Bill Grunkemeyer
Many elected officials desire to make that big announcement that an industrial firm has chosen to locate a new manufacturing facility in their community. Before such an event can happen, those same elected officials, working with community leaders, must make a series of difficult decisions regarding the creation of an industrial site. Unless a community has created an acceptable industrial site, they have little chance of attracting the construction of a new manufacturing firm. The first dilemma facing community decision makers is understanding just what an acceptable industrial site is in the eyes of the executives of a manufacturing firm. This dilemma is especially difficult to resolve as no universal site description exists that will guarantee to meet the priorities of all industrial firms.
Each industry has particular needs that cause a specific site to be more appropriate for their uses than another. However, community officials and leaders can discover some basic standards that will enhance the probability that an industrial site is ready for the construction of a manufacturing facility.
The following criteria provide general guidelines to assist community officials and leaders in evaluating the ability of their community to meet some basic foundations required for the creation of an industrial site.
Industrial firms desire to locate in zoned areas. Officials of industrial firms want to be good neighbors in the community in which they locate and, similarly, to assure that in the future good neighbors will also locate near their facility. Zoning assures that a firm is locating a facility in the area of the community where public officials and residents desire industrial activity. Industrial firms seek locations that cause the least inconvenience for residential and commercial areas.
To meet this goal, firms will seek sites that minimize their operation's impact on environmental quality for residents. Therefore, local officials should consider the direction of prevailing winds so odors and noise levels will not be an issue. In addition, zoning also assures that minimum standards are set for any future development on adjacent sites. Public officials need to assure that the community's industrial site is properly designated as a manufacturing zone. There should also be an attempt to identify the level of manufacturing use, such as a light or heavy manufacturing zone. Community leaders need to also consider the appropriateness of covenants. Covenants can limit the type of industry that locates on the site. For example, not allowing fencing or requiring storm water ponds will create a particular environment that encourages some industries and discourages others.
An industrial site should be located adjacent to a state highway, preferably within ten miles of a four-lane highway. When an industrial firm locates near a state highway they are assured access to a road constructed for tractor trailer use. If a community chooses to develop an industrial park, rather than a single industrial site, then it is important that the road going through the park has two access points to the state highway. Two access points guarantee that a firm locating in the industrial park will always have usable access and egress in case of an emergency. For example, if a vehicle accident should block one of the access points, the industrial firm can still meet it's shipping schedule through the other access point.
Topography of the site is also an important factor. Companies usually seek fairly level sites with adequate drainage to avoid standing water. Depending on a firm's desire for aesthetic considerations, a gently sloping site may be attractive. Once again, in considering topography a firm is trying to decrease the cost of site work. If a community is located in a hilly region it is still possible to find an acceptable site by laying out a plan that locates the firm on a plateau or terraced section of a hill. This could be very attractive, particularly if the community takes into consideration easy access and high visibility potentials.
Test boring information should be available for the entire industrial site. At a minimum five borings should be taken, one at each corner of the site and one in the center of the site. The borings should be to a depth of twenty feet and the ground water table level clearly noted. This information will help an industrial firm determine the amount of topsoil that must be removed and the load bearing capacity of the soils. Manufacturing equipment requires a greater soil bearing capacity than the actual building structure.
The organization representing the community should have a written option or some legal form of site control assuring that the property can be purchased for the asking price. The purchase price should be set at a figure that reflects the regional "fair market value" for industrial land. In addition to price, other details should be clearly stated, including available date of transfer, who pays transfer fees, closing costs, legal fees, and current agricultural use value recoupment tax costs if the land is presently in agricultural use. If the property is currently used for growing crops, clearly state the standards for calculating crop damage costs and identify who is responsible to pay those costs.
Utility standards are determined by the size of the site and its proximity to utility supplies. An engineering study and plan should detail how services will be provided. The following are some suggested minimum standards community leaders can use as a reference for technical discussions:
If the community's industrial site does not currently have utilities at the site, all is not lost. The engineering plan should include a cost estimate for construction, who will pay for the improvements, and a construction timetable that assures services will be available in ninety to one-hundred-and-twenty days from the date the industrial firm enters a purchase agreement. If this construction time cannot be met, then the minimum schedule for providing services needs to be determined and clearly stated.
Usually in the first phase of an industrial firm's site search, executives will ask if tax incentives are available. To be competitive, a community should have an enterprise zone established that includes the industrial site the community wishes to promote. An enterprise zone allows the local political jurisdiction to negotiate a tax reduction on real and personnel property taxes for improvements to the industrial site. The legislative body of the effected local political jurisdiction needs to enact the necessary legislation before the industrial site is promoted. It is also helpful if the effected legislative body has established some general guidelines for the percentage and length of time an industrial firm can expect as an incentive based on the firm's investment.
A phase-one environmental site assessment should be completed. An industrial firm needs this information to secure financing and to assure the absence of environmental issues regarding the site. This assessment reviews historical use of the site, evaluates existing conditions, and is performed by a qualified engineering firm.
A wetlands evaluation should also be completed to assure the industrial firm will not violate wetland environmental standards. The community should also review their local flood plain map and zones to assure the site is not in a flood plain. If either or both situations exist, then the industrial firm will incur additional construction costs should it choose to locate on the community's industrial site.
An archeological study may need to be completed if the community anticipates using federal or state funding to make improvements to the site. Community officials should discuss the issue with potential federal and state funding sources to determine the necessity for an archeological study. If such a study is needed, then the study should be completed before promoting the site. Failure to do so will probably result in the delay of the industrial firm's construction schedule as the archeological study will need to be completed before construction can start.
Community officials and leaders need to evaluate the ability of potential sites to meet the criteria listed for the location to be an acceptable industrial site. The criteria previously presented is intended to assist a community in meeting the preparedness requirement for successful industrial attraction. A community that fails to meet this preparedness requirement will only be frustrated at their inability to attract an industrial firm. Industrial firms are often trying to meet ambitious construction schedules. As soon as a specific location is selected, a ninety to one-hundred-and-twenty day construction schedule is not unusual. An industrial firm will want quick responses to specific informational requests, sometimes within twenty-four hours. Without accurate and prompt answers to the firm's site questions, a community may be removed from location consideration.
Many potential locations for a community industrial site usually exist. Community officials and leaders should first evaluate the criteria which incur the least financial risk. For example, before constructing a waterline to a site, the community should consider if proper zoning can be established. If public dollars are invested in a waterline to a site that cannot be classified as industrial zoning, then dollars appear to be wasted on that particular site. Issues such as zoning, highway access, ownership, and incentives can be reviewed and decided upon without a great deal of financial investment. Location and capacity of utilities can also be considered before investing in detailed engineering costs simply by estimating the distance to the site. Finally, dollars will need to be invested in soil tests plus environmental and archeological studies. However, even the risk of inappropriate investment in these studies can be reduced by discussing the issues with qualified professionals and by reviewing the past use of the site with local residents.
All educational programs conducted by Ohio State University Extension are available to clientele on a nondiscriminatory basis without regard to race, color, creed, religion, sexual orientation, national origin, gender, age, disability or Vietnam-era veteran status.
Keith L. Smith, Associate Vice President for Ag. Adm. and Director, OSU Extension.
TDD No. 800-589-8292 (Ohio only) or 614-292-1868