Carroll County supervisors will travel this week to Alabama, where they plan to visit a data center on a fact-finding mission related to a proposed development at the regional Wildwood Commerce Park.
The development, code named “Project Lightning,” has not been moving at a lightning pace. This month, the county’s board of supervisors broke with its partners in the commerce park — Grayson County and Galax — when it voted against handing over the project’s final approval to a regional economic development authority.
The unanimous Oct. 5 vote came about a month after Carroll board members passed an emergency zoning ordinance regulating large data centers in their county, where the Wildwood park is located off Interstate 77.
It was unclear where in Alabama the supervisors and their guests are headed. The county’s administrative coordinator, Crystal Adams, said late last week that County Administrator Mike Watson is the only one with that information, and he was out of town at a conference. Messages to the board members were not returned.
Local officials have said that the project, if approved, could deliver millions of dollars in tax revenue, sufficient to shore up flatlining budgets. Several citizens speaking in public comment sessions have said the data center could be a good thing, but many wanted to know more about what exactly would be coming, and Carroll County residents in particular were keen to maintain local control of decisions on an industrial park near their home.
Grayson County supervisors in late September, and the Galax City Council in early October, voted in favor of amending their agreement with the Blue Ridge Crossroads Economic Development Authority, giving power over final decisions to the authority, whose board includes two members of each locality’s government.
Now they’ll have to wait at least until Carroll County leaders visit Alabama.
“I’m unsure of which direction they are going at this time,” Watson said in a phone call earlier in October.
The final spot
Site 1 is the last remaining parcel at Wildwood Commerce Park. The 75-acre plot in Carroll County is home to multiple abandoned mines whose presence has driven off potential suitors over the years.
An engineering report obtained from the economic development authority via a Freedom of Information Act request showed 28 features, including pits, trenches and collapsed shafts near I-77. Mines in that area yielded copper, zinc, iron, arsenic and other materials, according to the report. Two of the abandoned mines were filled with trash, including tires, appliances and a toilet.
“In fact, we felt for a long time that it would be extremely difficult to develop, and we thought it might be a throwaway site that would never be developed,” Grayson County Administrator Steve Boyer told his board of supervisors recently.
Then “Project Lightning” came calling.
Rumors and FOIA requests have flown, and in the recent government meetings, officials publicly addressed some of the transparency concerns.
In a Sept. 29 special meeting of the Grayson County Board of Supervisors, Boyer said he expects an investment of more than $11 million over a three-year period to build a project that would employ at least 1,000 construction workers, then employ 200 people at about $85,000 a year once it’s finished.
The facility’s closed-loop water recirculating system would require 25,000 gallons of water per day to cool its servers, Boyer said. That’s less than about 40,000 gallons that the two local golf courses average daily and the 85,000 gallons that recently closed yarn manufacturer Parkdale Mills, in Hillsville, used per day in Carroll County, Galax officials posted on the city’s Facebook page.
The water would come from Public Service Authority pipes, with discharge processed through its wastewater system, the city posted.
Project Lightning would pay for power transmission upgrades needed at the industrial site, and recent State Corporation Commission requirements should mitigate utility cost increases for the region’s citizens, the city posted.
Boyer and Galax officials expect that after the site is complete, it would deliver about $1 billion in new tax revenue for Galax, Grayson and Carroll to divide evenly over the following 10 to 15 years — about $22 million each annually, if stretched over 15 years.
That annual revenue would be about 40% of Carroll County’s $55.5 million fiscal year 2027 budget. It would be about two-thirds of Grayson County’s recent annual budgets of at least $30 million. Galax’s fiscal 2027 budget is $29.3 million.
“With this future revenue, we can do a lot of things,” Boyer said, adding that he is “confident we’re working with the right company.”
Boyer gave those details along with a pitch for the board to approve the amended agreement among the Blue Ridge Crossroads Economic Development Authority and the three localities.
“Now this doesn’t guarantee anything,” Boyer said.
Boyer told his board that all three localities’ signing the agreement was crucial for negotiations to “move forward,” with very limited options if they don’t.
Revenue issues
Without that windfall, Boyer told the supervisors and visitors to the Sept. 29 meeting streamed on YouTube that they would have to make tough choices on the county’s revenue, as no growth lies on the horizon otherwise.
“The only way for us to grow at this point is to tax our citizens or cut services,” Boyer said. “The board can raise real estate tax or property tax. We just don’t have revenues coming in, and the revenues are flat, and your costs are going up. Everybody understands what diesel … costs now. It’s just getting really expensive. Our healthcare costs just went up another half million dollars.
“But where the board is, if we don’t increase revenue, we’ll be looking at cutting things like the sheriff’s office, parks and rec, library, trash service, and the money we provide, $1.7 million to the volunteer agencies, volunteer fire and volunteer EMS. We’ll have to reduce what we spend there. That’s really a bad place to be financially.”
Galax officials made a similar argument on the Facebook post, concluding that the possible revenues from a data center at Wildwood could broaden the tax base such that the city could not only avoid “tax increases on citizens” but can “significantly” lower them.
Watson, the Carroll County administrator, said finances are “stable” there, but he is mindful of yearly increases in expenses and state mandates that cost the county money.
“I can see in the next few years that we’re going to have to either cut services or increase taxes,” he said. “We’re all in the same boat. We’re trying to stretch the dollar as far as we can and still provide the services that the community, that the citizens, want.”
Wildwood Commerce Park is the best hope for increased revenue in Grayson County and Galax, where there are few remaining sites suitable for industry, officials said. They partnered with Carroll County in 2010, with each investing more than $6 million to develop the site, Boyer said. Grants from the Virginia Tobacco Commission, GO Virginia and the Virginia Department of Transportation contributed to a $23 million total investment, he said.
“We still owe almost $4 million,” Boyer said. “That’s the number we’ve got to pay every year.”
Fifteen years later, the park landed its first tenant, a greenhouse operation called Pluck’d, which represents a more than $100 million investment, but the annual payment in lieu of taxes is about $575,000 per year, split three ways, he said.
Local government officials acknowledged that key discussions have happened in closed meetings and that a nondisclosure agreement is in place. Cardinal News is working under the Freedom of Information Act to obtain a copy of that agreement.
Nondisclosure agreements are common in economic development, officials said. But much of the pertinent information has come out publicly, in meetings and in social media communications, said Watson, the Carroll County administrator.
Such agreements, better known as NDAs, protect the company names or properties in question, “just because of the competitive nature of these projects … every economic development project out there usually starts with an NDA,” Watson said.
Who makes the final call?
But local control is a pressure point. In the Carroll County board meeting, multiple speakers asked the council to reject the amended agreement with the economic development authority.
What’s more, the county in mid-September passed an emergency ordinance — in effect for 60 days, which started Sept. 14 — that includes provisions requiring noise limits between 60 and 70 decibels, engineering analyses to estimate water use, and for developers to pay for utility rate increases and system upgrades, according to the ordinance, posted on the Carroll County Facebook page.
By Grayson and Galax accounts, Project Lightning has already agreed to ordinance requirements for a closed-loop cooling system, power transmission installation and noise limits.
Wendy Hartung, speaking at the Carroll County meeting, said she was skeptical about the water consumption figures, which come from “hypothetical numbers from something that hasn’t even been developed.”
Nor was she aware of how many diesel-powered generators the project might require for backup power.
April Cope, from the county’s Pine Creek district, said she has studied reports, agreements, articles, studies and other information about data centers elsewhere.
“And the more that I learn more, one question keeps coming back to me,” Cope said. “Why would we give away our local decision-making power right now?
“I’m a salesperson. I sell to people every day,” she said. “And one thing I absolutely hate is pressured sales. I don’t like somebody pressuring me into making a decision. And I don’t like making my customers feel pressured either.”
Maybe the promises from the as-yet-unidentified data center will come true, she said. Cope and other speakers did not want their supervisors to allow the economic development authority to take such control over the decisions, saying that Grayson County and Galax had done so with haste, and many expressed skepticism about data centers in general.
“But when the numbers are this big and the consequences are this permanent, why does this decision need to move so quickly?” she said of the amended agreement proposal. “If this is truly a good deal for Carroll County, it should still be a good deal after we’ve had time to ask and get real answers.”
Her county’s supervisors will be headed south soon, searching for at least some of those answers.
