County awards tax incentives to 161-job CBD manufacturer prospect
SALISBURY — The Rowan County commissioners voted Monday to award tax incentives and other inducements to a cannabidiol (CBD) product manufacturing facility in northern Kannapolis that would create 161 jobs over four years, with the average annual salary exceeding $57,000.
Known as “Project Bay,” the commissioners also gave their support to a $300,000 OneNC grant application, a state grant for job-creation projects, for the facility. That requires a $150,000 local match, which is satisfied by the tax incentives the commissioners approved.
Scott Shelton, vice president of the Rowan County Economic Development Commission, said his agency and the project are pursuing a $250,000 building reuse grant from the state. It would finance electrical, heating, air conditioning and roof improvements.
While the company remains unnamed, the EDC says Project Bay is considering a facility at 2865 N. Cannon Blvd. along with sites in South Carolina and Kentucky. The total projected investment is $21.4 million
The company behind Project Bay plans to extract, process and refine CBD oil at the new facility, then sell it to other companies that make CBD products, Shelton said.
“They are researching the effects of CBD products and are finding ways for them to be better refined,” Shelton said.
The site in question would also serve as a headquarters for botanical derivative research, and all CBD used in product manufacturing would be derived directly from hemp plants.
Proposed job categories at the plant include manufacturing technicians, lab technicians, material preparations specialists and facilities technicians.
Rowan County would retain $142,185 if tax incentives are approved for the company, would collect $568,738 and provide incentive grants of $426,553.
“This will definitely be a benefit to the tax base,” Shelton said.
The EDC estimates the project would generate about $140,705 in annual tax revenue for the county after the conclusion of the incentive period.
The company would create 31 jobs in the 2021-22 fiscal year, would top 100 employees by 2023-24 fiscal year, and would reach its full projected number by the 2025-26 fiscal year.
“Over a 10-year span, the county will reflect about $845,000 in tax revenue,” Shelton said.
The county commissioners posed multiple questions to the EDC during its presentation Monday.
Commissioner Mike Caskey, for example, asked whether the company is interested in the north Kannapolis site because of the N.C. Research Campus in that city.
“Once the oil is extracted, what will they do with the byproduct of that?” Commissioner Judy Klusman asked.
Shelton said the EDC has not “had that conversation yet” with the company.
Chairman Greg Edds said he has discovered the many uses of hemp, which include being used to produce food, rope, clothing, paper, housing material, cooking oil, flour and more.
“It is even used in concrete, biodiesel and animal feed. It can also be used to treat eczema and psoriasis,” Edds said.
In December 2018, the North Carolina General Assembly passed a bill that made it legal for farmers to grow hemp, a cannabis plant that has low levels of tetrahydrocannabinol (THC).
Products made from CBD can be used in order to relieve anxiety and assist with sleep.
If Rowan County is chosen, Project Bay will begin installing equipment in early 2020. Additional equipment installations would take place through 2024.
“We have spoken to the city of Kannapolis staff, and this meets all of their zone requirements,” Shelton said. “We will continue to work with them during this permitting process.”
Rowan EDC President Rod Crider said in a phone interview that the name of the unnamed company interested in locating in Kannapolis will be revealed at a later time but no date “has been set in stone.”
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