COF

Commonwealth’s Development Opportunity Fund

The Commonwealth’s Development Opportunity Fund (COF) is Virginia’s “deal closing” discretionary grant.  The COF is used as a financial incentive for business opportunities resulting in significant job creation and investment once one Virginia locality has been selected by the company.

Discretionary , VEDP

Background

 

The Commonwealth’s Development Opportunity Fund (COF) is administered by the Virginia Economic Development Partnership (VEDP) and is governed by § 2.2–115 of the Code of Virginia. The goal of the program is to attract new economic development prospects or secure the expansion of existing business and industry in the Commonwealth by providing either grants or loans where there is competition for the project with another state or country. This is a discretionary economic development incentive program in which grants are negotiated and offered to qualified applicants. The program uses the following metrics:

  • New job creation meeting minimum wage requirements
  • Private capital investment

 

Program Evolution

 

The COF was created in 1996 as the Governor’s Development Opportunity Fund (GOF). The original intentions remain the same as today with an emphasis on return on investment analysis and providing dollars to projects that positively impact state and local revenues. The eligibility requirements have shifted over the years from having project thresholds of capital investment and jobs being based on population to being based on a locality’s distress level in terms of unemployment and poverty rates. Another important change to the fund was the removal of a limitation that allowed each locality to award only one project annually with a COF award.

 

Success Stories

 

P3_AmazonAmazon – In December 2011, Amazon announced the company’s plans to open two fulfillment centers in Virginia, investing a total of $135 million. The company planned to invest $85 million and create more than 1,000 jobs in Chesterfield County, and invest $50 million in Dinwiddie County, creating more than 350 jobs. The company received a total of $3.5 million in grants from the Governor’s Opportunity Fund to assist both Chesterfield and Dinwiddie with the project. The company also received an $850,000 grant from the Virginia Tobacco Indemnification and Community Revitalization Commission for the Dinwiddie County project in addition to being eligible for both the Virginia Enterprise Zone and Virginia Jobs Investment Programs. As of the latest survey data, these centers have exceeded their goals, creating over 3,650 jobs and investing nearly $200 million.

 

Ardagh Group Grand Opening eventArdagh Group – In August 2013, Ardargh Group, a global manufacturer of containers for the food and beverage industry, announced plans to create 96 new jobs and invest $93.5 million to establish a metal packaging manufacturing operation in Roanoke County. The Governor approved a $750,000 grant from the Governor’s Opportunity Fund to assist Roanoke County with the project. Virginia successfully competed against Kentucky, North Carolina, Maryland, West Virginia, Pennsylvania and Tennessee for the project. The company also qualified for rail access funding from the Virginia Department of Rail and Public Transportation and the Virginia Jobs Investment Program.

 

DRS Technologies – In April 2012, DRA Technologies, Inc. announced that it will be relocating its corporate headquarters from New Jersey to Arlington County. The company, recognized as one of the leading defense technology companies in the world, planned to expand its regional office to accommodate 100 employees which would bring in an excess of $10 million of capital investment to the region. The company received a $1 million grant from the Governor’s Opportunity Fund and was also eligible to receive a Major Business Facility Job Tax Credit and assistance from the Virginia Jobs Investment Program.

 

McKee Foods – In August 2012, McKee Foods Corporation announced it will invest $19 million to expand production at its manufacturing facility in Stuarts Draft in Augusta County, creating 78 new jobs. Virginia successfully competed against Arkansas for the project. McKee Foods received a $200,000 Governor’s Opportunity Fund grant. The company was also eligible to receive a Major Business Facility Job Tax Credit and assistance from the Virginia Jobs Investment Program.

 

Monogram Foods – In June 2015, Monogram Food Solutions, LLC, a Memphis-based manufacturer of value-added processed meats, announced plans to invest $7.244 million to establish a warehousing and logistics operation in Henry County, creating 101 new jobs. The company has operated a meat snacks production facility in the Henry County Patriot Centre announcing a total investment of $43.475 and the creation of 470 jobs since 2009. Monogram Foods has received $700,000 from three Governor’s Opportunity Fund grants to assist Henry County with the projects. The company was also eligible for grants from the Tobacco Region Opportunity Fund, the Virginia Enterprise Zone program, and the Virginia Jobs Investment Program for this most recent project.

 

Phoenix Packaging – In November 2012, Phoenix Packaging Operations, LLC, a manufacturer of thermoformed rigid plastic packaging, announced a second expansion in Pulaski County in less than two years. Virginia successfully competed against Arizona for the project. The total investment for the initial establishment of the facility and the two following expansions was $58.21 million, creating 440 new jobs. The company received three Governor’s Opportunity Fund grants totaling $1.45 million to assist Pulaski with the projects. The company was also eligible for the Virginia Enterprise Zone and Virginia Jobs Investment Programs. As of the latest survey data, the company has completed the investment and job creation metrics announced.

 

TempurTempur Sealy – In July 2013, Tempur Sealy announced the expansion of its manufacturing operation in Scott County with plans to create 42 new jobs and invest $13.3 million in facility development and improvements. A $150,000 grant from the Governor’s Opportunity Fund, was used to assist Scott County with the project. Virginia successfully competed against New Mexico for the project.

Contact:

Rob McClintock, Vice President of Research, VEDP