IDA Meeting- October 23, 2018

Shenandoah County Industrial Development Authority

Meeting Minutes:  October 23, 2018



Chairman Poling called the meeting of the IDA to order at 4:00 pm.  Mr. Vass provided a roll call with the following members present:  Mr. Blake Phillips, Vice Chairman Jay Winkfield, Mr. James Zerkel, Mr. Eddie Litten, Mr. Ted Rhea and Mr. Rex Morrison.  Others in attendance included:  Mr. Richard Walker, District 3 Board of Supervisors, Mr. Max Thornberry, Northern Virginia Daily, Ms. Jenna French, Director of Tourism and Economic Development, Mr. Jason J. Ham, IDA attorney and Mr. Evan Vass, Assistant County Administrator and IDA Secretary/Treasurer.


Chairman Poling called for an approval of the October 23, 2018 meeting agenda.  Mr. Litten made a motion, seconded by Mr. Morrison to approve the agenda as presented.  Mr. Ham requested that the IDA consider two amendments to the agenda:  the inclusion of two additional items under new business identified as #3 depository trust letter associated with the massanutten manor bond and #4 setting an IDA meeting for November 27th.   Mr.  Litten amended his motion per Mr. Ham’s comments with Mr. Morrison seconding the amended motion.  The agenda was approved by a unanimous voice vote.


Chairman Poling called for an approval of the October 1 IDA meeting minutes.  Mr. Zerkel made a motion, seconded by Mr. Rhea to approve the minutes as presented.  The minutes were approved by a unanimous voice vote.


Chairman Poling noted the next item on the agenda was a public hearing for a proposed multi-family housing revenue bond for the benefit of massanutten manor preservation LP.  Chairman Poling opened the public hearing at 4:05 pm.  Mr. Ham introduced the subject of the public hearing which included the issuance of tax exempt bonds by a private company for the acquisition and renovation of 116 low income residential units of massanutten manor in Strasburg. Chairman Poling asked if there was any member of the public that wished to speak to the matter.  There were no public comments.  Chairman Poling closed the public hearing at 4:06 pm.


Chairman Poling identified the next agenda item which was the financial report.  Ms. French reviewed revenues and expenditures for the month of September 2018.  Ms. French noted that per prior IDA approval, a certificate of deposit associated with the rural business enterprise grant (RBEG) had been made with city national for 14 months bearing a 2.3% interest rate.  Mr. Phillips asked about the RBEG CD maturing in January 2019 and questioned if IDA should begin the process of considering options related to this CD.  Mr. Rhea stated that the IDA should look for short term certificates to take advantage of increasing interest rates and to be prepared to utilize the RBEG funds for small business loans.  It was the consensus of the IDA membership to delay action on this particular CD acknowledging that the IDA would meet again before its maturity in January 2019.  Mr. Litten made a motion, seconded by Mr. Morrison to accept the financial report.  The motion was approved by a unanimous voice vote.


The following item on the agenda was the appointment of signatories on checking account and CD’s.  Mr. Harrison Nicholson former county finance director and IDA treasurer was still identified as a signatory on IDA documents.  Chairman Poling noted that Mr. Vass was appointed IDA treasurer at the previous meeting.  Vice Chairman Winkfield made a motion, seconded by Mr. Phillips to remove Mr. Nicholson and add Mr. Vass as a signatory on IDA checking accounts and CDs. The motion was approved by a unanimous voice vote.


Chairman Poling identified the first item of old business which was the bond application for massanutten manor.  Mr. Ham noted there would be two resolutions associated with this agenda item.  He reviewed the agenda item remarking that the bond provided up to $10 million in tax exempt financing for a private company to both acquire and rehabilitate 116 low income housing units of massanutten manor in Strasburg.   Mr. Rhea asked for conformation that the IDA’s role in this transaction was to allow these tax exempt bonds to pass through the IDA and that it did not obligate the IDA financially.  Mr. Ham confirmed Mr. Rhea’s assessment.   Mr. Morrison, seconded by Vice Chairman Winkfield made a motion to approve the inducement resolution for Massanutten Manor. The motion was approved by a unanimous roll call vote.


The second resolution was associated with a revised bond application.  Mr. Ham explained that the current application needed to be updated to revise and increase the IDA fee associated with such transactions, but also to modify the application to insure the IDA was protected, including: clarification on timing of bond closings to prevent conflict with Shenandoah County’s bank qualified tax exempt financing needs, to ensure publication and IDA counsel fees were paid by the applicant, and other matters.  Discussion ensued on the fee structure.  Mr. Ham stated that included in the agenda packet was a review of other local IDA fee structures.  He suggested that the fees charged by IDA were lower than other area IDA’s, particularly for those “in county” applicants.  Mr. Ham had suggested for discussion purposes a $1,000 application fee with an administrative fee of one tenth of one percent of the outstanding balance of the bond annually not to exceed $3,000.  Discussion ensued.  Mr. Litten made a motion, seconded by Mr. Morrison to establish an application fee of $2,500 with an annual fee of one tenth of one percent with a maximum of $5,000.  The motion was approved on a unanimous roll call vote.


The third item under old business was the Rural Business Enterprise Grant (RBEG) revised application.  Ms. French stated she had incorporated all the revisions from previous discussions with the IDA.  She noted that demographic information collected with the application was required by the office of rural development, US department of agriculture.  She added that Mr. Ham had reviewed the revised application in his capacity as IDA attorney.   With no further discussion Mr. Phillips, seconded by Mr. Litten made a motion to adopt the revisions to the RBEG application.  The motion was approved by a unanimous voice vote.


The fourth item of old business was an update on the division of the Northern Shenandoah Industrial Park: NSIP Lot 1A.  Ms. French remarked that Draper Aden Associates (DAA) had provided a quote of $9,000 to complete the subdivision of the property.  DAA acknowledged that the work could be completed for less and Ms. French noted her intent to seek other quotes.  She suggested that any subdivision work be delayed until after a meeting with the prospects seeking to potentially purchase the property had taken place.  Ms. French also noted that the DAA geophysical team had returned to the IDA owned properties in the Northern Shenandoah Industrial Park to finalize their evaluation.


The fifth item of old business was an update on lot 1C.  Ms. French said her comments related to Lot 1A were relevant to 1C.


The sixth and final item of old business was Lot 123A Right of Way.  Ms. French stated that there appeared to be no record of any signatories to the right of way between the IDA and Town of Strasburg dedicating a right of way to access property north of Lot 123A.  Ms. French noted that she could not locate minutes from a meeting where the action took place. Chairman Poling noted he may have the minutes and believed the IDA meeting in which the approval to grant the subject right of way was in November 2015.  Ms. French reviewed significant challenges with any right of way resulting in a crossing of CSX rail road tracks.


The first and second items of new business was the economic development strategic plan.  Ms. French stated that the county intended to embark on a strategic plan to provide direction to staff, policy leaders, developers, etc related to economic development within Shenandoah County.  To that end the county budget had included an appropriation of money to complete the plan and the county had also applied for a grant with the Virginia Department of Agriculture and Consumer Services (VDACS) to help fund a portion of the plan.  The amount anticipated from VDACS was less than originally conceived.  Ms. French suggested that the IDA may be a financial partner in some capacity to complete the plan.  She noted that an RFP had been issued and that eight firms had responded.  She also requested, regardless of IDA financial participation that a member of the IDA be appointed to select the consulting firm.  Mr. Rhea asked where the consultants were from and suggested they needed to understand Shenandoah County’s needs. Chairman Poling noted he had been through a process with an economic development plan with the Town of Strasburg in the last several years and that although the selected firm was based in New York the planning process if done well addresses local issues.  Mr. Vass suggested that perhaps the IDA should receive the RFP which was issued so that members knew what was being asked for in the scope of services.  After a brief discussion Vice Chairman Winkfield, seconded by Mr. Morrison made a motion to appoint IDA member Blake Phillips to this purpose.  The motion was approved on a unanimous voice vote.


The third item of new business was the depository trust letter.  Mr. Ham explained how this letter agreement was related to the Massanutten Manor and any other bond issuance.  Mr. Phillips, seconded by Vice Chairman Winkfield made a motion to approve the depository trust company letter agreement.  The motion was approved by a unanimous voice vote.


The fourth and final item of new business was the establishment of an IDA meeting on November 27th, 2018.  The consensus of the IDA was to hold a meeting at 3:30 pm.


The next item of business was the Director’s comments.  Chairman Poling remarked on the recent installation of infrastructure by Columbia Gas.


The final item of business identified on the agenda were staff comments.  Ms. French noted that the sign at the Northern Shenandoah Industrial Park had been updated to reflect new county contact information.


Chairman Poling asked if there being no other business for a motion to adjourn.  Mr. Litten, seconded by Mr. Rhea made a motion to adjourn.  The motion was approved by a unanimous voice vote.


The meeting was adjourned at 4:50 pm.




Respectfully submitted,


Evan Vass, IDA Secretary/Treasurer


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