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January 2025 Agenda Packet Wednesday, January 22, 2025; 6:00 P.M; County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 AGENDA I. CALL TO ORDER II. ROLL CALL III. REVISIONS TO AGENDA IV. APPROVAL OF AGENDA V. ELECTION OF OFFICERS FOR CALENDAR YEAR 2025 A. Election of Chairman (see Bylaws, Article VI, page 3-4) B. Election of Vice Chairman (see Bylaws, Article VI, page 3-4) C. Election of Secretary from the Authority’s staff D. Election of Treasurer from the Authority’s staff VI. CONSENT AGENDA E. Approval of December Meeting Minutes F. Approval of December Financials VII. OLD BUSINESS A. Pittsylvania County Strategic Plan Contract Update (M. Rowe) B. Legal Representation/Request for Qualification (RFQ) process (M. Rowe) VIII. NEW BUSINESS A. Approval of FY2024 Audited Financial Statements (K. Van Der Hyde) B. Approval of 2025 Meeting Schedule (M. Rowe) C. Preliminary Engineering Report (PER) for Gretna Industrial Park Roadway (M. Rowe) C. Staunton River Plaza Presentation (Gary Hodnett, Mayor, Town of Hurt) IX. ECONOMIC DEVELOPMENT UPDATES A. Overview of Projects (M. Rowe) B. Annual Fillings- Due on or before February 3, 2025 (K. Saunders) X. MATTERS FROM IDA MEMBERS XI. CLOSED SESSION A. Discussion concerning a prospective business or industry or the expansion of an existing business or industry where no previous announcement has been made of the business or industry’s interest in locating or expanding its facilities in the community. Authority: Virginia Code §2.2-3711(A)(5) Subject Matters: Project G, Project 10, Project B Purpose: Updates on Prospective Unannounced Businesses/Industries XII. RETURN TO OPEN SESSION AND CLOSED SESSION CERTIFICATION A. Closed Session Certification PITTSYLVANIA COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY CLOSED MEETING CERTIFICATION BE IT RESOLVED that at the meeting of the Pittsylvania County Industrial Development Authority (“Authority”) on January 22, 2025, the Authority hereby certifies by a recorded vote that to the best of each Authority member’s knowledge only public business matters lawfully exempted from the Open Meeting requirements of the Virginia Freedom of Information Act (“Act”) and identified in the motion authorizing the closed meeting were heard, discussed, or considered in the closed meeting. If any authority member believes that there was a departure from the requirements of the Act, he shall so state prior to the vote indicating the substance of the departure. The statement shall be recorded in the Authority’s minutes. Vote Joey Faucette Yes/No John Daniel Yes/No Timothy Reynolds Yes/No Bill Nuckols Yes/No Steven Merricks Yes/No Charles L. Minter Yes/No Michael Adkins Yes/No XIII. ADJOURNMENT Agenda Section: Consent Agenda (Section V(A)) Agenda Title: Approval of December Minutes Staff Contact: Matthew Rowe Agenda Date: January 22, 2025 Attachments: 1. 12-18-2024 Meeting Minutes- DRAFT SUMMARY: For the Board’s review and consideration, attached are the following Meeting Minutes for December: 1. 12-18-2024 Meeting Minutes- DRAFT FINANCIAL IMPACT AND FUNDING SOURCE: Not applicable. RECOMMENDATION: County Staff recommends the IDA Board approve the December Meeting Minutes as presented. MOTION: “I make a Motion to approve the December Meeting Minutes as presented.” PITTSYLVANIA COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY 12/18/24 MEETING MINUTES I. CALL TO ORDER Faucette called Meeting to order at 6:01 PM. II. ROLL CALL Saunders conducted Roll Call. The following IDA Members were present: Faucette, Nuckols, Merricks, Minter, and Adkins. Staff present: Shorter, Rowe, Saunders, and Van Allen. III. ADDITIONS/REVISIONS TO AGENDA Motion by Nuckols, seconded by Merricks, to move Item IX(B) Legal Representation/ Request for Qualification (RFQ) process to Old Business VI(A). Under Old Business, Item VI(A) Pittsylvania County Strategic Plan Contract Update was moved down to VI(B). IV. APPROVAL OF AGENDA Motion by Nuckols, seconded by Minter, to approve Agenda. Motion passed unanimously by IDA Members present. V. CONSENT AGENDA Approval of November/ December (called meeting) Minutes Approval of November Financials Motion by Nuckols, seconded by Minter, to approve Consent Agenda. Motion passed unanimously by IDA Members present. VI. OLD BUSINESS Pittsylvania County Strategic Plan Contract Update Rowe shared that the contract had been amended to add additional language with regards to a reduction in price of $2,500 for each month past the due date for any delays caused by the client. VII. NEW BUSINESS Preliminary Engineering Report (PER) approval for Gretna Industrial Park Roadway On a motion by Nuckols, seconded by Merricks, to approve the Proposal for Engineering Services Preliminary Engineering Report for Gretna Industrial Park with Hurt&Proffitt as presented on the condition that Gretna provides a monetary value towards this project. VIII. ECONOMIC DEVELOPMENT UPDATES Overview of Projects Rowe shared updates on the following: Axxor, TECHnista LLC, Staunton River Plastics, Morgan Olson, Cambridge Pavers, and Speyside. Rowe shared that the Enterprise Zone Renewal Application for Pittsylvania County, Zone 24, was approved. IX. MATTERS FROM IDA MEMBERS Staunton River Plaza Faucette shared that more updates are forthcoming and Gary Hodnett, Mayor, Town of Hurt, was going to try and attend the IDA meeting in January. Legal/Representation/ Request for Qualification (RFQ) process Connie Gibson, Procurement Manager for Pittsylvania County, discussed the RFQ process for IDA services and the steps involved in that procedure. X. CLOSED SESSION Motion to enter Closed Session (see attached Agenda Packet for full Closed Session information) by Nuckols, seconded by Minter. Motion unanimously passed by IDA Members present. IDA entered Closed Session at 7:05 PM. XI. RETURN TO OPEN SESSION AND CLOSED SESSION CERTIFICATION IDA returned to Open Session at 7:40 PM and Saunders read the Closed Session Certification paragraph (see attached Agenda Packet for same), and conducted a Closed Session Certification Roll Call, which was unanimously voted “Yes” by IDA Members present. XII. ADJOURNMENT Faucette adjourned the Meeting at 7:41 PM. Agenda Section: Consent Agenda (Section V(B)) Agenda Title: Approval of Financials Staff Contact: Kim Van Der Hyde Agenda Date: January 22, 2025 Attachments: 1 (December Financial Report) SUMMARY: A copy of the December Financial Report is included in the packet for your review, comment, and approval. FINANCIAL IMPACT AND FUNDING SOURCE: None RECOMMENDATION: County Staff recommends the IDA approve the December Financial Report as presented. MOTION: “I make a Motion to approve the December Financial Report as presented.” Pittsylvania County Industrial Development Authority Balance Sheet As of December 31, 2024 Accrual Basis Thursday, January 2, 2025 03:26 PM GMT-05:00 1/2 TOTAL ASSETS Current Assets Bank Accounts 10000 BB&T-Regular Checking 0.00 101000 First Citizens Checking 791,442.89 10200 ANB-Axxor Property Account 0.00 10300 FCB-Panacea Reserve Account 0.00 10400 FCB-IDA SR-Plastics 0.00 10500 ANB-IDA SR-Plastics 0.00 Total Bank Accounts $791,442.89 Accounts Receivable 11000 *Accounts Receivable 0.00 Total Accounts Receivable $0.00 Other Current Assets 120000 Accounts Receivable 0.00 Total Other Current Assets $0.00 Total Current Assets $791,442.89 Fixed Assets 110000 Inventory 1,300,310.00 15000 Capital Assets 150100 Land 497,442.00 150200 Industrial Building 13,289,443.07 150500 Construction in Progress 0.00 Total 15000 Capital Assets 13,786,885.07 160000 Accumulated Depreciation -437,901.50 Total Fixed Assets $14,649,293.57 Other Assets 120100 Notes Receivable-Intertape 0.00 120200 Note Receivable-Axxor 0.00 120500 Notes Receivable-Axxor-Land 0.00 121000 Note Receivable-Panacea Equip 0.00 121100 Notes Rec-Panacea Equip Reserve 0.00 121500 Note Receivable-Panacea Upfit 0.00 121600 Note Receivable-VRA Loan-Realty 750,000.00 121700 Note Receivable-ANB-SR Plastics 0.00 121800 Note Receivable-VSBFA-Axxor 2,976,217.14 125000 Other Receivable-ARCO 0.00 125100 Other Receivable-SR-Plastics 55,525.52 125200 Other Receivable-Axxor 0.00 130000 Interest Receivable 0.00 140000 Lease Receivable-Rage Plastics 9,282,364.16 141000 Lease Receivable-Technista 584,814.00 Total Other Assets $13,648,920.82 Pittsylvania County Industrial Development Authority Balance Sheet As of December 31, 2024 Accrual Basis Thursday, January 2, 2025 03:26 PM GMT-05:00 2/2 TOTAL TOTAL ASSETS $29,089,657.28 LIABILITIES AND EQUITY Liabilities Current Liabilities Accounts Payable 20000 *Accounts Payable 0.00 225000 Due To Danville City IDA 0.00 Total Accounts Payable $0.00 Other Current Liabilities 200000 Accounts Payable 0.00 252500 Note Payable-ANB Axxor Note -29,047.48 252600 Closing Costs 0.00 253700 Note Payable-TIC-Cyber Park 500,000.00 253800 Note Payable-Cyber Park 976,000.74 260000 Interest Payable 0.00 270000 Reserve-Panacea 0.00 270100 SR-Plastics Reserve 0.00 Total Other Current Liabilities $1,446,953.26 Total Current Liabilities $1,446,953.26 Long-Term Liabilities 210000 Security Deposit-2311 Cane Creek Pkwy 11,583.00 250000 Note Payable-ANB-Intertape 0.00 253000 Bond Payable-2311 Cane Creek Pkwy Building 543,239.00 253200 Note Payabe-First Citizens-Pana 0.00 253300 Note Payable-VRA Loan-Realty 750,000.00 253400 Note Payable-Atlantic Union SR Plastics 8,305,835.83 253500 Note Payable-VSBFA-Axxor 3,005,264.62 253600 Note Payable-VSBFA-SR-Plastics 995,105.71 2750 Deferred Inflow of Resources-Leases 7,701,584.50 Total Long-Term Liabilities $21,312,612.66 Total Liabilities $22,759,565.92 Equity 30000 Opening Balance Equity 1,943,527.66 32000 Unrestricted Net Assets 4,307,815.77 Net Income 78,747.93 Total Equity $6,330,091.36 TOTAL LIABILITIES AND EQUITY $29,089,657.28 Check Number Date Vendor Name Paid Amount FEE 12/6/2024 First Citizens Bank 211.33$ 1220 12/4/2024 VSBFA 36,133.85$ 1221 12/4/2024 Dewberry Engineers, INC.5,000.00$ 1222 12/13/2024 Atlantic Union Bank 43,887.71$ 1225 12/31/2024 Daniel Builders, LLC 1,495.00$ 1226 12/30/2024 Brooks & Pierce 540.83$ Pittsylvania County Industrial Development Authority Monthly Disbursements December FY 2024 Cash Current YTD Balance Rev/Exp Rev/Exp Budget Balance Funding Locality Contributions: Pittsylvania County 67,843.16 134,485.00 66,641.84 Rent: Axxor 1,500.00 9,000.00 18,000.00 9,000.00 Rage SR-Plastics 7,500.00 18,000.00 10,500.00 Other Receivables: Invenergy 50,000.00 50,000.00 - Fund Balance - - 59,154.00 59,154.00 Total Funding 1,500.00 134,343.16 279,639.00 145,295.84 Expense Accounting-Audit Fees - - 7,725.00 7,725.00 Legal Fees 540.83 5,340.83 50,000.00 44,659.17 Bank Service Charges 211.33 700.67 240.00 (460.67) Engineering 5,000.00 5,000.00 20,000.00 15,000.00 Insurance 13,525.00 13,525.00 - Property & Equipment Services 1,495.00 16,342.00 20,000.00 3,658.00 Postage, Mailing Service - 100.00 100.00 Prospect Visit - 20,000.00 20,000.00 Professional Services -Board 6,690.60 13,564.00 6,873.40 2311 Cane Creak Facility 67,843.16 134,485.00 66,641.84 Total Expense 7,247.16 115,442.26 279,639.00 164,196.74 Pittsylvania County Industrial Development Authority General Expenditures for Fiscal Year 2025 As of December 31, 2024 Total OPERATING ACTIVITIES Net Income $ 78,747.93 Adjustments to reconcile Net Income to Net Cash provided by operations: 20000 *Accounts Payable $ (4,135.30) 225000 Due To Danville City IDA $ (10,605.38) 252500 Note Payable-ANB Axxor Note $ (29,047.48) 260000 Interest Payable $ (23,388.52) Total Adjustments to reconcile Net Income to Net Cash provided by operations: $ (67,176.68) Net cash provided by operating activities $ 11,571.25 INVESTING ACTIVITIES 121000 Note Receivable-Panacea Equip $ 83,203.45 121800 Note Receivable-VSBFA-Axxor $ 205,411.89 125100 Other Receivable-SR-Plastics $ 5,125.44 130000 Interest Receivable $ 12,450.89 140000 Lease Receivable-Rage Plastics $ 125,721.84 141000 Lease Receivable-Technista $ (584,814.00) Net cash provided by investing activities $ (152,900.49) FINANCING ACTIVITIES 210000 Security Deposit-2311 Cane Creek Pkwy $ 11,583.00 253000 Bond Payable-2311 Cane Creek Pkwy Building $ (54,718.00) 253400 Note Payable-Atlantic Union SR Plastics $ (112,264.75) 253500 Note Payable-VSBFA-Axxor $ (147,239.51) 253600 Note Payable-VSBFA-SR-Plastics $ (13,288.67) 2750 Deferred Inflow of Resources-Leases $ 620,104.50 Net cash provided by financing activities $ 304,176.57 Net cash increase for period $ 162,847.33 Cash at beginning of period $ 628,595.56 Cash at end of period $ 791,442.89 Pittsylvania County Industrial Development Authority Statement of Cash Flows July - December, 2024 Agenda Section: New Business-Section VIII(A) Agenda Title: Approval of FY2024 Audited Financial Statements Staff Contact: Kim Van Der Hyde Agenda Date: January 22, 2025 Attachments: FY2024 Audited Financial Statements SUMMARY: A copy of the FY2024 Audited Financial Statements is included in the packet for your review, comment, and approval. FINANCIAL IMPACT AND FUNDING SOURCE: Not applicable. RECOMMENDATION: County Staff recommends the IDA Board approve the FY2024 Audited Financial Statements as presented. MOTION: “I make a Motion to approve the FY2024 Audited Financial Statements as presented.” - Communication with Those Charged with Governance - Communication with Those Charged with Governance To the Board of Directors Industrial Development Authority of Pittsylvania County We have audited the financial statements of the business-type activities of Industrial Development Authority of Pittsylvania County for the year ended June 30, 2024. Professional standards require that we provide you with information about our responsibilities under generally accepted auditing standards, and Government Auditing Standards, as well as certain information related to the planned scope and timing of our audit. We have communicated such information in our letter to you dated May 30, 2024. Professional standards also require that we communicate to you the following information related to our audit. Significant Audit Matters Qualitative Aspects of Accounting Practices Management is responsible for the selection and use of appropriate accounting policies. The significant accounting policies used by Industrial Development Authority of Pittsylvania County are described in Note 1 to the financial statements. No new accounting policies were adopted and the application of existing policies was not changed during 2024. We noted no transactions entered into by the entity during the year for which there is a lack of authoritative guidance or consensus. All significant transactions have been recognized in the financial statements in the proper period. Accounting estimates are an integral part of the financial statements prepared by management and are based on management’s knowledge and experience about past and current events and assumptions about future events. Certain accounting estimates are particularly sensitive because of their significance to the financial statements and because of the possibility that future events affecting them may differ significantly from those expected. The most sensitive estimates affecting the Authority’s financial statements are: Management’s estimate of the estimated useful lives of its capital assets is based on historical data. We evaluated the methods, assumptions, and data used to develop the estimate of the useful lives of its capital assets in determining that it is reasonable in relation to the financial statements taken as a whole. Management’s estimate of the market value of the industrial sites held for resale is based on the assessed value of the property. We evaluated the methods, assumptions, and data used to develop the estimate of the market value of the industrial sites in determining that it is reasonable in relation to the financial statements taken as a whole. The financial statement disclosures are neutral, consistent, and clear. Difficulties Encountered in Performing the Audit We encountered no significant difficulties in dealing with management in performing and completing our audit. - Communication with Those Charged with Governance - Corrected and Uncorrected Misstatements Professional standards require us to accumulate all known and likely misstatements identified during the audit, other than those that are clearly trivial, and communicate them to the appropriate level of management. Management has corrected all such misstatements. In addition, none of the misstatements detected as a result of audit procedures and corrected by management were material, either individually or in the aggregate, to each opinion unit’s financial statements taken as a whole. Disagreements with Management For purposes of this letter, a disagreement with management is a financial accounting, reporting, or auditing matter, whether or not resolved to our satisfaction, that could be significant to the financial statements or the auditors’ report. We are pleased to report that no such disagreements arose during the course of our audit. Management Representations We have requested certain representations from management that are included in the management representation letter dated November 27, 2024. Management Consultations with Other Independent Accountants In some cases, management may decide to consult with other accountants about auditing and accounting matters, similar to obtaining a “second opinion” on certain situations. If a consultation involves application of an accounting principle to the entity’s financial statements or a determination of the type of auditors’ opinion that may be expressed on those statements, our professional standards require the consulting accountant to check with us to determine that the consultant has all the relevant facts. To our knowledge, there were no such consultations with other accountants. Other Audit Findings or Issues We generally discuss a variety of matters, including the application of accounting principles and auditing standards, with management each year prior to retention as the entity’s auditors. However, these discussions occurred in the normal course of our professional relationship and our responses were not a condition to our retention. Other Matters We were not engaged to report on the introductory section, which accompanies the financial statements but is not RSI. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it. Restriction on Use This information is intended solely for the use of the Board and management of Industrial Development Authority of Pittsylvania County and is not intended to be, and should not be, used by anyone other than these specified parties. Blacksburg, Virginia November 27, 2024 Date: November 27, 2024 Memorandum to: Ms. Kimberly Van Der Hyde, Treasurer and Board Members From: Robinson, Farmer, Cox Associates Regarding: Audit Recommendations In planning and performing our audit of the financial statements of the Industrial Development Authority of Pittsylvania County for the year ended June 30, 2024, we considered the Authority’s internal control structure to plan our auditing procedures for the purpose of expressing our opinion on the financial statements and not to provide assurance on the internal control structure. However, during our audit, we noted certain matters involving internal control structure and other operational matters that are presented for your consideration. Our comments and recommendations, all of which have been discussed with appropriate members of management, are intended to improve the internal control structure or result in other operating efficiencies. We will be pleased to discuss these comments in further detail at your convenience. Board Member Disclosure Forms: During our audit, we noted that several members did not thoroughly complete the required disclosure forms. We recommend all Board members complete the form entirely during the required timeframe of January 1st – February 1st. Virginia Security for Public Deposits Compliance: During fiscal year 2024, the Virginia Treasury changed the compliance requirements and procedures related to the Virginia Security for Public Deposits Act of the Code of Virginia. These changes require management of the Authority to log into the State website and verify the balance reported by the bank as accurate. We noted that the Authority had not performed this verification process for the FY2024 audit. We recommend verifying it quarterly as required going forward. INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A COMPONENT UNIT OF PITTSYLVANIA COUNTY, VIRGINIA) FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30, 2024 INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A COMPONENT UNIT OF PITTSYLVANIA COUNTY,VIRGINIA) FINANCIAL REPORT FOR THE YEAR ENDED JUNE 30,2024 TABLE OF CONTENTS INTRODUCTORY SECTION Board Members ................................................................................................1 FINANCIAL SECTION Independent Auditors' Report ................................................................................2-4 Exhibit Page Basic Financial Statements: Statement of Net Position ...................................................................................1 5 Statement of Revenues, Expenses, and Changes in Net Position ......................................2 6 Statement of Cash Flows.....................................................................................3 7 Notes to Financial Statements ..............................................................................8-16 COMPLIANCE SECTION Page Independent Auditors’ Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards ......................17-18 INTRODUCTORY SECTION INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY BOARD MEMBERS Joey Faucette, Chairman John Daniel, Vice Chairman Matthew D. Rowe, Secretary Kim Van Der Hyde, Treasurer Timothy Reynolds Bill Nuckols Steven Merricks Charles Minter Michael Adkins -1- FINANCIAL SECTION Independent Auditors’ Report To the Board of Directors Industrial Development Authority of Pittsylvania County Chatham, Virginia Report on the Audit of the Financial Statements Opinion We have audited the accompanying financial statements of the business-type activities of the Industrial Development Authority of Pittsylvania County, a component unit of Pittsylvania County, Virginia, as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise the Industrial Development Authority of Pittsylvania County’s basic financial statements as listed in the table of contents. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the business-type activities of Industrial Development Authority of Pittsylvania County, as of June 30, 2024, and the changes in financial position, and cash flows thereof for the year then ended in accordance with accounting principles generally accepted in the United States of America. Basis for Opinion We conducted our audit in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States; and the Specifications for Audits of Authorities, Boards, and Commissions,issued by the Auditor of Public Accounts of the Commonwealth of Virginia. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are required to be independent of Industrial Development Authority of Pittsylvania County, and to meet our other ethical responsibilities, in accordance with the relevant ethical requirements relating to our audit. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Responsibilities of Management for the Financial Statements Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America, and for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, management is required to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about Industrial Development Authority of Pittsylvania County’s ability to continue as a going concern for twelve months beyond the financial statement date, including any currently known information that may raise substantial doubt shortly thereafter. -2- Auditors’ Responsibilities for the Audit of the Financial Statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and therefore is not a guarantee that an audit conducted in accordance with generally accepted auditing standards, Government Auditing Standards, and the Specifications for Audits of Authorities, Boards, and Commissions will always detect a material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment made by a reasonable user based on the financial statements. In performing an audit in accordance with generally accepted auditing standards, Government Auditing Standards, and the Specifications for Audits of Authorities, Boards, and Commissions, we: Exercise professional judgment and maintain professional skepticism throughout the audit. Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, and design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of Industrial Development Authority of Pittsylvania County’s internal control. Accordingly, no such opinion is expressed. Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluate the overall presentation of the financial statements. Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise substantial doubt about Industrial Development Authority of Pittsylvania County’s ability to continue as a going concern for a reasonable period of time. We are required to communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal control-related matters that we identified during the audit. Required Supplementary Information Management has omitted management’s discussion and analysis that accounting principles generally accepted in the United States of America require to be presented to supplement the basic financial statements. Such missing information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board who considers it to be an essential part of financial reporting for placing the basic financial statements in an appropriate operational, economic, or historical context. Our opinion on the basic financial statements is not affected by this missing information. Other Information Management is responsible for the other information included in the annual report. The other information comprises the introductory section but does not include the basic financial statements and our auditors’ report thereon. Our opinion on the basic financial statements does not cover the other information, and we do not express an opinion or any form of assurance thereon. In connection with our audit of the basic financial statements, our responsibility is to read the other information and consider whether a material inconsistency exists between the other information and the basic financial statements, or the other information otherwise appears to be materially misstated. If, based on the work performed, we conclude that an uncorrected material misstatement of the other information exists, we are required to describe it in our report. -3- Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated November 27, 2024, on our consideration of Industrial Development Authority of Pittsylvania County’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that report is solely to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the effectiveness of Industrial Development Authority of Pittsylvania County’s internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering Industrial Development Authority of Pittsylvania County’s internal control over financial reporting and compliance. Blacksburg, Virginia November 27, 2024 -4- Basic Financial Statements Exhibit 1 ASSETS Current Assets: Cash and cash equivalents 628,596$ Accounts receivable - reimbursed capital costs 60,651 Notes receivable, current portion 443,270 Interest receivable 12,451 Leases receivable, current portion 262,525 Inventory: Property held for resale 1,300,310 Total current assets 2,707,803$ Noncurrent Assets: Notes receivable, net of current portion 3,571,562$ Leases receivable, net of current portion 9,145,561 Capital Assets (net of accumulated depreciation): Land 497,442 Industrial building 12,851,542 Total capital assets 13,348,984$ Total noncurrent assets 26,066,107$ Total assets 28,773,910$ LIABILITIES Current Liabilities: Accounts payable 4,135$ Interest payable 24,739 Due to City of Danville IDA 510,605 Notes payable, current portion 654,610 Bonds payable, current portion 109,436 Total current liabilities 1,303,525$ Noncurrent Liabilities: Notes payable, net of current portion 12,900,390$ Bonds payable, net of current portion 1,238,521 Total noncurrent liabilities 14,138,911$ Total liabilities 15,442,436$ Deferred Inflows of Resources: Lease related items 7,081,619$ Total deferred inflows of resources 7,081,619$ NET POSITION Net investment in capital assets 1,837,926$ Unrestricted 4,411,929 Total net position 6,249,855$ The accompanying notes to financial statements are an integral part of this statement. Industrial Development Authority of Pittsylvania County Statement of Net Position June 30, 2024 (A Component Unit of Pittsylvania County, Virginia) -5- Exhibit 2 Operating Revenues: Rent revenue 49,400$ Lease revenue 871,315 Land option revenue 50,000 Total operating revenues 970,715$ Operating Expenses: Bank fees 178$ Insurance 20,508 Professional services 133,185 Maintenance 12,416 Miscellaneous 17,407 Depreciation 314,143 Total operating expenses 497,837$ Operating income (loss)472,878$ Nonoperating Revenues (Expenses): Corporate contributions 2,100$ Interest income 385,230 Contributions from Pittsylvania County 128,391 Interest expense (466,328) Total nonoperating revenues (expenses)49,393$ Change in net position 522,271$ Net position, beginning of year 5,727,584 Net position, end of year 6,249,855$ The accompanying notes to financial statements are an integral part of this statement. Industrial Development Authority of Pittsylvania County Statement of Revenues, Expenses, and Changes in Net Position For the Year Ended June 30, 2024 (A Component Unit of Pittsylvania County, Virginia) -6- Exhibit 3 Cash Flows from Operating Activities: Receipts from renters 309,143$ Payments to suppliers (185,281) Net cash provided by (used for) operating activities 123,862$ Cash Flows from Capital and Related Financing Activities: Corporate contributions for construction 45,641$ Principal payments on indebtedness (348,082) Interest payments on indebtedness (381,098) Net cash provided by (used for) capital and related financing activities (683,539)$ Cash Flows from Noncapital Financing Activities: Principal payments on indebtedness (347,481)$ Interest payments on indebtedness (86,125) Receipts from others 2,100 Receipts from Pittsylvania County, Virginia 128,391 Principal payments received on notes receivable 318,361 Interest received 385,553 Net cash provided by (used for) noncapital financing activities 400,799$ Increase (decrease) in cash and cash equivalents (158,878)$ Cash and cash equivalents at beginning of year 787,474 Cash and cash equivalents at end of year 628,596$ Reconciliation of operating income (loss) to net cash provided by (used for) operating activities: Operating income (loss)472,878$ Adjustments to reconcile operating income (loss) to net cash provided by (used for) operating activities: Depreciation 314,143 Changes in operating assets and liabilities: (Increase) decrease in lease receivables 234,201 Increase (decrease) in deferred inflows of resources related to leases (895,773) Increase (decrease) in accounts payable (1,587) Net cash provided by (used for) operating activities 123,862$ Schedule of noncash capital and related financing activities: Construction paid directly by City of Danville, Virginia Industrial Development Authority 301,794$ Note payable issued to Authority but paid directly to the City of Danville, Virginia Industrial Development Authority for above construction 989,134 The accompanying notes to financial statements are an integral part of this statement. Industrial Development Authority of Pittsylvania County Statement of Cash Flows For the Year Ended June 30, 2024 (A Component Unit of Pittsylvania County, Virginia) -7- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements June 30, 2024 NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: The financial statements of the Authority conform to generally accepted accounting principles (GAAP) applicable to governmental units promulgated by the Governmental Accounting Standards Board (GASB). The following is a summary of the more significant policies. A.Financial Reporting Entity: The Industrial Development Authority of Pittsylvania County, Virginia was created as a political subdivision of the Commonwealth of Virginia by ordinance of the Board of Supervisors of Pittsylvania County, Virginia on November 4, 1969, pursuant to the provisions of the Industrial Development and Revenue Bond Act (Chapter 33, Section 15.1-1373, et seq., of the Code of Virginia (1950), as amended). The Authority is governed by seven directors appointed by the Board of Supervisors of Pittsylvania County, Virginia. It is authorized to acquire, own, lease, and dispose of properties to the end that such activities may promote industry and develop trade by inducing enterprises to locate and remain in Pittsylvania County, Virginia. The Authority is a component unit of Pittsylvania County, Virginia. In addition, the Authority is authorized to issue revenue bonds for the purpose of obtaining and constructing facilities. Liability under the bonds may be retained by the Authority or it may be assumed by the enterprises for whom facilities are constructed. Collection of revenues pledged to liquidate the bonds may be assigned to a trustee. The revenue bonds are not deemed to constitute a debt or pledge of the faith and credit of the Commonwealth of Virginia or any municipality thereof. The bonds are payable solely from revenues generated from the lease or sale of the facilities constructed and may be secured by a deed of trust on those facilities. B.Basis of Presentation: The financial statements have been prepared in accordance with current reporting standards, which provides that the following sections be included in the annual financial report: 1.Management discussion and analysis (omitted) 2.Basic financial statements including a statement of net position, statement of revenues, expenses and changes in net position, and a statement of cash flows 3.Notes to financial statements C.Basis of Accounting: For financial reporting purposes, Industrial Development Authority of Pittsylvania County is considered a special-purpose government, engaged only in business-type activities. Accordingly, the Authority’s financial statements have been prepared using the economic resources measurement focus and the accrual basis of accounting. Under the accrual basis, revenues are recognized when earned, and expenses are recorded when an obligation has been incurred. D.Use of Estimates: The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures. Accordingly, actual results could differ from those estimates. -8- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued) E.Cash and Cash Equivalents: Cash and cash equivalents include cash on hand, amounts in demand deposits and short-term investments with a maturity date within three months of the date acquired by the government. For purposes of the statement of cash flows, the Authority considers their demand deposits and all highly liquid investments with an original maturity of three months or less when purchased to be cash equivalents. F.Prepaid Items: Certain payments to vendors represent costs applicable to future accounting periods and are recorded as prepaid items. The cost of prepaid items is recorded as an expense when consumed rather than when purchased. G.Capital Assets: Property, plant and equipment are carried at cost. No depreciation is taken on industrial projects, which are held for the purpose of development and resale. Property, plant, equipment, and leasehold improvements are depreciated using the straight-line method over the following estimated useful lives: H.Pass-through Financing Leases and Installment Sales: The principal activities of the Authority represent pass-through leases or installments sales. These agreements provided for periodic payments in amounts which are equal to the principal and interest payments due to project bond holders. The Authority has assigned all rights to the payments to the trustees, agents or the holders of the bonds, and the lessees or purchasers have assumed responsibility for all operating costs such as utilities, repairs and property taxes. In such cases, the Authority neither receives nor disburses funds. Although title to these properties may rest with the Authority, bargain purchase options or other provisions eliminate any equity interest that would otherwise be retained in the lease transactions. Deeds of trust secure outstanding bond obligations and title will pass to the lessee or purchaser at such time as the bonds are fully paid. Although the Authority provides a conduit to execute such transactions, it does not retain either the benefits of asset ownership or the liability for bond liquidation. Accordingly, the Authority does not recognize assets, liabilities, rental income or interest expense in its financial statements. Assets Years Machinery and Equipment 3-15 Bui ldings and Improv ements 40 -9- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued) I.Net Position: The Statement of Net Position reports the difference between (a) assets and deferred outflows of resources and (b) liabilities and deferred inflows of resources as net position. The Authority’s net position is classified as follows: Net Investment in Capital Assets –This category represents the net value of capital assets (property, plant, and equipment less accumulated depreciation) reduced by the debt incurred to acquire or construct the asset, if any. Restricted –This category includes resources for which the Authority is legally or contractually obligated to spend in accordance with restrictions imposed by external parties. Unrestricted –Unrestricted net position represents resources derived from charges to customers for goods received, services rendered or privileges provided, operating grants and contributions, and capital grants and contributions. These resources are used for transactions relating to the operations of the Authority and may be used at the Authority’s discretion to meet current expenses for any lawful purposes. J.Net Position Flow Assumption: Sometimes the Authority will fund outlays for a particular purpose from both restricted (e.g., restricted bond or grant proceeds) and unrestricted resources. In order to calculate the amounts to report as restricted net position and unrestricted net position in the Authority financial statements, a flow assumption must be made about the order in which the resources are considered to be applied. It is the Authority’s policy to consider restricted net position to have been depleted before unrestricted net position is applied. K.Deferred Outflows/Inflows of Resources: In addition to assets, the statement of financial position includes a separate section for deferred outflows of resources. Deferred outflows of resources represent a consumption of net assets that applies to a future period(s) and so will not be recognized as an outflow of resources (expense) until then. The Authority does not have any deferred outflows of resources as of June 30, 2024. In addition to liabilities, the statement of financial position includes a separate section for deferred inflows of resources. Deferred inflows of resources represent an acquisition of net assets that applies to a future period(s) and so will not be recognized as an inflow of resources (revenue) until that time. The Authority has one type of item that qualifies for reporting in this category. Certain items related to leases are reported as deferred inflows of resources. For more detailed information on these items, reference the related notes. -10- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: (Continued) L.Leases: The Authority leases various assets requiring recognition. A lease is a contract that conveys control of the right to use another entity’s nonfinancial asset. Lease recognition does not apply to short-term leases, contracts that transfer ownership, leases of assets that are investments, or certain regulated leases. Lessor The Authority recognizes leases receivable and deferred inflows of resources in the financial statements. At commencement of the lease, the lease receivable is measured at the present value of lease payments expected to be received during the lease term, reduced by any provision for estimated uncollectible amounts. Subsequently, the lease receivable is reduced by the principal portion of lease payments received. The deferred inflow of resources is measured at the initial amount of the lease receivable, less lease payments received from the lessee at or before the commencement of the lease term (less any lease incentives). Key Estimates and Judgments Lease accounting includes estimates and judgments for determining the (1) rate used to discount the expected lease payments to present value, (2) lease term, and (3) lease payments. The Authority uses the interest rate stated in lease contracts. When the interest rate is not provided or the implicit rate cannot be readily determined, the Authority uses its estimated incremental borrowing rate as the discount rate for leases. The lease term includes the noncancellable period of the lease and certain periods covered by options to extend to reflect how long the lease is expected to be in effect, with terms and conditions varying by the type of underlying asset. Fixed and certain variable payments as well as lease incentives and certain other payments are included in the measurement of the lease receivable. The Authority monitors changes in circumstances that would require a remeasurement or modification of its leases. The Authority will remeasure the lease receivable and deferred inflows of resources if certain changes occur that are expected to significantly affect the amount of the lease receivable. NOTE 2—DEPOSITS AND INVESTMENTS: Deposits with banks are covered by the Federal Deposit Insurance Corporation (FDIC) and collateralized in accordance with the Virginia Security for Public Deposits Act (the “Act”) Section 2.2-4400 et. seq. of the Code of Virginia. Under the Act, banks and savings institutions holding public deposits in excess of the amount insured by the FDIC must pledge collateral to the Commonwealth of Virginia Treasury Board. Financial Institutions may choose between two collateralization methodologies and depending upon that choice, will pledge collateral that ranges in the amounts from 50% to 130% of excess deposits. Accordingly, all deposits are considered fully collateralized. Statutes authorize local governments and other public bodies to invest in obligations of the United States or agencies thereof, obligations of the Commonwealth of Virginia or political subdivisions thereof, obligations of the International Bank for Reconstruction and Development (World Bank), the Asian Development Bank, the African Development Bank, “prime quality” commercial paper that has received at least two of the following ratings: P-1 by Moody’s Investors Service, Inc.; A-1 by Standard &Poor’s; or F1 by Fitch Ratings, Inc. (Section 2.2-4502), banker’s acceptances, repurchase agreements, and the State Treasurer’s Local Government Investment Pool (LGIP). The Authority did not have any investments as of June 30, 2024. -11- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 3—INVENTORY: PROPERTY HELD FOR RESALE: The Authority purchases land and develops it to promote industry in Pittsylvania County, Virginia. The Authority records this land at the lower of cost or market. The total recorded value as of June 30, 2024 was $1,300,310. NOTE 4—NOTES RECEIVABLE: The Authority has multiple note receivable agreements with various companies in an effort to boost economic development in Pittsylvania County. Payments related to those agreements are due to the Authority as noted below: The Authority purchased manufacturing equipment on behalf of Panacea Biomatx, Inc. which they need to produce their product. On April 19, 2018 the Authority entered into a manufacturing equipment lease with the Panacea Biomatx, Inc. (the “Company”). The Company is making payments of $9,100 consisting of principal and interest on the Authority’s note dated January 17, 2019 and the remaining amount paid into a debt reserve. As of June 30, 2022, the amount of principal due under this agreement was $124,704. During fiscal year 2023, the Company defaulted on their agreement while filing bankruptcy and only repaid $41,501. As of June 30, 2024 the Authority is still owed $83,203 on this agreement. The Authority has not written this amount off or offset same with any allowance for doubtful accounts because the Authority believes it will receive payment of that amount or more through secured interest in the manufacturing equipment. On March 22, 2021, the Authority issued a promissory note with RealtyLink USA, LLC in the amount of $350,000. This note is payable in a lump sum in March 2026 including 3% interest. On March 22, 2021, the Authority issued a promissory note with RealtyLink USA, LLC in the amount of $800,000. This note is payable in a lump sum in March 2026 including 0% interest. During fiscal year 2022, $400,000 of this note was forgiven. As of June 30, 2024, the balance on this note was still $400,000. On February 1, 2023, the Authority issued a promissory note with Axxor in the amount of $3,499,990 with a 2.44% interest rate. This promissory note mirrors a note payable that the Authority issued through the Virginia Small Business Financing Authority maturing on June 30, 2032. As of June 30, 2024, the balance was $3,181,629 and is secured by certain Company equipment. Year Ending June 30,Principal Interes t 2025 $443,270 $73,539 2026 368,951 64,655 2027 1,128,055 55,551 2028 387,262 46,345 2029 396,939 36,667 2030-3033 1,290,355 50,347 Totals $4,014,832 $327,104 Notes Receivable -12- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 5—LEASE RECEIVABLE: The following is a summary of leases receivable transactions of the Authority for the year ended June 30, 2024: Lease revenue recognized during the fiscal year was $871,315. Details of leases receivable: Payments related to those agreements are due to the Authority as noted below: NOTE 6—LONG-TERM OBLIGATIONS: The following is a summary of long-term obligation transactions of the Authority for the year ended June 30, 2024: Beginning Increas es /Decreas es /Ending Interes t Bala nce Issuances Retirements Bala nce Revenue Leases receivable 9,642,287$-$ (234,201)$ 9,408,086$305,407$ Commencement Lease Des cription Date End Date Ending Balance SR Plas tics Build ing Lease*2/1/2024 8/1/2029 Monthly 2.44% 1,010,104$ 30,242$ SR Plas tics Build ing Lease**7/1/2021 6/1/2031 Monthly 3.35% 8,397,982 232,283 Total 9,408,086$ 262,525$ *monthly combined principal and interes t pa ym ents of $4,546, with an irregular final payment of $850,154 on Aug us t 1, 2029 **monthly combined principal and interes t pa ym ents of $43,888, with an irregular final payment of $6,331,200 on June 1, 2031 Amount Due Within One Year Pa ym ent Frequency Discount Rate Year Endi ng June 30,Principa l Interes t 2025 $262,525 $318,683 2026 271,653 309,555 2027 281,101 300,107 2028 290,882 290,326 2029 301,007 280,201 2030-2032 8,000,918 721,064 Totals $9,408,086 $2,219,936 Leas es R eceivable Bala nce Increases /Decreas es /Bala nce July 1, 2023 Issuances Retirements June 30, 2024 Direct borrowings: Lease rev enue bonds $1,452,741 $- $(104,784) $1,347,957 Notes payable 13,156,645 989,134 (590,779) 13,555,000 Total $14,609,386 $989,134 $(695,563) $14,902,957 -13- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 6—LONG-TERM OBLIGATIONS: (Continued) Annual requirements to amortize long-term obligations and the related interest are as follows: Details of long-term indebtedness: The direct borrowings above are all secured by a deed of trust and the land, buildings, and equipment of the corresponding companies. Yea r Ending June 30,Principal Interes t Principal Interes t 2025 $654,610 $392,669 $109,436 $25,049 2026 674,033 374,674 114,293 20,192 2027 694,058 356,139 869,366 15,119 2028 714,419 337,230 124,664 9,820 2029 733,721 317,388 130,198 4,287 2030-2034 10,084,159 771,602 - - Totals $13,555,000 $2,549,702 $1,347,957 $74,467 Notes Payable Revenue Bonds Direct Borrowings Final Amount of Amount Interes t Issue Installm ent Maturity Original Ba la nce Due W ithin Rates Date Amounts Date Issue Outsta ndi ng One Yea r Dir ec t Borrowin gs Lease Revenue Bonds : Panacea 4.39%1/30/2018 $67,242 (s a)^2/1/2029 1,079,198$597,957$ 109,436$ RealtyL ink 0.00%3/1/2021 lu mp s um 7/16/2025 1,150,000 750,000 - S ubtota l - leas e rev enue bonds 1,347,957$ 109,436$ Notes Payable: SR-Pla stics 3.55%6/1/2021 $43,888 (m)*6/1/2031 8,672,280 8,418,101$ 231,772$ SR-Pla stics 2.44%7/26/2022 4,546 (m)**3/1/2024 1,020,000 1,008,394 30,303 Cyber Park 4.25%2/10/2024 6,158 (m)***1/10/2034 989,134 976,001 32,468 Axxor 2.44%2/1/2023 36,134 (m)7/1/2032 3,499,990 3,152,504 360,067 S ubtota l - notes payable 13,555,000$ 654,610$ Total Direct Borrowings 14,902,957$ 764,046$ Total L ong -T erm Obligations 14,902,957$ 764,046$ (sa) - s emi-annual ins ta llm ents , includi ng interes t as applicable (m) - monthly ins tallm ents , inclu ding interes t as applicable ^s em i-annual payments inclu de s mall chang e - amount noted is av erage payment lu mp s um bond is due in one lump sum payment at maturity *monthly combined princi pa l and interes t payments of $43,888, with an irreg ular final payment of $6,349,930 on June 1, 2032 **monthly co mbined principal and interes t payments of $4,546, with an irreg ular final payment of $850,154 on Aug us t 1, 2029 ***monthly combined principal and interes t payments of $6,158, with an irreg ular final payment of $628,609 on January 10, 2034 -14- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 7—CONDUIT FINANCING: On January 30, 2018, the Authority issued a $1,803,802 tax-exempt bond bearing interest at 3.59% that matures on June 30, 2028. The bond proceeds were used for various projects for the benefit of Pittsylvania County, Virginia (the County). The County intends to repay this debt and has agreed to report the debt on their financial statements. Therefore, the impact of this issuance is not reported on the statement of net position of the Authority. The balance on this bond,as of June 30, 2024,was $319,735 as reported in the County’s financial statements. NOTE 8—CONTINGENT LIABILITIES: Certain programs in which the Authority participates were audited in accordance with the applicable specifications. Pursuant to the provisions of current guidance certain programs were tested for compliance with applicable grant requirements. While no matters of noncompliance were disclosed by audit, an awarding agency may subject grant programs to additional compliance tests, which may result in disallowed expenditures. In the opinion of management, any future disallowances of current grant program expenditures, if any, would be immaterial. NOTE 9—CAPITAL ASSETS: As of June 30, 2024, capital assets consist of the following: NOTE 10—DUE TO CITY OF DANVILLE, VA IDA: The Authority is in the process of constructing a shell building that is jointly owned by the Authority and the City of Danville, Virginia Industrial Development Authority. The construction contracts and funding sources are in the name of the City of Danville Industrial Development Authority. Since the building is jointly owned, the Authority has recorded a liability for the amount equal to the contributed asset received. The Authority expects to either sell the building to a third party or negotiate a long-term structured agreement in the future for repayment of construction costs. As of June 30, 2023, the amount owed and contributed assets were $1,197,950. During fiscal year 2024, additional construction and contributed assets were added increasing the balance to $1,499,744. Permanent financing of $989,134 was issued in the Authority’s name in fiscal year 2024 and is reported as a note payable as of June 30, 2024. The Authority still reports $510,605 due to the City of Danville Industrial Development Authority because this amount has not been structured with permanent financing. Beginning En ding Balance Increases Dec reases Balance Business-typ e Ac tivities: Capital as sets , not being depreciated: Land 497,442$ -$ -$ 497,442$ Cons tructi on in progres s 1,197,950 301,794 (1,499,744) - Total capital as sets being depreci ated 1,695,392$ 301,794$ (1,499,744)$ 497,442$ Capital as sets , being depreciated: Bui ldings and improv ements 11,789,700$ 1,499,744$ -$ 13,289,444$ Accum ulated depreciati on: Bui ldings and improv ements (123,759)$ (314,143) -$ (437,902)$ Total capital assets being depreci ated, net 11,665,941$ 1,185,601$ -$ 12,851,542$ Busines s-type activities capital as sets , net 13,361,333$ 1,487,395$ (1,499,744)$ 13,348,984$ -15- INDUSTRIAL DEVELOPMENT AUTHORITY OF PITTSYLVANIA COUNTY (A Component Unit of Pittsylvania County, Virginia) Notes to Financial Statements (Continued) June 30, 2024 NOTE 11—LITIGATION: As of June 30, 2024, there were no matters of litigation involving the Authority which would materially affect the Authority’s financial position should any court decisions on pending matters not be favorable. NOTE 12—UPCOMING PRONOUNCEMENTS: Statement No. 102, Certain Risk Disclosures, provides users of government financial statements with essential information about risks related to a government’s vulnerabilities due to certain concentrations or constraints. The requirements of this Statement are effective for fiscal years beginning after June 15, 2024. Statement No. 103, Financial Reporting Model Improvements, improves key components of the financial reporting model to enhance its effectiveness in providing information that is essential for decision making and assessing a government’s accountability. The requirements of this Statement are effective for fiscal years beginning after June 15, 2025. Management is currently evaluating the impact these standards will have on the financial statements when adopted. -16- COMPLIANCE SECTION Independent Auditors’ Report on Internal Control over Financial Reporting and on Compliance and Other Matters Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards To the Board of Directors Industrial Development Authority of Pittsylvania County Chatham, Virginia We have audited, in accordance with the auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Government Auditing Standards,issued by the Comptroller General of the United States; and the Specifications for Audits of Authorities, Boards and Commissions, issued by the Auditor of Public Accounts of the Commonwealth of Virginia, the financial statements of the business-type activities of Industrial Development Authority of Pittsylvania County, a component unit of Pittsylvania County, Virginia, as of and for the year ended June 30, 2024, and the related notes to the financial statements, which collectively comprise Industrial Development Authority of Pittsylvania County’s basic financial statements and have issued our report thereon dated November 27, 2024. Report on Internal Control over Financial Reporting In planning and performing our audit of the financial statements, we considered the Industrial Development Authority of Pittsylvania County’s internal control over financial reporting (internal control) as a basis for designing audit procedures that are appropriate in the circumstances for the purpose of expressing our opinion on the financial statements, but not for the purpose of expressing an opinion on the effectiveness of the Industrial Development Authority of Pittsylvania County’s internal control. Accordingly, we do not express an opinion on the effectiveness of the Industrial Development Authority of Pittsylvania County’s internal control. A deficiency in internal control exists when the design or operation of a control does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, misstatements on a timely basis. A material weakness is a deficiency, or a combination of deficiencies, in internal control such that there is a reasonable possibility that a material misstatement of the entity’s financial statements will not be prevented, or detected and corrected, on a timely basis. A significant deficiency is a deficiency, or a combination of deficiencies, in internal control that is less severe than a material weakness, yet important enough to merit attention by those charged with governance. Our consideration of internal control was for the limited purpose described in the first paragraph of this section and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses or significant deficiencies may exist that were not identified. Report on Compliance and Other Matters As part of obtaining reasonable assurance about whether Industrial Development Authority of Pittsylvania County’s financial statements are free from material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts, and grant agreements, noncompliance with which could have a direct and material effect on the financial statements. However, providing an opinion on compliance with those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance or other matters that are required to be reported under Government Auditing Standards. -17- Purpose of This Report The purpose of this report is solely to describe the scope of our testing of internal control and compliance and the results of that testing, and not to provide an opinion on the effectiveness of the entity’s internal control or on compliance. This report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the entity’s internal control and compliance. Accordingly, this communication is not suitable for any other purpose. Blacksburg, Virginia November 27, 2024 -18- Agenda Section: New Business-Section VIII(B) Agenda Title: Approval of 2025 Meeting Schedule Staff Contact: Matthew Rowe Agenda Date: January 22, 2025 Attachments: Approval of 2025 Meeting Schedule SUMMARY: A copy of the 2025 Meeting Schedule is included in the packet for your review, comment, and approval. FINANCIAL IMPACT AND FUNDING SOURCE: Not applicable. RECOMMENDATION: County Staff recommends the IDA Board approve the 2025 Meeting Schedule as presented. MOTION: “I make a Motion to approve the 2025 Meeting Schedule as presented.” IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 IDA Meeting Wednesday 6:00 PM - County Administration Conference Room; 1 Center Street, Chatham, Virginia 24531 January 22, 2025 March 19, 2025 February 19, 2025 April 16, 2025 May 21, 2025 June 18, 2025 July 16, 2025 August 20, 2025 September 17, 2025 October 22, 2025 November 19, 2025 December 17, 2025 Schedule of Meetings 2025 Wednesday Page 1 of 7 PITTSYLVANIA COUNTY INDUSTRIAL DEVELOPMENT AUTHORITY BYLAWS ARTICLE I. NAME AND OFFICES 1. The name of this Authority shall be the INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF PITTSYLVANIA, VIRGINIA ("Authority"). 2. The principal Office of the Authority shall be located at 1 Center Street, Chatham, Virginia 24531. The Authority may also have other Offices at such other places, both within and outside the State of Virginia, as the Board of Directors may from time-to-time fix or determine or the business of the Authority may require. 3. Except as otherwise required by Resolution of the Authority, or as the business of the Authority may require, all books and records of the Authority shall be kept at the Office to be designated by the Directors of said Authority. The Minutes of the Authority shall always be open and available for public inspection during normal business hours, and copies of said Minutes may be produced to any Virginia citizen pursuant to the Virginia Freedom of Information Act. ARTICLE II. PURPOSES AND POWERS The Authority shall fulfill all the purposes and intents of the General Assembly of Virginia, as expressed in Chapter 49, Subtitle IV of Title 15.2 of the Code of Virginia, 1950, as amended, and by any other enactment that may hereafter be adopted by the General Assembly. The Authority shall also fulfill all purposes and intents of the Board of Supervisors of Pittsylvania County, Virginia (“Board of Supervisors”), as may hereafter be provided, and the general purpose of the Authority shall be to promote industry and develop trade in the area within its jurisdiction for the general good of the people of said area and of the Commonwealth of Virginia. The Authority shall have any and all powers that have been granted to it by the Acts of Assembly of Virginia, aforesaid, and the powers that may hereafter be granted to it by any enactment of the General Assembly and, also, those powers that may be granted to it by any delegation of authority hereafter granted by the Board of Supervisors. ARTICLE III. BOARD OF DIRECTORS; STIPEND; TRAVEL REIMBURSEMENT 1. The Authority shall be governed by a Board of Directors ("Board," "Board of Directors," or "Directors") composed of seven (7) Directors which will consist of one (1) Director per Magisterial District, appointed by the Board of Supervisors. All powers of the Authority shall be vested in the Board of Directors. 2. The seven (7) Directors shall serve a four (4) year term, all as appointed by the Board of Supervisors, except where there have been appointments to fill vacancies, in which case the terms shall be for the unexpired terms. The Board of Supervisors, at any time and under their sole discretion, may remove any Director with or without cause. 3. No Director shall be an officer or employee of Pittsylvania County, Virginia. Page 2 of 7 4. Stipend. Directors shall receive a monthly stipend of one-hundred and fifty dollars ($150.00). Said Stipend shall be paid monthly via direct deposit and shall be paid regardless of Meeting attendance or Meeting occurrence. As required by the Authority’s auditors, Directors shall be issued an IRS W-2 Form related to said stipend payment. Habitual Meeting non- attendance issues may be reviewed by the Board of Supervisors for potential corrective action measures. 5. Travel Reimbursement. Directors shall not receive travel reimbursement for in-County travel. Directors shall receive travel reimbursement, at the current IRS Mileage Rate, for all official and necessary Authority related travel occurring outside the County. 6. The Board of Directors shall have the right to prepare, or delegate the preparation of, confidential reports for submission to any person, governmental body, or agency consistent with the purposes and powers stated in Article II, the Board of Directors shall also have and the right to receive from any source confidential reports consistent with the purposes and powers stated in said Article, but no action binding the Authority, may be taken respecting such reports except by action of the Board of Directors. ARTICLE IV. OATH OF DIRECTORS; VIRGINIA CONFLICTS OF INTERESTS ACT FORMS Each Director shall, before entering on his duties, take and subscribe the Oath prescribed by Section 49-1, Code of Virginia, 1950, as amended, which shall be administered in accordance with law. Thereafter, each Director shall file any and all forms as required by the Virginia Conflicts of Interests Act, as designated by the Board of Supervisors in the County Code. ARTICLE V. OFFICERS 1. The Board of Directors shall elect from its membership a Chairman and a Vice- Chairman from its membership. The County’s Economic Development Project Manager shall serve as the Authority’s Secretary. The County’s Director of Finance, or his/her designe e, shall serve as the Authority’s Treasurer. 2. The regular terms of Office for the officers shall commence on the date of the regular or Annual Meeting of the Directors each year, and shall continue until the next such Annual Meeting, and thereafter until their successors are elected. Any officer may be elected to succeed himself. 3. Chairman. The Chairman’s duties shall be to preside at Meetings of the Board of Directors; to prepare the Agenda for any and all Meetings, and to make a copy of the said Agenda available to the Secretary for the purpose of providing adequate Notice of Special Meetings as hereinafter provided; to call Special Meetings; to call Special Elections; to be ex-officio a member of all committees; to sign, with the Secretary or Treasurer, or any other proper officer of the Authority thereunto authorized by the Board of Directors, any documents or instruments which the Board of Directors has authorized to be executed, except in cases where the signing and Page 3 of 7 execution thereof shall be expressly delegated by the Board of Directors or by the Bylaws to some other officer of the Board of Directors, or shall be required by law to be otherwise signed or executed; and in general shall perform all duties incident to the office of Chairman and such other duties as may be prescribed by the Board of Directors from time-to-time. The Chairman shall have an equal vote with the other Directors, and shall not have a second, tie-breaking vote on any question. 4. Vice-Chairman. The Vice-Chairman’s duties shall be to preside at Meetings on the request of the Chairman, or in the absence of the Chairman; and in case of the death or resignation of the Chairman, shall become Chairman for the remainder of the term for which the Chairman was elected. In the absence of the Chairman, the Vice-Chairman shall perform the duties of the Chairman, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Chairman. The Vice-Chairman shall perform such other duties as may be assigned by the Board of Directors from time-to-time. 5. Secretary. The Secretary shall be responsible for the preparation of the Minutes of Meetings of the Board of Directors, kept in a record book and made available for public inspection at all appropriate times; to have custody of all important records of the Authority; to have custody of the seal of the Authority and to see that the seal of the Authority is affixed to all documents or instruments, the execution of which on behalf of the Authority under its seal is duly authorized by the Board of Directors; to sign with the Chairman or Vice-Chairman any documents or instruments which the Board of Directors has authorized to be executed; to see that all notices are duly given as required by law, these Bylaws or by the Board of Directors; to call Meetings of the Board of Directors to order in the absence of the Chairman and Vice-Chairman, and thereupon to conduct an election for a temporary presiding officer for that Meeting; and in general to perform all the duties incident to the office of Secretary and such other duties as from time-to-time may be assigned by the Board of Directors. In the absence of the Secretary, the Chairman shall appoint a Director to be responsible for the preparation of detailed Minutes of the Meeting. 6. Treasurer. The Treasurer shall be responsible for (a) the duty to keep the keep suitable records of all financial transactions of the Authority; (b) the authority to arrange for the preparation of any audits of the Authority’s financial records, as may be directed by the Board; (c) the duty and authority to have charge and custody of all funds and arrange for their investment and deposit in the Authority’s name when authorized by the Board; (d) the duty to furnish a copy of such audit to the Board of Supervisors;(e) the duty to make available for public inspection at all times such annual audit; (f) the duty and the authority, in the Secretary’s absence, to perform all duties of the Secretary, except for those certain other duties which the Chairman, under the Bylaws, has delegated to a Director and/or other Officer; (g) and in general, the duty to perform all the duties incident to the office of Treasurer and such other duties as from time-to-time may be assigned by the Board of Directors. The Treasurer shall give bond in such a sum as may from time-to-time be fixed by Resolution of the Board of Directors, payable to the Authority and to Pittsylvania County or the Commonwealth Virginia, as their interests may appear, with corporate surety authorized to act as such in the Commonwealth, said premium on any bond/surety shall be paid as an expense of the Authority. ARTICLE VI. ELECTION OF OFFICERS Page 4 of 7 1. The regular election of Officers shall be held at the Regular Annual Meeting to be held on the second Tuesday in January of each year as hereinafter provided in Article VII. 2. Special Elections may be held at any Regular or Special Meeting in to fill vacancies or to fill newly created offices, but only after specific notice, as required by law has been given. ARTICLE VII. MEETINGS 1. Annual Meeting. The Annual Meeting shall be held on the second Tuesday in January of each year at a time and location designated by the Board of Directors. 2. Regular Meetings. Monthly Meetings shall be held on the second Tuesday of each month without Notice, unless the same shall be a legal holiday; if so, said Meeting shall be held on the immediate following business day; further provided, however, that if the Chairman, or the Vice-Chairman in his/her absence or incapacity, shall determine, after consultation with the Secretary, that there are no matters requiring action by the Board of Directors at any scheduled Regular meeting, the Chairman, or Vice-Chairman in his/her absence or incapacity, may cancel any such Regular Meeting. 3. Special Meetings. Special Meetings of the Board of Directors may be held whenever called by the Chairman, the Vice-Chairman, or any two (2) Directors. Whenever any two (2) Directors, not including the Chairman or Vice-Chairman, request a Special Meeting, they shall provide the Secretary with a written statement of the business to be considered for the purpose of providing adequate Notice. 4. Notice of Meetings. Three (3) days' written Notice of all Regular or Called Meetings of the Board of Directors stating the time and place and in the case of a Special Meeting, the purpose thereof, shall be given by the Chairman, Vice-Chairman, or Secretary, by mailing the same to each Director at his residence or business address or by electronic mail, if requested by the Director. If mailed, such Notice shall be deemed to be delivered when deposited in the United States Mail so addressed with postage prepaid. Notwithstanding the foregoing, no Notice need be given to hold a legally constituted Special/Called Meeting, if all the Directors are present or sign a Waiver of Notice. 5. Waiver of Notice. Whenever any Notice is required to be given to any Director of any Meeting under these Bylaws, a Waiver thereof in writing signed by all of the Directors, whether before or after the time stated therein, shall be equivalent to the giving of such Notice. The attendance of a Director at a Meeting shall constitute a Waiver of Notice of such Meeting, except where a Director attends a Meeting for the express purpose of objecting to the transaction of any business, because the Meeting was not lawfully called or convened. 6. Quorum. Four (4) members of the Board of Directors shall constitute a quorum of the Authority for the purpose of conducting its business and exercising its powers and for all other purposes, except that no facilities owned by the Authority shall be leased or disposed of in any manner without a majority vote of the Board of Directors. No vacancy in the membership of the Page 5 of 7 Board shall impair the right of a quorum to exercise all of the powers and perform all of the duties of the Board. 7. Order of Business. At all Meetings of the Authority, the following Order of Business shall be observed, as far as consistent with the purpose of the Meeting: Call to Order Roll Call Any Additions/Revisions to Agenda Approval of Agenda Consent Agenda 1. Approval of Previous Meeting Minutes 2. Review/Approval of Monthly Financials Presentations Old Business New Business Economic Development Updates Matters from Authority Members Closed Session (if any) Return to Open Session and Closed Session Certification (if any) Adjournment 8. Meetings to be Open to Public. Formal action shall be taken by the Board of Directors only at Open Sessions/Meetings and such Meetings shall be open to the public. 9. Voting. The vote on the adoption of every Resolution, any proposals creating a liability, or for the appropriation or expenditure of funds shall be by yeas or nays, and whenever the vote is not unanimous, the names of Directors voting for and of those voting against such action shall be entered upon the Minutes. 10. Procedure. Unless otherwise provided, procedure at Meetings shall follow Robert's Rules of Order (latest edition). 11. Signing of Minutes. When approved, all Minutes of Meetings of the Board of Directors shall be signed by the Secretary, and the Meeting’s presiding officer. 12. Remote Participation in Meetings. As authorized by § 2.2-3708.3, Code of Virginia, 1950, as amended, the Authority shall allow the participation of Authority Members in a Meeting through electronic communication means from a remote location that is not open to the public subject to complying with all parts of the following written policy: A. On or before the day of a Meeting, the Authority shall notify the Authority Chairman that the Authority Member is unable to attend the meeting due a personal matter, and the Authority Member shall identify with specificity the nature of the personal matter, or the Authority Member Page 6 of 7 shall notify the Authority Chairman that the Authority Member is unable to attend a Meeting due to a temporary or permanent disability or other medical condition of the Member or the Member’s family member that prevents the Authority Member’s physical attendance. The Authority shall record the specific nature of the personal matter or fact of temporary or permanent disability, and the remote location from which the absent Authority Member participated in its minutes. B. If the absent Authority Member’s remote participation is disapproved, because such participation would violate the strict and uniform application of this written policy, such disapproval shall be recorded in the Authority’s Minutes. C. Such participation by the absent Authority Member shall be limited in each calendar year to two (2) Meetings or twenty-five percent (25%) of the Meetings held per calendar year rounded up to the next whole number, whichever is greater. D. A quorum of the Authority shall be physically assembled at the primary or central Meeting location. E. The Authority shall arrange for the voice of the absent Authority Member to be heard by all people in attendance at the primary or central Meeting location. ARTICLE VIII. COMMITTEES 1. The Chairman may, with the advice and consent of the Board of Directors, appoint such Special Committees as may be deemed appropriate to carry out the intents and purposes of the Authority. ARTICLE IX. STAFF 1. The Board of Directors may employ and compensate such employees and agents, including, but not limited to attorneys, accounting firms, clerks, as it deems necessary in carrying on the business of the Authority. 2. The employees and agents of the Authority may prepare and submit confidential reports and recommendations to the Board of Directors, but no action binding on the Authority shall be taken respecting such reports except as provided in Article III. ARTICLE X. OFFICIAL SEAL The official seal of the Authority shall consist of a disc having engraved or impressed upon it the following words or figures: INDUSTRIAL DEVELOPMENT AUTHORITY OF THE COUNTY OF PITTSYLVANIA, VIRGINIA. ARTICLE XI. FISCAL YEAR The Authority’s Fiscal Year shall be from July 1 through June 30 of the current year. Page 7 of 7 ARTICLE XII. AMENDMENTS Except as otherwise provided by law, these Bylaws may be amended, added to, altered, or repealed, in whole or in part by the Board of Directors at any Meeting of the Board of Directors, provided that Notice of the proposed amendment, addition, alteration, or repeal is given in the Notice of the Call of such Meeting, and such Notice is given in the manner provided in Article VII. Paragraph 4, not less than one (1) week prior to the holding of such Meeting. Any Director may Waive written Notice. ARTICLE XIII. CONFLICTING PROVISIONS If any provision of these Bylaws should be inconsistent with the enabling Act or with the terms, conditions, or stipulations of any trust agreement entered into by the Authority, such conflicting provisions of these Bylaws shall, to the extent of such conflict, be deemed ineffective and of no force. The remainder of the Bylaws shall remain in full legal force and effect. Amended December 11, 2012. Amended December 13, 2016. Amended December 11, 2018. Amended January 12, 2021. Amended February 16, 2022. Amended February 22, 2023.