What can a COF grant be used for?
COF proceeds may be used for:
- Public and private utility extension or capacity development on- and off-site.
- Public and private installation, extension, or capacity development of high-speed or broadband internet access, whether on- or off-site.
- Road, rail, or other transportation access costs beyond the funding capability of existing programs.
- Site acquisition.
- Grading, drainage, paving, and any other activity required to prepare a site for construction.
- Construction of publicly or privately owned buildings or build-out of publicly or privately owned buildings.
In no case may COF proceeds be used, directly or indirectly, to pay or guarantee the payment for any rental, lease, license, or other contractual right to the use of any property. The COF may not be used to purchase equipment or for overhead expenditures.
How are grant awards calculated?
There is no formula for calculating the amount of the grant award. In determining grant amounts, the following criteria are considered: a Return-on-Investment (ROI) analysis, new jobs, wage levels, overall employment, capital investment, area and regional unemployment, poverty and fiscal stress, the locality’s financial support of the project, company growth potential, diversification of job base, and needs of the project.
What happens if statutory program investment and employment minimums are not met?
The company must meet the statutory minimums for both jobs and investment for the given locality or be subject to a 100% repayment of the grant.
What positions do not qualify as new jobs?
Seasonal or temporary positions, positions created when a job function is shifted from an existing location in the Commonwealth, and positions with construction contractors, vendors, suppliers, and similar multiplier or spin-off jobs shall not qualify as new jobs.
Are contract employees allowed to count as new jobs?
The Commonwealth will consider dedicated, full-time, Virginia-based contractors as eligible net new jobs should the company desire to count them toward the new job targets. The requirements for contract positions are the same as for those positions on the company’s payroll and would be required to meet the same requirements as a “new job.”
What is prevailing average wage?
"Prevailing average wage" is the amount determined by the Virginia Employment Commission to be the average wage paid to workers in the city or county of the Commonwealth where the economic development project is located. The prevailing average wage will be determined without regard to any fringe benefits.
When can a company start counting job creation/capital investment?
The performance agreement will detail the date from which VEDP will start counting new jobs and capital investment. Generally, this date will be around the announcement date of the project.
Can used equipment moved to a project site count as qualifying capital investment?
Generally, the value of used equipment transferred by the company to the project site will not count as qualifying capital investment.
Are there any local benefits? What qualifies as a local match?
Localities must at least match dollar-for-dollar with local funds the amount requested from the COF. A local match may be funded by cash grants and/or an in-kind contribution from the locality for the direct benefit of the grantee, such as infrastructure development, fee waivers, or free or reduced-price land or buildings.
What is the timing of receiving the grant? Can the grant funds be front-loaded?
Typically, COF grants are released after the Commonwealth has received revenues from the project in excess of the grant amount. This may occur within the first year of the project or over a number of years, depending upon the amount of the investment, employment and wages, and ramp-up schedule. Grants may be released over time via several tranches based upon the revenue accrual for the Commonwealth. Any additional metrics regarding payout of the grant will be included in the performance agreement.