By. Bryan Rothamel, Field Officer
On November 1st, 2017, Fluvanna County put the Zion Crossroads water and sewer project out to bid.
Decades of discussion have culminated in the supervisors advertising for bid the $11.9 million project.
The request for bid will be done in three parts. The pipes, the mechanical and the water tower are all in separate requests in hops of getting better bids by companies that would otherwise have to subcontract.
After the supervisors completed a series of motions, the room applauded as the long chapter of Fluvanna politics is nearing a close. The project is expected to take 18 months to construct.
Economic Development? Supervisors also initiated a rezoning process for an undisclosed business trying to relocate in the Zion Crossroads area. The project would be an investment of $8 to $10 million and bring about 40 jobs to the county. The business would be disclosed once the public hearings occur.
The property is currently zoned agricultural and is seeking an industrial zoning. The county is also working with the business to get a hookup to the aforementioned water project once water is flowing.
In other water news, after a closed meeting, the supervisors pledged $5,000 to Caroline County for proposed legal advice on fighting Aqua America’s proposed rate increases. Lake Monticello is served by Aqua. Caroline County has several subdivisions also served by Aqua, estimated at 30 percent of its population.
Caroline reached out to other home owners associations and locality governments for assistance in teaming together to fight against Aqua’s request. Caroline estimated the cost of legal advice and State Corporation Commission expert help at over $75,000.
Other presentations during the November 1st meeting included one from an official from Fluvanna Girls Softball League (FGSL). FGSL wanted the county to loan $25,000 to the private organization to field improvements at the Carysbrook field. Work included leveling the infield and outfield as well as replacing the backstop and adding an outfield fence.
The proposed loan was $25,000 paid over five years with 2 percent interest. Unfortunately, supervisors were briefed by the county attorney they have no legal authority to loan money to FGSL, a private organization. Because Carysbrook is county property, the county could construct the requested work and FGSL can voluntarily contribute to the county’s coffers.
Chris Fairchild, FGSL official, said even if the supervisors said they didn’t want to be paid back, FGSL wants to pay for the improvements. Supervisors and the parks and recreation department will work with FGSL to get work scheduled as previously planned.
Over the course of the last 15 years, FGSL has invested $168,000 in field improvements including construction of dugouts and concession stand.
Supervisors were briefed on preliminary budget projections of the Fluvanna County Public Schools system. Chuck Winkler, superintendent, is projecting a request of $2.2 million over last year’s budget.
That estimate included standards of quality changes that are partially funded by the state. He included the entire figure but noted if the state implemented, it would have a huge state budget implication. He said the likelihood of being passed was slim, but included it as a precaution.
Also in Winkler’s increase were pay raises and increase in health care costs. He also had additional money for technology improvements. He noted that if technology was funded again by Capital Improvement funds, it lowers the county’s per pupil spending.
The supervisors will next meet on November 15 at 7 p.m.
The Free Enterprise Forum’s coverage of Fluvanna County is provided by a grant from the Charlottesville Area Association of REALTORS®and by the support of readers like you.
FORUM WATCH EDITORIAL
By. Neil Williamson, President
When a new business concept is successful the first thing the government attempts to do is tax it. What is the second thing? – regulate it. In an interesting ‘Short Term Rental’ twist of fate, Albemarle has completed the first thing ensuring but is about to put those revenue sources (and others) in jeopardy by driving much of this thriving new industry out of the open and into a Black Market.
Please let me explain.
Back in June 2017, Albemarle joined many Virginia localities in updating its tax code to capture ‘transient lodging’
At its June 14, 2017 Board meeting, the Board of Supervisors amended the County Code §15-900 and §15-901 to enable the County to impose taxes on residential transient lodging, previously not included in this regulation. They also amended County Code §8-616 to explicitly list short-term rentals on the list of businesses subject to the business,professions, and occupations licensing (BPOL) tax requirements.
Albemarle County has been engaged in a “community conversation” regarding the regulation of short term rentals (AirBnB, HomeStay Charlottesville, etc.). Rather than dealing specifically with the impacts of such rentals, with ordinances already on the books, Albemarle is seeking to restrict the number of rentals any property might be able to book in any given calendar year. This is a mistake.
According to Allison Wrabel’s article in Monday’s (10/30) Daily Progress, our good friend, Travis Pietila, of the Southern Environmental Law Center (SELC) spoke out last week’ Planning Commission meeting about this very issue:
“We need to make sure that the revenue to be gained from homestays does not lead to building new houses in the rural area that would not otherwise be built, and it’s critical that the limits put in place to keep that from happening are enforceable,” he said.
Pietila said that the 90-day limit proposed for whole house rental was too high and that a 30-day limit seemed much more appropriate.
“But a more fundamental concern is that the limits based on a number of days a property can be rented would prove unenforceable,” he said.
While we firmly disagree with SELC’s position that property owners should be restricted from building new homes on parcels that have that fundamental property right, we concur that limits based on a number of days would not only prove unenforceable – it not only starts a negative domino effect on transparency and taxation – it is an unfair restriction on property rights.
Negative Domino effect – if allowed to only permitted to rent my house on a short term basis for 30 days a year, that is exactly what some savvy property owner will claim. If there is market demand for greater than 30 days a year (ie: weekend from April 15 to December 31 = 76 days), the incentive is to rent the space and not claim the rental on the TOT form, lower the BPOL payment, don’t report the rental revenue for 46 days of occupancy on state or federal income tax forms.
This scenario fits Investopedia’s definition of a Black Market:
Economic activity that takes place outside government-sanctioned channels. Black market transactions usually occur “under the table” to let participants avoid government price controls or taxes. The black market is also the venue where highly controlled substances or products such as drugs and firearms are illegally traded. Black markets can take a toll on an economy, since they are shadow markets where economic activity is not recorded and taxes are not paid. In the financial context, the biggest black market exists for currencies in nations with strict currency controls. While most consumers may shun the black market because they consider it sleazy, there may be rare occasions when they have no choice but to turn to this necessary evil.
What is gained by this charade?
More from Wrabel’s article:
Commissioner Pam Riley said she is concerned about the impact on local housing, especially as the county considers adding apartments and townhomes.
“The more you remove what could be housing units, really at any price range, from the long-term rental, you’re really exacerbating your affordability problem,” she said.
The Free Enterprise Forum finds itself again agreeing with SELC’s Pietila’s economic analysis, if not his property rights restriction on that analysis:
Pietila said officials should consider limiting whole-house rentals in the rural area to existing houses.
“This would give existing homeowners the ability to earn some extra income and help defray housing costs, while reducing the risk of encouraging new house construction,” he said.
We have seen anecdotally, the short term rental income provides the revenue needed that makes the housing ‘affordable’. If a unit (home, apartment, townhouse) has a monthly cost (mortgage/rent) of $900 a month and it is rented four weekend days at $150 a night, that generates $600 in revenue, this income helps offset housing cost. Anecdotally, we have witnessed families visit their parents for football weekends and pay their entire monthly housing cost with the revenue.
Commissioner Daphne Spain is quoted in Wrabel’s article questioning the property owner rights regarding short term rentals:
…Spain said she noticed that many comments said that people should be able to do what they want with their homes to generate income.
“I don’t give much credence to that, because if they wanted to open a brewery or a speakeasy to earn money, or a brothel, that wouldn’t be allowed, so there are limits for the public good on what a person can do with their home and these are all residential areas,” she said.
Spain’s argument is really comparing apples and oranges. Unlike a brewery (or even brothel), the use of the property is still residential – it is just a question of the length of stay in residential. How are the impacts different?
Which has more impact on me as a land owner, my neighbor renting out his house on weekends or a family with 5 teenagers moving in next door?
The reality we see from the Planning Commission is a clear anti short term rental bias. Albemarle County would be wise to focus on mitigating any impacts of short term rentals [under existing ordinances] and skip any fatally flawed attempt to strangle this thriving new business with onerous regulations that are unlikely to be followed and will be impossible to enforce.
Neil Williamson, President
By. Neil Williamson, President
This afternoon, in an alphabet soup of a joint meeting Albemarle County’s Economic Development Authority (EDA), Planning Commission (PC), and Board of Supervisors (BOS) discussed Site Readiness from a Site Selectors Prospective in an effort to focus on growing business.
Timmons Group Joe Hines presentation “Are your sites and community prospect ready?” was eye opening to many in the room. Hines suggested the locality should own or control parcels under consideration and that the locality needs to make infrastructure investment on the parcel to become most attractive in the site selection process.
Assistant County Executive Lee Catlin (in likely her last public presentation prior to retirement) used much of Hines Presentation talking points to present an overview of the Deschutes Brewing competition that Roanoke won. The discussion was very good and highlighted the areas where Roanoke was better prepared for the opportunity. (Check out @Neilswilliamson Twitter feed for more details)
In a seemingly unrelated news event, Business Insider reports on Amazon’s search for a new 2nd North American Headquarters.
The company’s press release lays out a few details of what it’s looking for: metro areas with more than one million people; a “business-friendly” environment; a strong technical workforce; be “urban or suburban locations with the potential to attract and retain strong technical talent,” and “communities that think big and creatively when considering locations and real estate options.”
Ignoring the obvious million people hurdle, how do you think Albemarle, or Charlottesville for that matter stacks up regarding “communities that think big and creatively when considering locations and real estate options”.
Considering Catlin’s presentation, one portion that was not mentioned was the “community” response to Deschutes. Over two years ago, I wrote in Da Lessons from Deschutes.
4. While the Supervisors recognize the economic reality, the public is not yet sold on the concept of increased economic development. This lack of public support is seen by outsiders as “unwelcoming” and is clearly a competitive disadvantage. As Lisa Provence reported in C-ville regarding the Planning Commission denial of the CPA, some are not convinced that economic development (AKA Growth) is a good thing:
Watching the various states and localities compete for the Amazon 2nd Headquarters, I am amazed by the deftness of their marketing and efforts to show community support:
This challenge is actually an opportunity. Notice Amazon did not say “governments” who think big and creatively. They are looking for a community that will not only welcome them but allow them to become one with them. The communities competing for HQ2 are attempting to present their community as complimentary to the creative class. Don’t think this is only in big time economic development. Roanoke’s “Hashtag” campaign was a big part of the Deschutes Decision.
Albemarle Supervisor Rick Randolph thought the presentation corrected a “myth” that Albemarle lost Deschutes – he said instead Roanoke won it. Sounds like splitting hairs to me but I still have the core question.
Is Albemarle ready to energetically embrace economic development?
Randolph said he was supportive of “smart” economic development where jobs went to Albemarle citizens and no traffic was generated – sounds like a unicorn hunt to me.
Supervisors Liz Palmer and Brad Sheffield both expressed interest in redevelopment sites.
One positive suggestion came late in the meeting from Planning Commissioner Jennie More. More thought that economic development should be a part of the community vetted Master Plan process. This might be a first step in developing the kind of community buy in that can be more than “accepting” of economic development instead can cheer for it.
This meeting was a good first step, but I remain concerned that not everyone is equally energetic about economic development and the community is clearly not yet fully engaged.
If everyone understands the net benefits of economic development and brings positive energy to support the effort, perhaps then Albemarle can be in a position to “Win”.
If not, we may want to ask if Albemarle should be (or is) in the game at all.
Neil Williamson, President
By. Bryan Rothamel, Field Officer
The Fluvanna County Board of Supervisors approved debt financing plan for Zion Crossroads water project at the April 19th meeting.
The project doesn’t have final design or numbers yet, but the possible funding source will be the Virginia Resource Authority (VRA).
The supervisors approved applying in the summer bond pool with the VRA. The application will be for $10 million, the latest estimated cost of the project. The deadline for the application is May 1.
The county should get a final design and cost in the next month. At that time, the supervisors can decide how much financing they want to use and amend the application. The county administrator recommends putting $4 million from the county’s cash balance to the project.
In regards to current county debt, the high school bonds have a window of about 100 days in the fourth quarter 2018 where $57 million can be reinvested. The county has two known options.
One option is to issue a ‘float agreement’ where the county contracts with an investment firm now at a locked in amount. The investment firm gives the county a set amount now with the hopes the firm can invest that money for a better return when the window opens.
If the county issued a float agreement right now, it is estimated it would bring in a $74,000 immediate payout. They could also ask for a specific amount and once a bid comes in at that price, accept it. The county can issue the float agreement at any time but as the window nears, firms will be less like to ‘bet’ high.
A second option is to purchase a state and local government series (SLGS) when the 100 day period occurs. The only issue is the SLGS are sometimes blocked to be purchased. Two years ago SLGS were not allowed to be purchased for most of the year.
Supervisors directed staff to ask more questions about possibilities to Raymond James, the county’s financial adviser.
At April 12th meeting, the supervisors approved the FY18 budget and tax rates on a 4-1 with Don Weaver (Cunningham District) dissenting.
The real estate tax rate is set at $0.907 per $100 assessed. The personal property stayed at $4.35 per $100. The business rates decreased in an effort to help local businesses.
Late changes to the budget included giving staff a 2 percent raise to start January 1, increasing the budget for county attorney, additional funds for the Sheriff’s Office and Earth Day hazardous waste collection. The supervisors also are using cash to purchase a new brush truck for emergency services.
More public was present at the meeting but overall the budget season had few county residents active in the process.
The supervisors will next meet on May 3 at 4 p.m. for a regular session. A work session on county projects, including the Zion Crossroads water project, is expected before the May 17 meeting.
The Free Enterprise Forum’s coverage of Fluvanna County is provided by a grant from the Charlottesville Area Association of REALTORS®and by the support of readers like you.
By. Neil Williamson, President
My first car was a yellow 1976 Ford Pinto Station Wagon (fondly referred to as the ‘Banana Boat’). Over time, I upgraded the stereo and dressed up the interior but it never really changed the fundamental fact that my teenage “ride” was a yellow Pinto Station Wagon.
This car came to mind as I watch Charlottesville consider important and proper changes to their Business Professional Occupancy License (BPOL) tax.
Please let me explain.
On March 6th, Charlottesville City Council will be considering changes to their BPOL Ordinance designed to promote fairness to mid-sized businesses. Currently, any business operating in Charlottesville is required to pay BPOL based on its gross receipts. In fiscal year 2016, the BPOL tax generated $6.9 Million dollars in revenue for the City, 4.4% of all City revenue. All 38 cities in Virginia charge BPOL. The Free Enterprise Forum believes this is an unfair tax as it is based on gross receipts and has called for it repeal.
Staff provided several examples of the challenges under the existing ordinance:
Charlottesville businesses grossing $50,000 or less per year pay a flat fee of $35 and businesses grossing more than $50,000 pay based on a rate (established in State Code and as determined by the particular type of business) multiplied by annual gross receipts.
As an example, a veterinarian grossing $49,000 per year pays $35 for an annual business license. A veterinarian grossing $51,000 per year pays according to the standard rate for veterinarians and other similar professions ($0.58/$100), and would pay a rate-based fee of $295.80.
A graphic designer grossing $49,000 per year pays $35 for an annual business license. A graphic designer grossing $51,000 per year pays according to the standard rate for graphic designers and other similar professions ($0.36/$100), and would pay a rate-based fee of $183.60. The effect is that similar small businesses with very similar gross receipts end up paying very different fee amounts.
Meanwhile in neighboring Albemarle County, businesses earning up to $100,000 pay a flat fee of $50. Therefore the business starting out (>$50,000 gross revenue) pays less in Charlottesville until they cross the $50K threshold and then they pay much more.
The Commissioner of the Revenue has reported of hearing significant concerns from taxpayers about what can be a dramatic jump in their BPOL costs as they cross the $50K gross annual threshold. It is important to recognize that $50K in gross revenue is the point where many businesses may be at the tipping point between viability and failure.
As the staff report outlines:
In an effort to attract, retain, and encourage small businesses in the City of Charlottesville, the Commissioner of the Revenue and City Treasurer are proposing a modest change to the fee structure used to assess BPOL:
- Businesses grossing $50,000 and below continue to pay $35 license fee
- Businesses grossing $50,001 to $100,000 pay a $50 license fee
- Businesses grossing over $100,000 pay the license fee based on applicable BPOL rate
This proposed change would benefit small businesses within the City of Charlottesville by reducing the license fee paid by businesses earning between $50,000 and $100,000. Staff estimates that approximately 450 businesses would benefit from this structural change. There would also be a comparable change in the technology business incentive as well. We are recommending that these changes take place for the upcoming assessment year of 2018.
The Commissioner and Treasurer would note that this is a relatively modest proposal that seeks to provide meaningful relief to small businesses in our community within limited statutory, system, and budget constraints.
These changes do not come without cost. Staff estimates adoption of this proposal would potentially reduce BPOL revenue by $93,000.
While the Free Enterprise Forum has consistently called for the REPEAL of BPOL, we are supportive of the reforms contained in the proposal. In addition, we commend the Commissioner of the Revenue and the Treasurer for thinking beyond the bean counter box and seeking reform. When properly implemented, we see these changes as leveling the playing field with adjoining localities, increasing fairness for small to mid sized businesses and promoting economic development.
We would be remiss if we did not remind the City that regardless of changing the paint job, adding new tires and a kicking new stereo, you are still driving a Pinto Station Wagon.
Yes, repeal would be better but we support these commonsensical BPOL reforms.
Photo Credits: Motorbug.com, Autospost.com
By. Neil Williamson, President
Tonight (10/24) the Albemarle County Board of Supervisors will take “public input” regarding the possible relocation of their courts system. Of the five options on the table, all but one keeps the courts in the City of Charlottesville. While the Free Enterprise Forum would like to have a favored option, we do not believe the case has been made for any option — considering how far along the process is, we are astonished at the basic questions that remain unanswered.
To review here are the five options:
OPTION 1: DOWNTOWN/LEVY EXPANSIONOPTION 2: RELOCATE COUNTY & CITY GENERAL DISTRICT COURTS TO COUNTY OFFICE BUILDING MCINTIRE
OPTION 3: RELOCATE COUNTY GENERAL DISTRICT COURTS TO COUNTY OFFICE BUILDING MCINTIRE
OPTION 4: RELOCATE COUNTY GENERAL DISTRICT COURTS & CIRCUIT COURTS TO COUNTY OFFICE BUILDING MCINTIREOPTION 5: RELOCATE COUNTY GENERAL DISTRICT & CIRCUIT COURTS TO COUNTY SITE
As we examine the decision matrix provided by the county, we have many more questions than answers.
Here are our top ten inquiries:
- Has the city offered any economic incentives to support any of the City based options? (see last week’s blog post)
- Why does option 1 (stay downtown) cost $12,500,000 more than building in option 5?
- Why does it cost $18,000,000 to put the General District Court at the County office building when it appears that most of the infrastructure is already there?
- If you build a new county admin facility, where will it be located and, how much does it cost? Where is that cost shown?
- Do options 2-5 factor in the lost property tax revenue for whatever parcel is acquired?
- The matrix seems to indicate that options 2-5 strongly support the County’s strategic redevelopment/urban place making priorities. Doesn’t that really depend on where the County offices are built and how? It could eat up a bunch of property in the urban area and create little long term value.
- Will option 5 allow a mix of uses on their site? What of creating affordable housing over top of the new county offices?
- It seems that you are assuming any new construction by the County in the County has high economic development value. Why? What assumptions have been made to draw that conclusion?
- Is taking urban county property off the tax rolls good for economic development? Will the development area be expanded to replace this lost land?
- Why is the construction risk higher for option 1 than any of the other options?
The public input offered can only be as good as the information provided to them to base that input. We forwarded these questions to Albemarle County early last week and they indicated they hoped to have answers in their presentation tonight. If that is the case, the public will have limited time to process the information before the public input session closes.
Regardless, these questions need answers before anyone should make a decision on the future location of the court.
The jury is not “still out” — the full argument has yet to be presented.
Neil Williamson, President
Neil Williamson is the President of The Free Enterprise Forum, a public policy organization covering the City of Charlottesville as well as Albemarle, Greene, Fluvanna, Louisa and Nelson County. For more information visit the website http://www.freeenterpriseforum.org
Photo Credits: Albemarle County
This article first appeared in the August 21, 2016 Daily Progress
By Neil Williamson
Imagine being in the banana business — and you have no way to obtain fruit.
That is Albemarle County’s current economic development sales position: “Yes, we have no bananas.”
“If a manufacturer calls interested in locating near a highway, we tell them, ‘We have nothing for you,’. Prospect businesses are looking to move within three to six months if they are not looking to build. We tell them, ‘We have no product ready to go today.’” – Faith McClintic, Albemarle County’s economic development director
The “product” Albemarle is lacking is available, properly zoned land. McClintic’s comments to a joint meeting of Albemarle Board of Supervisors, Planning Commission and Economic Development Authority paint a very dark picture for Albemarle County’s economic future.
During the Fiscal Year 2017 budget cycle, the county budget summary stated:
“Other communities for a larger commercial tax base have been able to keep their real property tax rates more stable over the past several years.”
Despite the great recession, other Virginia localities with more vibrant business sectors have not been forced to raise property taxes to balances their budgets.
Currently 80 percent of Albemarle’s local tax revenue is from property taxes; only 20 percent is from business taxes. Other communities are closer to a 70/30 ratio.
If there was one lesson the community learned from losing the Deschutes Brewery opportunity (regardless of whether we were ever really in the game), it was that this community is ill prepared for the very economic development that the Comprehensive Plan envisions.
But it doesn’t have to be that way.
Over the years, Albemarle has spent millions of dollars setting aside parkland and open space to make sure nothing happens on selected properties. Isn’t it time Albemarle invests in making something happen in economic development?
Solving Albemarle’s economic development problem is not about the Planning Commission and Board of Supervisors holding a plethora of focus groups and multiple public work sessions to determine the types of jobs (and salaries) they would like to see. The elected and appointed bodies should instead focus on what they do control: the regulatory environment (planning, zoning and procedures).
Albemarle does not have enough land properly located and zoned for new business development or business expansion. The fundamental problem is that Albemarle’s Comprehensive Plan map and zoning maps do not agree.
Absent new land for development, Albemarle’s annual projected property tax increases are only just beginning. As the tax rates grow, businesses will stop expanding here, choosing instead more business-friendly (and lower-tax-burdensome) localities. Fleeing commercial tax revenue exacerbates the situation, further increasing reliance on the property taxes.
There is a simple answer: Make more.
The two ways to “make more” are to expand the development areas (currently around 5 percent of land mass) and/or proactively rezoning development area land.
Proactive rezoning is when a locality (with owner consent) takes the initiative and rezones land to match its Comprehensive Plan designation. In practice, this makes it easier to develop to the uses and the specific densities expressed in the community-vetted Comprehensive Plan. Since the locality is the applicant, misnamed “voluntary” proffers are eliminated.
Community involvement and education are key in any proactive rezoning. The idea that the community can weigh in on the concept of the rezoning rather than seeking specific site-plan information for a potential applicant keeps the discussion on the macro rather than micro level.
Political will and an understanding of development desires are required for proactive rezoning to be successful. Such rezoning can’t be significantly restricted by onerous form-based zoning codes.
Albemarle has proactively rezoned one region, the Downtown Crozet District (DCD). Due to the highly restrictive form-based code that accompanied this proactive rezoning, thus far only one new private businesses has located in the DCD zone.
The Free Enterprise Forum believes strongly in property rights; therefore, the concept of owner consent to any proactive rezoning is critical. Such consent can easily be established with an opt-out provision prior to the final zoning change enactment.
If a countywide, comprehensive, proactive rezoning is not possible, perhaps Albemarle can look at those areas it has already determined to be the so-called “priority” development areas and start there. Pantops and the new Berkmar Extended both seem ripe for consideration.
Development area expansion
Due to the political work in Richmond of those who came before us, Albemarle has Interstate 64 cutting through the county. Later political activity produced the 1979 development area boundaries (approximately 5 percent for development, approximately 95 to remain rural). Because of the 1979 decision (and little adjustment to it), Albemarle County is woefully behind other communities in land designated for growth.
Based on new environmental restrictions (protecting stream buffers, preserving slopes) and the creation of Biscuit Run State Park (where development once had been approved), the 5 percent land mass of the development areas has been shrinking for more than a decade.
Let’s face it: 1979 had a number of bad ideas (pet rocks, disco, Ford Pinto, etc.). It is far past time to reconsider this nonsensical notion about growth and, at a minimum, open economic development near interchanges to both commercial and industrial opportunities.
Expecting less than 5 percent of your land mass to generate enough positive business revenue to pay for increasing service demands from residents is not feasible. Albemarle will never catch up to its so-called “peer” communities if it does not dedicate, designate and zone more land to jobs.
Fractured board vision
A secondary but equally important problem is a lack of unity within a one-party-dominated Board of Supervisors regarding economic development goals. While Chairman Liz Palmer has stated that her desire for new business is to increase tax revenue, White Hall Supervisor Ann Mallek is concerned about the lack of job opportunities for the 440 families in her district living below self-sustainability (according to the Charlottesville Regional Chamber of Commerce’s Orange Dot Report).
Planning Commission Chairman Tim Keller raised the idea of seeking jobs that paid enough for residents to afford homes costing $600,000-plus. Such price points generate “breakeven” property taxes [when the taxes generated equal the cost of services demanded]. He questioned the fiscal responsibility of seeking to grow lower-paying jobs.
Supervisor Rick Randolph took exception to the concept of looking toward advanced manufacturing as the job sector on which to focus. Charlottesville Tomorrow quoted Randolph as saying:
“I am feeling a disconnect [regarding] the need for manufacturing, when what we really need to focus on is the underemployment situation. I am looking at a target sector for employment that is missing our biggest need.”
Over the past five years working with the Central Virginia Partnership for Economic Development, Albemarle has identified and focused on four target industry sectors for growing and expanding business [ bioscience and medical devices, business and financial services, information technology/defense and security, and agribusiness].
Despite this concerted effort, the results have not followed. The most recent job statistics indicate a loss of 324 jobs in those segments that have been their focus. It does not take a rocket scientist to see that either we need to realign the targets or rework the opportunities we are presenting to the targets.
The Free Enterprise Forum appreciates all of these different perspectives on the types of jobs needed, but we continue to believe all the navel-gazing in the world will not promote a new paradigm in Albemarle where land is readily available and businesses are welcomed by the community rather than being seen as a threat to our way of life.
Who will champion the Albemarle Board of Supervisors coming together to lead the charge for improving the business climate?
Until significant changes are made in the county government’s staff culture and development structure (initiating proactive zoning, expanded development areas, and streamlined approval process, etc.), Albemarle will continue to lose new job opportunities, as well as losing existing businesses that chose to move to more welcoming localities.
When a new or existing business calls the county wanting to expand Albemarle’s employment opportunities and the business tax base, there should be a better answer than “Yes, we have no bananas.”
Neil Williamson is president of the Free Enterprise Forum, a privately funded non-profit public policy organization focused on local governments in Central Virginia. For more information visit freeenterpriseforum.org.
E-mail received Wednesday July 27th:
“Last evening (7/26), under New Business (after your departure) the planning commissioners briefly discussed your comments under “matters from the public.” We wonder if you might expand on your thoughts in a 1-3 page “discussion piece” for our review, reflection and comment at a future meeting.
J. Timothy Keller – At-Large Commissioner and Chair
Albemarle Co. Planning Commission
By. Neil Williamson, President Free Enterprise Forum
For a LONG TIME, Albemarle County has been institutionally aloof regarding business prospects. The consensus thinking had been ‘of course they want to come here, they are lucky we’re even considering letting them in’. Virginia’s economic development office only reluctantly sent prospects to Albemarle based on this attitude and the lack of inventory available. Many neighboring localities benefited from this posture as they positioned themselves as “Not Albemarle”.
According to some, this philosophical position has changed, we are still waiting to see “the New Day in Albemarle”. Like it or not, economic development is a competitive effort. The question is not only does Albemarle want to compete – the question is does Albemarle want to win?
Citizens are beginning to recognize the need for commercial and light industrial economic development that could increase revenue and relieve tax pressure on Albemarle County land owners. Staff to is recognizing the need as some have taken to comparing economic development decisions to getting a child to eat vegetables, it is no longer ‘do you want vegetables’ the question is ‘peas or carrots?’.
As part of Albemarle County’s Economic Development Strategic Planning, the Free Enterprise Forum believes the Planning Commission is uniquely qualified to assist in identifying and reducing the regulatory barriers to development while preserving the public input to the process.
In her presentation, Economic Development Director Faith McClintic identified Regulation & Development Review Time as one of the four County influences of cost components. As “Time is money”, the Planning Commission should consider several steps to reducing the time required for a prospect business to gain the necessary approvals to build or lease space and be open for business.
We believe the Planning Commission should focus on this charge rather than determining which type of job or income level we should be targeting. By focusing on improving the process, you make Albemarle more welcoming to ALL jobs.
Idea #1 Proactive Rezoning – The community vetted Comprehensive Plan map and the Zoning maps do not agree. If the Planning Commission simply did a County wide adjustment to the maps, with owner consent and proper public input, you could increase the inventory of properly designated land AND remove an unproductive 1.5 years from an applicant approval process. Such a public process might include a public education component regarding business taxes reducing pressure on property taxes.
To be successful the proactive rezoning must allow for development to occur. When Albemarle created the Downtown Crozet District with a proactive rezoning it added a burdensome layer of design guidelines that precluded almost all private investment in the district (only 1 business is now using the DCD zoning- and they almost could not).
Idea #2 Expand the development areas
Albemarle County is woefully behind other communities in land designated for growth. Based on the new environmental restrictions (stream buffers, preserved slopes) and the Creation of Biscuit Run State Park.
Expecting 5% of your land mass to generate enough positive business revenue to pay for citizen service demands, is not feasible. Absent new land for light industrial development, Albemarle’s projected property tax increases are only just beginning. As the tax rates grow, businesses will stop expanding here, choosing instead more business friendly (and lower tax burdensome) localities.
Albemarle will never catch up to its so called “peer” communities if it does not dedicate, designate and zone more land to jobs.
Idea #2.5 Removing highway interchange zoning restrictions.
Starting with the end in mind, Albemarle County should have land available to meet the Comprehensive Plan’s Economic Development goal of a varied and vibrant job base. According to McClintic, if a prospect business contacts her office seeking to have highway access, she must tell them she has nothing to offer.
Due to political work of those who came before us, Albemarle has Interstate 64 cutting through the County. In 1979, when the development area boundaries were created, Albemarle made a decision not to maximize this highway frontage. Let’s face it 1979 had a number of bad ideas (pet rocks, disco, Ford Pinto etc.) it is time to reconsider this nonsensical notion and open economic development near interchanges to both commercial and industrial opportunities.
As an aside, this issue continues to be discussed in the community. Just last week, the Albemarle County Farm Bureau passed a resolution in support of this concept.
Idea #3 Streamline Approval Process – One need only look to the Development Review Task Force, Development Initiative Steering Committee (DISC), DISCII (AKA Son of DISC) to see specific proposals to streamline operations that have not been instituted.
The level of detail required at the rezoning stage is ridiculous. Albemarle should return to the “bubble map” methodology which focuses on the use not the design of the project. This would significantly reduce the staff time to process applications and the applicant cost of reengineered drawings for multiple iterations.
Idea #3.5 Eliminate Mandated Community Meetings-Holding such meetings in the prescribed county fashion adds unnecessary red tape and time costs. Such meetings should be voluntary for applicants and those who hold them will tend to have a competitive advantage when their proposal comes forward. These meetings have become unelected screening devices that limit the quality and density of proposals that move forward to the Planning Commission.
Idea #4 Consider Municipal investment in an Industrial Park – Albemarle County has dedicated a significant portion of its development area to open space (parks, easements, stream buffers, etc.) that positively impacts the “Quality of Life” but generates zero tax revenue. An argument could be made that investing in an industrial park where local jobs could grow would be at least as valuable as paying a landowner not to develop their development area property.
Idea #5 Remove Development Area Building Height Restrictions If Albemarle wishes to develop a true urban core with significant population and business density, the current height limitations should be repealed. Allow the market (rather than government) dictate height requirements.
Idea #6 Metrics, Metrics, Metrics The Free Enterprise Forum believes people pay attention to those things that are measured. We recommend the Planning Commission and Board of Supervisors receive quarterly reports that contain the following:
- what is the success rate for NMD projects?
- How much commercial absorption is happening each year? If we achieve no real commercial, then aren’t these just overcomplicated residential projects?
- What’s the Review time per project?
- What’s the tax revenue impact per project?
- What is the cumulative tax revenue impact of commercial development?
- New Commercial SF construction/yr
- New Industrial/Flex SF construction/yr
- Residential build-out of higher profile areas or projects (e.g., Crozet, HTC, Belvedere, Liberty Hall, Spring Hill, Riverside Village, Old Trail)
As stated previously, the Free Enterprise Forum believes the Planning Commission is in the best position to identify and eliminate regulatory barriers. Such action will require courage and faith. Many of these types of decisions will require the Planning Commission NOT to weigh in rather to grant approval administratively. While we recognize this may be a new concept for many commissioners we believe not weighing in may actually generate more of the type of development the Comprehensive Plan envisions.
Thank you for the opportunity to provide more than three minutes of thoughts on this issue.
Neil Williamson, President, Free Enterprise Forum
FORUM WATCH EDITORIAL
By. Neil Williamson, President
Much like turning an aircraft carrier, Albemarle County Economic Development Strategic Planning Process is very slowly moving forward while some involved are busy paddling in very different directions. The reality is there is not only a need to change direction, there is a dire need for the crew to work together to change the many adverse elements surrounding the ship.
Last night’s (7/26) joint meeting of the Board of Supervisors, the Planning Commission and the Economic Development Authority showcases how each member of this crew has a different perspective on not only the current reality but also regarding the eventual destination of this cruise.
Albemarle Economic Development Director, Faith McClintic shared a couple of stunning facts regarding how the county must respond to business inquiries (including expansion of existing businesses):
If a manufacturer calls interested in locating near a highway they tell them “we have nothing for you”
Prospect businesses are looking to move within 3 – 6 months if they are not looking to build. We have no product “ready to go today”
Several members of the joint meeting questioned some of the statistics presented and suggested the focus of the economic development strategic plan might be redirected. Board of Supervisors Chair Liz Palmer mentioned that she thought this process was about bringing more business into the county to generate new tax revenue.
Planning Commission Chair Tim Keller also raised the concept of the types of jobs the plan was seeking to target suggesting the breakeven point [when the taxes = the services demand] for residential is $600K+ questions if we should be seeking to grow lower pay jobs.
Supervisor Ann Mallek took a different approach highlighting that the Charlottesville Regional Chamber of Commerce Orange Dot report identified her district as having 440 families lack basic self-sufficiency. She is thinking of them when she is thinking about economic vitality.
Supervisor Rick Randolph took exception to the concept of looking toward advanced manufacturing as the sector focus. Aaron Richardson of Charlottesville Tomorrow reports:
Of those in the workforce, the report showed, more than 26 percent of Albemarle residents hold some form of advanced degree, but only 7.8 percent of available jobs require more than a bachelor’s degree.
Those numbers, said Supervisor Rick Randolph, do not support staff’s assertion about the need for more manufacturing jobs.
“I am feeling a disconnect between the need for manufacturing, when what we really need to focus on is the underemployment situation,” he said. “I am looking at a target sector for employment that is missing our biggest need.”
Over the last five years, Albemarle has been focused on several target business sectors for growing and expanding business. The numbers indicate they have actually lost 324 jobs in those segments that have been the focus. We agree based on these results a re-tuning of the targets may be appropriate.
The Free Enterprise Forum appreciates all of these different perspectives on the types of jobs needed but we continue to believe all the navel gazing in the world will not promote a new Albemarle paradigm where land is readily available and businesses are welcomed by the community rather than being seen as a threat to their way of life.
Until significant structural (proactive zoning, streamline approval process, etc.) and cultural changes are made Albemarle will continue to lose new job opportunities and existing businesses who chose to locate in localities who have embraced the prospect of new business.
Absent such changes Albemarle’s Economic Development Program will not be compared to a well coordinated warship but more to the S.S. Minnow of Gilligan’s Island fame.
Neil Williamson, President
Photo Credit: United Artist Television
By. Neil Williamson, President
Adapted from comments made to The Albemarle County Planning Commission and Board of Supervisors April 19, 2016
Tonight, at your request, you have heard three presentations regarding local government’s role in economic development.
- Planners want to “Create Centers for Livability and Economic Development”.
- Piedmont Virginia Community College (PVCC) explained their plans to address transitioning workforce needs
- Albemarle’s own Director of Economic Development, Faith McClintic, described Economic Eco-systems as more than just buildings.
What purpose does the Planning Commission have investigating the topic of Economic Development?
In what world, should the appointed planning commission, which is advisory to the Board of Supervisors on land use matters, be examining how we train the workforce – don’t we have an elected school board, and 4 members on the PVCC Board for this function.
Perhaps rather than having staff spend time preparing a PowerPoint about how they think “Centers for Livability and Economic Development” should be designed, perhaps they could be directed to proactively remove overly prescriptive zoning regulations that make it illegal to park customer cars in front of a business. Current code philosophy is we don’t mind your business it’s your customers that are the problem (relegated parking).
Rather than asking what you can do to help PVCC train our workforce or helping the Economic Development Director to focus on the right businesses to come to Albemarle County, the Planning Commission (and Board of Supervisors) should DO THEIR JOB and focus on removing unnecessary regulatory barriers and streamlining the time (and money) consuming approval processes that doom many economic development projects before they even start.
Over the last four years, we have seen the accountability factor for our elected officials obfuscated by Citizen Councils and Planning Commission actions. We continue to believe these unelected bodies have too much power in the approval process and should be disbanded. Why not streamline the approval process for any project that already agrees with the community vetted Comprehensive Plan and send those proposals directly to the Board of Supervisors for action.
We have heard several horror stories of projects where businesses have walked away from Albemarle County after calculating the time and expense required to see an application from start to finish.
The Free Enterprise Forum understands it is human nature to want to do “something” about a perceived problem. Perhaps the best way to examine the problem is to recognize your role in the problem and heal thyself.
The best way for Albemarle County to increase economic development is to follow rule number 1 and get out of the way.
Neil Williamson is the President of The Free Enterprise Forum, a public policy organization covering the City of Charlottesville as well as Albemarle, Greene, Fluvanna, Louisa and Nelson County. For more information visit the website www.freeenterpriseforum.org
Photo Credits: Albemarle County, Free Enterprise Forum, Getty Images