Culpeper's Technology Zone Cultivates an Innovation Ecosystem

We’re talking data centers to kick off Season 5! Bryan Rothamel, Culpeper County (VA) Economic Development, shares about the Culpeper Technology Zone, a 690-acre campus designated to host data centers and advance the STEM industries at the forefront of Culpeper’s economy. 

 

At Livability, we highlight the unsung awesomeness of small and mid-sized cities across the country. We also partner with communities to reach their target companies and potential residents through digital content and print magazine programs.

 

Be sure to subscribe so you’re alerted when we release new episodes. Learn more about us at LivabilityMedia.com and follow us on LinkedIn, Facebook and Instagram. Have an idea for an upcoming episode? Email host Amanda Ellis at [e-mail].

 

Inside America’s Best Cities is produced by SpeakEasy Productions.

 

Episode Transcript

Bryan [00:00:07]: Communities just really struggle, especially rural communities, with what type of development they do want to see. We were able to say, “Here's where we want to see it.” You only get one chance to do a new industry to your community and do it right. And we work really hard at doing that. Amanda [00:00:27]: That's the voice of Bryan Rothamel, Economic Development Director at the Culpeper Department of Economic Development in Culpeper, Virginia. We're kicking off a new season today talking with Bryan about industry clusters, specifically the consolidated location of Culpeper's Tech Zone. The Tech Zone streamlines power needs, leverages existing infrastructure, and centralizes the area's data center operations. Keep listening for all the details. I'm Amanda Ellis, and you're listening to Inside America's Best Cities, a podcast for Chamber, Economic Development, and Talent Attraction professionals. Learn more about this podcast at livabilitymedia.com and with that, let's jump in. Welcome, Bryan, to Inside America's Best Cities. We're so excited to have you here today. We're going to be talking about the Culpeper Tech Zone. Kick us off by just telling us, what is that? Bryan [00:01:25]: So the Culpeper Tech Zone is in our ordinance, and it's an incentivized area where we're encouraging technology companies, primarily data centers, to go into one specific area of our county where we offer incentives, financial incentives, as well as incentives that they can build a higher building. But it's a defined area of our community. One thing, though, with the CTZ is it's more than just an incentive program. It's more than just an area defined on a map. We view it as its own little organism where we want to solve the problems that it has, that it creates, and look at it holistically. What are the best ways that we can make the companies that locate into our CTZ successful and also work for the greater community? Amanda [00:02:14]: Yeah. So why was this created? Like, what was happening that sparked the idea, how did you get here? Bryan [00:02:20]: So if you go back over 20 years ago, we had one data center, which was the Swift data center, which is related to finance. Then in 2008, we landed Equinix. They had a data center, and we wanted more of this. We created five zones at the time. We didn't quite know how to target it. We knew how to target manufacturers. So we looked at the Tech Zone as just another tool in our toolbox, and we built it as if it were for manufacturers. In 2021, the conversation started heating up about data centers. We were able to land a new one. It was out in more of a rural area. Through that process we learned a lot. We learned what came with it primarily very tall strings attached with electric. And as we learned that, we were like, okay, we need to really define this a little bit better and encourage development closer to our urbanized area where we already had a power corridor established and in use. That power corridor will be upgraded and we'll need additional upgrades to power. We ended up taking one of the Tech Zones away, it was more rural and the board of supervisors decided to take that away. So it went from five to four. Over time, we kept seeing more and more activity into one specific of the four. It was previously known as the McDevitt technology zone. And we said, we like this. We like this area. It's where Equinix is already located. The power goes straight into this Tech Zone. We were able to expand it slightly and in 2023 we removed the other three and left one single Tech Zone. And that's what we're talking about now as the Culpeper Tech Zone. So that's kind of the story of how we got to one single Tech Zone. And the advantages of it. The height increase, 45ft makes a lot of sense for industrial outside the Tech Zone. It didn't make sense for data centers. We were able to increase that to 75 in this defined area. Amanda [00:04:23]: So you're already starting to talk about some of the unique needs that data centers have. And I know that some of our listeners are probably familiar with those. But can you delve more into that? Bryan [00:04:32]: The fiber connectivity obviously is very important for them, as is the electrical. If you can't get power and you can't get fiber, it's really hard for a data center to operate. Amanda [00:04:44]: It's kind of the whole thing. Bryan [00:04:46]: Again, another history lesson. We had a federal reserve building that was a Cold War era facility that created a lot of connectivity. That's why Swift decided to come. Most likely that's why Swift is in Culpeper County. That building has since been decommissioned and now is actually the Library of Congress. Everything audio and visual that is stored by the Library of Congress is stored in Culpeper, Virginia. But Equinix came and put- Amanda [00:05:13]: That's really interesting! Bryan [00:05:14]: It is. It's a really interesting building. It's built into the side of a hill, but anyway, it's really cool. Amanda [00:05:21]: How far are you all from DC? Like an hour and a half? Bryan [00:05:26]: About. So we're outside of a designated zone that if something were happening in DC, we should be outside of any… Amanda [00:05:33]: You've got it all safe. Bryan [00:05:35]: Yeah. So the network access point, though, was created by Equinix. So that created a lot more fiber connectivity. We do have that power corridor that's already established that helps power the development we see in cold pepper. So those were the two main factors. Outside of that, you have other infrastructure, such as water and sewer. We can provide all of that within our urbanized area. So that's a tremendous benefit. But then we look at even bigger things. Workforce development. These are going to be construction projects that happen over many years that are going to create a lot of trades position. Well, our technical education center for both of our community high schools, we have one technical education center that is located in the CTZ. That just happens to be where it is. The Germanna Community College campus for Culpeper happens to be in the CTZ. We find that is extremely beneficial. And our data center companies that have landed already are really looking forward to working with them, because right now, yes, they need to be powered and they’ll have employees and data center professionals, but they need to be built, and that's where we see a lot of struggle. So the availability for us to partner right in the zone is an extreme benefit and one we look forward to utilizing. Amanda [00:06:52]: Is there anything else out there like this, or is this a pretty innovative way to approach things? Bryan [00:06:57]: The way we view it is, it's innovative that we told the community what we were looking to do at the same time that we were going through the decision to how many Tech Zones do we need? Where do they need to be? We're also doing our comprehensive plan update. So we were looking holistically at the entire county of what do we want the next 20 years to look like? What should Culpeper look like in the 2040s? Part of that was, we want to see industrial development happen around the urbanized core. So we were able to go to the data center companies, because right now, across Virginia, we're seeing them go into communities that they never considered previously, and communities are struggling with, do we want this here, yes or no? And unfortunately, that yes or no is happening through a legislative process of someone trying to file a rezoning and having that discussion. We were able to kind of front-end some of that. And in the comprehensive plan, say, here's where we want our industrial land, here's where we want residential, here's where we want to keep Ag. So when datacenter companies came and they said, do you have any sites available? Where can we go? We were able to point and say, this is what our future land use map shows this is where our Tech Zone, this is where we're incentivizing. And the data center community really appreciated that. As rezonings have occurred within the CTZ, the conversation has been much smaller. And you're mitigating unique issues to that specific project where there's still community engagement and there's still people coming and discussing what they're concerned about. But we're talking about a handful of people. So now you're looking, okay, this is a neighbor. Is there some way we can mitigate light? Is there some way we can mitigate sound better than we have? Those are very small issues. Rather than we don't want this in this area, in the CTZ, that conversation has been much, much different. So that's where we find it's unique. Communities just really struggle, especially rural communities, with what type of development they do want to see. We were able to say, here's where we want to see it. There's still standards, there's still issues that need to be mitigated and understood. And the data center developers that we've talked with have taken up that cause and taken it to heart. But they're able to know a little bit more what's inbounds and what's out of bounds. Amanda [00:09:24]: You talked a bit about some concerns from locals. Can you talk a little more about what those were? Sounds like you've worked through it but… Bryan [00:09:34]: Yeah, there of course has been concerns, and we're looking at the largest buildings that will be in the county, and we'll happen to have at least five campuses as such. Our first one that we landed was more rural and was further out, and there was a lot of conversation about that. Does this make sense? They ended up developing a small portion of a 200 acre parcel, conserving a lot of it and trying to find as best they could to mitigate those concerns. That's been a huge thought. Our strategic plan for economic development was accepted by the board of supervisors in January 2023, and we laid out the data centers that we're going to work on and attracting. We need to attract a town environs. Town environs is what we call around the urbanized area of the town of Culpeper. It's the environment around town. That's where we have the infrastructure available. That's where we have the fiber connectivity. So the conversation when we're going out to attract these data centers, that's where the conversation leads. Now, if someone else wants to come outside of that area, they're welcome to have that discussion but it's going to be a much different conversation and there's going to be more concerns that need to be mitigated. When we've looked in the CTZ, like I said before, we're having far fewer grand issues. It's more specific to that project, and that has helped make those rezonings the best that they can be, because we're able to mitigate specific concerns rather than this industry might not work in this area. Amanda [00:11:14]: Yeah. So just a way different conversation. What kind of incentives are in place to encourage companies to locate here particularly? Bryan [00:11:22]: Yeah. So on the data center side, if you invest $10 million in new taxable property, that could be either real property (a building) that could be business / personal property (the servers themselves) so if you, in any calendar year, if you do $10 million and you hire ten employees at the prevailing average wage, which typically in Culpeper county has been in the upper forties, so if you do those two things, that becomes a qualifying event. The new taxable items that you added in that year, we will rebate at 40% for five years. As long as you are paying the taxes on that. So the item ends up leaving the county. Then of course, we're not incentivizing something that has left, but you pay the taxes and then we're able to rebate 40% of those taxes. Amanda [00:12:10]: So you talked about this a little bit, but part of the intent here, it seems like, is to keep this limit expansion beyond this zone for the data centers, both in terms of physical space and just in other resources, and making sure you're well equipped. From that standpoint, is that an accurate way to look at it? And how much of the space is already taken? What capacity do you still have? Bryan [00:12:33]: Yeah, so we're looking at, over summer, our last on claim parcel of the CTZ will be going through a rezoning. Other than that, though, of the incentivized area, that's going to be our 6th campus, if that's approved. And that will pretty much round out what we were looking to incentivize. The next thing for the CTZ is we're looking at bringing in the rest of the ecosystem, the rest of the work that goes into building and maintaining these facilities. We think we're a great location. You can be in Culpeper County and go north to the nucleus that is northern Virginia, or you can go east to what's happening in the Fredericksburg region. They're having tremendous growth of their data center industry as well. We provide incentives for our manufacturers. That incentive is a little bit different. It's a lower entry point. So if you do $500,000 of new taxable items to the county in the calendar year, we'll rebate 100% of the machinery and tools taxes paid for three years, and that does not have an employment number tied to it. That also allows us to kind of round out the rest of the ecosystem. Amanda [00:13:45]: What are some of the benefits of this approach? So we've talked a lot about some of the benefits for you all in recruiting and for those companies, but what about for the community and just people there? Bryan [00:13:54]: The big thing is the development of this nature. We're talking upwards of 10 million sqft. Will take five to ten years to fully develop. If it happens all at once, we're looking at a tremendous growth of tradespeople coming in. We're looking at all the benefits that come with that. Hotel rooms will be booked. People will be coming in to check on the project, to work on the project. They will be eating in our restaurants, they'll be shopping at our local stores. They'll have families that come to visit. It's going to change a lot of the way money flows into the community. Also, we'll see tremendous growth of our tax revenue. These buildings are very expensive. The equipment is very expensive and expansive. We will see a change of how our government is able to collect revenue and provide additional services. We've had residential growth of double digits in the early two thousands in the. It'll probably happen again in the 2020s. That brings strain on services and schools. And we're looking at building our next elementary school, a new elementary school. We have a middle school that needs renovation. Bills will be coming due that this revenue and this increased attention into Culpeper will help provide that. We're looking forward to the availability of our young people to go through public schools, get trained at the technical education center, go on to the community college and get a certificate or get an associate's degree and be able to work out the front door, literally leave the school and have jobs in the front yard of the school is also extremely beneficial. We're looking forward to all of that. But the big thing I try to stress to everyone is, yes, the data centers are great. That's not the only thing we're trying to be. That's one reason also why we're taking a smaller approach. I call it the teaspoon approach, rather than the whole cup is let's see how this works. Let's see if this works for us and what issues we need to work through before we look at going further, incentivizing further than we have. It's a smaller plan, but 10 million sqft is still a lot. We're really excited for the developers that we have that are coming in. They're providing innovative results. One kind of fun and innovative thing that's happening, we've talked to several developers and we're trying to get all of them together on this, and I think they will, is that we want every vendor to provide 1 hour of time to our school system. Just 1 hour that our school system could come do a site visit, that their professionals could come into the school and say, this is what it's like to really, you wanna be an electrician? This is what it's really like. Do you wanna work on the finishing touches of the building? Do you wanna work on the land? Do you wanna be a data center professional? This is what I did to become… all of that is so invaluable. The hardest thing for the school system is, yes, we can train them, we can teach them, and they do a fantastic job at that, but it's really hard to show. And so far we've had several developers who've already said like, yes, we want to be a participant in that. We want our vendors to be in the schools. So that's one fun way that we're interacting, but there's just so many benefits that we're really trying to capture all of it so that it's not just tax revenue, it's not just construction. It's fundamentally making Culpeper a better version of itself. Amanda [00:17:33]: It's going to be so interesting to hear from newer members of the workforce, young people, like going forward over the next several years, because in so many of our interviews, you know, we talk about how we're really exposing middle and high school students to a lot more career paths in a way different way than I feel like, you know, people our age were then. And it's going to be really interesting to see how that plays out. And I hope it'll make a big difference because I don't know about you, but, you know, when I was like, what do I want to do? I'm kind of like, well, I don't know about any jobs besides what my parents did and like teachers, so. Bryan [00:18:03]: And, you know, when we were in school, there was not as much of a push into working with your hands and working on the trades. That has not gone away. There are still young people who don't want to work in an office, that don't want to work in a computer, that college is not the right path for them. And then we went through a time where we just threw kids there and we didn't make it a wonderful experience. So we're looking for more and more of that. Like I said, the data center conversation for us is not just the buildings. It's so much more. And we're so appreciative of how this has come out. You only get one chance to do a new industry to your community and do it right, and we work really hard at doing that. Amanda [00:18:47]: Anything else to add on the talent pathways front that we haven't already talked about? Bryan [00:18:53]: You know, I talked a lot about our public school system, but also Germanna Community College. They're going to be bringing courses straight to the Culpeper campus. Everything from fiber and all that goes into how you lay fiber to conduit and training, management training. And then also, as we start transitioning, we'll start the conversation here pretty soon about data center professional. So we're really looking forward to all that. We feel that we can provide a great training resource within our community already. Amanda [00:19:25]: Well, Bryan, let's segue into a couple of fun questions to wrap up our time. So my first one is in our pre-interview chat you shared you have a journey journalism background prior to moving into economic development. How do you feel like that has informed your work as an economic developer? Because that's sort of an unusual path. Bryan [00:19:44]: Yeah. I was a local government beat reporter. I have spent more time in board of supervisor meetings than anybody could possibly imagine. So I did that for eight years before transitioning in. And it was actually in an interview where I realized I wanted to go into economic development. I was interviewing the economic developer for the community I was covering. And halfway through the interview, I'm like, “I want your job. This sounds amazing.” I think the big thing is for journalism is you try to ask questions and listen and understand. And I try to understand the problems that are coming. When a client's talking to us about coming to the county, what they say is always important. Words matter. So trying to understand, why did they word it that way, why did they say it that way? And then also telling our story, what's important about Culpeper? I really love telling that, and I think that kind of pulls from my journalism background, but, yeah. Amanda [00:20:40]: And the final question I always ask every single guest is if someone were visiting your area for the first time, what's like a bucket list thing, If you had to only pick one that they should be sure to do? Bryan [00:20:52]: I'm going to say they need to go to the Davis Street district, which is in downtown Culpeper. That's where our shops are. That's where our restaurants, you're able to walk. We have this wonderful bakery called knackles. You need to go there early because they do sell out, but you need to get their donut. Other than that, it's wonderful just going out in the country and seeing the beautiful countryside. But if you want me to pick one, I'll say, let's go to Davis Street. Let's go down one of our restaurants, Pinto Thai, it's one of my favorite restaurants, has a robot that brings the food out to you. Amanda [00:21:25]: I've heard of that and I have never been anywhere that does it. Bryan [00:21:29]: Yeah, actually, when they added it, I had been there the week prior to them adding it, and then a data center company came in and they're like, hey, I just got lunch at Pinto and the robot brought, and I was like, no, there's no robot at like, I don't know what you're talking about. And I went the next day and had to email them. They were so fascinated, though, how futuristic we were. But I thought that was a funny story. That was really embarrassing for me because I was like, I don't even know what you're talking about. Literally, the next day I was like, oh, they literally just added this. Amanda [00:22:00]: You're like, “Next time we add robots, I need to get an update.” Bryan [00:22:04]: Yeah, I need to know ahead of time when robots are being added to the community. It just was very lucky that that person went there and thought very highly of Culpeper after that. Amanda [00:22:13]: So funny. Well, thank you so much, Bryan. Lots of good information here for our listeners and really appreciate you spending a little bit of your day with us. Bryan [00:22:21]: Thanks so much, Amanda. I really appreciate it. Amanda [00:22:28]: Thanks for listening to the Livability podcast, where we take you Inside America's Best Cities. At Livability, we highlight the unsung awesomeness of small and mid-sized cities across the country. We also partner with communities to reach their target companies and potential residents through digital content and print magazine programs. If you enjoyed this episode, please follow, rate and review this show wherever you listen to podcasts. You can also learn more about us at livabilitymedia.com. Have an idea for an upcoming episode? Email me at [e-mail]. Until next time, from Livability, I'm Amanda Ellis, sharing the stories of America's most promising places. (00:03):
undefined
undefined