052-03
)fV~
l/
BOARD OF SUPERVISORS
Resolution
Ford Motor Company
WHEREAS, Ford Motor Company has made known its intent to locate a parts
distribution center by making new taxable real estate and personal property investments and
adding new jobs; and
WHEREAS, the company meets the policy guidelines of the Frederick
County Economic Development Incentives Fund as established by the Winchester-Frederick
County Economic Development Commission in 1995;
BE IT RESOLVED, that the Board of Supervisors for the County of Frederick, Virginia
does hereby approve the payment of $75,000.00 to the Industrial Development Authority of
Frederick County, Virginia from the Frederick County Economic Development Incentive Fund to
assist in locating a parts distribution center for Ford Motor Company in Frederick County,
Virginia.
BE IT RESOLVED, that the Board of Supervisors for the County of Frederick, Virginia
does hereby approve the payment of $75,000.00 to the Industrial Development Authority of
Frederick County, Virginia from the Governor's Opportunity Fund to assist in locating a parts
distribution center for Ford Motor Company in Frederick County, Virginia.
BE IT RESOLVED, that said funds are subject to an executed Memorandum of
Understanding outlining the required performance criteria.
BE IT FURTHER RESOLVED, that the Board of Supervisors for the County of
Frederick, Virginia, does authorize the County Administrator to execute the Memorandum of
Understanding on its behalf.
Upon motion duly made by ,ems
and on the votes hereafter recorded,
, seconded by lJiJ..S
r:..O )
ADOPTED, this 9- th day ~ ,2003.
Richard C. Shickle Sidney Reyes
Linda Tyler
Margaret B. Douglas
W. Harrington Smith, Jr.
Robert M. Sager
Gina Forrester
A COPY TESTE:
John R. Riley, Jr.
Clerk, Board of Supervisors
Resolution No.: 052-03
MEMORANDUM OF UNDERSTANDING
THIS MEMORANDUM OF UNDERSTANDING, (the "Memorandum") made and dated this
iLl"
.LL day of April, 2003, evidences the agreement among the COUNTY OF FREDERICK, VIRGINIA, a
pOlitical subdivision of the Commonwealth of Virginia (the "County"), the INDUSTRIAL
DEVELOPMENT AUTHORITY OF THE COUNTY OF FREDERICK, VIRGINIA, a political subdivision
of the Commonwealth of Virginia (the "IDA"), the WINCHESTER-FREDERICK COUNTY
ECONOMIC DEVELOPMENT COMMISSION, a joint commission of the City of Winchester and
Frederick County, Virginia (the "Commission"), FORD MOTOR COMPANY ("Ford"), a Delaware
corporation, regarding a new location in the Commonwealth of Virginia for Ford's parts distribution.
RECITALS
A. Ford intends to invest Nine Million Dollars ($9,000,000.00) in taxable real estate and
taxable improvements, to invest Two Million Five Hundred Thousand Dollars
($2,500,000.00) in taxable personal property and to create Ninety-Five (95) new jobs at a
part distribution facility (the "Facility") to be located in Frederick County, Virginia
(collectively the "Projecr),
B. The County agrees to make a cash grant to the IDA in the sum of Seventy-Five Thousand
Dollars ($75,000.00), and the IDA agrees, upon receipt of such funds, to make a cash
grant to Ford in an identical amount (the "IDA Grant") to be applied by Ford in order to
complete the Project, as more fully set forth hereinafter.
C. The IDA shall also receive a grant of Seventy-Five Thousand Dollars ($75,000.00) from
the Governor's Opportunity Fund (the "Opportunity Fund Grant") and the IDA, as
administrator of the Opportunity Fund Grant, upon receipt of such funds, shall disburse
such funds to Ford as reimbursement for site purchase costs and subsequent site
development expenditures, as more fully set forth hereinafter.
NOW THEREFORE WITNESSETH: That for and in consideration in the sum ofTen Dollars ($10.00),
cash in hand paid by each of the parties hereto unto the other, the receipt and sufficiency of which is
hereby acknowledged, and other consideration deemed adequate at law, including, but not limited to,
the covenants and conditions set forth in this Memorandum, the parties do hereby agree as follows:
1. Recitals: The Recitals are made a material part hereof and incorporated herein by
reference as if set out in full.
2. Terms and Conditions of Disbursement:
a. The obligations of the IDA to make disbursement of the IDA Grant to Ford is
expressly contingent upon receipt of such funds by the IDA from the County.
b. The obligation of the IDA to make disbursement of the Opportunity Fund Grant to
Ford is expressly contingent upon receipt of such funds by the IDA from the
Governor's Opportunity Fund.
c. Provided that the IDA receives the IDA Grant and Opportunity Fund Grant in a timely
fashion, the IDA shall disburse such funds to Ford after July 1,2003, but no later than
August 1 , 2003.
3) Reimbursement/Default: Ford agrees to make reimbursement of the IDA Grant and the
Opportunity Fund Grant, as described in Section 4, below, in the event that Ford fails to
satisfy S!lJ. the following terms and conditions, as reasonably determined by the IDA:
a. Ford acquires and has fully operational taxable real estate in an amount of not
less than $9,000,000.00 and taxable personal property in an amount of not less
that $2,500,000.00 at the Facility located in Frederick County, Virginia by June 30,
2004;
b. Ford creates Ninety-Five (95) net new jobs associated with the Project by June
30, 2004;
c. Ford employees created by the Project will average an annual salary of not less
than $52,400 excluding benefits by June 30, 2004;
MOU: Ford April 2003
Frederick County, Virginia
page 2 of 5
d. Ford maintains the level of taxable investment, new jobs and wage levels created
as part of the Project until June 30, 2006; and Ford maintains and continues the
operation of the Project in Frederick County, Virginia for a four (4) year period
commencing on June 30, 2004.
4. Refund:
a) In the event that Ford fails to meet all of the foregoing conditions
set forth in Section 3, above, (the "Conditions") then and in that event Ford shall
refund to the IDA such portion of the IDA Grant and the Opportunity Fund Grant
as is proportionate to Ford's shortfall in satisfying the Conditions (the "Ford
Refund"). Upon receipt of the Ford Refund, the IDA shall retum the same, or
such proportionate share thereof as called for herein, to the County and to the
Govemor's Opportunity Fund, respectively.
b) Notwithstanding the foregoing, if Ford has met ninety percent (90%) of the
investment and employment goals set forth in this Memorandum by June 30,
2004, maintains the level of investment and jobs created through the Project for a
period of two (2) years beginning on June 30, 2004, and remains fully operational
in Frederick County, Virginia for a period of four (4) years until June 30, 2008,
then and in that event, Ford shall be deemed to have substantially complied with
the terms of this Memorandum and shall no longer be obligated to repay the Ford
Refund or any portion thereof unto the IDA.
5. Cooperation: The County agrees to use its best efforts to "fast track" any
building permits required for the construction and installation of the Facility by Ford so
that the appropriate building permits, if otherwise prepared and submitted in proper
form, can be issued in a timely manner in order to meet the deadlines set forth above.
The County and the Commission agree to reasonably cooperate with Ford, its
MOU: Ford April 2003
Frederick County, Virginia
page 3 of 5
equipment suppliers and its equipment contractors. in order to assist Ford in meeting
its operational deadline so that the Facility is equipped by not later than June 30,
2004. Nothing contained in this Section 5 shall be interpreted to in any way require
the County to issue any building permits unless and until all applicable terms and
conditions as required by law for such building permits have been met and satisfied
by Ford.
6. Time: Time is of the essence as to all matters set forth in this Memorandum.
7. Blndina Effect: This Memorandum shall be binding upon and inure to the
benefit of the parties hereto and their respective successors upon the date of
acceptance of this Memorandum.
8. Construction: This Memorandum and the terms thereof shall be interpreted
and construed in accordance with the laws of the Commonwealth of Virginia.
9. Asslanment: This Memorandum may not be assigned by any party hereto.
10. Ratification and Implementation: This Memorandum must be fully ratified by
all parties hereto not later than 5:00 p.m. on May 30, 2003, and the implementation by
Ford of the terms of this Memorandum must have commenced by June 30, 2004;
otherwise. this Memorandum and the terms hereof shall be deemed withdrawn and of
no further force and effect.
MOU: Ford April 2003
Frederick County, Virginia
page 4 of 5
COUNTY OF FREDERICK, VIRGINIA
(SEAL)
r , County Administrator
INDUSTRIAL DEVELOPMENT AUTHORITY OF THE
COUNTY OF FREDERICK, VIRGINIA
By: laP( ~
(SEAL)
OUNTY ECONOMIC
By:
(SEAL)
FORD MOTOR COMPANY
By:yr ~
(SEAL)
MOU: Ford April 2003
Frederick County, Virginia
page 5 of 5
APPENDIX A
NET FISCAL IMPACT
PROPOSAL: Ford Motor Company: Parts Distribution Center
1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
NET DIRECT FISCAL IMPACT
Annual Return $101,161 $101,161 $101,161 $101,161 $101,161
Cumulative Return $101,161 $202,322 $303,483 $404,644 $505,805
NET INDIRECT RESIDENTIAL FISCAL IMPACT
Annual Return ($62,249) ($62,249) ($62,249) ($62,249) ($62,249)
Cumulative Return ($62,249) ($124,499) ($186,748) ($248,997) ($311,246)
NET IMPACT
Annual Return $38,912 $38,912 $38,912 $38,912 $38,912
Cumulative Retum $38,912 $77,823 $116,735 $155,647 $194,559
'Three '(3) Year Return
$116,7351
$194,559 I
IFive (5) Year Return
ASSUMPTIONS
Demooraohics
Persons per Residential Unit
School Children per Residential Unit
2.60
0.70
Investment and Emolovee Pian
(totals. 5 Year)
Real Estate
Machinery & Tools
Personal Property
Business License
$9,000,000
$0
$2,500.000
$0
Employees
Averaoe Annual Waoe
95
$52,400
APPENDIX B
ASSUMPTIONS
PROPOSAL: Ford Motor Com an . Parts Distribution Center
SSUMPTIONS
Item
Persons per Residential Unit
School Children per Residential Unit
School Children per Residential Unit (Elementary)
School Children per Residential Unit (Middle)
.~hool Children per Residential Unit (High School)
Value
2.60
0.70
0.39
0.14
0.17
J. '-.": ~.
NOTE: ALL VALUES ARE FY ANNUAL TOTALS
';
Residential
Per ResidentIal Unit Real Estate Tax Revenue
Per Residential Unit Other General Fund Revenue
PeT Residential Unit General Fund Service
Per Residential Unit General Fund Service (no educ)
$1,220
$1.665
$3,124
$B30
Per Cepita Fiscallmpect Analy1lis Model. Frederick County 2002
Per Cepita Fiscal Impact Analysis Model. Frederick County 2001
Per Ceplta Fiscal Impact Analysis Model, Frederick County 2002
Per Ceplta Fiscal Impact Analysis Model, Frederick County 2001
Capital Facilities Cost per Pupil (Elementary)
Capital Facilities Cost per Pupil (Middle)
Capital Facilities Cost per Pupil (High)
Capital Facilities Costs: Fire & Rescue. Per Residential Uni
Capital Facilities Costs: Public Safety - Per Residential Unit
Capital Facilities Costs: Parkland. PeT Residential Unit
Per Capita Fiscal Impact Analysis Model, Frederick County 2002
Per Capita Fiscallmpacl Analysis Model, Frederick County 2002
Per Caplla Fiscal Impact Analysis Model, Frederick County 2001
Per Capita Fiscal Impact Analysis Model, Frederick County 2002
Per Capita Fiscal Impact Analysis Model, Frederick County 2002
Per Cap/ta Fiscal Impact Analysis Model, Frederick County 2002
n-Resldential
Real Estate Tax Return
M&T, BPOL, BE, PP"Tax
Per Employee Other General Fund Revenue
Per Employee General Fund Service
Capital Facilities Costs: Public Safety. Per Employee
See Investment and Employment Plan Sheet
See Investment and Employment Plan Sheet
$175 Per Capita Fisca/lmpact Analysis Model. Frederick County 2002
$132 Per Capita Fiscal impact Analysis Model, Frederick County 2002
$2 Per Capita Fiscal Impact Analysis Model, Frederick County 2002
Consultant Estimates
Taxes
Real Estate
Machinery and Tools
Year 1 (60%)
Year 2 (50%)
Year 3 (40%)
Year 4 (30%)
Personal Property
property taxed at 30% r:i original value
Sales Tax
Income Spent on Taxable Products
$0.61
$2.00
$1.20
$1.00
$0,80
$0.60
$4.20
$1.26
,-'
t;.
"fter Assumotions
enue and Expenditure (Opereting & Capital) Levels will remain at 1999 . 2000 levels
No changes in any tax rates
No slack capecity in any general fund revenues and operating expenditures
No changes in number of persons per residential unit or school children per residential unit
Weldon Cooper Center. Universlly of Virginia
Weldon Cooper Center, Unlverslly of Virginia
We/don Cooper Center, University of Virginia
Weldon Cooper Center. University of Virginia
Weldon Cooper Center, Unlverslly of Virginia
Weldon Cooper Center, Unlverslly of Virginia
Weldon Cooper Canter, University of Virginia
We/don Cooper Center, University of Virginia
Weldon Cooper Center, University of Virginia
American Chamber of Commerce and Research Association
.- .....;;~._,_. .""
APPENDIX C
INVESTMENT AND EMPLOYMENT PLAN
PROPOSAL: Ford Motor Com pan : Parts Distribution Center
Projected Plans 1ST YEAR 2NO YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Value of New Construction
Phase 1 9,000.000
Phase 2
Phase 3
Phase 4
Annual Value 9.000.000
Cumulatlva Vslue 9,000,000 9,000,000 9,000,000 9pOO,000 9,000,000
. ....., .,' ..
,.-.-,
Value of Machinery & Tools
Phase 1
Phase 2
Phase 3
Phase 4
Annual Vslue
Cumulative Value
Value of taxabl. personal property
Phase 1 2.500,000
Phase 2
Phase 3
Phase 4
Annual Vslue 2,500,000
Cumulative Value 2,500,000 2,500.000 2,500,000 2,500,000 2,500,000
..liS TIIX Retum from Employees
Phase 1 10,813 10,813 10,813 10,813 10.813
Annual Value 10,813 10,813 10,813 10,813 10,813
Cumu/effve Value 10.813 21.626 32,439 43,252 54,065
Projected Employment 1ST YEAR 2ND YEAR 3RD YEAR 4 TH YEAR 5TH YEAR
Phase 1 95
Phase 2
Phase 3
Phase 4
Annual Ve/ua 95
Cumulative Value 95 95 95 95 95
Projected Wages 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Average Salary (w.o benefits) 52,400
Phase 1 4.978,000 4.978.000 4,978,000 4,978.000 4.978,000
Phase 2
Phase 3
Phase 4
Annual Value. 4,978,000 4,978,000 4,978,000 4,978,000 4.978,000
Cumulative Value 4,978,000 .~,956,OOO. 14,934,000 19,912,000 24.890,000
. , ~, '.,:i"-':"',
.~ .
^"PENDIX 0
DIRECT FISCAL IMPACT
PROPOSAL; Ford Motor Company; Parts Distribution Center
DIRECT REVENUES
Real Estate Tax Return 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Revenues $54,900 $54,900 $54,900 $54,900 $54,900
Cumulative Revenues $54,900 $109,800 $164,700 $219,600 $274,500
M& T, BPOL, BE, pp. Tax 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Revenues $31,500 $31,500 $31,500 $31,500 $31,500
Cumulative Revenues $31,500 $63,000 $94,500 $126,000 $157,500
Sales Tax 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Revenues $10,813 $10,813 $10,813 $10,813 $10.813
Cumulative Revenues $10,813 $21,628 $32,439 $43,252 $54,065
Local sales tax receipts reflect portion of purchases by neW workers
(Based on 54.5% of annual payroll spent on taxable purchases - US Chamber 2000) (New taxable sales based on proportion of total taxable
sales between Winchester and Frederick County for 1999 - Virginia Department of Taxation)
Other General Fund Revenue 1 ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Revenues $16,628 $16,628 $16,628 $16,628 $16,628
Cumulative Revenues $16,628 $33,256 $49,884 $66,512 $83,140
DIRECT REVENUES 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Revenues $113,841 $113,841 $113,841 $113,841 $113,841
Cumulative Revenues $113,841 $227,682 $341,52,3 $455,364 $569,205
. .
DIRECT EXPENDITURES
General Fund: Operating Costs 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Costs $12,508 $12,508 $12,508 $12,508 $12,508
Cumulative Costs $12,508 $25,016 $37,524 $50,032 $62,540
Capital Facilities Costs 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Costs $172 $172 $172 $172 $172
Cumulative Costs $172 $344 $516 $688 $860
DIRECT EXPENDITURES 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Costs $12,680 $12,680 $12,680 $12,680 $12,680
Cumulative Costs $12,680 . $25,360 . $38,040 $50,720 $63,400
,. ." . ~,
;~- .,";;,;-," 0,,;
NET DIRECT FISCAL IMPACT
Annual Return $101,161 $101,161 $101,161 $101,161 $101,161
Cumulative Return $101,161 $202,322 $303,483 $404,644 $505,805
..
.,'-.
APPENDJX E1
Indirect Plan
PROPOSAL: Pro'ect Phoenix (FORD
j)roJected Plans
1ST YEAR
2ND YEAR
3RD YEAR
4TH YEAR
5TH YEAR
Employment Transfer
Phase 1 (least 40 years of age)
phase 2 (less than 40 years of age)
Annuel Value
Cumulativ&
47
48
95
. '._, ..-ce._'... -,. ..,,_......<,-;:.-..:,:._';c
T olal New Ho....holds
Phase 1 (least 40 years of age)
Phase 2 (less than 40 years of age)
Annual Value
47
48
95
Total New Population
Pha.. 1 (least 40 years of age)
Pha.. 2 (Ies. than 40 years of age)
Annual Value
Cumulative Value
247
247
Number of Households with School Age Children
phase 1 (leasl40 years of age)
phase 2 (less than 40 years of age)
Annual Value
Cumulative Value
'.0'
,umber of New School Age Children
Phase 1 (least 40 years of age)
Phase 2 (less than 40 year. of age)
Annual Value
Cumuletiv& Value
1ST YEAR
2
34
36
36
2ND YEAR
3RD YEAR
4TH YEAR
5TH YEAR
36
36
36
36
~.E$llmale<l Profiles of Tnm5l~ed Workers""" ,
50% wolldorce moving is at least 40 years of age
less than 1 % hes school age
50'10 wolldorce is less than 40 yaar. of age
those families haw children. exact number is unknown
.APPENDIX F
INDIRECT RESIDENTIAL CAPITAL FACILITIES COSTS
PROPOSAL: Ford Motor Company: Parts Distribution Center
POTENTIAL NEW STUDENTS
Elementary 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual New Public School Students 20
Cumulative New PubliC School Student 20 20 20 20 20
Middle 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual New Public School Students 7
Cumulative New Public School Student 7 7 7 7 7
High 1 ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual New Public School Sludents 9
Cumulative New Public School Student 9 9 9 9 9
POTENTIAL CAPITAL FACILITIES COSTS
Elementary 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Capital Facilities Costs 46.277 46,277 46,277 46,277 46,277
Cumulative Capital Facilities Costs 46,277 92,555 138,832 185,109 231,386
Middle 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Capital Facilities Costs 27,321 27,321 27,321 27,321 27,321
Cumulative Capital Facilities Costs 27,321 54,643 81,964 109,285 136,607
High 1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Capital Facilitias Costs 39,694 39,694 39,694 39,694 39,694
Cumulative Capital Facilities Costs 39,694 79,389 119,083 158,777 198.472
POTENTIAL OTHER CAPITAL FACILITIES COSTS
1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Capital Facilities Costs 30,967 30,967 30,967 30,967 30,967
Cumulative Capital Facilities Costs 30,967 61,933 92,900 123,866 154,833
TOTAL RESIDENTIAL CAPITAL FACILITIES COSTS
1ST YEAR 2ND YEAR 3RD YEAR 4TH YEAR 5TH YEAR
Annual Capital Facilities Costs 144,260 144,260 144,260 144,260 144,260
Cumulative Capital Facilities Costs 144,260 288,519 432,779 577 ,038 721,298
~~
~~ WINOIESTER I FREDERICK COUNTY
~~ Economic Development Commission
DATE:
April 4, 2003
John R. Riley, Jr.
County Administrator
Patrick Barker, AICP II?
Executive Director Y
TO:
FROM:
RE:
Local Govemment Agreements for a parts distribution center
for Ford Motor Company
Attached for your review and comments are the Memorandum of Understanding (MOU)
and BOS resolution for a parts distribution center for Ford Motor Company. As you recall,
BOS seemed favorable in executive session in providing an equal match to the Governor's
Opportunity Fund of $75,000.00 to secure this location. Govemor Warner has approved
an equal grant amount of$75,OOO;00 from the Govemor's Opportunity Fund to assist in
Frederick County securing the location of this project.
Since the executive session, Ford Motor Company has slightly modified their taxable
investment. Ford Motor Company now plans on investing $9.0 million in taxable real
estate and $2.5 million in taxable personal property. Previously investment levels were
$10 million and $3.0 million for taxable real ~state and taxable personal property
respectively. Job creation and average annual wage values remain unchanged. . .
I would like to request that the MOU for this project be placed on the BOS's April 9th
agenda. As you are aware, the Governor must formally approve State's financial
assistance and announce the project prior any local public action.
Thanks for your help. I am available if you have any questions or comments on these
materials on this project.
45 E. Boscawen Street - Winchester, VA 22601
phone: 540-665-0973 - fax 540-722-0604 - e-mail info@wininva.com
web: http://www.wininva.com