Quarterly Report on Commonwealth's Development Opportunity Fund (COF) (February 2, 2023)

Summary

A February 2, 2023 letter from Jason El Koubi, President and Chief Executive Officer, to the chairs of the Senate Finance and Appropriations Committee, the House Appropriations Committee and the House Finance Committee. It is the quarterly report on the Commonwealth's Development Opportunity Fund (COF) under § 2.2-115(G) of the Code of Virginia, covering the second quarter of the 2023 fiscal year. The letter states that $387,695,352 had been appropriated to the Fund as of December 31, 2022, and that $5,459,700 was committed in the quarter to assist 12 projects, with total committed job creation of 1,759 and committed investment of $521.0 million. It then summarizes the projects one by one, including a $250,000 grant for Lutron in Hanover County.

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Full text

                   I   Virqrü.


VEDP               I Economic
                   I Developmtnr
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        February 2, 2023



        The Honorable Janet D. Howell                 The Honorable George L. Barker
        Co-Chair                                      Co-Chair
        Senate Finance and Appropriations             Senate Finance and Appropriations
          Committee                                     Committee
        Room E509                                     Room E619
        P.O. Box 396                                  P.O. Box 396
        Richmond, Virginia 23218                      Richmond, Virginia 23218

       The Honorable Barry D. Knight                  The Honorable Roxann L. Robinson
       Chair                                          Chair
       House Appropriations Committee                 House Finance Committee
       Pocahontas Building, Room W1312                Pocahontas Building, Room W435
       900 East Main Street                           900 East Main Street
       Richmond, Virginia 23219                       Richmond! Virginia 23219

        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 second quarter
        of the 2023 fiscal year as required by § 2.2-115(G) of the Code of Virginia.

       As of December 31, 2022, a total of $387,695,352 had been appropriated to the Fund
       overtime. As of December 31, 2022, the Cardinal Financial System cash balance was
       $85,664,409, and the balance available for future commitments totaled $37,564,232.
       Taking into account COF preapprovals of $14,547,300 made by the Secretary of
       Commerce and Trade, however, the available balance is $23,016,932. Generally, 40%
       of preapprovals, or $5818920, do not move forward, and the available balance is more
       likely approximately $29,000,000. Active grants awarded since the inception of the Fund
       total 705.

       For the second quarter of the 2023 fiscal year, ended December 31, 2022, a total of
       $5,459,700 was committed from the Opportunity Fund to assist 12 projects relocating to
       or expanding in the state, Total committed job creation of these projects was 1,759,
       while committed investment totaled $521.0 million. Summaries on these projects follow:




901 E. Cary Street, Suite 900
Richmond. Virginia 23219
VEDPorg
Money Committee Chair
February 2, 2023
Page 2


   1. Hanover County: Lutron, a manufacturer of blinds and shades, will expand its
      existing facility in Hanover County. This project will create 200 new jobs and an
      investment of $28.3 million (amount of grant: $250,000; use of grant: building
      construction; other grants awarded: Virginia Jobs Investment Program grant of
      $150,000; local match: $250,000; anticipated completion date: September2025;
      average wage of new jobs: $50,754; prevailing average wage: $49,427). This
      project has been announced.

  2. Halifax County: Skip Barber Racing School, an operator of high performance
     driving schools, will relocate its corporate headquarters to Halifax County. This
     location will create 24 new jobs and an investment of $8.9 million (amount of
     grant: $100,000; use of grant: building construction; other grants awarded:
     Virginia Jobs Investment Program grant of $21,600, Enterprise Zone Job
     Creation grant of $69,400; local match: $312,000; anticipated completion date:
     September 2025; average wage of new jobs: $102,083; prevailing average wage:
     $41,754). This project has been announced.

  3. Mecklenburq County: FyberX, a manufacturer of ecological-friendly textiles, will
     locate a new facility in Mecklenburg County. This location will create 45 new jobs
     and an investment of $17.5 million (amount of grant: $150,000; use of grant:
     building upfits; other grants awarded: Virginia Jobs Investment Program grant of
     $36,000, Enterprise Zone Job Creation grant of $160,600, Enterprise Zone Real
     Property Investment grant of $45,000; local match: $172,480; anticipated
     completion date: September 2025; average wage of new jobs: $62,041;
     prevailing average wage: $40,649). This project has been announced.

  4. Floyd County: Hollingsworth & Vose, a manufacturer of filtration materials, will
     expand its existing facility in Floyd County. The company will create 25 new jobs
     and invest $40.2 million (amount of grant: $558,700; use of grant: building upfits;
     other grants awarded: none; local match: $650,538; anticipated completion date:
     December2025; average wage of new jobs: $52,488; prevailing average wage:
     $34,236). This project has been announced.

  5. Caroline County: World Class Distribution will locate a new warehouse and
     storage facility in Caroline County. This project will create 745 new jobs and an
     investment of $275.0 million (amount of grant: $3,000,000; use of grant: building
     construction; other grants awarded: Economic Development Access Program
     grant of $800,000; local match: $3,700,000; anticipated completion date:
     December 2025; average wage of new jobs: 169 at $38,457 and 576 at $32,760;
     prevailing average wage: $45,230. This project has been announced.
Money Committee Chair
February 2, 2023
Page 3


  6. Not Yet Announced.

  7. Tazewell County: Ronald Mark Associates, a manufacturer of PVC resin, will
     locate a new facility in Tazewell County. This location will create 29 new jobs and
     an investment of $13.5 million (amount of grant: $116,000; use of grant: building
     upfits; other grants awarded: Virginia Jobs Investment Program grant of $23,400,
     Enterprise Zone Job Creation grant of $41600, Enterprise Zone Real Property
     Investment grant of $1 00000; local match: $240,607; anticipated completion
     date: December 2026; average wage of new jobs: $45,903; prevailing average
     wage: $38,309). This project has been announced.

  8. Not Yet Announced.

  9. City of Suffolk: M S International, Inc., a distributor of flooring, wall, and
     countertop surfaces, will open a new distribution facility in the City of Suffolk. The
     company will create 80 new jobs and invest $61.6 million (amount of grant:
     $225,000; use of grant: building construction; other grants awarded: Virginia Jobs
     Investment Program grant of $57,800, Port Economic and Infrastructure
     Development grant of $34,000; local match: $225,000; anticipated completion
     date: December2025; average wage of new jobs: $57,166; prevailing average
     wage: $57,563). This project has been announced.

  10. Not Yet Announced.

  11. Not Yet Announced.

  12. Patrick County: Apex Mills, a manufacturer of knit fabrics and dye, will locate a
      new facility in Patrick County. This location will create 140 new jobs and an
      investment of $3.1 million (amount of grant: $300,000; use of grant: buflding
      upfits; other grants awarded: Virginia Jobs Investment Program grant of
      $112,000, Enterprise Zone Real Property Investment grant of $80,278; local
      match: $300,000; anticipated completion date: December 2025; average wage of
      new jobs: $39,253; prevailing average wage: $34,953). This project has been
      announced.
Money Committee Chair
February 2, 2023
Page 4


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

For the second quarter of the 2023 fiscal year, actual disbursements from the Fund
totaling $394636 were made to the City of Norfolk for CMA CGM and the City of
Virginia Reach for Acoustical Sheetmetal.

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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