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Posted April 25, 2013 | comments Leave a comment

Shenandoah eyes regional push for economic boost

By Alex Bridges

Critics of Shenandoah County's leaders say the government doesn't do enough to promote economic development.

Foes of higher tax rates claim the county does not promote economic development. They argue that without more, higher-paying jobs the county can't expect to see more revenue from taxes. As a result the county relies too heavily on residents who pay taxes on homes and vehicles, opponents contend.

Funding earmarked in county budgets for such efforts backs those claims. But a section in the budget doesn't give the whole picture, officials point out. Likewise, officials say a regional approach may benefit the county more so than trying to attract new business and industry on its own.

Shenandoah County spent $103,880 on economic development in fiscal 2011 -- $55,139 for personnel and $48,741 for other expenses. That total amount fell to $87,474 in fiscal 2012 and the county has spent $72,796 this fiscal period on economic development, as indicated in a separate section of the budget.

Up until September 2012, the budget covered a part-time salary for former County Administrator Vincent Poling who acted as the economic development director. But the county has recently shifted those duties to Community Development Director Brandon Davis, whose office also oversees planning and zoning and building inspections - each of which has its own budgets separate from economic development.

The fiscal 2014 budget approved by the Board of Supervisors on Tuesday includes $1.01 million for community development. But that budget section includes money not only for economic development but also $367,768 for planning and zoning, $184,790 for tourism, $237,475 for the Soil and Water Conservation District, $150,671 for the Virginia Tech Cooperative Extension Service and $1,300 for the gypsy moth control program. The county increased funding for planning and zoning, tourism and the conservation district.

The budget calls for the county to spend $72,353 on economic development next year. Nearly half that amount pays for the county's membership with the Shenandoah Valley Partnership located in Harrisonburg. Shenandoah County is the northernmost jurisdiction included in the organization's membership that stretches east and south.

Davis stated in an email this week that a regional approach to attracting industries like that of the partnership works better because prospective businesses don't worry about jurisdictional boundaries.

"They choose their general expansion area based on their specific target market and individualized needs," Davis stated. "The regional partnership offers a vehicle for site selectors to communicate with one individual that represents much of a company's targeted area. By our participation in the SVP, we keep our community 'in the hunt' for prospective projects."

The county would need to spend much more money than its pays in dues to set up a marketing campaign as robust as the partnership's, Davis explained.

Communities in the partnership work together until time to compete for those prospects, Davis added. Also, economic development in a neighboring jurisdiction can benefit Shenandoah County, Davis stated.

Shenandoah Valley Partnership recently changed the formula used to calculate membership dues on a per capita basis, said Chief Executive Officer Don "Robin" Sullenberger this week.

"We are basically, first and foremost, a marketing organization, so we are marketing the region for economic development projects," Sullenberger said. "We do that much more effectively on a collaborative basis in terms of trying to market the entire region. Economic development has, in recent years, become very much a regionally driven game and so pooling our resources gives us more leverage in doing that."

The partnership's recent efforts helped existing businesses expand rather than attracted new enterprises, Sullenberger said. More than 90 percent of the region's growth in recent years came from the expansion of existing industry, he noted. The partnership coordinates its efforts with the businesses and the state for both workforce and economic development.

The organization recently sent Davis to a seminar in Colorado where he met and interacted with site selectors from around the country, Sullenberger said.

"These are the people who drive the process in today's world in terms of locating new projects," Sullenberger recalled. "So he got an opportunity to interview some of the leading site selectors in the country and he was representing the entire Shenandoah Valley, but obviously if he's there from Shenandoah County he has the opportunity to speak about the specific opportunities within his jurisdiction."

The downturn in the economy hurt the region especially along the Interstate 81 corridor, Sullenberger noted. But Shenandoah County could see economic development prospects in the future, he added.

"We consider Shenandoah County a very strong business location and particularly because of logistics a well-positioned one in terms of location," Sullenberger said.

The organization's chief acknowledged that funding economic development can pose a challenge for local leaders.

"In particularly rural jurisdictions, balancing the use of public funds is a challenge and we all know that," Sullenberger said.

Shenandoah County paid the partnership $23,278 in fiscal 2011 and 2012 and budgeted the same amount in the current period. But the entity increased the county's dues by $8,406 or more than 36 percent for next fiscal year. The county budgeted $31,586 to remain a member of the partnership. Davis states in the budget request that the per capita increases over the next several years will be required of the members to maintain competitiveness.

Even with the large increase in dues to the partnership, the county still plans to spend slightly less on economic development next fiscal year.

The county's economic development budget includes $520 to pay membership dues to the town chambers of commerce, the Shenandoah Valley Technology Council and the Virginia Economic Development Association.

The county also plans to spend $18,000 for "support of existing industry" that goes to the Winchester Regional Airport, the Lord Fairfax Small Business Development Center and Shen-Paco Industries. Another $2,500 is budgeted to support visits by new industries.

Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or abridges@nvdaily.com

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