Submitted by Susan Hardee Steger
May 4, 2016 6:59 a.m.
Members of the Nassau County Board of Commissioners (BOCC) gathered for an early morning workshop to continue discussion on the LignoTech Florida project under an Economic Development Grant Program (EDG). LignoTech Florida is proposing to invest 110 million dollars in a facility to be built adjacent to the Rayonier Advanced Material plant on Gum Street in Fernandina Beach that will bring to the community 50 or more jobs.
A Qualified Target Incentive based on the number of jobs created by LignoTech squeaked by on a 3 – 2 vote in March with Commissioners Kelley and Spicer voting against despite an 80% state match ($360,00) and 10% match of ($45,000) from the City of Fernandina Beach.
County Attorney Mike Mullin reviewed the 2012 BOCC ordinance which established the Economic Development Grant Program and outlined the process which begins with the Nassau Economic Development Board’s (NCEDB) review and recommendation for the grant award. “Upfront performance measures must be met and maintained by the applicant for the entire period of grant eligibility,” said Mullins. The EDG program is a “fairly standard model around the State of Florida.
Today the NCEDB will recommend to its board to bring before the BOCC a 75% grant refund of ad valorem tax in years 1 – 5 and 50% reduction on years 6 – 10 on ad valorem taxes. That recommendation will be presented to the BOCC for approval at a future meeting.
Property Tax Appraiser, Mike Hickox prepared a presentation with projections for tax revenue from the LignoTech project. Graphs show the Nassau County School Board and the City of Fernandina Beach will receive the most revenue. (See Graph Below)
Commissioner Danny Leeper voiced his support for the incentives noting the county is receiving $2,500 in ad volorem taxes today and in 2018 will receive $105,000 even with incentives. Leeper spoke to the additional benefits of jobs, more jobs coming to support the industry, and the environmental benefit. “This is a common sense . . .”
Board Chairman Walter J. “Junior” Boatright noted the county’s desire to diversify its tax base from heavy reliance on residential advolem taxes toward industrial. Using the average taxable value on homes in Nassau County ($150,000), Boatright said, “It takes 100 new homes that require more county services to equal the $105,000 coming from LignoTech.
Commissioner Steve Kelley asked to slow the process so the county could prepare a cost benefit analysis. He also wondered if a 75% tax incentive is a good fit. Ted Selby, county manager said the facility will be located in Fernandina Beach so city services will be provided and costs required of the county will be very limited. The $105,000 revenue is more than enough to cover any expenses.
Laura DeBello, executive director of the NCEDB in response to a request for comment after the meeting said, “I fully support the thorough due diligence given to the tax payer dollars being considered but I must reinforce that this is a self-generating incentive, meaning, the tax dollars in question are those that are being generated by this new business coming to the area, and only a portion of the new taxes being generated are granted back to the business entity over the course of the economic development grant program. All of the taxing authorities outside of the Board of County Commissioners portion will receive 100% of their share, which is yet another benefit to the local community.”
This is the third time the BOCC has approved an Economic Development Grant. In 2013, VyStar received a 5 year grant for expansion of an existing business based on 11 new jobs with average wages excluding benefits of $29,182 and a 4.3 million dollar investment.
A five year grant was given to DaySpring Village in 2015 an approved 5 – 0 by Commissioners, Boatright, Edwards, Leeper, Kelley, Spicer, based on 85 new jobs averaging $20,320 excluding benefits and a 4.74 million dollar investment. LignoTech Florida is the first EDG in the new business category. Estimates are for 50- 60 new jobs with salaries averaging $50,000 and a planned 110 million dollar investment.
A decision from the BOCC is expected soon.
