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Was $200,000 of TAX Money Spent For 14 (That’s Right, 14) Jobs?! Perhaps Just the Tip of the Iceberg…

It’s way past time for somebody to stand up.  I was hoping Senator Obenshain was on board several weeks ago when he wrote this but I have not seen any follow up yet!  And the Governor might ban me from his email list for this but let’s take the chance!

Here it is:

Governor Ralph Northam today announced that Hampton Farms, a division of Severn Peanut Company, Inc., will invest $5.735 million to install a bulk peanut butter production line at its peanut processing operation in Southampton County. As a result of this expansion, the company will create 14 new jobs and increase its already significant purchases of Virginia-grown peanuts by an additional $6 million, or 12 million pounds over the next three years.

Sounds great until you read this little gem:

The Commonwealth partnered with Southampton County and Hampton Farms on this project through the Governor’s Agriculture and Forestry Industries Development (AFID) Fund, which is administered by the Virginia Department of Agriculture and Consumer Services (VDACS) and made to businesses that add value to Virginia-grown agricultural and forestall products.

Governor Northam approved a $100,000 grant from the AFID Fund, which Southampton County will match with local funds. Funding and services to support the company’s employee training activities will be provided through the Virginia Jobs Investment Program, administered by the Virginia Economic Development Partnership.

So the Commonwealth of Virginia (read you, Virginia taxpayer) puts up $100 grand and Southampton County (that means you, Southampton County taxpayer!) will match it (I assumed for the purpose of this article it is another $100 grand) AND…

Remember the Tip of the Iceberg rule?  It may be applicable here, too!  There is reading this press release even more money paid out for “employee training activities” at a peanut plant that will buy only two million dollars of local peanuts each year for three years.

Again, what did the taxpayers get for their $200,000 PLUS investment?  Virginia will sell six million dollars of peanuts to a company and let’s not forget the FOURTEEN jobs!  Even if you assume the jobs are $50,000 each and assuming 6 percent on all the salary (which we know ain’t happening!) That is $3000 in taxes per each job and that would be $42,000 per year.  It would take over two years to even begin to recoup the state funds.

And the local funds?

No local income tax (Thank the Lord!) so the local taxes would be indirect at best – through buying items in Southampton perhaps!  (Or increases in personal property taxes and maybe increases in real property taxes?)

As expected, the pols were all over themselves patting themselves on the back:

“Congratulations Hampton Farms for your expansion in Southampton County,” said Senator L. Louise Lucas. “The expansion will have a tremendous impact on the local economy and add value to the Virginia-grown agricultural and forestall industry.”

 “I am pleased that Hampton Farms is expanding its peanut processing operations and peanut butter production line in Southampton County. The 14 new jobs created will benefit our families and provide additional revenue to boost the economy of rural Virginia,” said Delegate Roslyn C. Tyler. “Small businesses makes up 46.9% of the private workforce in Virginia. I have always been a supporter of increasing small businesses opportunities in the 75th district. The Commonwealth’s partnership with local governments and small businesses has been beneficial to rural areas with business expansion and new business initiatives requiring additional revenue and training support during Governor Northam’s Administration. Thank you, Hampton Farms for continuing to invest in Southampton County and the Commonwealth.”

 “We could not be more ecstatic over the Hampton Farms expansion,” said Southampton County Board of Supervisors Chairman Dallas Jones. “Agriculture drives our local economy, and this announcement not only increases our local tax base and provides additional employment opportunities for our citizens, but provides a market for an agricultural product grown in Southampton County.”

So I say:  Let’s thank them!

Here is the number for Sen. Lucas’ office:  (757) 397-8209

And here is Del. Tyler’s number:  (434) 336-1710

And here is Chairman Jones’ cell number:  (804) 894-1512

And finally the Governor!  (804) 786-2211

Remember always be nice and civil but it is okay to be a bit sarcastic!  Like this:

We sure thank you Senator Lucas for the 14 whole jobs we paid $100,000 plus for!  For a company who probably did not need the grant!

We need people to run for delegate and senator dedicated to stopping this unprofitable and wasteful misuse of taxpayers money on crony capitalistic schemes.  Time to step up!

About Elwood Sanders

Elwood "Sandy" Sanders is a Hanover attorney who is an Appellate Procedure Consultant for Lantagne Legal Printing and has written ten scholarly legal articles. Sandy was also Virginia's first Appellate Defender and also helped bring curling in VA! (None of these titles imply any endorsement of Sanders’ views)

2 Responses to “Was $200,000 of TAX Money Spent For 14 (That’s Right, 14) Jobs?! Perhaps Just the Tip of the Iceberg…”

  1. Bob Shannon says:

    No one should be surprised by this, yet another example of decisions being made by individuals who have spent their entire careers suckling on the government teat. They have never risked a penny of their own money and yet are being promoted as some sort of business genius.

    Absent the exceptions ( and there are always exceptions) most members of the General Assembly would bankrupt a snow cone stand in the middle of August.
    They have never owned a business or run a business and can not begin to understand the proper allocation of resources.

    In government the proper allocation of resources has no meaning to these folks. Their are no consequences for making bad decisions on proper allocation of resources. They simply look at government as some sort of savior, a facilitator of their goofy schemes. They view taxpayers as bottomless pockets they can pick when they run our of money and have to fund their next bad idea.

    I am almost amusingly awaiting 2020 when the 1.002 Billion comes due on the Medicaid Expansion. Watch next year as scores of members of the G.A announce they won’t be running for re-election. Many who betrayed promises they made to their voters that they would not support Medicaid expansion, only to take the benefactors campaign money and then screw Virginians will not want to now step up and find the 1 billion needed to fund this boondoggle of a bad idea.
    Bob Shannon

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    Tom White Says:

    Nothing is more conservative than a republican wanting to get their majority back. And nothing is more liberal than a republican WITH a majority.

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