County mulls purchase of land

By Bill Rautenstrauch, The Observer October 19, 2012 03:00 pm

The Union County government is considering borrowing some $745,000 in a move aimed at increasing availability of large lot industrial land in the local area.

The money, according to County Commissioner Mark Davidson and Union County Economic Development Executive Director Dan Stark, would buy 60 acres at the Baum Industrial Park on State Highway 82 near Island City. Stark said the property is close to being “shovel-ready” and ownership would give the community a competitive edge in the battle to attract manufacturing businesses.

“One of our weaknesses is that we don’t have a good inventory of shovel-ready land. We need more 10-plus and 25-acre-plus parcels that can be ready quickly, not land that would take four years or more to prepare,” Stark said Thursday.

Davidson, the county’s economic development liaison, said he agrees with that assessment.

“There’s a clearly identified lack of industrial ground in Union County and the region,” he said. “If we want to be successful in moving the economy forward, we need to have land in the hands of a willing seller that wants to support the local economy.”

He added that the parcel is a promising one because it is already zoned heavy industrial.

“That allows for a larger company to come in, and there would be a lower cost to the developer because it’s outside city limits,” he said.

Wednesday, Stark made a presentation to the three-member county board of commissioners, outlining a proposal to buy the 60-acre parcel from absentee owner Bob Hendra. 

Hendra ,who lives in Singapore, was a partner in an effort several years ago to build a biodiesel facility on the property. That project was never completed, but the property remains a so-called “Tier One” parcel where site development could begin within 180 days of selection.

According to Stark’s proposal, the county would borrow $445,000 from the Oregon Special Public Works Fund, and $300,000 from UCEDC. The 25-year loan from the state would have a fixed interest rate of 3.76 percent, and the 25-year loan from UCEDC would be indexed to the Oregon Short Term Fund. It would carry an 0.6 percent interest rate initially, and would not exceed 3.76 percent.

The UCEDC is a private, non-profit corporation that works to support the local economy and create jobs through attraction and retention of businesses. Stark said that neither Union County nor UCEDC itself have the resources to acquire the property. 

Access to funding

Union County, however, has access to funding that is not available to UCEDC or a private party, including the state public works fund.

Stark said Thursday that the parcel is the only one of its size and kind available in Union County now. Its advantages include proximity to a rail line and to Boise Cascade’s particleboard plant.

Stark also said that if the county does not acquire it, there is danger the property could end up divided into many smaller parcels, negating its usefulness to a larger company.

“There are several different ways it could be marketed. Once you start selling four or five acre pieces, you lose the feasibility of a planned approach,” he said.

Stark said UCEDC is on an intensive business recruitment campaign, and is hoping in particular to attract manufacturers of wood products, machinery, transportation equipment, and furniture and related products. 

 He said a business that makes products of particleboard would be an especially good fit for the parcel at Baum.

The county board made no formal decision on Stark’s proposal Wednesday, but will consider action on it in November. 

Davidson said Administrative Officer Shelley Burgess will bring loan documents forward, and give a report on how the county would fund loan payments.