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IDA wants $2.25 million for Riverstone power upgrade

SoVaNow.com / April 08, 2010
The Halifax County Industrial Development Authority is seeking $2.25 million in tobacco funds for electrical upgrades at Riverstone Technology Park to lure potential data centers to the site, say officials.

The request has been submitted to the Southside Economic Development Committee of the Virginia Tobacco Commission, which is slated to meet later this month to consider 13 funding requests. The panel has $6.9 million budgeted to dole out for economic development projects in Southside Virginia.

Separately, the Halifax Educational Foundation is requesting $185,000 for renovation work at the new Business of Art & Design program at the SVHEC, to be housed in the former American Tobacco Warehouse “Bag Factory.” The money is needed to achieve LEED (Leadership in Energy & Environmental Design) Certification for the new center.

In its application for Riverstone Technology Park funding, the IDA points to inadequate electrical capacity as a potential stumbling block to recruiting data centers to the site. IDA officials argue that work should begin now to increase available capacity from 9 to 20 megavolt-amperes (MVA) so Riverstone will “be ‘ready to go’ in order to compete.

“It is not acceptable to a time sensitive project to be delayed by excessive development or unnecessary unknowns,” the IDA application argues.

“Getting the project under way is essential, and anything that hinders this reduces the community’s chances of success.”

IDA Executive Director Mike Sexton declined yesterday to comment on data center operations that may be actively looking at Riverstone, although he said “our activity is good with prospects.” Sexton said the IDA request reflects the reality that “it takes a long time to get these things done” and “we don’t want to lose a project because we’re not in a position to win it.”

The IDA application cites two uses for the sought-after $2.25 million: $271,000 for mechanical and electrical work and a minor upfit at Riverstone Technology Building One, and a much larger chunk of money — $2 million — to upgrade the Welco electrical substation by adding a transformer and other infrastructure.

The IDA also identifies the need to install a new transmission line running to the substation, costing an additional $750,000. The application further notes that the IDA and county will divert $200,000 previously committed to the Riverstone Ready Sites Project to help defray the cost of the power line.

“The remainder will have to be done in another phase as soon as funds are available in the future,” the applications states.

The IDA projects that a data center expansion at Riverstone involving a current client will create 30 to 50 jobs over three years.

Noting that “data storage facilities have an extremely high investment but few employees,” the IDA argues that “the availability of these jobs” — which pay in a range from $50,000 to $100,000 — “will diversify the employment in Halifax County and Southside Virginia to allow for stable growth and attract some of the brightest of Halifax County youth and natives to come back to take advantage of these opportunities.

“Once we have a successful location in Riverstone Technology Park, other technology firms are expected to locate and cluster,” the application states.

If approved, the substation project is expected to take two years to complete. The substation site is located in the rear of the park and the facility will be fed with 115 kV line that is expected to run some two miles alongside the Dan River to the Reedy Creek substation near the Georgia-Pacific site.

The IDA is currently under contract with Dominion Virginia Power to complete the engineering for a 40 MW transmission feed to serve potential data centers and other businesses at Riverstone.

Already representing an investment of $22 million-plus, the Riverstone Technology Park currently has four tenants: a Virginia Employment Commission/DMV customer call center housed in Building Two and, in Building One, the Mid-Atlantic Broadband Cooperative, AVID LLC (a small aerospace engineering and software development firm) and the IDA office itself.

The IDA is also in the midst of a separate initiative at Riverstone to create “pad ready” industrial sites, which also would be served by the electrical upgrade.

The IDA is also seeking an operating partner for the Modeling & Simulation Center for Excellence since taking over the Riverstone-based center last year from Virginia Tech.

In a second Halifax County grant application pending before the Tobacco Commission, the Halifax Educational Foundation is asking for $185,000 to incorporate “green” building and design elements at the SVHEC Business of Art & Design Center.

About half of the funds would be spent on a “gray water” system to reclaim roof water for flush valves in water closets, exterior hose bobs and necessary make-up water for a cooling tower.

Other LEED features that would be incorporated into the new center include recycled materials for conference center seating and toilet partitions, a waste program to recycle leftover materials, and a LEED manager to fulfill reporting requirements under the certification program.

The position would pay $22,000, with the grant providing financial support.

The grant application notes that the HEF “is already investing more than $500,000 in multitudes of LEED related design elements and activities” such as recycled wood, masonry and plastic building materials. LEED standards have been developed by the U.S. Green Building Council (USGBC) “to provide a suite of standards for environmentally sustainable construction,” the HEF applications states.

LEED is widely used in 30 countries including the U.S. and is “an internationally recognized green building certification system,” the application reads.

The $10 million Business of Art & Design Center is projected to produce 156 skilled workers with a certificate level or Associate of Applied Science (AAS) advanced manufacturing degree in its first three years of operation.

“Based on these numbers there will be a developing workforce available for the companies who have already shown support for the program and for companies attracted to the area by the availability of a highly skilled work force and a unique high tech training center,” the application continues.

So far, the Virginia Tobacco Commission has provided $6 million to start up the center, with historic tax credits providing $4 million in additional funding.

The Southside Economic Development Committee of the Tobacco Commission is scheduled to take up the Halifax County requests and 11 others when the panel meets April 29 in Roanoke.

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