The Hall County Board of Commissioners has approved a rezoning needed for the estimated $100 million expansion of Kubota Manufacturing of America into the Gateway Industrial Centre off Ga. 365 in North Hall.
Kubota has promised to create about 650 jobs at its new manufacturing facility, but it took scrapping some standards and conditions governing property development at the industrial park to get the deal done.
And Kubota’s move will potentially increase costs, or at least offset any proceeds generated from the land sale, for the county as it continues to build out infrastructure along the Gateway corridor with taxpayer money.
Johnnie Hicks, who resides in Lula near the industrial park, told the Board of Commissioners on Thursday the exemptions granted to Kubota effectively destroy the vision for the Gateway corridor, and will lead to excessive noise and air pollution, among other problems.
“We were very encouraged when Gateway first was announced because it had an intelligent design and appropriate ordinances to protect and ensure the safety of the public around it,” she said, before adding those assurances are now in jeopardy.
Several buffer requirements and other standards outlined in the Gateway Corridor Overlay District were removed in order to approve the rezoning of about 180 acres to heavy industrial, which will accommodate Kubota’s new facility.
Brian Rochester, executive vice president of Gainesville-based Rochester & Associates, a firm that provides land surveying, civil engineering and project management services, said Kubota has been a good “corporate citizen” in the community for nearly three decades and deserves the benefit of the doubt when it comes to providing exemptions from certain standards so the company can expand its business.
“I think extending some trust to them is not a big gamble,” he added.
However, Commissioner Craig Lutz said relaxing these standards is a bad way to do business.
“I’m still having a hard time wrestling with that,” he added. “What I don’t like is having two different standards. That, in its own right, bothers me.”
Kubota’s expansion will generate an estimated 650 jobs, paying an average wage and benefits package of about $54,000 annually, and will include about $33 million in construction-related investment.
An additional $70 million to $80 million investment will be made in outfitting the facility.
The company currently employs about 1,300 workers in Gainesville.
Tim Evans, vice president of economic development at the Greater Hall Chamber of Commerce, said three local suppliers to Kubota will also benefit financially from the manufacturer’s expansion into Gateway.
And a report from the Carl Vinson Institute of Government at the University of Georgia states an additional 340 jobs are likely to be created, assuming a one-year construction time frame.
The move into the park will generate about $2.5 million in upfront cash for the county as part of its share of lot proceeds from the approximately $5.67 million ($31,500 per acre) sale of land to Kubota, according to county and chamber officials.
While that will help reimburse the county for its previous $10 million financial commitment to building out the industrial park, which includes laying sewer lines, it will be offset by the commission’s approval Thursday of up to $3 million for the construction of a public road accessing Kubota’s new facility.
“We knew we were going to spend the money,” said Philip Wilheit, chairman of the Gainesville and Hall County Development Authority, which helped negotiate the deal with Kubota. “This just gives us an opportunity to spend it earlier.”
Special purpose local option sales tax, or SPLOST VI, revenues will fund the road construction and other infrastructure projects related to Kubota’s move.
However, this revenue stream was never intended to pay for infrastructure projects at the industrial park, a fact Lutz said was concerning and the reason he did not support this expenditure.
When the Kubota deal was announced just before this year’s election, critics, such as Gov. Nathan Deal’s opponents in the gubernatorial contest, Jason Carter and Andrew Hunt, cried foul.
Wilheit, after all, has taken criticism for his involvement in the industrial park, land he and his business partners transferred to the development authority in 2012.
Wilheit has served as Deal’s campaign chairman, and Deal helped orchestrate the move of the state poultry laboratory into the industrial park, an anchor tenant for Gateway.
But charges of cronyism and back-door dealing are unfounded, Wilheit said, adding that proceeds from the poultry lab sale were pumped into building out infrastructure at the industrial park.
Wilheit said the Kubota deal, which involved no state money, was negotiated over about two years, and the announcement was made because Kubota hopes to begin grading at the new manufacturing site early next year.
“So we moved quickly,” he added. “The election didn’t have anything to do with it. I’m certainly not going to apologize” for creating jobs.
But residents, such as Hicks, said officials who orchestrated the Kubota deal should have done a more thorough job of communicating its impact on the community.
Lutz, while supportive of Kubota’s plans, also said the process had been flawed.
“And then all the sudden, snap, it had to be done and it had to be done yesterday,” he said of the deal. “I don’t think that’s the right way to do business in Hall County.”
Wilheit said Kubota’s move into the industrial park means about half of the 518-acre site is now committed to specific projects, adding he expects the remainder of the land to be developed within five years.
“It’ll be A-plus across the board,” he said of Kubota’s expansion. “There’s no doubt how important they are. Kubota gives (Gateway) great credibility.”