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Grant Program to Promote Regional Cooperation Is on Fast Track in Virginia General Assembly



If Virginia’s fractious localities can’t stop squabbling and play nice on their own, state leaders are hoping a monetary incentive will entice them. The projected cost to state taxpayers: $38 million and counting.

That’s how much Democratic Gov. Terry McAuliffe put in his two-year budget for an initiative designed to encourage regional cooperation stoke Virginia’s lagging economy. The initiative is sailing through the Republican-controlled General Assembly with widespread bipartisan support, spurred by a high-powered coalition of Virginia business leaders.

Legislation pushed by the Virginia Initiative for Growth and Opportunity in Each Region – GO Virginia for short – won the unanimous approval Wednesday of the budget-writing House Appropriations Committee, a sign that it’s on a fast track to approval by the Assembly.

The initiative arose out of mounting concern about economic conditions in Virginia. Hit hard by cutbacks in federal defense spending, economic growth has slowed to 48th among the 50 states.

“We saw our economy going the wrong way, and we had to have a solution,” John “Dubby” Wynne told key lawmakers Wednesday. The driving force behind GO Virginia, Wynne is a Hampton Roads philanthropist and retired CEO of Landmark Communications, predecessor of the company that owns The Virginian-Pilot.

Regional cooperation is essential to economic development, Wynne said, but localities seem unable or unwilling to cooperate voluntarily, so it’s time to try financial incentives. “We’ve got to do something here to change that behavior,” he said.

The legislation establishes the Virginia Growth and Opportunity Board, a 21-member body that would include senior lawmakers and members of the governor’s Cabinet but whose majority, 11 members, would come from private business.

The state board would make grants, based partially on population and partially on competitive applications, to between eight and 10 regional councils. Those councils, in turn, would allocate the money for economic development projects in their regions. The ultimate recipients of the grants could be public entities, nonprofits or public-private partnerships.

In addition, when two or more localities collaborate on a successful project, 50 percent of the state income tax revenue generated by the project would be returned to the localities as a reward.

House Majority Leader Kirk Cox, R-Colonial Heights, and Del. Tim Hugo, R-Fairfax County, the lead sponsors of the legislation, portrayed the initiative as a new paradigm in economic development.

Cox said the state has spent $679 million since 2010 on economic development, but it’s unclear what the state has gotten for its money. State leaders were spooked by an investigative report in The Roanoke Times last month detailing how Virginia spent $1.4 million on a business deal in Appomattox that never materialized.

GO Virginia is a safer bet because it’s being driven by the state’s business community, Cox said. “These are people who create jobs every day in the commonwealth.”

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