of level setting for what Go Virginia is and the importance of what you all do.

The report that would flow out of this particular effort would be similar to the 2013 report that was provided.

This would be, and I'll maybe expand on it, but the report that this would come out of would be crafted to generate a plan.

We see it as a strategic plan for this sector to identify what the gaps are that are keeping this sector from growing and expanding and thriving.

and then we will create an action plan for how to address those gaps.

Some of those opportunities might be directed at Go Virginia.

That's the expectation that Go Virginia can fund some of the follow on implementation grants, but some of them may be, well, local government should do X and here's a source of funding for it.

We should go to the federal dollars for this.

So that's how I envision it and I know Maureen and J.T.

Yeah, I'd love to add to that.

So, you know, I think the 2013 grant, that was an AFID planning grant that the county alone matched state funds to pursue that opportunity.

And that was really centered around this tourism conflict that

There would be a Virginia Wine Center somewhere in Albemarle where people could come and learn about wine and plan their trips out into the rural area and that we could become kind of a statewide hub of Virginia wine.

This grant that we're discussing today, and Maureen, if she is available on the line to add to this, as Shannon said, this is kind of a strategic plan that would be looking at some of the bullets that were listed in the handout for today's meeting, looking at challenges around labor, access to capital, availability of supplies, and

necessary agricultural products, production facilities, tax and legal issues, economic impact overall, challenges to distribution and transportation.

So I think it would be a broader scope that said, you know,

The number of partners that are coming to the table and the ultimate funds that are available will really dictate the scope of the study, depending on how much money is available will depend on what all can be included and can't.

So I think that's one way to answer it.

Any other questions about Go Virginia?

I mean, given we just passed 170 projects, so I don't want to link without any questions on my part, but what I'm trying to figure out is just like, what can we expect?

What good can we expect to return to all law citizens?

Maybe I should have asked them directly like that.

And I get at high level, you need this information to figure out a strategy.

It's not that I'm not supportive of it.

I'm just a little skeptical, maybe.

Not that people won't do a vision on producing it.

There is a good intent.

Yeah, it's a fair question.

And and as Shana mentioned, this is this is just a planning grant and she can speak to the success of the then the subsequent implementation grants that are much larger.

So, for example, if

It was determined that a major barrier to our local wine shipping nationally and internationally was some sort of facility or piece of equipment or something.

This grant, this planning grant, would provide the basis to then pursue the funds to address that kind of gap.

So as one example,

That's actually a perfect example.

Strengthening this sector in terms of, you know, we're going to have private sector at the table.

We have a winery owners and we have professional services people that work with the wineries for expanding all at the table, including local government.

And we have PVCC, you know, everybody that's involved to identify what those gaps are.

And yes, the strengthening the sector helps grow the jobs, become more efficient, generate new businesses, etc.

So

Tax revenue is probably one thing.

Support of the agriculture just to have some healthy use of the land.

The whole thing can't be housing built.

It's right in the county.

So it's a nice way to get an economic return and a way to just require heavy development.

I'm very supportive, I'm just curious.

Well, I think that's a good question.

what we often talk about it's just sort of the but for idea and that maybe in this case what we're saying and thinking is there's nobody else who would do this sort of thinking on their own and really need to bring people together and we've got to provide the funding to do that because so much of the time like if we're making a grant to a company we're saying well would they do this anyway and are we really just funding this I mean is that a fair assessment that this is this is allowing

That's right.

So every other locality and region has pledged either in kind or cash contributions to this effort.

And this will be a regional examination of the wine industry and what its challenges are.

And it actually segues pretty nicely.

If you don't mind, Shannon, I'll just

Kind of forge ahead just to show, you know, with Liz's help, we just got an update on the unique and significant place of the wine industry in our local economy.

So at last count, we have over 52 farm wineries in Albemarle County.

A very conservative estimate of its annual economic impact would be at least one hundred million dollars a year.

No, the economic impact.

Sorry, I was distracted because it says 2019 summary report.

April 2022.

Yes.

Yeah.

That's right.

And looking specifically at that at that at the commercial wine grape report that split the state into the regions that you see here, the five separate regions, I thought it was interesting to see that central Virginia is definitely a leader among the state and

then within that central Virginia region, Albemarle County is heads and shoulders.

If you totaled all the other portions of go Virginia region nine, that's about 1200 acres and we're over a thousand acres.

So we by ourselves account for about 50% of the grapes under vine.

And so,

Some other things just to quickly point out, recently we were selected by Wine Enthusiast Magazine as one of the top five finalists for wine regions in the entire world, going up against Australia, Italy, France.

So these sections of the

of the map that you see that are highlighted in bold, those are special viticultural areas that are designated for the specific grapes that come from that area so that, you know, as people are trying these wines around the world.

They can say that the grapes came specifically from this region.

So, as we said, we talked about sort of what the plan was.

You could think of it as a strategic plan for the wine industry.

It will be engaging

The associations like the vineyards and the wineries association meeting with other industry stakeholders.

But then, as Shannon was talking about, you know, getting validation from businesses and higher education partners that do training and that kind of thing at the table to review the recommendations before they're completed.

We would ask that it would incorporate that 2013 Virginia Wine Center study to see if that idea has legs.

The sort of the research that I did to figure out what happened as a result of that study was really just that there was a change in state leadership and not so much that there was anything

negative about the idea.

So it would be great to see that be revived and built upon.

The Convention and Visitors Bureau that handles tourism for Charlottesville and Albemarle is pledging a letter of support for this grant and

As I said, every other locality is participating.

I'm proposing that Albemarle provide $20,000 in cash.

Fauquier is pledging $10,000.

Green is bringing five.

There's a total in-kind match of all the other counties of about $35,000.

So that will build a strong case to the Go Virginia Council around positive and favorable action on this application.

There is some urgency to it.

The application is due tomorrow.

but Nelson County graciously agreed to be the lead on the application itself.

The purpose behind that though is to engage with the wineries while they're outside of peak harvest season and peak tourism season.

So this sort of, if you make the deadline tomorrow, there could be action in the November, December timeframe.

There could be a procuring who will complete the study.

Could you go back to the county by county?

Yeah.

And then what was the one before that?

Oh, that was the state.

Yes.

Chris Ingle asked me to mention that Charlottesville has no grapes, but they drink a lot of wine.

Well, they should support too.

They're providing an in-kind contribution.

What, Chris has offered to drink wine?

Maybe they could get some grapes on that one.

Five years.

It's that little quote there.

I'm curious if I could ask a question.

I understand Nelson's in-kind contribution.

Engaging their particular vineyards and wineries that are active.

Some private sector participation includes Afton Mountain vineyards,

There's some other partners at the table, PBCC, Williams Compliance, Joy Ting is a person that's involved and offering time and expertise for the process.

There you go.

So at the last count, and things have been coming in all afternoon, we are looking at the $35,000 in cash match and we're about

57334 for in kind from the locality.

So we're well on our way.

We were hopeful for 50,000 and one if we were to qualify for the reduced match, but as an overachiever, I want to get to 100% if we can.

So I do ask and appreciate your consideration of this.

But between you and Falk here, you guys have

So this is more curiosity than anything is that what is the length of time from the ones that grants approved to when you actually get the results?

These planning grants are awarded for one year and the general timeline that

and I'll let Maureen or J.T.

So basically within 12 months.

Is it possible to have at the end of, you know, as we're, obviously we have multi-year terms and this is not gonna be the first time that somebody's gonna come with, hey, we'd like to do a study or analysis, give us money to do this.

Is it possible to have, once you have the finished report, to kind of discuss it or even to have a look at it as a board to see, you know, was this money well spent?

I definitely have to report.

I think it's really, I mean, even the one last meeting, you know, when people are asking us to invest money in research, essentially,

OK, what is going to come of that?

It's different when you say, hey, we're going to do this.

It's going to create this amount of jobs.

That's very tangible.

But I find a lot of these help us study.

We want to figure it out, do data analysis and so forth.

Shannon, can you talk about, are there, I know for the implementation grants, there are required metrics around job creation, wages, things like that.

Well, this is why the planning grants are one year.

And I will also say when the Go Virginia model is, and has been proven successful, I'll give you an example here in a second,

One year to study or fail fast.

Identify, no, this is not going to work.

So we're not throwing more money at it.

So that's one thing these planning grants are designed to do.

But the second thing is Go Virginia requires that they're in the application.

What is the line of sight to an implementation grant?

And that's where our jobs numbers or our new businesses serve.

And as I've worked with many of these planning grant teams, I'm like, what we want to do is know what that is before the year's over.

While everybody's at the table, figure out what the next step is, what the next Go Virginia grant

So that's why we like this model at Go Virginia.

An example that maybe you're familiar with is Acevo Biohub, which is in this area very strongly supporting the cluster biotechnology companies.

They were one of our first planning grants in Region 9.

These four loosely held 501c6 of biotech professionals.

They needed the money to stand this up and engage the community, work with Weldon Cooper Center, identified the impact of that.

And then within a year, they had a strategic plan

and an impact and immediately had a two year planning grant through Go Virginia for $400,000, $500,000 for two years and then generate those jobs.

Entrepreneurs served capital investment gains.

So yes, that's why we have a short line of sight on this plane of grants.

Very much so, thank you very much.

And I love the tie-in with higher education and giving because I think the other advantage that I see about essentially this investment is if we're investing with the time with the schools, then hopefully people will graduate and stay in the community and be up-skilled.

I like the linkage there.

Just thinking out loud briefly, it's been a paradigm shift for me to come from a business environment into the demands of a, they're just different demands.

Like they're not, it's not that, I don't need any way to suggest that the demands of government are better or worse or anything than private sector.

around that.

So what I'm learning is that a lot of the ways that things happen, it's very consensus based.

So we need data to show other stakeholders that this is going to be a viable investment.

That's what I'm hearing.

I think if I'm getting that right, it sort of makes sense to me.

It'll make more sense as time goes on.

Maybe I would love to see in addition, like I said, I'm fully supportive of this.

This is great.

I'd love to see things that for the

for the tangible results contingent on the board, which I don't know how big that might just be me.

I'd love to see things that have a direct, obvious payout that might have a strategic component or I guess it's just a request

for everyone in the county to be on the lookout for things.

I'll give you an example.

Is there a housing unit?

You know, for the cost of what we spent on a couple of studies here, it might have paid for a single residential unit in Albemarle County for a family that doesn't have one.

That's, you know, are we solving the housing problem for Albemarle County?

No, but it's something we can look at, point to and say, well, we solved a problem for a family.

and it takes, I'd like to see some of that and in addition to these sort of long range strategic investments that we're making to try to leverage grants and invest the community in thinking about these economic challenges differently.

So it's just a comment, not a question.

Well, and I think the other thing we can think about is in terms of future beings, if we're looking for topics to discuss, you know, to bring people to speak, we can look for things to talk more about the specifics of the benefits and those things.

So we put that on the planning list.

Thank you.

Go ahead.

Just a quick comment for my fellow directors.

Since I cut off the point that I had forgotten.

We have a confirmed fund balance from our budget analyst in the finance department that we have currently after our expenditures from other incentive programs that we've paid out in fiscal year 24.

We have a cash balance of $616,000 roughly that will need to be reappropriated come the end of the calendar year, but if there is need to

to replenish that fine.

That's when we would take that to the board for consideration.

So, yes, we have six hundred.

Two hundred of that.

Two hundred of that is an allocated currency.

That's the number that matters, Jeff.

The supervisors have made it clear that that money is to be used for specific, like not for a housing unit or something.

Right.

And the allocated means that it's committed to some private folder.

All right, if there are no further questions, is there a motion?

I'll motion.

I move that the EDA adopt the resolution appropriating $20,000 payable to the County of Nelson, Virginia, as a match to the Go Virginia Region 9 cluster scale-up planning grant, subject to the terms of this resolution and the Go Virginia grant, if awarded, and

All right.

Is there a second?

Second.

Any further discussion?

All right.

Do we need a roll call vote or should we do?

Director Long.

Aye.

Director Johnson.

Aye.

Director McNaughton.

All right.

Thanks, Shannon and Maureen, for joining us.

So next is the staff report.

Yes, a very brief staff report for the directors, mainly an update in activity from our partners, namely Civo Biohub and the Chamber.

The first two pictures in the center of the slide here are from an event that Ashley and I attended last Tuesday night.

I don't know if this is quite a tangible result per se, but the gentleman speaking in the foreground of the top picture is from a development firm out of the DC Baltimore area that specializes in the development of lab space.

And he and his firm are partnering with Civo Biohub to examine our ecosystem, to figure out

What type of lab space would make the most sense given the cluster of particular biotech companies we have here?

And so you can't really see it, but on the bottom picture here, he gave a great presentation and he talked about the companies that are here and that are growing right now really would benefit from

Bio lab space and chemistry lab space.

And so that's typically the kinds of labs that have a lot of venting, a lot of hoods, a lot of distinct air duct systems for the types of research that they would be doing.

This slide, and I'm sure Dr. Hastings would be willing to share this with us, but this was a really fascinating

The top icons here walk through a biotech company from Idea all the way through seed funding and series A and then exit and it

This talks about the mix between your space having lab space and office space.

And basically, as you ramp up, the proportion of your space switches from research more to marketing and compliance and administration.

And it was really a fantastic evening to learn.

It was called Lab 101.

And I expect that we'll have Dr. Hastings back here at some point to talk about

What are some real development that's happening as a result of their engagement?

Yeah, there's a variety and Bonamos, for example, is in a zoning district that is commercial office that permits up to 4,000 square feet.

But they went to the Board of Supervisors who granted a special exception that goes up to 50,000 square feet for them.

Yeah, that's why I was asking.

I knew light industrial was really low so I didn't know whether there were other things, other areas.

And the second event, just to give a quick update on Friday night last week, the Chambers Minority Business Alliance presenting their Vanguard Awards.

This is Chef Antoine Brinson.

He's been featured on channels like HBO and has become a real

Very recognizable face in our community.

He does workforce training in the culinary arts.

And the other winner was Sabrina Fagans, who is a owns a fitness company.

And so we were at the Holiday Inn off Route 29.

There was a great celebration, a lot of community.

And just a quick update to share with the group that it was an enjoyable evening and

The United Way, who we also partner with, was there presenting some of their results, which I'll email the EDA by way of reporting out some of the past things that you've been involved in.

This Friday, Ashley and Liz will be at the Black Business Expo at X-Art Park.

So if you have an opportunity to go by and check that out, part of the announcement on last Friday night was a guide for black businesses that the United Way has published.

So I have that available here if anybody would like to check that out.

It's great outreach.

I love to see, because when I think about how are we reaching the businesses that really need it?

I mean, the biotech firms and well-heeled companies, you know, we're happy to support those.

But I have a soft spot in my heart for that, that just a small business entrepreneur rolling a roll of the dice and take a chance.

And they don't necessarily even know the resources that are available to them.

We've talked recently about some trainings, and in particular, I know we focused on this VITA training.

If I could interrupt or just add, I did check with BEDP and quarterly would indicate that it happens quarterly.

after I did some further research.

I cracked the case.

And quarterly, these trainings will be available for BVP.

Because this is the chamber event, the one that Diantha had asked us all to be.

So I actually canceled one meeting to go to that chamber event.

So Ashley, you're referring to the VEDP training on the left hand side?

Got it.

All right.

Thank you.

Any unfinished business, any matters you want to discuss?

All right.

Good meeting.

October 17.

Can you go back one slide really quick?

I did want to write that date down over time.

I know I have it somewhere, but I just want to... Is it two days or you can have one or the other?

It's two days.

All right, is there a motion to adjourn?

I move that we adjourn.

Second.

All in favor?

Aye.

All right, thanks everybody.