Quarterly Report on Commonwealth's Development Opportunity Fund (COF) (January 24, 2024)

Summary

This is a letter dated January 24, 2024 to The Honorable L. Louise Lucas, The Honorable Luke E. Torian and The Honorable Vivian E. Watts, with the subject Quarterly Report on Commonwealth's Development Opportunity Fund (COF). It documents transactions of the Fund in the second quarter of the 2024 fiscal year. As of December 31, 2023, a total of $409,974,380 had been appropriated to the Fund over time, and the balance available for future commitments totaled $39,586,085. For the quarter, a total of $14,455,000 was committed to four projects, with Framatome in Lynchburg, Tate in Russell County and Northrop Grumman in Waynesboro announced. Actual disbursements totaling $195,250 were made to Montgomery County for Tore Robotics and the City of Virginia Beach for Acesur.

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VEDPlI
       January 24, 2024



       The Honorable L. Louise Lucas                  The Honorable Luke E. Torian
       Chair                                          Chair
       Senate Finance and Appropriations              House Appropriations Committee
         Committee                                    201 North Ninth Street
       P.O. Box 396                                   General Assembly Building, Room 1223
       Richmond, Virginia 23218                       Richmond, Virginia 23219

       The Honorable Vivian E. Watts
       Chair
       House Finance Committee
       201 North Ninth Street
       General Assembly Building, Room 907
       Richmond, Virginia 23219

        RI;:      Quarterly Report on Commonwealth's Development Opportunity Fund (COF) per
                  § 2.2-11S(G)

       Senator 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 2024 fiscal year as required by § 2.2-11S(G) of the Code of Virginia.

       As of December 31, 2023, a total of $409,974,380 had been appropriated to the Fund
       over time. As of December 31, 2023, the Cardinal Financial System cash balance was
       $109,795,475, and the balance available for future commitments totaled $39,586,085.
       Taking into account COF preapprovals of $20,940,000 made by the Secretary of
       Commerce and Trade, however, the available balance is $18,646,085. Generally, 40%
       of preapprovals, or $8,376,000, do not move forward, and the available balance is more
       likely approximately $27,000,000. Active grants awarded since the inception of the Fund
       total 700.

       For the second quarter of the 2024 fiscal year, ended December 31, 2023, a total of
       $14,455,000 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 1,067,
       while committed investment totaled $280.0 million. Summaries on these projects follow:




901 E. Cary Street, Suite 900
Richmond, Virginia 23219
VEDP.org
Money Committee Chair
January 24, 2024
Page 2


  1. City of Lynchburg: Framatome will expand its existing advanced nuclear energy
     facility in the City of Lynchburg. This expansion will create 515 new jobs and an
     investment of $49.4 million (amount of grant: $5,000,000; use of grant:
     recruitment and training and building upfits; other grants awarded: Enterprise
     Zone Job Creation grant of $1,308,800, Enterprise Zone Real Property
     Investment grant of $200,000; local match: $2,500,000 (partial waiver was
     granted for the remaining $2,500,000); anticipated completion date: December
     2029; average wage of new jobs: $105,109; prevailing average wage: $55,338).
     This project has been announced.

  2. Russell County: Tate, a manufacturer of raised flooring and other rigid materials,
     will locate a new facility in Russell County. This location will create 170 new jobs
     and an investment of $14.9 million (amount of grant: $700,000; use of grant:
     building upfits; other grants awarded: none; local match: $1,000,000; anticipated
     completion date: December 2027; average wage of new jobs: $52,020; prevailing
     average wage: $45,303). This project has been announced.

  3. City of Waynesboro: Northrop Grumman, a manufacturer of aerospace and
     defense-related electronics, will locate a new facility in the City of Waynesboro.
     This expansion will create 331 new jobs and an investment of $201.2 million
     (amount of grant: $8,500,000; use of grant: building upfits; other grants awarded:
     none; local match: $8,500,000; anticipated completion date: December 2028;
     average wage of new jobs: $93,942; prevailing average wage: $46,044). This
     project has been announced.

  4. Not Yet Announced.
Money Committee Chair
January 24, 2024
Page3


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 2024 fiscal year, actual disbursements from the Fund
totaling $195,250 were made to Montgomery County for Tore Robotics and the City of
Virginia Beach for Acesur.

Sincerely,



::}J2 \LSZ_.
President and Chief Executive Officer

JRE:kme

Enclosures

cc    The Honorable Caren Merrick
      Secretary of Commerce and Trade


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