June 6, 2022 - 2:00 pm - County Board of Commissioners Meeting Minutes (Special)

10 820 Meeting of the Johnston County Board of Commissioners June 6 , 2022 Special Meeting The Johnston County Board of Commissioners met in special joint session Monday , June 6 , 2022 at 2 00 pm with the Selma Town Council at the Selma Civic Center located at 300 North Webb Street , Selma , North Carolina The following members of the Board of Commissioners were present Present Chairman RS “ Butch ” Lawter , Jr , Vice Chairman Patrick E Harris , Ted G Godwin , Fred J Smith , Jr , Richard D Braswell , and April Stephens Absent Commissioner Tony Braswell Also Present County Manager Rick J Hester , Clerk to the Board Paula G Woodard , County Attorney Jennifer J Slusser , and Executive Assistant Deputy Clerk to the Board Dana Cuddington Selma Mayor Byron McAllister welcomed everyone to the special meeting Vice Chairman Patrick E Harris gave the invocation and the Board of Commissioners and Selma Town Council jointly led those in attendance in the Pledge of Allegiance to the American Flag Chairman RS “ Butch ” Lawter , Jr called the meeting of the Johnston County Board of Commissioners to order at 2 00 pm Selma Mayor Byron McAllister called the Selma Town Council meeting to order Chairman Lawter opened the County’s public hearing for the purposes of allowing public comment on a proposed economic development incentive grant Mayor McAllister opened the Town’s public hearing Johnston County Economic Development Director Chris Johnson stated in 2021 , Johnston County was fortunate to have several project announcements that totaled well over 400 million and created thousands of jobs He stated for 2022 , Johnston County is poised to potentially meet and exceed this figure and the communities along the Interstate 95 corridor are and will continue to be a major focus for the State of North Carolina Mr Johnson reported that because of the hard work and visionary actions of the Selma Town Council and the Board of County Commissioners , as well as many others who are in attendance , today it is Selma’s turn to shine Mr Johnson thanked the Board of Commissioners for their pro - business leadership that makes these opportunities possible Mr Johnson stated today’s project announcement allows the County to continue with job growth allowing the County residents the opportunity to have high paying jobs here at home Mr Johnson explained that Do Good Foods proposes to invest more than 100 million in a new production facility in the newly constructed 135,000 square foot Class A facility located at Eastfield Business Park in Selma Mr Johnson provided the Board with a background on Do Good Foods stating they are a revolutionary climate forward company that upcycles surplus grocery food into nutrient - dense animal feed He continued that Do Good Foods has created a closed - loop system with state - of - the - art infrastructure designed to upcycle surplus grocery food after community donations occur into nutritious animal feed He stated in addition to the over 100 million investment , the operation will create approximately 100 jobs with wages averaging nearly 60,000 per year which is more than double of the reported 2019 median household income for residents of the Town of Selma Mr Johnson stated as is customary this project and investment projections have been evaluated by Dr Mike Walden , Retired Professor and Economist from North Carolina State University whose report shows that the monetary investment as well as the jobs and ancillary job growth is projected to be over 73 million annually for the Town of Selma and Johnston County Mr Johnson stated the economic development incentive grant offer comes with no risk to the taxpayers in that the incentives only come from the company’s investment He noted the grant would equate to a percentage of the taxes Do Good Foods , or its subsidiary , pays on the new investment and if required benchmarks set forth in the agreement are not met no incentive is given Mr Johnson noted as with all economic development incentive grants , this proposal has been vetted and recommended for approval by the Johnston County Economic Development Advisory Board Mr Johnson concluded his remarks by stating the proposal is consistent with North Carolina General Statutes and he requested the Board of County Commissioners and Selma Town Council to consider approval of the economic development incentive grant Mr Johnson introduced Chris Sawitsky , Senior Vice President of Engineering with Do Good Foods and invited him to make a few remarks Mr Sawitsky thanked the Board of Commissioners and the Selma Town Council for considering the economic development incentive grant noting the project was competitive and they are very appreciative of the proposed incentive opportunity Page821 June 6 , 2022 – Special Meeting Continued County Attorney Jennifer Slusser presented for the Board’s consideration a proposed resolution and accompanying economic development incentive grant agreement for the project proposed by Do Good Foods and described by Mr Johnson Ms Slusser reminded the Board of the factors to be considered when reviewing incentive grant opportunities , which include job creation , capital investment , competition , and diversifying the economy Ms Slusser reviewed with the Board the framework of the proposed agreement with Do Good Foods stating the required performance commitments include a 385 million capital investment to develop and construct a new grocery surplus upcycling facility for manufacturing animal feed in the Eastfield Development located in the Town of Selma She stated the employment commitment for this project is solid at 90 permanent full - time job positions for employees working on the project site with an average salary of not less than 63,500 with benefits Ms Slusser noted the capital investment is estimated to be completed by December 2023 and the job creation completed by 2024 Ms Slusser continued that the incentive proposal is a cash grant to be made in seven annual payments beginning March 15 , 2024 and continuing through March 15 , 2030 , which are quantified and measured as 50 of the ad valorem taxes paid on eligible investments She stated in this case , the eligible investments are business personal property improvements during the investment period Ms Slusser stated in order to provide flexibility to Do Good Foods , at its election , it may delay the start of grant payments by one year to begin the grant payments in 2025 through 2031 ; however , in no case will Do Good Foods receive more than seven annual grant payments She stated if incentives are granted Do Good Foods must provide certification of investments and employment Ms Slusser explained that grant payments are conditioned upon Do Good Foods paying in full its ad valorem tax bills for that year for all of its property situated in the County and subject to ad valorem taxation She stated additional conditions include Do Good Foods remaining current on all payments owed to County , remaining current on the filing of annual property tax listings , and having no current appeals pending regarding the valuation of the property at the project site She stated Do Good Foods must also not be in violation of any other obligation to the County including all county ordinances and regulations Ms Slusser stated there are recapture provisions in the proposed agreement if Do Good Foods does not carry out and maintain the terms of the agreement Ms Slusser presented the following factors the Board is required to consider for the proposal ? Job creation Does the project provide the creation of a substantial number of permanent jobs In this case , there will be a direct creation of not less than 90 jobs with an average salary of 63,500 According to the Economic Impact Analysis by Mike Walden the private sector direct and indirect job creation as a result of the investment is 264 new jobs ? Capital Investment - Increasing the tax base Does the project increase the tax base The required capital investment is 385 million but it is anticipated to be more According to the Walden Report the private sector annual operating impact , taking into account all direct , indirect , and induced impacts from the development , is estimated to be in excess of 73 million ? An initial “ but for ” or necessity determination is made that the incentive is required for a project to go forward , typically in a competitive situation In this case , Johnston County was competing with several locations ? The proposed project meets the County’s incentive policies for this type project The EDIGA meets the policies for the programs as more particularly described earlier ? Final approval is made at a public meeting , properly noticed ? A written agreement governs implementation ? Diversifying the economy Diversification of the economy alongside job creation and increasing the tax base as an indicator of “ net public benefit ” arising from an incentive “ Diversification of the economy ” refers to significant impacts on sectors of the economy or making a location attractive for additional development This is addressed in the Walden Report An end user that will bring jobs to the County meets this purpose Ms Slusser advised that this project meets all the above - referenced criteria should the Board choose to approve it and she offered to answer any questions Attorney Marcus Burrell with Hewett Law Group , representing the Town of Selma , reviewed the Town’s proposed incentive grant with the Selma Town Council Chairman Lawter asked if there were any citizens present who wished to comment on the incentive proposal by Johnston County Mayor McAllister asked if there were any citizens present who wished to comment on the incentive proposal by the Town of Selma Page822 June 6 , 2022 – Special Meeting Continued Jeffrey Hamilton , Selma Business Owner , asked if the company is obligated to stay in Selma after the seven year grant period is completed County Attorney Jennifer Slusser advised that the commitment is for a seven year period and the investment must be in full for that seven years in Johnston County in order for the company to receive the incentive There being no further public comments , Chairman Lawter closed the County’s public hearing Mayor McAllister closed the Town’s Public Hearing Commissioner Ted G Godwin moved the Board adopt the following resolution to enter into an economic development incentive grant agreement with Do Good Foods Vice Chairman Patrick E Harris seconded the motion which carried by unanimous vote RESOLUTION OF THE JOHNSTON COUNTY BOARD OF COMMISSIONERS AUTHORIZING INCENTIVES FOR ECONOMIC DEVELOPMENT WHEREAS , the County seeks to promote economic growth and development within its jurisdiction and the social and economic improvement of its citizens , and desires to accelerate the quality and quantity of economic growth and employment opportunities in its jurisdiction by encouraging business enterprises satisfying the aforementioned public purposes and thereby reduce physical , economic and social distress resulting from unemployment and under employments existing in its jurisdiction ; WHEREAS , the Economic Development Partnership of North Carolina the “ Partnership ” and the County are in discussions to induce Do Good Foods of Selma LLC to locate a new grocery surplus upcycling facility for manufacturing animal feed the “ Facility ” on the parcel located at 101 East Providence Boulevard , in or near the Town of Selma in Johnston County , North Carolina and shown as NC Pin 261400 - 73 - 9709 and Tax Parcel ID 12M11019GM the “ Project Site ” ; WHEREAS , an economic impact review containing a fiscal analysis of the proposed Facility on the Project Site prepared for the Johnston County Economic Development Commission in June 2022 indicates that at full buildout the proposed project would result in a substantial increase in direct property tax revenues for the County and the direct and indirect creation of a substantial number of new jobs ; WHEREAS , the County has presented the Company with various incentives in order to induce the Company’s commitment to locate the Facility on the Project Site in Johnston County ; WHEREAS , North Carolina General Statute 158 - 71 a authorizes the County to make appropriations for economic development purposes which will increase the population , taxable property , employment , industrial output or business prospects of the County ; WHEREAS , the Board has determined that granting incentives the “ Incentives ” to the Company in exchange for the commitment of the Company to locate , develop and build out the Facility on the Project Site in Johnston County would be beneficial to the County’s efforts to increase economic opportunities for its residents , its population , ad valorem tax revenues and sales tax revenues , and enhance and improve business prospects in general , including the creation of a substantial number of jobs above the County’s average annual salary ; WHEREAS , the Board has received and reviewed a proposed Economic Development Incentive Agreement between the County and the Company the “ Agreement ” providing for the County’s granting the Incentives to the Company in consideration of the Company’s commitments set forth in the Agreement ; and WHEREAS , the Board has , pursuant to the notice and hearing requirements of North Carolina General Statute 158 - 71 , held a public hearing to consider whether to grant the Incentives in exchange for the commitment of the Company to locate and operate the Facility on the Project Site in Johnston County NOW THEREFORE , the Board 1 Determines and concludes a that granting the Incentives in exchange for the commitment of the Company to proceed with the development and buildout of the Facility on the Project Site would be beneficial to the County’s efforts to increase overall economic opportunities for , and improve the general welfare of , its residents and increase its population , ad valorem tax revenues , sales tax revenues and business prospects in general and result in the creation of a number of new well -Page823 June 6 , 2022 – Special Meeting Continued paying jobs in the County , and b that the benefits described above accruing to the County will outweigh the cost of the Incentives granted hereunder , creating a net public benefit ; 2 In consideration for the commitment by the Company to proceed with the development and buildout of the Facility on the Project Site in accordance with the terms set forth in Agreement , authorizes the Chairman of the Board and , alternatively , the County Manager , subject to compliance with any pre - audit requirements under the Local Government Budget and Fiscal Control Act , to enter into and execute the Agreement and any other necessary documents , on behalf of the County for the County to grant Incentives on terms not materially inconsistent with the Agreement as set forth on Exhibit A , attached hereto and incorporated herein by reference or with revisions as the County Manager , in consultation with the County Attorney , shall find to be not materially inconsistent with the form of the Agreement attached hereto and the intent and purpose thereof ; 3 The Agreement shall be construed as a continuing contract in accordance with North Carolina General Statutes § 153A - 13 ; 4 The Agreement is contingent on the Town of Selma authorizing incentives for economic development for the Facility at the Project Site Adopted this the 6th day of June , 2022 The Selma Town Council took action on their respective economic development incentive proposal The Board of Commissioners and Selma Town Council formally welcomed Do Good Foods to Johnston County There being no further business , the Chairman declared the Board of County Commissioners meeting adjourned at 2 30 pm RS “ Butch ” Lawter , Jr , Chairman Paula G Woodard , Clerk to the BoardPage