Panel spent $116M in '12 in Va's tobacco region

RICHMOND, Va. (AP) -- A commission created to spark development in southwest and Southside Virginia spent more than $116 million in the last fiscal year to change the landscape of the state's rural communities hurt by manufacturing and agricultural job losses, according to the panel's most recent annual report released ahead of a Tuesday meeting in Richmond.

The Virginia Tobacco Indemnification and Community Revitalization Commission uses bond money from Virginia's share of the $206 billion national settlement against the tobacco industry to target communities that have the highest unemployment rates. Since its creation in 1999, the 31-member panel chaired by Del. Terry G. Kilgore of Scott County, has approved about 1,525 grants for agribusiness, education, research and development, economic development and other special projects.

In fiscal year 2012, the commission approved 124 grants, including $28 million to help build industrial and commercial "mega-sites" to attract new businesses and more than $16 million to fund energy and biotechnology research. The commission also completed its role of paying out about $479 million to tobacco growers affected by programs that limited and stabilized the amount of tobacco they produced.

Additionally, it paid out a portion of one of its largest investments to help fund Liberty University's new Center for Medical and Health Sciences, a $40 million facility for programs aimed at developing health care professionals to practice in medically underserved areas. During the fiscal year that ended June 30, it awarded $12 million of its intended $20.5 million investment for the Lynchburg facility set for completion in 2014.

Chancellor Jerry Falwell Jr. and Dr. Ronnie B. Martin, the dean of the School of Osteopathic Medicine, said the commission's funding was critical to making the new center a reality.

"Sixty-seven percent of the people in southern and southwest Virginia live in health profession shortage areas, so being able to help increase access to quality medical care is a key factor in economic development as well as the quality of life for those individuals," Martin said.

The commission also has provided grants for numerous economic development projects, including $2.7 million to help fund South Boston Energy LLC's construction of a 50-megawatt biomass electric generating facility in Halifax County and $1 million for assist Danville with recruiting Web Parts LLC to relocate its computer programming, applications and data center operation there that is expected to create 260 jobs within three years.

It also approved $800,000 in funds to assist Hampton-based Faneuil Inc. with opening a customer care center for Dominion Virginia Power that's expected to create 150 jobs.

While some praise the commission's contributions to help close business deals and improve conditions in Virginia's tobacco communities, the commission's work hasn't come without controversy in recent years. Following calls for greater oversight, legislation that went into effect in July allows the state Inspector General to review the commission's work and investigate allegations of fraudulent, illegal or inappropriate activities concerning the panel's funds.

A June 2011 study by the General Assembly's investigative arm said the commission signed off on millions of dollars in economic development projects with a sketchy understanding of them, and some yielded little or no benefit in the state's poorest region. The 180-page report said there was no way to measure outcomes for nearly 90 percent of the commission's grants.

But, the report said, Southside and Southwest Virginia — regions of the state hit hard declines in tobacco, textile and other manufacturing industries the past 20 years — clearly benefited from commission support for scholarships, job training and the deployment of high speed Internet.

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Michael Felberbaum can be reached at http://www.twitter.com/MLFelberbaum .