The Shadow
LOW MOOR — A proposed $1.5 million expansion by Bennett Logging & Lumber in Alleghany County is proving to be complicated.
The company, owned by Steve Bennett, chairman of the Alleghany County Board of Supervisors, wants to establish a hardwood kiln operation on abandoned railroad property near Selma.
The property, once known as the C&O Railyard, is now called Clifton Forge Railyard South. It was purchased by the county in 2012 from three private investors for $232,025, or $7,439 per acre. The property, which totals 31.19 acres, lies in Alleghany County and the town of Clifton Forge. The county purchased the land for economic-development purposes.
David Kleppinger, executive director of the Alleghany Highlands Economic Development Corp., said Bennett Logging & Lumber began evaluating a possible expansion in 2004.
In 2006, the company purchased a kiln drying operation in Greenville, located in Augusta County. Kilns are generally used to dry lumber for hardwood flooring.
As expansion plans have begun to proceed following an economic recession, Bennett has decided to move the kiln operation to Alleghany County, where he has operated his sawmill business for 40 years.
“Mr. Bennett has more than 60 employees and he would really like to grow his business here,” Kleppinger said.
The expansion would create 15 new jobs. Kleppinger pointed out that Bennett Logging & Lumber wants to begin the expansion project soon so it can meet the growing demand for hardwood products in foreign countries.
“They need for this to happen right now. It’s at the point where this needed to happen yesterday,” Kleppinger said.
Bennett said his company’s sawmill in Selma has been the main focus of business for 40 years, but the global economy is necessitating change. The company is now exporting hardwood products to six or seven foreign countries.
“Wherever these warehouse buildings and kilns go, that’s going to be the heart of our company for the next 40 years,” Bennett said.
The Clifton Forge Railyard South property is located less that one mile from Bennett’s sawmill in Selma. It’s also near Interstate 64 and has available water and sewer access. Natural gas may be extended to the property if Bennett’s expansion project moves forward. Bennett said his company may be willing to install a large line so that natural gas can eventually be extended to the Selma area.
But the narrow configuration of the useable portion of Clifton Forge Railyard South will pose development challenges. The property is 3,200 feet long, but flood zones create a narrow, buildable area.
“It’s a complicated piece of property,” Kleppinger said.
Bennett Logging & Lumber is considering two options for the first phase of its expansion. The first option, known as Option A, would involve the purchase of 22.74 acres from the county for the construction of an 80-by-280-foot dry wood warehouse and wood-drying kilns. The facilities would be located within the town of Clifton Forge.
However, purchasing and developing the 22.74 acres is largely contingent upon zoning in Clifton Forge. Last year, the town eliminated M-1 zoning for industrial purposes and placed the property under R-1, which covers residential uses.
“The big issue is how the town will address this,” Kleppinger said. “Quite frankly, it’s not a very business-friendly approach.”
County officials said they were unaware of the zoning change. In March, County Administrator John Strutner contacted town officials and asked that the property to be returned to M-1 zoning.
“The county believes the best zoning designation for the two parcels inside the town’s corporate limits would be one that permits, by right, the same types of uses permitted in the county’s M-1 zoning district.
“The county respectfully requests that the town proceed to re-visit this apparent oversight in its recent re-working of its zoning code and zoning map, and correct the situation,” Strutner wrote in a March 27 letter to Clifton Forge Town Manager Darlene Burcham.
Burcham replied to Strutner’s letter by saying she had discussed the issue with town council “and they are not interested in returning an industrial zoning designation by right to our zoning ordinance, but are willing to entertain a conditional zoning request.”
If the zoning in Clifton Forge cannot be resolved, Bennett would consider Option B, which would involve the acquisition of 5.02 acres in the county that are zoned M-1.
The kilns and warehouses would be placed on the 5 acres, with no possibility for future expansion.
“Expansion beyond [the five acres], I guess, would occur somewhere else,” Kleppinger said.
A third option would be to carry out the expansion in Augusta County.
Nevertheless, Bennett is expressing optimism that he will be able to resolve the zoning issues with Clifton Forge so the expansion can move forward in Alleghany County.
“I understand where Clifton Forge is coming from. They want to be a little Mayberry-kind-of town and with the exception of a few things, they seem to be doing a heck of a good job at it,” he said.
Alleghany County Commonwealth’s Attorney Ed Stein was at Tuesday night’s meeting to explain that Bennett’s potential purchase of the publicly-owned property does not pose a conflict of interest.
“There is nothing in the state code that prohibits it, but Mr. Bennett cannot participate in any way in the decision-making process,” Stein said.
Kleppinger has overseen negotiations with the county since he was approached by Bennett in September. The proposed sale of the property to Bennett became public in April. Bennett recused himself from discussions until after supervisors agreed to sell him the property at $7,439 per acre.
County Attorney Jim Guynn said the county must now develop a purchase-option agreement with Bennett’s company.
Last year, the Clifton Forge Railyard South property assessed at $156,100 ($5,005 per acre). The county appealed the reassessment and it was raised to $248,000 ($7,951 per acre.) The county is now proposing to sell the land to Bennett for $7,439 — the same amount it paid the land.
Falling Spring Supervisor Matt Garten called the proposed selling price fair, given the challenges the property will pose to Bennett.
“After looking at the property, I learned that you’ve got to find a way to use the property. I agree with [the selling price]. It’s a difficult piece of property to develop,” said Garten, who originally felt the selling price was too low.
Kleppinger also sought to shoot down notions that Bennett is receiving preferential treatment.
Kleppinger said that in addition to the challenges Bennett will face in developing the property, his company will pay high machinery and tools taxes, particularly if the expansion occurs in Clifton Forge.
When the county and town’s machinery and tools taxes are taken into consideration, the effective rate is $12.75 per every $100 of assessed value.
“It’s not the highest rate in the state, but it’s not anywhere near the lowest,” Kleppinger said.
The taxes would be 20 percent lower in Augusta County.
“I know that because of his position, some people may think that Mr. Bennett is receiving special treatment. That’s far from the case,” Kleppinger said.
