some see a field. we see a megasite. we see an...

NC MEGASITES DRAFTA CATALYST FOR ECONOMIC RECOVERY IN THE PIEDMONT TRIAD REGION

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SOME SEE A FIELD.

WE SEE A MEGASITE. WE SEE AN AUTOMOTIVE MANUFACTURING FACILITY. WE SEE THOUSANDS OF NEW JOBS. WE SEE ECONOMIC RECOVERY.


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A recent report by PriceWaterhouseCoopers identifies seven factors influencing a manufacturing resurgence which may last beyond a cyclical recovery. Rising labor costs in Asia are often cited, but transportation and energy costs are also on the rise. Strategies to protect supply chain integrity and national export initiatives are all pointing toward new investments in manufacturing facilities in the United States.

North Carolina enjoys a strong and positive reputation for manufacturing and productivity, providing us a strategic marketing position as companies plan for new US facilities. A small portion of these future projects will require very large, shovel-ready industrial land – “mega sites”. The timing of the site evaluation process will require that the sites have already been vetted, that community support for this type of project is in place, and that the site is largely under control. While Virginia and South Carolina can identify two or three such sites, North Carolina does not currently have a ‘megasite’ in the market. In order to

compete for these large, transformational manufacturing projects – an automotive manufacturing facility, for example – NC needs one or more megasites in the mix.

The PTP has established NC Megasites, LLC as the non-profit entity that will receive and distribute funds for the purpose of developing and marketing megasites in central North Carolina. We have spent nearly two years evaluating potential sites and building community support and partnerships. The PTP and its private-sector partners have spent more than $400,000 on these efforts, and have gained commitments from local governments for an additional $15 million to achieve the goal of pre-certifying three sites in central North Carolina for major manufacturing projects.

NC Megasites, LLC needs the support and partnership of the State of North Carolina. Funds appropriated by the General Assembly this year are available for transformational

industrial product development. The State’s investment will leverage the public and private funds committed to control, pre-certify and market three promising industrial ‘megasites’ in Central North Carolina. This proposal serves as a formal request to the State of North Carolina for $4,972,750 to NC Megasites, LLC, an investment in the continued economic prosperity of North Carolina.

OUR PROPOSALAS THE ECONOMIES OF OUR STATE AND NATION CONTINUE TO IMPROVE, THE MANUFACTURING SECTOR SHOWS PROMISE, EVEN SIGNS OF ‘RENAISSANCE’.

The PTP and its private sector partners have spent two years and $400,000 to pre-certify three sites. They have also gained commitments from local governments for an additional $15 million to achieve this goal.

ORGANIZATIONAL FUND FLOW

Davidson County Chatham County Greensboro/Liberty

NC Megasites, LLC

NC Department of Commerce


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The Piedmont Triad region was hit hard by the Great Recession. The economic downturn began over a decade ago as textiles and traditional manufacturing declined significantly or moved overseas, along with thousands of jobs. Between 2000 and 2010, the Triad region lost nearly 90,000 jobs — the equivalent of every business in Research Triangle Park shutting its doors or all the businesses in downtown Charlotte moving elsewhere. This shocking statistic has been somewhat underplayed because it occurred as a relatively slow leak until the global recession let the air out of the economy.

The traditional manufacturing sector was hit especially hard. Piedmont Triad manufacturing lost over half its jobs from 1994 to 2010. What had been historically strong industry sectors — the veritable foundations of the Piedmont Triad regional economy — suffered job losses at a sickening pace. Thomasville Furniture, Hanes, Burlington Industries, Cone Mills and Guilford Mills, these once mighty manufacturers headquartered in the Triad shed jobs and assets as they battled the impact of global trade and the pressures of the recession. And the fact is, the vast majority of these lower-skill manufacturing jobs are simply not coming back. This is the unambiguous context in which the Piedmont Triad region exists today.

STATE OF THE REGION EMPLOYMENT CHANGE BY NC PARTNERSHIP REGION (2000-2010) Source: NCDOC Divison Of Employment Security

BETWEEN 2000 AND 2010, THE TRIAD REGION LOST NEARLY 90,000 JOBS — THE EQUIVALENT OF EVERY BUSINESS IN RESEARCH TRIANGLE PARK SHUTTING ITS DOORS OR ALL THE BUSINESSES IN DOWNTOWN CHARLOTTE MOVING ELSEWHERE.

-90,000 -60,000 -30,000 0 30,000 60,000

Advantage West

Charlotte Region

Eastern Region

Northest Region

Southeast Region

Piedmont Triad

Research Triangle

North Carolina

∆ 10 yr

∆ 5 yr

∆ 1 yr

Northeast Region


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Given our serious economic condition, the traditional ‘regional marketing’ tactics will not be sufficient. We need to establish new economic engines to replace the ones we lost. Because the job losses here were gradual and dispersed, there was no one economic event which triggered a re-set of the regional strategies. But we can now see, in these historical data, the decimation of the manufacturing industry in the region. The

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Given the serious economic conditions, traditional ‘regional marketing’ tactics are not sufficient to regain the levels of prosperity of the recent past. The Piedmont Triad region needs to establish new economic engines to replace the ones lost. Because the job losses were gradual and dispersed, there was no one economic event which triggered a re-set of the regional strategies. But these historical data illustrate the decimation of the manufacturing industry in the region. The supporting infrastructure: training programs, logistics and transportation systems, a skilled and production-oriented workforce, is still in place and can be leveraged as a competitive advantage with a new platform of competitive assets in the region.

Typical business recruitment and attraction strategies will bring only marginal improvements to employment, wage levels, and quality of life. It is laudable when companies make commitments to add 200 or 400 jobs in expanded facilities, but this rate of growth cannot overcome the employment deficits that this state and region have seen.

This effort will require new priorities which deliver big results, fast. This will ensure the region’s economy continues on solid ground. These marginal announcements and increases will come, but there must also be projects which can catalyze an improved competitive position for the region and state. These ‘game changers’ will reposition the region and its economy as an engine for the entire state.

This ‘game changer’ strategy is required to pull the region out of the jobs deficit and prepare for long-term prosperity. This strategy will result in direct and indirect jobs numbering in the thousands and will bring the region back to a healthy level of employment.

PIEDMONT TRIAD JOB TRENDS (MANUFACTURING)

IT IS LAUDABLE WHEN COMPANIES MAKE COMMITMENTS TO ADD 200 OR 400 JOBS

IN EXPANDED FACILITIES, BUT THIS RATE OF GROWTH CANNOT OVERCOME THE

EMPLOYMENT DEFICITS. WE MUST IDENTIFY PRIORITIES THAT CAN DELIVER BIG

RESULTS, FAST.


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PIEDMONT TRIAD MANUFACTURING JOB SHIFTS 1990-2010


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North Carolina and the Piedmont Triad certainly have the fundamentals to make this happen. The region is known as a very attractive and affordable place to live and work, in a state that consistently ranks among the top places to do business.

Back in 2010, the PTP identified industrial site readiness as a potential ‘game changer’. The region has many business and industrial parks, but lacks a very large developable tract that could be marketed as a ‘mega-site’. There were possibilities, but none had been advanced to the point of control, where a live economic development prospect could evaluate it for a new investment. A comprehensive search through central North Carolina has identified three sites which deserve further due diligence. We have studied the selections by Toyota, Volkswagen, BMW and others located in the southeast to understand what such a site involves, what companies require, as well as the resulting economic impact. UNCG economist Dr. Donald Jud estimates that a mid-size auto manufacturer could attract approximately 5,000 jobs and contribute over $700 million to the regional economy.

With economic prosperity as the common goal, the State and regional leaders will work as a unified force toward to position central North Carolina for 21st century jobs.

UNCG ECONOMIST DR. DONALD JUD ESTIMATES THAT A LARGE AUTO MANUFACTURER COULD ATTRACT APPROXIMATELY 5,000 JOBS AND CONTRIBUTE OVER $700 MILLION TO THE REGIONAL ECONOMY.

ESTIMATED IMPACTS FROM A MID-SIZED AUTOMOTIVE ASSEMBLY PLANT Source: Dr. G. Donald Jud, UNCG

IMPACT VALUE

EMPLOYMENT 6,526

LABOR INCOME $642,752,280

VALUE ADDED $1,274,430,596

OUTPUT $4,271,237,688

TOTAL STATE & LOCAL TAXES $101,708,714

PROPERTY TAXES $25,148,418

SALES TAXES $32,631,225

INCOME TAXES $18,442,011

OTHER TAXES $25,487,060

PROXIMITY MAP

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To Lexington

Linw

ood Rail Y

ard

Optional Property403 Acres +/-

Norfolk Southern Railroad

To S

alisbury

Railroad

Davidson County

Rowan County

Inters

tate

85 /

Highway 2

9 - 70

Old

Sal

isbu

ry R

oad

Old

Hig

hway

29

-70

Hig

hw

ay 1

50

Belmont Road

Clark Road

Linwood-Southm

on

t Ro

ad

Sam Sharpe Road

0’

North

3000’

Scale: 1” = 3000’

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DAVIDSON COUNTY

Size Opt. Property Total

2,272 Acres +/- 403 Acres +/-2,675 Acres +/-

Location Davidson County

Nearby Communities

Lexington (< 1 mile)Salisbury (5 miles)

Nearby Interstates

I-85 N/S < 1 mileI-40 E/W 26 miles

Nearby Airports

PTI 52 milesRaleigh 110 milesCharlotte 59 miles

Nearby Rail Adjacent to eastern boundary

Current Zoning

Light IndustrialOffice & InstitutionalRural Agricultural

To Lexington

To S

alisbury

Optional Property403 Acres +/-

Linw

ood Rail Y

ard

Norfolk Southern Railroad

Railroad

Rowan CountyDavidson County

Inters

tate

85 /

Highway 2

9 - 70

Old

Sal

isbu

ry R

oad

Old

Hig

hway

29

-70

Hig

hw

ay 1

50

Belmont Road

Clark Road

Linwood-Southm

on

t Ro

ad

Sam Sharpe Road

0’

North

3000’

Scale: 1” = 3000’

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DAVIDSON COUNTY

Property Under Control1,690 Acres +/-

Methods of Control: · Contingency Contract to Purchase or Lease · Option to Purchase · Real Estate Listing Agreement Authorizing Sale of Property · Letter from Owner Indicating Intent to Sell

Property Not Under Control582 Acres +/-

Optional Property Not Under Control403 Acres +/-

NC Piedmont Triad MegaSites - Davidson CountySite Criteria: Yes Attainable TBD Notes:• Site Size: 1,400 ac. min. to 2,000 ac.• Site Shape: Reg. Configuration; min. 1,500ft. Edge to Center• Property Control: Ownership or Option to Purchase• Zoning: Industrial or Ability to Rezone• Ex. Buildings on Site: Min. Bldgs on Site; Easily Demolished• Adjacent Sites: Min. Residences w/in 1,500ft of Site; No Quarries, Blasting,

Cooling Towers, Sources of Particulate Emissions, Odors, etc. w/in 2 mi.• Topography: 0 - 20% Grade Change• Site Mass Grading: Low Cost to Grade• Geotechnical Study: Depth to Rock & Water Table• Phase I Environmental Study: Clean Site and/or Remediation w/in 90 days• Floodplain: Outside FEMA 100-Year Floodplain• Streams/Wetlands: Delineation & Ability to Remediate w/in 90 days• Endangered Species Study: None or Remediation w/in 90 days• Historical/Archeological Survey: None or Remediation w/in 90 days

Utility Criteria: Available within 18 Months of Company Announcement• Electric Power: Duel Feed, Backup Transformer; 30-40 megawatts• Water/Sewer: 1m gpd Min. Capacity• Natural Gas: Sufficient Service for Heavy Industrial Use• Telecommunications: Fiber Optic Service

Other Criteria:• Interstate/ Hwys: Adj. to Site w/2+ Access Pts• Railroad: Main Line Rail w/ min. 3,000lf adjacent to Site• Commercial Air: 50 mi. max. to Airport; 10,000ft Runway; Air Cargo Service• Sea Ports: For Containerized Vessels• Multi-Jurisdictional Partnership: Inter-local Coop. Agreement w/ 2+ Local Gvts.• Workforce Availability: 500,000 min. Qualified Skilled Workers w/in 30 mi.• Logistics Infrastructure: Service & Logistics Providers w/in 30 mi.• Supplier Park: 1,000+ ac. w/in 15 mi. of Mega-site Zoned & Property Control• Foreign Trade Zone: Designation w/in 60 Days• EPA Attainment Zone: Located in Designated Air Pollution Area


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DAVIDSON COUNTYSITE CRITERIA MATRIX

Portion of Site Requires Rezoning

Floodplain is Located on Portion of Site

Study to be Completed



Extension to Site Required - 11 Month Schedule

Extension to Site Required - 6 Month Schedule

Under Review


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BUDGET PROPOSAL CHATHAM COUNTY MEGASITE 1,488 ACRES

Budget Item 1: Site Due Diligence

Preliminary Feasibility Analysis & Master Planning $ 70,000

» Onsite Inventory & Analysis

» Offsite Access & Utility Studies

» Buildable Tract Studies

» Conceptual Master Plan

» Final Master Plan

» Marketing Package

» Traffic Consultant

Environmental & Geotechnical Due Diligence $ 37,500

» Phase 1 Environmental Site Assessment

» Preliminary Wetlands Determination

» Preliminary Threatened & Endangered Species Determination

» Preliminary Historic Properties/Structures Inquiry

» Preliminary Subsurface Exploration (1 boring per 50 acres)

Total Site Due Diligence Budget $ 107,500

Budget Item 2: Legal and Consulting Fees $ 148,000

Budget Item 3: Option Fees (15% of Tax Value) $ 265,000

TOTAL CHATHAM COUNTY MEGASITE BUDGET $ 520,500

BUDGET PROPOSAL DAVIDSON COUNTY MEGASITE 2,272 ACRES


















Budget Item 3: Option Fees (15% of Tax Value) $ 1,858,500

TOTAL DAVIDSON COUNTY MEGASITE BUDGET $ 2,362,000


BUDGET PROPOSAL GREENSBORO/LIBERTY MEGASITE 2,030 ACRES


















Budget Item 3: Option Fees (15% of Tax Value) $ 1,539,000

TOTAL GREENSBORO/LIBERTY MEGASITE BUDGET $ 2,065,250

BUDGET PROPOSAL OVERVIEW

Budget Item 1: Site Due Diligence Chatham County $ 107,500Davidson County $ 128,500Greensboro/Liberty $ 126,250

Subtotal: $ 362,250

Budget Item 2: Legal and Consulting Fees Chatham County $ 148,000Davidson County $ 375,000Greensboro/Liberty $ 400,000

Subtotal: $ 923,000

Budget Item 3: Option Fees (15% of Tax Value)Chatham County $ 265,000Davidson County $ 1,858,500Greensboro/Liberty $ 1,539,000

Subtotal: $ 3,662,500

TOTAL MEGASITE BUDGET

Chatham County $ 520,500

Davidson County $ 2,362,000

Greensboro/Liberty $ 2,065,250

NC MegaSites Website $ 25,000

TOTAL: $ 4,972,750

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