Lexington, KY - Fayette County's pristine farms have long made it a unique place to live and work. Thousands of middle-class jobs were created when IBM established its typewriter division here in the 1950s. That business has morphed into printer maker Lexmark, the second largest private employer, after St. Joseph Healthcare System. The University of Kentucky is the largest public employer, with more than 17,000 jobs paying an average of more than $60,000 per year each. Notably, UK's main campus sits on only 784 acres. Because of UK and other nearby colleges and universities, Fayette County is among the 10 most highly educated communities in America, with 38 percent of adults having at least a bachelor's degree (compared to the national average of 26 percent). The area is centrally located at the intersection of I-64 and I-75.
Lexington's ability to attract a large manufacturer that might capitalize on these characteristics has been constrained by its longstanding Land Use Plan. Fayette County is divided into a core Urban Services Area (USA) of 54,664 acres and a farm belt Rural Services Area (RSA) of 127, 818 acres. This division has forced all urban activities, including residential subdivisions, schools, commercial buildings, shopping centers and manufacturing facilities, into the USA. The RSA's agricultural land, including horse farms, has been preserved from development by large-lot zoning.
In recent years, the larger tracts of land in the USA have been built out. Fayette County Schools' chief operating officer, Mary Wright, has noted that no 50-acre tract of land is easily available inside the USA upon which to build a sixth public high school. In 1986, the Saturn car company approached Fayette County about the possibility of building a car factory that would have employed 18,000 people. Fayette County officials advised Saturn that there was no 800-acre tract available to build their factory upon here. Instead, Saturn built its factory in Tennessee.
In 1999, the minimum developable tract size in the RSA was increased to 40 acres from 10 acres. No RSA land is available to serve as a site for a multi-hundred acre manufacturing facility, and no large tracts (more than 20 acres) are available inside the USA. A 2011 review of available tracts of 5 acres or more inside the USA reveals that there are fewer than 75 acres currently zoned and buildable for manufacturing facilities. This land is in small, non-contiguous tracts scattered throughout the USA.
This situation leaves Fayette County at a competitive disadvantage when attempting to attract new, large-scale job creators. Such companies need land ready to build upon quickly. They do not have time for a prolonged land use process and development. If Fayette County is to attract new economic development opportunities and job creation prospects, it must have a sufficient supply of useable land.
The recent Angelou economic development study conducted for the LFUCG reveals the need for it to address the lack of available land for job creation projects. The Angelou Study recommends that LFUCG improve the permitting and development review process, as well as the availability of suitable land.
Given that most developable land for new manufacturing facilities inside the USA has been used, the people of Fayette County and the LFUCG must now seriously consider allowing a few large tracts of land in the RSA to be used as sites for new manufacturing facilities. If these land use changes are not adopted, then these manufacturing facilities will continue to locate in competing places.
Commerce Lexington, Inc. (CLX) has done a good job, given the land-use constraints, of attracting new businesses. In 1998, CLX established the Blue Grass Business Park (BBP) and developed more than 100 acres inside the USA, in an effort to address the lack of land for manufacturing job-creating prospects. BBP has become the home of Tiffany & Co. (125 jobs), Big Ass Fans, Webasto Roof Systems (700+ jobs), Sumitomo (70) and Kito USA (35). Only 20 BBP acres remain available.
The millions of dollars of taxpayer monies that the LFUCG spends on its Purchase Of Development Rights (PDR) program, to protect horse farms from non-agricultural development, would be better spent by Commerce Lexington in efforts to attract new job-creating employers. Given current zoning and land use laws, the RSA farms are not in any real danger of development.
Although agricultural land makes up about 70 percent of Fayette County, the Thoroughbred horse business contributes less than 5 percent of the county's annual output, according to the report "Strategies for Developing Agricultural Opportunities in the Greater Lexington Area: A Special Report Prepared for the Fayette County Farm Bureau and the Fayette County Agribusiness Task Force," October 2005. According to a 1999 American Farmland Trust's report, "The Cost of Community Services in Lexington-Fayette County, Kentucky", the commercial and industrial uses of land in Fayette County consume only $0.22 of government services for each dollar paid in taxes. Agricultural and open land consumes $0.93 in services for every tax dollar paid. For many reasons, the horse business is in decline, with significantly fewer horses residing in Fayette County than did three years ago. While there are some higher paying jobs, such as equine veterinarians and farm managers, many farm jobs pay only $7.50 to $15.00 per hour.
When broken down by withholding taxes taken out of employee paychecks in Fayette County, 70.38 percent are from commercial and industrial employees, but only 2.87 percent comes from farm workers' paychecks. Although newcomer ACS (a subsidiary of Xerox) has provided hundreds of new call center jobs, many pay only $10 per hour. The percentage of people working in middle-class-wage-paying manufacturing and construction has decreased substantially since 2007.
In Fayette County, the percentage of children living in poverty has increased to 26.5 percent in 2010, from 14.7 percent in 2000. In August 2011, Fayette County's unemployment rate was merely 7.2 percent. Most people have jobs, but many of those jobs do not pay the middle-class wages (and benefits) necessary to support a family.
Middle-class job growth has stalled in Fayette County. Little land remains inside the USA to provide sites for prospective manufacturers, much less large-scale manufacturers that could bring thousands of higher-paying jobs. Most of the possible sites are located within the RSA, which is off limits under current law and regulations.
I am not proposing the widespread development of the RSA's agricultural land. I do suggest, however, that it is reasonable for about 1,000 acres out of 127,818 acres to be made available as building sites for prospective manufacturers, to bring thousands of higher-paying jobs to Fayette County. This land use can be accomplished without destroying the agrarian character of Fayette County. Locating the Toyota factory in Scott County has not destroyed that county's rural nature.
The government should structure its land use policies so as to attract good-paying jobs for thousands of residents, rather than protecting the social and financial interests of the very wealthy and a select few. The people of Fayette County have some fundamental decisions to make about the future of this community.