The Harlan Fiscal Court heard an update from Economic Development Director Larry Calhoun during a meeting on Tuesday, including a discussion on the lease and possible sale of a building the county recently purchased near Putney.
Harlan County Judge-Executive Dan Mosley asked Calhoun to bring the panel up to date on several economic fronts.
“The building we purchased in Putney, Kitts Creek Forestry Products has sent of a letter of interest in leasing it on a short-term basis and then purchasing it at the end of that short lease term,” Calhoun said. “We would…lease it for $2,750 a month for a six-month period, which would give them time to get into their revenue season.”
Mosley pointed out the proposed monthly payment is normal for such a transaction.
“The $2,750 a month, that is consistent with what we’re charging at the building at Coldiron that we lease,” Mosley said.
Calhoun stated that a long-term lease is also a possibility.
“If for some reason they elected not to go through and close, then we’d have to do an extended long-term lease, and we can do a lease with a purchase option,” Calhoun said.
Mosley said a short-term lease would allow time for the tenants to become established.
“It would give them time…to get in the building and get their finances in order,” Calhoun said. “We would surplus it at the appraised value, not what we bought it for.”
Mosley added the minimum bid would be the appraised value.
“The appraised value is about $25,000 higher than what we paid,” Mosley said.
Calhoun stated the county paid approximately $309,000 for the property.
Magistrate David Kennedy asked if any other companies had shown interest in the property.
“We’ve had a couple that we’ve talked to, but no one’s brought anything to us in the way of a letter of intent or a contract,” Calhoun responded. “Until something’s done, it’s wide open.”
After some further discussion, the court approved a motion to lease the property for six months to Kitts Creek Forestry Products for $2,750 per month.
Calhoun also told the court he has completed an assessment of all county property, and has concluded the best option involves pursuing a business park at the Sleepy Hollow Golf Course location in Cumberland.
“It’s 139 acres, the infrastructure is there…electricity and so forth,” Calhoun said. “There’s adjacent land to it that’s under ownership by a coal company that could be purchased if you ever needed to expand it.”
Calhoun said he would have information soon on what it would take to make the location a state certified build-ready site.
“There are only a handful in Kentucky,” Calhoun said. “The reason you want to do that is if a site selector or CEO comes in, they know all the due diligence work has been done and they can get their permits in and be up and doing a building design within six months.”
Calhoun said information on the costs would be in soon.
“If we can control some property with the infrastructure in place, it gives us an advantage,” Calhoun said. “We’re in the process of doing that, and that is my number one recommendation.”
Mosley added build-ready sites are more enticing to companies.
“There’s more to it than just saying ‘there’s a piece of land you can build on,’” Mosley said. “There has to be other things in place before they’ll pull the trigger, and the state’s certified build-ready program is the most extensive we’ve seen anywhere.”
Calhoun also stated a number of properties have been put on StateBook.
According to the website at www.statebook.com, StateBook is an online marketplace for site selection and economic growth and development.
“I said when I got here it would be 18 months before we got the first company,” Calhoun said. “I think we’re on track for that.”
Kennedy asked for clarification on what sort of park they were considering.
“Explain to me the difference in an industrial park and a business park,” Kennedy said.
Calhoun explained a business park does not involve heavy manufacturing.
“There will be no heavy industry, and there won’t be anything that’s environmentally sensitive,” Calhoun explained. “It will be restricted to light manufacturing — for example, building automobile parts and things like that — and then business or business offices.”
Kennedy pointed out there were multiple industrial parks built across the state in the past that did not pan out.
“During the Paul Patton administration, there was a drive statewide to build industrial parks,” Kennedy said. “There were approximately seven regional industrial parks built in this state. Two-thirds of them folded. They’re sitting empty all across the state. What is going to make this different?”
Calhoun said a business park would go after a different sort of customer.
“I’ve done this — I developed a park in my prior position, 250 acres — it’s an entirely different sector of the economy,” Calhoun said. “Some of the elements we would put into it would satisfy that base of customers…a heavy industrial site…that’s not going to work…you have failed industrial parks because they have limited themselves to the very basic elements of any park and not gone above and beyond that. It’s all about the infrastructure you have in place and how you restrict it, and the segment of the cluster that you go after. The people we’ll be trying to appeal to here will be either light manufacturing or office uses.”
Calhoun said many of the industrial parks failed due to not employing the correct marketing strategy.
“All I’ve got to say is go get ‘em,” Kennedy said.
Reach Joe P. Asher at 606-909-4132 or on Twitter @joe_hde