GARNER — Town officials can begin to revitalize the former ConAgra factory because it was designated a brownfield site Sept. 16.
The move is “one of the last big straws before (the town) begins marketing the site” to potential industrial clients, said economic development director Tony Beasley.
But the town will not rush to sell the property, Beasley said. It will deliberately and methodically market the site to recruit companies that will maximize utility of the former Slim Jim factory, which is 99 percent demolished.
“We could have unloaded the property quickly but it wouldn’t have generated the money, jobs and tax revenue,” Beasley said.
Beasley said that while he hopes the town can find a buyer sooner, he said three to five years would be a realistic expectation.
The town has specifically targeted the bio-tech industry as well as high-tech manufacturing. It also hopes for a property investment (and corresponding tax value) comparable to the original ConAgra plant.
Beasley said the site presents a number of advantages to employers, and said the town would offer various incentive packages on top of the tax breaks offered by the state’s brownfield laws, given high enough levels of investment and job creation.
A brownfield site has a threat of environmental contamination that hinders redevelopment. A 1997 law allows the state Department of Environment and Natural Resources to work with developers on such sites. The developer agrees to make the property usable again, while the department limits liability on contamination risk. Tax incentives come with the package. The idea is to fix up industrial sites rather than build on new areas, minimizing the amount of land impacted by industry.
ConAgra decontaminated the soil on the site, but groundwater will remain unusable after contamination from an industrial cleaning agent that proves difficult to remove.
After the 2009 explosion, the town lost $55 million from its tax base, worth more than a quarter-million dollars per year in tax revenue. The property was given by ConAgra to the town, along with a $2.5 million gift, when the company decided to shut down its Garner operation after the explosion.
The value of the primary tract of land bordered by I-40, Jones Sausage Road and East Garner Middle School is now listed by Wake County at $2.58 million, plus $835,416 in building value.
Beasley includes among advantages of the site: its size, the 20-minute drive to the airport, proximity to Raleigh, and pending development of hotel, retail and restaurant space in a growing White Oak Crossing area nearby. He also said he thinks the area could soon end up with “Class A,” or high-rent multi-story, commercial office space as its commercial and industrial base grows.
Beasley said the exact incentive package has not been determined; the town is putting together marketing materials and a spreadsheet to show developers the possible savings.
“The first five years averages out about 50 percent (reduction in property taxes),” Beasley said. “In essence he’s lowered his loan payments for the first five years. So that’s the reason we’re looking at trying to create some examples so all that would show up.”
The brownfield tax exclusion moves from 90 percent gradually to 10 percent. Beasley said that for the right company the town would likely throw in comparable reductions during the next five years after the brownfield breaks end, extending property tax breaks out a full decade. Beasley also said “you can get the land for almost nothing” and that already-existing breaks could also be found in water and sewer fees.
While the town’s potential offerings may seem like a lot to give, Beasley said that enticing a company to build something in the neighborhood of $75 million worth of real property would still produce more tax revenue – not to mention more and better jobs to town – than simply offering the land to the highest bidder.
As of now, the town isn’t collecting any tax revenue.
“You might be getting 50 percent (of possible property taxes) when you’d get zero if no one re-developed it,” Beasley said.
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