Go to home page

BY CATHY DYSON

In the midst of tough economic times, King George County is getting higher marks for how it manages money.

The county was one of 16 rural localities in the East--and the only one in Virginia--to get an improved bond rating recently from Standard & Poor's Rating Services in New York.

The county's score improved from A-plus to AA, which represents excellent financial security, according to Standard & Poor's scale.

The rating is like a consumer's credit score, said Donita Harper, King George's finance director. With a better score, the county can borrow money more easily and get lower interest rates on bonds.

"That directly impacts our cost as we do business," said King George Supervisor Dale Sisson.

An improved rating is unusual in this market, said Steve Johnson, a partner at Troutman Sanders in Richmond. His law firm does the paperwork for King George County's bonds.

"It's obviously quite a positive from the county's perspective," he added.

Bond ratings in other Virginia localities are staying the same or being downgraded, Johnson said.

In March, Stafford County officials were told their county's rating may fall because there's less money in the reserve fund. Stafford tries to keep 10 percent of its operating budget in reserve, but the amount dipped to 8.48 percent as revenues dropped and officials used reserves to make up the difference.

By contrast, King George has almost 60 percent of its operating budget--or $19 million--in a reserve fund, Standard & Poor's reported.

"That's an extraordinarily good number," Johnson said.

When asked why the reserve balance is so high, especially when the county imposed stringent spending guidelines this year, the county's finance director compared it to an individual's savings account.

Consumers are advised to keep enough in savings to cover six months' worth of expenses, but Harper said having a year's worth is an even better idea.

"We want to make sure if we lost all our revenue, we could cover our operating budget," Harper said.

Plus, King George has money designated for future projects. Its current capital-improvement plan includes $114 million for parks, schools and equipment.

Of that, almost $10 million is for projects deemed urgent or necessary in the next three years.

"There is money designated for future spending," Harper said. "When you take everything out, we really don't have that much."

MILITARY MIGHT

In addition to the healthy reserve fund, and millions in annual revenue from its landfill--which is the only one in the region that accepts out-of-state trash--King George has the Naval Surface Warfare Center Dahlgren Division enhancing its financial position.

More than half of the county's revenues come from businesses associated with the government, according to Fitch Ratings, another New York company that rates localities.

Fitch's most recent rating for King George remained A-plus.

The government sector in King George represents 57 percent of county earnings, Fitch reported. That's much higher than the state average of 24 percent and the national average of 16 percent, said Barbara Ruth Rosenberg, an analyst and director at Fitch.

The strong military and defense-contractor presence keep the county economy stable, but King George doesn't have the breadth of other businesses and industries that rating companies like to see, Rosenberg said.

That's where Nicole Thompson comes in. The 40-year-old Richmond native and University of North Carolina graduate was hired as King George's new economic development director in May.

Her primary goals are to support existing businesses--there are almost 1,000 in the county--and lure new ones to the rural area.

She replaces Theresa O'Quinn, the county's former deputy administrator who became King George's first economic development director in December 2007.

When O'Quinn changed jobs, she kept her salary of $120,175, which made her one of the highest-paid economic development directors in the region.

Thompson was hired for considerably less: $87,000 a year.

County officials never considered leaving the position vacant after O'Quinn left in January, said County Administrator Travis Quesenberry.

"Tough times are when you need to work harder in economic development," he said.

KEY AREAS FOR GROWTH

Thompson has worked in economic development for more than 15 years in Norfolk, Fairfax and, most recently, Portsmouth. She also worked for state government for six years.

She plans to work with supervisors and the Economic Development Authority to figure out what kinds of businesses the county needs, especially in the industrial park.

That's where Harris Teeter Inc. plans to build a 500,000-square-foot distribution warehouse, which will create 335 new jobs.

The grocery chain signed an agreement with the county in January and was given three months to do a feasibility study. Five months have passed, and Harris Teeter still hasn't closed on the property.

The company asked for an extension on the study and should be finished with its paperwork in July, Quesenberry said.

As Thompson drove through the industrial park recently, she noted that it's one of three key areas slated for economic development. The other two are Dahlgren and the intersection of State Route 3 and U.S. 301.

She knows she'll have to find a balance as she does her job. She wants to attract more commercial interests, and county officials have stressed that they want to maintain the rural nature of the county.

She believes there's enough space for both.

"I think King George is a great location," Thompson said. "It's primed to become a lot more than it is now."

Cathy Dyson: 540/374-5425
Email: cdyson@freelancestar.com

Back to top