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Quarterly Report on Commonwealth's Development Opportunity Fund (COF), Fourth Quarter of the 2022 Fiscal Year

Summary

A letter dated September 12, 2022 from Jason El Koubi, President and Chief Executive Officer, to the chairs of the Senate Finance and Appropriations, House Appropriations and House Finance Committees, a quarterly report on the Commonwealth's Development Opportunity Fund (COF) under § 2.2-115(G). It states that as of June 30, 2022, a total of $369,803,100 had been appropriated to the Fund over time. For the fourth quarter of the 2022 fiscal year, it reports that $2,019,300 was committed from the Fund to assist four projects, with total committed job creation of 394 and committed investment of $75.1 million. It then gives project summaries, including Muhlbauer in the City of Newport News and Scholle in Smyth County.

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“Quarterly Report on Commonwealth's Development Opportunity Fund (COF), Fourth Quarter of the 2022 Fiscal Year.” Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/2022-rd455-d7ec4284a4/, SHA-256 7e3537052536436887afeaa70e0410527beabd60b1a47cf7f7f9e1c11e07147e.

Full text

DocuSign Envelope ID: C3C9CF2F-85A2-49D1-ADBA-60778A8CDF09




            September 12, 2022



            The Honorable Janet D. Howell                         The Honorable Barry D. Knight
            Chair                                                 Chair
            Senate Finance and Appropriations Committee           House Appropriations Committee
            P.O. Box 2608                                         1852 Mill Landing Road
            Reston, Virginia 20195                                Virginia Beach, Virginia 23457

            The Honorable Roxann L. Robinson
            Chair
            House Finance Committee
            P.O. Box 4627
            Midlothian, Virginia 23112

            RE:     Quarterly Report on Commonwealth's Development Opportunity Fund (COF) per
                    § 2.2-115(G)

            Senators and Delegates:

            I am writing to provide documentation of the transactions of the Commonwealth’s
            Development Opportunity Fund (COF) which have occurred during the fourth quarter of
            the 2022 fiscal year as required by § 2.2-115(G) of the Code of Virginia.

            As of June 30, 2022, a total of $369,803,100 had been appropriated to the Fund over
            time. As of June 30, 2022, the Cardinal Financial System cash balance was
            $77,802,043, and the balance available for future commitments totaled $28,857,130.
            Taking into account COF preapprovals of $15,872,300 made by the Secretary of
            Commerce and Trade, however, the available balance is $12,644,830. Generally, 40%
            of preapprovals, or $6,348,920, do not move forward, and the available balance is more
            likely approximately $19,000,000. Active grants awarded since the inception of the Fund
            total 695.

            For the fourth quarter of the 2022 fiscal year, ended June 30, 2022, a total of
            $2,019,300 was committed from the Opportunity Fund to assist four projects relocating
            to or expanding in the state. Total committed job creation of these projects was 394,
            while committed investment totaled $75.1 million. Summaries on these projects follow:

                1. City of Newport News: Muhlbauer will locate a semiconductor machinery
                   technology center in the City of Newport News. This project will create 34 new
                   jobs and an investment of $9.0 million (amount of grant: $227,700; use of grant:
                   building improvements; other grants awarded: Enterprise Zone Job Creation
                   grant of $103,800; Enterprise Zone Real Property Investment grant of $80,000;
                   local match: $265,200; anticipated completion date: December 2024; average
                   wage of new jobs: $57,500; prevailing average wage: $59,244). This project has
                   been announced.
DocuSign Envelope ID: C3C9CF2F-85A2-49D1-ADBA-60778A8CDF09


            Money Committee Chair
            September 12, 2022
            Page 2


                 2. Smyth County: Scholle, a manufacturer of plastic bags, will expand its Smyth
                    County facility with the addition of film extrusion and new printing and packaging
                    lines. This expansion will create 75 new jobs and an investment of $31.1 million
                    (amount of grant: $600,000; use of grant: site development and building
                    construction; other grants awarded: Enterprise Zone Job Creation grant of
                    $54,400, Enterprise Zone Real Property Investment grant of $200,000, Rail
                    Industrial Access Program grant of $450,000; local match: $559,630; anticipated
                    completion date: June 2025; average wage of new jobs: $50,889; prevailing
                    average wage: $39,474). This project has been announced.

                 3. Henrico County: EAB, a marketing and consulting services firm, will expand its
                    existing facility in Henrico County. This expansion will create 206 new jobs (160
                    jobs in Henrico County and 46 remote workers) and an investment of $5.9 million
                    (amount of grant: $741,600; use of grant: building upfits and improvements; other
                    grants awarded: Virginia Jobs Investment Program grant of $84,000; local match:
                    $576,000, with a waiver granted for the remaining $165,600 due to the 46 remote
                    workers; anticipated completion date: June 2027; average wage of new jobs:
                    $75,000; prevailing average wage: $61,994). This project has been announced.

                 4. City of Suffolk: Massimo Zanetti Beverage, a manufacturer of coffee and tea,
                    will expand its facility in the City of Suffolk. The company will create 79 new jobs
                    and invest $29.1 million (amount of grant: $450,000; use of grant: building
                    improvements; other grants awarded: Port Economic and Infrastructure
                    Development grant of $25,000; local match: $500,000; anticipated completion
                    date: June 2025; average wage of new jobs: $50,246; prevailing average wage:
                    $57,563). This project has been announced.

            For the projects that have been announced, I am enclosing a profile and analysis and
            recommendation by the Virginia Economic Development Partnership.

            For the fourth quarter of the 2022 fiscal year, actual disbursements from the Fund
            totaling $3,125,698 were made to the City of Petersburg for Civica and the City of
            Petersburg for AMPAC.

            Sincerely,



            Jason El Koubi
            President and Chief Executive Officer

            JRE:kme

            Enclosures

            cc      The Honorable Caren Merrick
                    Secretary of Commerce and Trade

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