Town Authorizes Cash Infusion for Berryville Graphics

Berryville Graphics is a step closer to receiving over $400K in taxpayer funding thanks to a vote by the Berryville Town Council last night. The $467,200 in public grants includes a combination of state and local funding and comes with the expectation that the German-owned company will hire 85 new employees and invest in equipment at its Berryville location.

“Berryville Graphics is the largest employer in town,” said Berryville mayor Wilson Kirby after last night’s unanimous vote to authorize $94K of town funding for the matching grant. “The town of Berryville will benefit and we want to see them grow.”

Berryville Graphics is part of Bertelsmann AG, a German-owned worldwide corporation with interests in entertainment, publishing, printing and distribution. Berryville Graphics produces nearly 120 million books each year at its manufacturing facility in Berryville, Virginia.

Under the proposed cash infusion, which must also be ratified by both the Clarke County Board of Supervisors and the Industrial Development Authority of Clarke County, the Commonwealth of Virginia’s “Governor’s Opportunity Fund” will provide the Berryville Graphics with $200K along with $67K from the “Virginia Jobs Investment Program”.

The $200K of Commonwealth funds must be matched by local funds in order for the deal to happen. Last night’s $94K authorization represents 47% of the required matching funds with the remaining $106K to be considered for approval by the Clarke County Board of Supervisors next Tuesday.

The Clarke County Supervisors and Town officials met in closed session on Monday to discuss the deal but took no action following the meeting. Last night’s Town council meeting was the public’s first glimpse at the agreement between the Town, County and Commonwealth.

Photo Edward Leonard

Under the resolution passed last night, the Town of Berryville will receive $94K from the Industrial Development Authority of Clarke County (IDA), which will act as the fiscal agent for both the state and local funds, to pay for its share of the deal. The funds will then be repaid by the town to the IDA over the subsequent three years beginning in 2013.

Town council member Mary Daniel (Ward 3) said that the Town would make the money back in three years based on economic benefit based on the additional hiring and taxes from new equipment that Berryville Graphics plans to install.

But while the 85 additional jobs will add a welcome boost to the local economy, the new hiring still places Berryville Graphics 33 employees below its 2009 employment position.

In January 2010 Berryville Graphics, eliminated 68 positions in a move designed to cut operating costs. The job cuts were aimed at shoring up the firm’s struggle to remain cost competitive in the global publishing industry. The company also released approximately 50 workers in May 2009 after a smaller layoff in January.

Under the terms of the proposed agreement between the Town and the County, Clarke County is tasked with monitoring Berryville Graphics for compliance with its investment and employment promises.

Terms of the performance agreement with Berryvillle Graphics were not disclosed at last night’s meeting.

Comments

  1. May no one ever complain about the TARP program again

  2. Another View says:

    This is an unbelievable disgrace. Everyone from Richmond on down, connected with this stupid decision to misuse taxpayer dollars should resign.

    Government is not a bank, be the “customer” a food stamp recipient or a multinational corporation.

    • Yes I agree and how many of the 85 people will be from clarke co. Most will probably come from across the state line. CC quit wasting my tax $s

  3. It’s not going to help Clarke County in the least until the powers that be start charging business taxes instead of the $30 per year business license fee.

    • Allan "Bugs" McWilliams says:

      R W /B.G. is located in the town limits so they pay a gross receipts tax.I applaud the town councils decision to keep business that is a major tax payer here.

      • They aren’t a major taxpayer, they are a major employer.

      • Roscoe Evans says:

        Bugs, I’m sure you know the numbers and the policies.

        Can you give us a line of two on who the town/county’s largest taxpayers are; and, why this policy makes financial sense? And, perhaps, why Bank of Clarke or some other institution was not the logical source of financing?

        I really do not care for inane political philosophies about taxation and government actions, but, I think wallowing in ignorance facilitates that sort of nonsense. (I’m all for what works best for the most.) Maybe you or somebody else can shed some light on the decisionmaking here.

    • No, new taxes are not need.

    • just the facts..PLEASE says:

      GREAT idea….taxing businesses more ALWAYS helps……….since you must feel that paying real estate tax , personal property tax and collecting sales tax for Clarke County is NOT enough for local businesses ……… lets punish those businesses that operate in our county with ANOTHER TAX!

  4. Complete misuse of our money…I don’t want to invest in Berryville Graphics, let them survive on their own.

  5. If you read between the lines the German-based organization approached someone (probably in Richmond as Town representatives are not senior enough) and said: Give us an incentive to stay or we’ll pack up and move somewhere that will be happy to see us come. One of the problems with foreign-based companies is that they hold little, if any, allegiance to localities in the United States. It’s about money … not community.Nothing else.
    What will happen the next time they hold a gun to someone’s head … where will the money come from then?
    They have a history of down sizing (referenced May 2009 and January 2010). Why would anyone invest in a dying industry? Oh yeah, that’s right … Berryville hierarchy thinks that dial up is “high speed internet” and that the publishing industry is a flourishing industry on the verge of exploding. (cough)
    I’d rather use my tax dollars to make certain our kids have school books. THAT is investing in community!

  6. ElinorDashwood says:

    I agree. Nothing against Berryville Graphics or it’s employees but the printing industry is in a downward spiral and no amount of money thrown at this company is going to keep it going beyond the next ten years, probably less.

    • Another View says:

      I don’t care if it is the most successful company in the world. Taxpayers’ monies are not for government to invest in private businesses or individuals. Success or not, the act itself is wrong.

    • ElinorDashwood says:

      I find it amusing that I’m actually on the same page as AV on this issue (usually we aren’t even in the same book), and he still wants to try to argue with me. 🙂

      • You flatter yourself. He isn’t arguing with you. You’re misinterpreting his agreement.

        • ElinorDashwood says:

          I beg to differ. If he were just posting an opinion to the article like everyone else, why did he hit the REPLY button to my comment (as you did) instead of just putting his comment at the bottom of the page?

  7. Berryville Graphics Invests $10.6 Million To Consolidate Operations In Clarke County, Virginia
    (06/13/2012)

    Virginia Basic Business Taxes 2012
    Virginia Direct Financial Incentives 2012

    Berryville Graphics, an affiliate of German-based Bertelsmann AG, Europe’s largest media company, will invest $10.6 million to consolidate its book printing operations at its manufacturing facility and headquarters in Berryville, Clarke County, Virginia, creating 84 jobs.

    Governor Bob McDonnell said, “Berryville Graphics is one of the largest, fully automated book manufacturers in the U. S. and is a part of Europe’s largest media company. During my 10-day marketing mission to Europe, I had the opportunity to meet with Bertelsmann’s CEO personally to close this important deal for Virginia. Berryville Graphics has thrived in Clarke County since 1956, and with this significant investment will keep its operations in the Commonwealth and create 84 new jobs.”

    “Building new relationships and strengthening existing partnerships with European companies is the focus of the Governor’s marketing mission, and this project is a tremendous result,” said Jim Cheng, Virginia Secretary of Commerce and Trade. “Berryville Graphics and Bertelsmann AG are important corporate partners to Virginia, and we further solidified this bond. The Town of Berryville in Clarke County has been the ideal business environment in which the company has thrived, and I congratulate all involved on this great investment and new jobs.

    BVG produces nearly 120 million books each year at its manufacturing facility at 25 Jack Enders Boulevard in Berryville, west of Leesburg, Virginia. “The book industry has faced many challenges over recent years, forcing us to review existing capacity and ultimately, reduce the number of physical locations,” said Dave Liess, President & Chief Executive Officer of Berryville Graphics and Coral Graphic Services. “While this was not an easy decision, the excitement and partnership shown by both the State of Virginia and Clarke County has reinforced our belief that Berryville is the right place to invest. I would like to thank everyone involved in making this expansion possible and we look forward to many more successful years in Virginia.”

    The Virginia Economic Development Partnership worked with the Town of Berryville and Clarke County to secure the project for Virginia. In a package of incentives, Governor McDonnell approved a $200,000 performance-based grant from the Governor’s Opportunity Fund to assist the Town of Berryville and Clarke County. In addition, through its Virginia Jobs Investment Program, the Virginia Department of Business Assistance will provide funding and services to support the company’s recruitment, training and retraining activities.

    “Berryville Graphics has significantly enriched the community for many years, not only in terms of job creation and retention, but also by their regular payment of property taxes and consistent generosity to community groups,” said Michael Hobert, Chairman of Clarke County Board of Supervisors. “We want this valued partnership to endure. Our aim is to encourage Berryville Graphics’ continued growth in Berryville and Clarke County. We also believe this collaboration will bring about increased productivity, helping to keep Berryville Graphics competitive, and leading to the hiring of even more workers who will contribute to the economic life of the community.

    THIS WAS A DONE DEAL IN JUNE!!!!

  8. It is probably cheaper for a family to buy something like a kindle for the kids and the school to buy the license for books. The problem: Kids trashing the electronics.

  9. Realistic Joe says:

    A company should make it or not on their own merits.

    There should be NO taxpayers funds spent in this way – County, State or Federal!!!

    The Entitlement Mentality will be the ruin of our future and it’s coming in hard and fast.

    [redacted] has finally hit Clarke in a way that no amount of head shaking, tongue wagging will change.

    Hammer your elected representatives and I don’t mean just Clarke Co…as they are letting it happen and on levels that are unbelievable and unnecessary!

  10. livein22611 says:

    Where is the county finding 106k to give these people??? What guarantees are there in this deal??? And after all the crap they put the school system through! What gives the BOS the right to give a private (foreign!!!) business operating capital?? This is ridiculous and these bozos need to be voted out next election. Someone, anyone, needs to run against these clowns. After all the talk about a tight budget……guess that’s just bull. Will these be Clarke County jobs?? No. Idiots!!!! All of them!!

  11. Every time I read this paper my decision to leave Clarke is reinforced….

    Such a shame such a great community is so mismanaged….

  12. Fly on the wall says:

    Technically, Mayor Kirby, BVG might be the biggest private-sector employer in Berryville, but the biggest “employer” is the county staff in the town (JJC and schools).

  13. Got-A-Dollar says:

    The state funding portion came with the blessings of our Republican govenor, I thought they were against throwing away taxpayer money!

  14. Roscoe Evans says:

    As a job creator, I see nothing wrong with this.

    I’ve got four rental properties, and starting 9/15, I am sending my lawn boy’s bills to the Mayor’s Office, to have them paid. I’m also going to have my cars serviced, and having invoices from BAP sent over on 10/1.

    I’m sort of semi-retired, but I had 5 employees in my DC office until last year. I figure its only fair to send the last three years’ salary figures to the mayor there, and demand repayment.

    I also donate to Heifer International, OxFam, and The Smile Train, and I am sending a letter to Governor Bob this PM, demanding matching grants to each charity, from Virginia’s treasury, to be paid, ASAP.

    In return, I promise to pay my taxes no later than April 15 each year, and to not fire any of my current employees for the next 30 days.

    My guess: there is more to this story. It would be nice to see a follow up.

  15. How many of those employees live in Clarke County and pay taxes and do business locally? How much local busines does BG create? Lots I am sure

  16. Hardly none are from CC. Look at the line coming outta that place at shift change. All West Va plates……

  17. Something is so not right here!

    Bertelmans AG is made up of corporate divisions, each one is MULTI billion $. http://www.bertelsmann.com/

  18. My 2 cents, thats what I’ve been hearing also.

    After reading their website I became confused. http://www.bertelsmann.com/.. Go to charts, there you will find the amount of revenue they make, it’s in the BILLIONS!

    The fact is Berryville Graphics was moving on, out of this Town! How long will they be staying in Berryville if this deal goes through?

    I’d really like to know where the money is coming from?

    In June our Police dept was in need of funds. Our Sheriff shouldn’t have to beg for money and then be turned down!
    From CDN: Roper has stated publicly during previous meetings with the Supervisors that there have been multiple occasions in 2012 when no deputies from his department were on duty due to budget limitations.

    This money they some how found, should go straight to our Police dept!

    BTW Berryville Graphics prints school textbooks. They should have had 300-400 textbooks thrown in as part of the deal.

  19. George Archibald says:

    It is an astonishing scandal that our government is giving taxpayer money to the country’s largested multi-billion-dollar book-publishing conglomerate whose profits go to Germany, where its foreign-owned corporate owner Bertelsman is located. To add insul to to injury, the performasnce agreement between Berryville Graphics, the Bertelsman subsidiary, is being kept secret by our Town Council and Board of Supervisors? Right here, on Clarke Daily News online, I ask under the Virginia Freedom of Information Act that this performance agreement be produced and made public forthwith.