Council likely to drop enterprise zone rules

FRONT ROYAL – Town leaders might have jumped the gun when they backed rules for an enterprise zone last week.

Now Town Council plans to kill the proposed incentives for development in the former Avtex Fibers site. Council members on Monday agreed to bring up the ordinance next week to vote down the proposal. The decision came after council discussed the ordinance that members adopted on a first reading July 13 following a public hearing.

An enterprise zone, if approved by the state and adopted by ordinance in the town, would give new businesses incentives to build in the designated area, through discounts on utility connection fees and taxes. Council needed to adopt the ordinance on a second reading to set the regulations. Councilwoman Bébhinn Egger had asked after the hearing that the ordinance include more protections for the town in case a business takes advantage of the incentives and then leaves before Front Royal can receive any long-term benefit from the commercial investment.

Town Attorney Doug Napier presented an update to council Monday of the proposed ordinance that would base the incentives on the investment, job creation and other criteria, through a tiered approach. The more jobs created or money invested in the project, the greater the discounts on fees or tax breaks, under the proposed ordinance.

Councilman Eugene Tewalt argued that council couldn’t adopt the ordinance on second reading with Napier’s changes. Rather, council would need to nullify the ordinance and start from scratch as well as hold another public hearing on the new version. Tewalt said the proposal before council Monday was the opposite of what members passed last week.

Mayor Timothy Darr suggested that Town Manager Steve Burke and Napier discuss the proposed ordinance and the tiered, incentive program with members of the Front Royal-Warren County Economic Development Authority and hear their input. Darr said he would support the tiered approach.

“It’s a way to bring in additional business but also I think everyone on council’s concern was we also need to protect ourselves and make sure it’s not a way to be taken advantage of by businesses as well,” Darr said. “But I also think that before we get into that discussion we need to make sure that whatever we’re doing kinda is in play with what the EDA’s thinking about or considering.”

Local business owners Mike McCool and Craig Laird have voiced concerns about the ordinance as proposed to council. McCool told council during the discussion Monday that the proposed discounts on utility connection fees were negligible, but some members disagreed.

The town had an enterprise zone in the area of the Avtex site until the state removed the designation. Council did adopt a resolution July 13 indicating the town’s desire to create an enterprise zone and make the application. All the effort to restore the zone might be for naught if the state doesn’t grant the request. EDA Executive Director Jennifer McDonald advised council that the town’s chances of receiving the designation are slim.

At one point, council talked about postponing the second reading on the ordinance until the state announces the results of the town’s application.

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