TROF

Tobacco Region Opportunity Fund

The Tobacco Region Opportunity Fund (TROF) provides performance-based monetary grants to localities in Virginia’s tobacco producing regions (34 counties and six cities in Southside and Southwest Virginia as defined by the Virginia Tobacco Region Revitalization Commission) to assist in the creation of new jobs and investments, whether through new business attraction or existing business expansion.

Discretionary , Regional/Local Assistance , TRRC

BACKGROUND

 

The Tobacco Region Revitalization Commission (TRRC) is responsible for administering the Tobacco Region Opportunity Fund (TROF). The goal of the TROF is to assist in the creation of new jobs and investments in tobacco-dependent regions and communities, whether through new business attraction or existing business expansion. The program uses two primary metrics in evaluating candidate projects and measuring outcomes:

  • Virginia jobs created, and their average wage
  • Value of Virginia taxable assets

 

PROGRAM EVOLUTION

 

Unlike other programs which may be governed by statute, the TROF and associated guidelines, regulations, processes, and procedures is established and maintained by the TRRC. Since inception, there have been three primary changes to the program.

  • Approximately 7- to 8-years ago, the TROF was revised to be more formulaic in approach. This ensured the scoring and estimates of award for approved projects were objective in nature, rather than subjective.
  • About 2- to 3-years ago, the funding structure of TROF was changed. As a precursor to being approved for a TROF grant, the locality (recipient of funds) became required to supply a letter of credit in the event of non-performance or a structured clawback taking place. The entity which ultimately received the funds was requested, but not required, to also supply a letter of credit. Applicants may also choose to receive the funding up-front and provide proof of performance at project completion, or receive the funding after project completion and proof of performance.
  • Finally, various tweaks and changes to the TROF have occurred over the years. In particular, the performance agreement – the legally binding contractual obligation – explicitly requires proof of performance from the company, which is cross-referenced to Virginia Employment Commission (VEC) data for employment, and the Local Commissioner of Revenue in a locality for proof of taxable assets.

TROF governing policy may be found on the TRRC website, here. The strategic plan of the TRRC is currently being revised with a focus on targeted and quantifiable outcomes of projects, across all grant programs. The strategic plan is anticipated to be approved during Summer 2016.

Contact:

Ned Stephenson, Deputy Director, TRRC