BY EMILY BATTLE
A Spotsylvania County company that does high-end woodwork for a client list that includes the White House could get public incentives to move to Fredericksburg, where it hopes to expand its operation.
City Council members will receive the details of
Creative Dimension Group has outgrown its space in the Spotsylvania Industrial Park, according to a letter written by company President Deborah Sullivan and sent to city economic development staff as part of the incentives application.
The 26-year-old business produces cabinets, exhibit displays, millwork, woodwork and other products for a number of government agencies.
CDG is working to purchase the former Insteel Industries Inc. plant at 1351 Belman Road, in Fredericksburg's Battlefield Industrial Park.
Company co-owner and Vice President Jack Johnson said the deal has not yet been finalized.
"There are still moving pieces, and we hope to have resolution and closure on the deal by the end of the month," he said.
The incentives package is proposed as a way to fill the financing gap that CDG has encountered in trying to make this purchase at a time when credit markets are tight.
In order to get the incentives, CDG would have to invest $7.5 million in the purchase and renovation of this industrial building. It would have to employ 60 people in architectural millwork manufacturing at the facility.
CDG would also have to invest an additional $325,000 within five years to to expand its operation, add five employees within its first year of operation and add at least 15 more full-time employees within its first five years in the city.
The company currently employs 58 people. City Economic Development Director Kevin Gullette said its jobs are high-skilled trade positions with salaries in the range of $45,000 a year.
The incentive is proposed in two five-year periods, so CDG would have to meet these benchmarks to continue getting the $20,000 annual payments for another five years.
During the second five-year period, the company would have to maintain a workforce of 80 full-time employees.
CDG would also be required to create a workforce development program for millworking with James Monroe High School within the first 18 months of the grant period. It might also work with Germanna Community College on this program.
CDG President Deborah Sullivan wrote in a letter to city officials that the company plans to expand immediately after its move to Fredericksburg and expects to employ 83 full-time staff by 2013.
CDG currently brings in annual revenue of $7.5 million. It expects that to rise to $8.5 million shortly after moving to Fredericksburg, and to $16 million after five years.
"After an exhaustive search we have determined there are no feasible or viable alternatives in the county of Spotsylvania as well as the surrounding counties," Sullivan wrote. "We have, however, found viable alternatives in the region as well as surrounding states."
When CDG first approached the city in April, city Economic Development Director Kevin Gullette e-mailed Spotsylvania Coun-ty Administrator Randy Wheeler and Economic Development Director Russell Seymour.
"The City will not offer incentives to [CDG] if there are opportunities in Spotsylvania County they could take advantage of," Gullette wrote. "However, I think we could both agree that if either indicates moving out of State, the City should do everything we can to keep them in the region."
The incentives being considered for CDG are roughly equivalent to its machinery and tools taxes if it moved to the city.
In all, Gullette projected that CDG's move to the city would mean $405,100 in tax revenue over 10 years. The grant would cost $200,000, netting $205,100 for the city.
CDG would not use all of the space in the 145,000-square-foot plant. Sullivan's letter to the city indicates that the company is talking to a business from Springfield about leasing space.
In addition, the Blue & Gray Brewing Co., which is currently in Spotsylvania's Bowman Center, has indicated in documents filed with the city's planning department that it is in talks to lease 10,000 square feet to move its brewery there and open a restaurant.
The Planning Commission is scheduled to hold a public hearing on those plans, which would require a special-use permit for the restaurant, on Wednesday.
Emily Battle: 540/374-5413
Email: ebattle@freelancestar.com