Henrico supervisors create new investment program to incentivize redevelopment
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Henrico’s Board of Supervisors Nov. 10 created the Henrico Investment Program, which they hope will incentivize property owners in five regions of the county to redevelop their land.
The program is designed to help take the county’s participation in the Virginia Enterprise Zone Program (which offers similar incentives in designated areas) a step further.
It will apply to portions of five regions in the county:
• Mechanicsville Turnpike: from the city line to Henrico Plaza;
• Staples Mill Road: from Parham Road to Dumbarton Road;
• Patterson Avenue: from Starling Drive to Goochland County line;
• West Broad Street: from Hungary Spring Road to Pemberton Road;
• Williamsburg Road: from Laburnum Avenue to Nine Mile Road.
The enterprise zone program provides benefits for businesses, such as permit fee waivers, landscaping grants, off-site improvement grants and design assistance. But the county’s zone (which includes about 3,840 acres) is limited by state regulations and will expire in December 2022. A 5-year extension application is available, but the county would be unable to reapply after 2027, according to officials.
The purpose of the Henrico Investment Program would be to provide incentives to property owners and businesses both within and outside of the current enterprise zone to promote redevelopment along maturing corridors for commercial and industrial uses, Henrico EDA Research and Real Estate Coordinator Abigail Patterson told supervisors during a July work session about the plan.
Initiatives would include retaining and expanding enterprise zone incentives to the new Henrico program, in addition to establishing new programs in corridors where re-development hasn’t happened naturally, Patterson said in July. Specific incentives include signage, demolition and building façade grants, she said.
The county is expected to fund the pilot program with $750,000.
“With the new Henrico Investment Program and amended commercial tax credit program for rehabilitated buildings, Henrico and the Board of Supervisors show once again their commitment to encouraging reinvestment in the county’s mature areas and to helping businesses, particularly small businesses, to grow and thrive,” said Anthony J. Romanello, executive director of the Henrico Economic Development Authority.
Such local economic revitalization zones became permissible in Virginia after the 2017 General Assembly adopted legislation allowing counties to create them.
Though some details are being finalized, HIP is expected to offer the local incentives currently available in the Enterprise Zone program, as well as:
• allowing the sign grant to include the removal, refurbishment or replacement of signs attached to buildings;
• increasing the demolition grant to a maximum of $100,000 based on the building’s size; and
• expanding the building facade grant to include building system improvements and roof repairs or improvements.
“While there is some overlap between Enterprise Zone and Henrico Investment Program areas, applicants will be able to take advantage of the incentives from only one of the programs,” said Eric S. Leabough, director of the Department of Community Revitalization. “Because the incentives will vary slightly, businesses and property owners will be encouraged to determine which of the two programs best suits their needs.”
In a separate action Nov. 10, the Board amended the county’s commercial rehabilitation tax credit program to allow more buildings to qualify, even if they get larger during a renovation.
Since 2004, Henrico has allowed a seven-year partial real estate tax exemption when rehabilitated buildings increase in assessed value by at least 40%. Before the amendments were adopted Tuesday, rehabilitated buildings were ineligible for the exemption if they were more than twice their original size.
To allow more flexibility in design, Henrico now allows nonresidential buildings greater than 20,000 square feet to qualify for the exemption if the expanded portion is 125% or less of the building’s original size. Rehabilitated nonresidential buildings up to 20,000 square feet can qualify regardless of their original size. Seventy-one projects have received the exemption since 2004, resulting in improved buildings assessed from $150,000 to $72 million.
