Title
Resolution Authorizing an Economic Development Incentive Grant to National Distribution Centers, LLC not to exceed $102,549.00 for new capital investment in real property, machinery and equipment, and new jobs
Body
Department: Executive
Council District: 2
Public Hearing: 12/8/2015
Advertising Date/By: 11/25/2015
Contact 1 and Phone: Jim Westmoreland 373-2002
Contact 1 and Phone: Kathi Dubel 373-4579
PURPOSE:
The City of Greensboro has been requested to consider an economic development incentive grant of up to $102,549.00 to National Distribution Centers, LLC for a planned expansion of distribution operations in the Southeast, with a location at 300 Penry Road in Greensboro under consideration. The grant is for the purposes of making capital investment in real property and new machinery and equipment purchases.
BACKGROUND:
National Distribution Centers, LLC is the operating company of NFI Industries, Inc. (NFI), a fully integrated supply chain solutions provider headquartered in Cherry Hill, NJ. NFI owns facilities globally and operates nearly 25 million square feet of warehouse and distribution space, employing more than 8,000 associates. Its business lines include dedicated transportation, warehousing, intermodal, brokerage, transportation management, global, and real estate services.
NFI plans to open a distribution center for a large consumer products company of approximately 850,000 square feet. NFI has identified three (3) existing buildings - two (2) in North Carolina and one (1) in South Carolina - that are suitable for planned operations. The company is considering the former Kmart distribution center, 300 Penry Road, in Greensboro. Although the entire 1.6 million square feet is much larger than is needed, NFI is reviewing the facility for their new operations. If the Greensboro building is selected, the company plans to grow and utilize the space in the future.
The company will be hiring 80 direct full-time employees over a 3 year period with an average wage of $42,199.00. The Greensboro option would include $3,100,000.00 for real property improvements and $950,000.00 in new machinery and equipment purchases.
BUDGET IMPACT:
A total of up to $102,549.00 to be paid to the company over an six (6) year period after the capital investment of $4,050,000.00 is completed and the new jobs have been created. 80 jobs are expected to be created by December 31, 2018. The incentive grant is expected to be paid in FY18/19, FY 19/20, FY 20/21, FY 21/22, FY 22/23, FY 23/24.
RECOMMENDATION / ACTION REQUESTED:
In accordance with the City’s economic development guidelines and N.C.G.S. § 158-7.1, it is recommended that City Council approve the request for an economic development grant and authorize city staff to execute a performance agreement between the City of Greensboro and the company in an amount not to exceed $102,549.00 based on an investment of $4,050,000.00 in real property improvements and machinery and equipment to be paid over an eight year period after the capital investment has been completed and the new jobs have been created.