Orange County

Will $4.3M incentive package bring a global medical supply company to Orange County?

Orange County, Mebane weigh incentives for medical supply company

Orange County commissioners and the Mebane City Council are considering $2.6 million in cash, grants and tax incentives to bring Medline, a top U.S. supplier and distributor of medical supplies, to the Buckhorn Economic Development District.
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Orange County commissioners and the Mebane City Council are considering $2.6 million in cash, grants and tax incentives to bring Medline, a top U.S. supplier and distributor of medical supplies, to the Buckhorn Economic Development District.

The story was updated at 11 a.m. Sept. 11, 2019.

An Illinois medical supply company wants to build a new distribution center in western Orange County using local and state incentives.

The Mebane City Council annexed the 175.9-acre site south of Interstate 85 on Sept. 9. The council also voted to offer $803,000 in cash and other incentives to land Medline Industries Inc.

The Orange County Board of Commissioners approved a separate, $1.84 million tax incentive at a Sept. 10 public hearing. The state also is offering roughly $1.7 million in grants, workforce training support and road improvements.

Medline is expected to build the 1.2 million-square-foot facility on West Ten Road in Orange County, between Gravelly Hill Middle School, the Preston Loop neighborhood and the Buckhorn Flea Market. A site plan has not yet been submitted to the city, but construction is slated for completion by early 2021.

Dmitry Dukhan, Medline vice president for real estate, said the company could be operational by the end of 2021.

The facility would be located in Orange County’s Buckhorn Economic Development District, roughly 1,200 acres set aside for the development of manufacturing, wholesale, distribution, retail and service companies.

The Medline site already has water and sewer utilities available. The current owners of the land that would comprise the Orange County site are asking Mebane to rezone it for light industrial use.

Medline plans to construct its facility to meet high energy-efficient standards, including a rooftop solar-panel array that could meet up to 50% of the plant’s electrical needs, Dukhan said. A 1.1 million-square-foot Medline facility in California that has rooftop solar panels meets 35% of its annual electricity needs, county staff reported.

Medline’s new facility also would use very little water and could encourage its vendors to make future investments in the Buckhorn district, staff reported.

The $65.3 million project would have to meet annual goals for five years to earn the incentives, including the creation of 250 full-time jobs at an average salary of $35,468 a year. Dukhan noted that employees also earn bonuses and are eligible for college reimbursement, growth and training programs, and other benefits.

Medline officials eventually expect to employ up to 700 full-time workers, Dukhan said.

If the company meets its goals, Mebane would provide a cash grant of $653,000 and waive $150,000 in local impact, permit and inspection fees over the first five years. If the company falls short of its goals in a given year, it would receive only a portion of that year’s anticipated incentive.

Orange County would discount up to 75 percent of the company’s new annual property tax payments for five years.

The project, in the first five years, could generate nearly $3 million in new property taxes for Orange County, making it the county’s largest industrial property taxpayer, staff said.

It could generate more than $2.6 million in additional property taxes for Mebane, city staff reported, plus over $8.8 million in sales tax revenues from the sale of construction materials and employee spending.

Near Morinaga candy plant

The facility would be located less than four miles from Morinaga America Foods Inc., which opened in 2016 in the Buckhorn Economic Development District. Morinaga American is a subsidiary of Morinaga & Co., Japan’s largest international confectionary and candy maker.

Medline Industries, founded in 1966, is the largest private U.S. medical supply manufacturer and distributor with offices in 20 countries providing next-day service to hospitals, physicians, pharmacies and other health centers.

The company manufactures 80,000 medical products, including the CURAD line of bandages and gauze pads. It also distributes over half a million medical products, with customers in 90 countries and 24,000 employees worldwide.

In June, Medline officials reported over $12 billion in total annual sales, including to government agencies, such as U.S. Homeland Security, emergency management services and first responders.

Dukhan noted the Buckhorn plant would serve hospital and medical needs across North Carolina and in parts of Virginia, South Carolina and Georgia. It also will back up operations in Florida, he said.

The announcement comes roughly a month after Mebane, county and state officials approved an incentives package to help Swiss industrial equipment maker ABB expand its Mebane distribution and manufacturing hub. ABB plans to add over 400 new jobs in return for $7.6 million in tax incentives and grants, including $4.3 million for jobs training.

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Tammy Grubb has written about Orange County’s politics, people and government since 2010. She is a UNC-Chapel Hill alumna and has lived and worked in the Triangle for over 25 years.
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