RD278 - Virginia Tobacco Indemnification and Community Revitalization Commission Annual Report Fiscal Year 2010


Executive Summary:
The close of fiscal year 2010 marks the Commission’s 11th fiscal year promoting economic revitalization in the Commonwealth’s tobacco region. On behalf of the Commission, I am pleased to report our progress to you.

The Virginia Tobacco Indemnification and Community Revitalization Commission will soon conclude the first of its two statutory missions: indemnification of tobacco growers against the adverse effects of a decline in quota. By the end of fiscal year 2010, a total of $458.5 million has been made available by the Tobacco Commission and other sources and represents 96% of the amount necessary to fully indemnify Virginia’s tobacco farmers. In 2010, the Commission voted to extend the indemnification pay-out timeline to 2012, and we are on course to complete our first mission by that date.

The second statutory mission is to revitalize tobacco-dependent communities. In 2010, the Commission approved 170 grants totaling an investment of approximately $131 million in the core grant programs of Agribusiness, Education, Economic Development infrastructure and incentives, and Special Projects as well as two new grant programs: the Reserve Fund and Research and Development.

The Education grant program has been an important part of the Commission’s work since its first meeting. In 2010, the Southwest Burley Scholarship and Southside Loan Forgiveness programs won a Southern Growth Policies Board Innovator Award for boosting educational opportunity. Those two programs have assisted nearly 6,000 people in the region with the cost of attaining a four-year degree. Another program important to the Commission since its inception is the funding of GED programs in the region. In southwest Virginia for example, 9,625 students have received a GED since funding began in 2000.

The Reserve Fund was established in FY 2009 to provide the commitment of funds needed to attract non-Commission funding. In FY 2010, notable uses of the Reserve Fund include a $3.8 million matching fund grant for the Buggs Island Telephone Cooperative to gain a federal grant of $18.9 million to expand broadband in Southside Virginia. The Reserve Fund also supplied $5.7 million in required matching funds so that Bristol Virginia Utilities could be successful in securing $22.7 million in federal funds to extend the broadband communications network in eight tobacco region communities in southwest Virginia. In Pittsylvania County, the Van Der Hyde Dairy Anaerobic Digester Project used a Tobacco Commission $383,000 Reserve Fund match to secure 1.15 million federal dollars.

In 2010, the Commission created the Research and Development (R&D) Grant Fund to encourage collaboration between private investors and Virginia’s educational institutions to conduct research and development in the tobacco region in an effort to support technology-based economic development. For example, the R&D Committee-approved project titled “Mid-IR (infrared) Fiber Optic Research, Development and Commercialization Facility” involves the following team: IRFlex Corporation, the private partner; Virginia Tech School of Engineering, The Institute for Advanced Learning and Research, Danville Community College, and GenEdge Alliance, the educational partners; and the Dan River Business Development Center, the locality partner.