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Valencia County: An economic development hotspot

Copyright © 2017 Albuquerque Journal

If you want to see the future, look to Valencia County. A majority of voters there have chosen the winning candidate in every presidential election since 1952, according to the U.S. Election Atlas, a longer streak than any other place in the country. They anticipated Trump’s surprising win over Clinton. But could they have predicted that their community – known for centuries as a mostly rural expanse with a modest agricultural industry – would become one of the bright spots in New Mexico’s economy?

For Lucero Chavez, owner of the Los Lunas-based New York Barber Salon, the recent uptick in activity has been surprising, but welcome.

Lucero Chavez, who owns the Los Lunas-based New York BarberSalon, says she’s seen more clients since Facebook began building its data center in Los Lunas. (Adolphe Pierre-Louis/Albuquerque Journal)

“We are really busy,” she said. “It’s a lot of people who work at Facebook, on the data center there.”

Economic development officials describe Facebook as the crown jewel in a triad of recent successes for the county. The social media company announced in September of last year it had chosen Los Lunas as the site of its new data center, an investment now predicted to top $1 billion. A few weeks later, bottled water supplier Niagara Bottling said it, too, was coming to Los Lunas. Then early this year, manufacturer Keter Plastics announced it would move into the long-vacant Solo Cup plant in Belen.

Keter Plastics moved into the Belen-based facility formerly owned by Solo Cup early this year. (Adolphe Pierre-Louis/Albuquerque Journal)

Those projects have impacted other sectors of the local economy: Several chain restaurants and gas stations are moving into the county to accommodate increased traffic, and gross receipts tax revenue in Los Lunas is up by nearly $2 million, largely as a result of Facebook’s construction activity (though some of that will be reimbursed to the company; see sidebar).

“For a lot of these businesses, it’s very much a game of ‘follow the leader,’ ” said Ralph L. Mims, Los Lunas’ economic development manager. “This is just the beginning.”

Much to offer

Mims said Valencia County has much to offer big businesses, particularly those with operations that require large tracts of land. The land is often cheaper than more densely populated areas in New Mexico, and because much of that property is owned by a few landowners, property purchase negotiations are streamlined, Mims said. Places like Los Lunas also have something many other rural areas can’t offer: an abundance of undeveloped land in tandem with sewer access, waterlines, and other infrastructure.

The construction of a Facebook data center in Los Lunas is expected to bring 1,000 workers on site through 2023. (Roberto E. Rosales/Albuquerque Journal)

Steven Tomita, Belen’s planning and economic development manager, said transportation is also a key component of the county’s appeal. Albuquerque and the Sunport are a short drive on I-25, and the Rail Runner can be ridden from Belen to Santa Fe. A rail hub is in development in Los Lunas, and Belen’s railroad infrastructure has long been one of its most important assets.

“Keter told us they were originally looking at coastal cities, but started looking at Belen because of our rail network,” Tomita said. “That type of transportation network is crucial for a big manufacturer.”

Economic development officials say projects in Valencia County are creating a greater demand for retail in places like Main Street, Los Lunas. (Adolphe Pierre-Louis/Albuquerque Journal)

Valencia County has another attraction, too, one that garners more controversy than its infrastructure or transportation offerings: Its officials have shown that they are willing to offer businesses millions of dollars in incentive packages in conjunction with the state. Executives at Facebook, which received $10 million in Local Economic Development Act funding, a gross receipts tax reimbursement, and a hefty property tax break, have consistently cited the ease of doing business in Los Lunas as the primary reason the company chose New Mexico over the other state they were considering for the data center, Utah. In Utah, incentive negotiations stalled as public officials questioned a potential package they saw as too generous.

The Niagara Bottling plant in Los Lunas is expected to bring 47 jobs to the area. (Adolphe Pierre-Louis/Albuquerque Journal)

Matt Geisel, New Mexico’s economic development secretary, said incentives are one of the ways the state is able to “close the gap” between itself and competitors. As for tax abatements and rebates, they reflect “revenue that wouldn’t have happened if the development didn’t happen,” he said.

Momentum, not a cure

While the county’s recent success has been a boon for village coffers and local businesses, Valencia still grapples with the problems that have plagued it for decades. Census data from 2015, the most recent year for which statistics are available, show that nearly 11 percent of Valencia County households live far below the poverty line on $10,000 annually; Advocates for the poor say that thousands of households are struggling to survive today.

And crime is still a problem. Valencia, with a population of about 76,000, is the sixth-most populous county in the state, but it is second only to Bernalillo County for violent crimes, according to a 2016 FBI report.

But Mims said economic development is key to addressing the county’s other issues.

“It’s about creating jobs and opportunities for our young people,” said Mims. “That impacts crime, that impacts services, that impacts everything else.”

To create those jobs, the county has had to take careful inventory of its assets and learn how to market them. Geisel said one of the county’s greatest achievements has been showcasing those assets to businesses that might not have considered looking outside big cities.

“It’s a case study,” he said.

In other words, the rest of the country may look to Valencia County in 2020 during the next presidential election. But New Mexicans are watching the community now to see what it portends for the rest of the state.