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240528 Joint Meeting City of Randleman Project JK-88 May 28, 2024 - Special Joint Meeting with the Randleman City Council for Project JK-88 The Randolph County Board of Commissioners met in special session at 11:00 a.m. at the Randleman City Council Chambers, 105 W Naomi St. Randleman, NC. Chairman Darrell Frye, Vice-Chairman David Allen, Commissioner Kenny Kidd, Commissioner Maxton McDowell, and Commissioner Hope Haywood were present. Also present were County Manager Zeb Holden, Assistant County Manager/Finance Officer Will Massie, Assistant County Manager William Johnson, Associate County Attorney Aimee Scotton, Paralegal Lauren Hughes, and Clerk to the Board Dana Crisco. Present for the Randleman City Council were Mayor Gary Betts, Sr., Mayor Pro-Tem Michael Dawkins, Alderwoman Melissa Blalock, Alderwoman Nancy Henderson, Alderwoman Kimmy Williams, and Alderman Steve Grooms. Also present for Randleman were Attorney Bob Wilhoit, Finance Officer Elizabeth Sechriest, and Interim City Manager Shain Sexton. Present from the Randolph County Economic Development Corporation was Crystal Gettys, Business Recruitment Director. Chairman Frye opened the meeting for the County and explained the reason for the meeting. Mayor Betts then opened the meeting for the City of Randleman. Crystal Gettys, Randolph County Economic Development Corporation Business Recruitment Director was introduced. Ms. Gettys said Project JK-88 is Ross Stores, Inc. Ross Stores has plans to construct their ninth distribution hub in Randleman, NC upon formal approval of local and state incentives. Ross Stores, Inc. is a publicly traded multinational company employing over 100,000 people. The company has a significant industrial portfolio and strong internal real estate experience with over 60 million square feet of real estate owning 30% of their properties. Upon state and local incentive approvals, Ross will construct a 1.7 million square foot distribution center located on approximately 330 acres at the interchange of 1-74 and US Hwy. 311 in Randleman, NC. The company's investment in real and personal property is estimated at $450 million with the creation of 852 new jobs earning annual wages that meet or exceed the average county wages. The EDC is proposing a total local incentive package of approximately $38,636,000 over a period of fifteen years to be split between Randolph County in the amount of approximately $17,095,000 and the City of Randleman in the amount of approximately $21,541,000 and shall not exceed 70% of the real and personal property taxes paid by the Company to the County and City over the fifteen-year term. Payments will be made over a fifteen-year period beginning January 1, 2029. As a result of the company's investment Randolph County will retain approximately $7,325,940 in property tax over fifteen years, the City of Randleman will retain approximately $9,229,385 in property tax over the fifteen-year period. In addition to local incentives, Ross qualifies for more than $11 million in various state grants and training funds to include a Job Development Investment Grant (JDIG). The company is also receiving funding support from the General Assembly and NCDOT for project related road improvements. 5/28/24 The EDC believes that Ross will be a tremendous asset to the community and will increase the value of the property, generate significant investment in real and personal property and provide 852 job opportunities. Therefore, the EDC requests that the city and county approve the resolution offering approximately $38.6 million in cash grants over a fifteen-year period to Ross Stores, Inc. Public Hearing Chairman Frye opened the Public Hearing for the County and closed it after everyone who wished to speak had done so and Mayor Betts did the same for the City. Brian Hall, Samet Corporation, spoke in favor of the project. He said he had worked with Crystal and Ross Stores to get this project to come to fruition. He thanked the County and City for their cooperation. On motion of Haywood, seconded by McDowell, the Board voted 5-0 to adopt the Resolution to Enter Into an Economic Development Incentives Contract with JK-88 and a Resolution Authorizing Conveyance of Real Property to JK-88 for Economic Development, as follows: RESOLUTION AUTHORIZING THE COUNTY OF RANDOLPH TO ENTER INTO AN ECONOMIC DEVELOPMENT INCENTIVES CONTRACT WHEREAS, Section 158-7.1 of the North Carolina General Statutes authorizes a county to undertake an economic development project by extending assistance to a company in order to cause the company to locate or expand its operations within the county; and WHEREAS, the Board of Commissioners of Randolph County has held a public hearing to consider whether to participate in an economic development project that will result in the County of Randolph (the “County”), the City of Randleman (the “City”), and an unnamed corporation (the “Company”) approving an economic development incentives package whereby the County and the City contribute a total expenditure of approximately thirty-eight million six hundred thirty-six thousand and no/100 dollars ($38,636,000.00) over a period of fifteen (15) years to the Company to offset the costs of the Company’s location to the City of Randleman, Randolph County, North Carolina; and WHEREAS, upon the completion by the Company of this expansion project, the Company will have generated new value/investment in personal property, machinery and equipment associated with the project in an amount equal to or in excess of four- hundred fifty million and no/100 dollars ($450,000,000.00), and created eight-hundred fifty-two (852) new full-time jobs in the County and City; and WHEREAS, this economic development project will stimulate and stabilize the local economy, promote business in the County and City, and result in the creation of a significant number of jobs in the County and City; and WHEREAS, the County has in its General Fund available revenues sufficient to fund this economic development project. NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of th Randolph County, this 28 day of May, 2024, as follows: 5/28/24 Section 1. The County is authorized to make incentive payments to the Company, said expenditures estimated to total approximately seventeen million ninety-five thousand and no/100 dollars ($17,095,000.00) of County funds for the Company’s economic development project. This estimate is based upon the current plans of the Company as submitted to the Randolph County Economic Development Corporation. The total amount of incentive payments may be less or more than this estimate and shall be measured as provided in Section 2 below. Section 2. The appropriation outlined in Section 1 above will be paid to or on behalf of the Company pursuant to a performance-based incentive contract. In addition to the standard terms found in contracts that the County routinely executes in the ordinary course of business, the economic development incentives contract entered into by and between the County, the City, and the Company must contain the following essential terms and conditions: a. The total payment made to or on behalf of the Company under this contract shall not exceed seventy percent (70%) of the real and personal property taxes paid by the Company to the County over the fifteen (15) year term referred to in paragraph b. b. Payments shall be made over a period of fifteen (15) years beginning January 1, 2029. c. The amount of each payment from the County shall be measured by and equal to seventy percent (70%) of the real and personal property taxes paid to the County by Company in the previous calendar year. The amount of each payment from the City shall be measured by and equal to seventy percent (70%) of the real and personal property taxes paid to the City by Company in the previous calendar year. d. The contract amount will be paid in fifteen (15) installments at a frequency not to exceed one installment per fiscal year (July 1-June 30). The obligation of the County and the City to make any installment payments specified herein shall be conditioned upon the satisfactory completion by the Company of certain performance requirements to be set out in detail in the economic development incentives contract but shall include, at a minimum, the following: i. The Company must deliver to the City and the County written certification that the Company has invested a sum equal to or in excess of four-hundred fifty million and no/100 dollars ($450,000,000.00) in locating its facility in Randleman, North Carolina. ii. The Company must provide to the County and the City Employment Security Reports evidencing the creation of eight hundred fifty-two (852) new full-time jobs. e. The contract must provide the County and the City with a means of recouping a portion of the contract amount if the Company fails to maintain its level of operations in the County and City at the same level that existed at the time of the fifteenth and final installment payment for a period of five (5) years immediately following the date on which the said final installment of the contract amount is paid to the Company. 5/28/24 f. If the Company does not remain in full operation during this five (5) year period, a portion of the incentive money must be returned. The amount to be returned shall be determined by a formula specified in the economic development incentives contract. Any amounts returned by the company in this manner shall be divided on a pro rata basis between the County and the City. Section 3. The Chairman of the Randolph County Board of Commissioners is hereby authorized to execute on behalf of the County of Randolph a contract drafted in accordance with Section 2 of this resolution and any other documents necessary for the implementation of this economic development project. Section 4. Participation in this economic development project by the County is expressly contingent upon participation in this economic development project by the City. And RESOLUTION AUTHORIZING THE CONVEYANCE OF REAL PROPERTY FOR ECONOMIC DEVELOPMENT WHEREAS, North Carolina General Statute 158-7.1 authorizes a county to undertake an economic development project by conveying property to a company in order to cause the company to locate or expand its operations within that county; and WHEREAS, Randolph County (“County”), is the owner of two parcels of property (collectively, the “Property”) more particularly described as lots identified by Property Tax Identification Numbers 7745856329 and 7745960060, and obtained by the County by Deed recorded at Deed Book 2845 Page 999 of the Randolph County Registry; and WHEREAS, the entirety of the Property is located in Randolph County; and WHEREAS, the Company desires to locate a processing facility on the Property (the “Project”); and WHEREAS, the County and the Company have engaged in negotiations for the conveyance of the Property to the end that the Company may construct the Project on the Property, and have reached tentative agreement on the terms for the conveyance; and WHEREAS, the County finds that in order to aid and encourage the Company to locate, develop, and construct the Project in the County, it is necessary and desirable to offer conveyance of the Property as provided herein; and WHEREAS, the Board of Commissioners of Randolph County has held a public hearing to consider whether to approve the conveyance of the Property to the Company. NOW, THEREFORE, BE IT RESOLVED by the Board of Commissioners of th Randolph County this 28 day of May, 2024: 1. The conveyance of the Property to the Company will stimulate the local economy, promote business and result in the creation of a substantial number of jobs in Randolph County that pay at or above the median average hourly wage in the County. According to the most-recent publications of the North Carolina Department of Commerce Labor and Economic Analysis Division, the median 5/28/24 average wage in Randolph County is forty-five thousand eight hundred and one and no/100 dollars ($45,801.00). The probable average hourly wage at the facility to be constructed by the Company is twenty-two and 02/100 dollars ($22.02), and the average wage to be paid by the Company is forty-five thousand eight hundred and six and no/100 dollars ($45,806.00) which is above the current median average wage in the County. The determination of the probable average hourly wage at the facility is based upon information provided to Randolph County Economic Development Business Recruitment Director Crystal Gettys by the Company; and 2. The fair market value of the Property is one million fifty thousand and no/100 dollars ($1,050,000.00). This determination of fair market value is based upon the recent sale of the Property to Randolph County; and 3. As consideration for the conveyance of the Property, the Company will contractually agree to construct and equip facilities on the Property with an investment by the Company of at least four hundred fifty million ($450,000,000.00). At the County’s current tax rate, said facilities will generate real and personal property tax revenues over the next ten (10) years in an amount at least sufficient to return to the County the fair market value of the Property; and 4. The Chairman of the Board of Commissioners is authorized to execute a land conveyance agreement in accordance with this resolution and the necessary documents to convey the Property to the Company; and 5. The documents executed in the conveyance of the Property shall include provisions that contractually obligate the Company to construct, within 5 years, the improvements and investments at the Property that will generate the tax revenues taken into account in arriving at the consideration as described in paragraph (3) above and providing for the reconveyance of the Property to the County if the Company fails to make these improvements. Adjournment At 11:32 a.m., on motion of Allen, seconded by McDowell, the Board voted 5-0 to adjourn the meeting. ________________________________ ________________________________ Darrell Frye, Chairman David Allen ________________________________ _________________________________ Kenny Kidd Maxton McDowell ________________________________ _________________________________ Hope Haywood Dana Crisco, Clerk to the Board 5/28/24