Tuckahoe Creek Service District, a water and sewer system covering 13 square miles and serving 556 customers, was created to ease economic development in the eastern end of the county by providing a ready-to-go infrastructure.

But nothing about the TCSD has been easy.

In 2002 the county borrowed $63 million from the Virginia Resources Authority to build the service district. That investment has already accrued more than $11 million in capitalized interest the county hasn’t yet started paying off and its liability is growing at a rate of $2 million per year. 

Deputy County Administrator John Wack confirmed to The Gazette last week that about $97 million of the county’s long-term enterprise obligations are tied to the TCSD.

And if its pipes are defective, as Goochland Utilities Director Gary A. DuVal asserted last December after a force main broke on River Road, the TCSD could come with an even bigger price tag.

The cost to fix the sewer line was more than $50,000, which, considering that County Administrator Rebecca Dickson told The Gazette last month that there is only $85,000 set aside for repairs and maintenance of the district’s infrastructure, is a significant sum.  If more pipes in the district were to break, any repair costs over what is budgeted would have to come from the TCSD fund balance.

Planning for the future

At a strategic planning session held last week, Dickson said that, in addition to Courthouse Village, the county needs to aim its economic development efforts on the TCSD.

But West Creek Business Park, which was poised to be the district’s bustling center of commerce, never attracted the gold-heavy investors that were expected to rush in.

“We all know about the debt service challenge that’s facing us in the future,” said Dickson at Tuesday’s planning session, which was held by the Board of Supervisors at the Goochland Company 5 Fire-Rescue Station.

So where will the county get the money to pay the bills that are stacking up in the TCSD?

A diversified economy
Diversifying the county’s economic efforts could help, said county officials at last week’s meeting.

“Real estate is the lion’s share of our tax base… and is about 54 percent of our total revenue,” said Dickson.  Only 15 percent of the county’s real estate tax base comes from commercial real estate.

“Assessment values were down this year,” said District 4 Supervisor Malvern “Rudy” Butler, “and we need to make up that difference with growth. We need to work on small businesses, we need a dry cleaner in Centerville, we need an auto parts store. We need to work on those businesses and hopefully we can do this, we can be diversified in what we try to do.”

District 5 Supervisor James W. Eads disagreed. “”We’re not going to pay those bonds off with small operations,” he said. “We’re going to have to have at least $10-12 million per year of development, and that ain’t going to come from dry cleaners.”

Attracting new business
Dickson believes that hiring a new economic development director would, by working with the chamber of commerce and the economic development authority, help the county attract and retain businesses.

“We need to establish a marketing plan for the TCSD,” said Dickson.

“Right now we don’t have anything,” she added.

Scott M. Gaeser, principal broker of Eagle Realty Virginia and chairman of the Tuckahoe Creek Advisory Committee, agrees that growth is critical to stabilizing the district’s tax rate.

“Last year we had no choice but to have a tax increase because there was no economic development in the county,” said Gaeser. “I’m not saying we have to open the floodgates, but we have to be willing to share our county with other people.”

“Every new user that comes in, residential or commercial, helps relieve the tax burden in the future,” he added.

Gaeser says that increasing the number of users of the TCSD, which has been operating far below capacity, is the only way the district will be able to pay off its escalating debt.

Right now the TCSD serves 500 residential and 56 commercial customers, and uses 600,000 of an available 5.25 million gallons of water per day.

Raising taxes
Eads believes that the district’s ad valorem tax should be used to finance its costs.

“The people who bought the bonds and got into the TCSD, they knew from day one that the county would pay 55 percent in real estate sharing and the ad valorem tax would pay the difference,” said Eads. “If the ad valorem tax is three dollars, that’s life.”

The ad valorem tax, which was created to focus the tax burden on those who are benefitting from the system’s infrastructure, went up from 23 cents last year to 27 cents as of July 1.  That tax is expected to go up each year to address the TCSD debts and the depreciation of its infrastructure.

Water and sewer rates for the district were also increased and applied to, among other costs, a $23 million wastewater commitment to the City of Richmond.

Butler argues that raising the ad valorem tax could have a detrimental effect to those beyond the TCSD’s borders.

“Our obligations are to all the people in this county,” Butler said. “We are not going to be able to borrow money if we keep raising the ad valorem tax to pay bond, if that has to go up to 50 or 60 cents, how are we going to get people to locate here?”

Engaging landowners
Encouraging landowners to sell their property to developers would also help expand the TCSD’s customer base, said several supervisors.

“Owners of different tracts of land didn’t want to sell it for such and such a price, and prospects went away,” said Butler.

But TCSD Advisory Board member Clarence B. Robertson says that property owners in the district can’t be blamed for not wanting to sell during a bad economy.

“Some people have land and they want what they want out of it, and they have the patience to hold on,” said Robertson, who is a partner with Landvest LLC and was involved with developing  the Kinloch Golf Club, Kinloch Housing Development and West Creek Office Park. “Why should they sell their land, and pay a lot of taxes and get cash they can’t do anything with? Where would you put cash today? People are afraid of losing it.”

West Creek
In the meantime the county is hoping that new businesses will move into West Creek Business Park, which, at 3,500 acres, is Goochland’s largest development.

West Creek is located in the eastern part of the county and is served by the TCSD.  Its tenants include Capital One, CarMax, the Virginia Farm Bureau, Performance Food Group and a satellite office facility for the Federal Reserve Bank of Richmond.

Thomas Pruitt of Pruitt and Associates, the managing parnter of West Creek, says that many development projects throughout the region have stalled due to a sluggish economy that has lessened the demand for new retail or office projects.

“The only thing we can do now is to wait for the economy to turn,” said Pruitt.

One project that is moving forward, added Pruitt, is the proposed West Creek Hospital.

Karen Nelson, a spokesperson for HCA Realty, says that plans are on track for the hospital to move in this fall. Last month HCA requested a review and renewal of a master plan for the hospital, which would ultimately be a 97-bed facility that could expand and diversify the county’s tax base, and provide employment opportunities for Goochland residents.

Adding mixed-use zoning

Another proposed business in the TCSD is an Alligator Fuels car wash and convenience store off Pouncey Tract Road, which was approved by supervisors last week.

Sewer and water lines are being extended for the project. In addition to expanding water and sewer services, updating zoning ordinances would also make the district more attractive to businesses.

“I’m convinced the county has to bring zoning into the new century,” said Gaeser. “Right now we still have zoning from the 1950s.”

Goochland County Planning Director Bob Hammond said this week that there is no mixed-use zoning in the county.

Mixed-use zoning would allow different types of uses, such as residential, office and commercial, to be located within one area.

“We’re competing with other counties on economic development, but if we don’t have the lines, a road plan, a master plan for mixed-use or density, they’ll go to other places,” said Butler.

Photo by Ken Odor
Sites are available for development in West Creek Business in the TCSD. Development of the office park, once slated to house a giant Motorola chip plant, has been slow.