Saturday, August 13, 2022

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City council allows second, more limited rezoning for Medline, 4-1, although neighbors speak out against it

Mebane’s city council voted this week to rezone an additional 48.5 acres along the south side of West Ten Road in western Orange County for Medline to allow for light manufacturing (conditional) uses.

The Illinois-based medical supply company recently announced its plans to build a 1.2 million-square foot distribution center on 175 acres across the same road, on the north side of West Ten Road in western Orange County.

The 48.5-acre site on the south side of West Ten Road had been zoned for rural, non-farm residential uses under Orange County’s Unified Development Ordinance.  The council voted 4-1, with mayor pro tem Jill Auditori opposed this week, to approve Medline’s rezoning request.

In an interview with The Alamance News, Auditori said after the meeting Monday night that she voted against the rezoning request because Medline has obtained a waiver from a provision within Mebane’s Unified Development Ordinance (UDO) that requires site plans to come before the council for approval.  “I would like the city council to have some say in the final approval in the final [use] of the property,” Auditori explained in the interview.  “I don’t expect it will be a bad project, and I appreciate that they limited the scope of what could go there.”

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The 48.5-acre site on the south side of West Ten Road is located outside Mebane’s municipal limits but within its extra-territorial jurisdiction (ETJ).  Mebane council members voted unanimously last month to annex the 48.5-acre site and agreed earlier last fall to annex the 175-acre site on the north side of West Ten Road, where Medline intends to build the distribution center.

However, council members and neighboring property owners raised concerns last month about possible noise, vapor, and exhaust emissions, Medline amended its application for rezoning, offering to restrict any future use of the 48.5-acre site to 24 uses that the company believes will have little or no impact on the environment and property values for nearby homes.

The potential future uses that Medline offered to restrict the property to include:  accessory uses and structures; apparel and finish fabric products; bulk mail and packaging; communication tower of 50 feet or less; computer and office equipment; drugs and pharmaceuticals; fencing; outside storage; research, development, or testing services; solar farms; temporary construction, storage, or office; and general and self-storage warehouse, according to a letter that Medline’s vice president of real estate operations sent the council last week.

“These would be the exclusive uses that would be permitted on that property,” Mebane development director Cy Stober said Monday night, at the outset of a public hearing on Medline’s rezoning request.  The property is on the outskirts of Mebane, “to put it mildly,” but is within Orange County’s Buckhorn Economic Development District and a utility area that the city has worked with Orange County to cultivate, he said.

Stober also said that the 24 restricted uses that Medline offered as a condition for rezoning would preclude construction of an animal shelter or a recycling center.  A solar farm – one of the 24 possible uses that Medline offered to restrict the use of the property to – would require any future developer to apply to the city for a Special Use Permit, which would have to be handled through a separate development process, he told the council Monday night.

Austin Watts, vice president of the Kimley-Horn engineering firm in Charlotte, said this week that Medline has discussed its intention to hold on to the property for the short term but may resell it later. 

“I went back to Medline and expressed the concerns that were brought up [last month], and they were more than willing to make this a conditional rezoning” to allow future uses that would be compatible with Medline’s distribution facility, Watts told the council.  The company’s representatives don’t want chicken houses and mobile homes that had been abandoned “as the doormat to their front door,” Watts said Monday night.  “The intent is it’s going to be something professional and a good mix with Medline in general.”

“That gives me a lot of comfort – and I’m sure the neighbors, too,” councilman Tim Bradley responded.

Appraiser: No significant impact on surrounding property values

Medline hired an appraisal firm in Raleigh last month to evaluate the potential impact that M-2 zoning would have on surrounding property values.  The latest 48.5-acre site that Medline has acquired along West Ten Road is bounded on the western side by mobile homes; a Baptist church, several other mobile homes, and the Buckhorn Flea Market are located east of the site.   A residential subdivision, Preston Loop, is located northwest of the property, while Gravelly Hill Middle School is situated northeast of the Medline property.

The firm, Kirkland Appraisals, looked at recent homes sales prices for several residential properties near the Governors Green and Collington Farms subdivisions in Mebane that are located adjacent to parcels that have been zoned M-2 and compared those sales prices with other similar homes that had recently sold.  The appraisers determined there was little impact on the purchase price for homes located adjacent to property that has been zoned for light manufacturing.  Kirkland noted in its analysis that other properties north, east, and west of Medline’s 48.5-acre site on West Ten Road are zoned for the Buckhorn Economic Development District, which was created for higher-intensity commercial and industrial uses. 

Nick Kirkland, who described himself as an appraiser trainee that has been “accepted as an expert in over four dozen hearings” on rezoning requests elsewhere, told the council this week that the firm’s analysis showed “no significant impact to adjoining property values.

“My conclusion is that this will be a harmonious use once rezoned,” Kirkland said Monday night.  He acknowledged that the latest sales price for one home in Governors Green “was at the low end of the range” of the sales prices for all of the properties his firm analyzed, which he characterized this week as “typical market friction.”  Home sales prices for Governors Green that the appraisers analyzed ranged from $204,000 to $220,000 between 2015 and 2017, based on a report the firm prepared for the council’s discussion.   

Neighbors air concerns about noxious uses, lack of independent appraisal

Patty O’Connor, who lives at 1011 Squires Road in Mebane, appeared concerned this week about the vagueness of the 24 potential uses that Medline had offered as a condition for rezoning.  She’d expressed similar concerns about the company’s plans for the land on the south side of West Ten Road during the public hearing on Medline’s annexation petition.  “What does Medline consider to be accessory uses and structures?” O’Connor asked Watts Monday night.  “It could be any number of things…I’m becoming concerned with noxious things.”

“I’m becoming concerned with noxious uses…Beauty is in the eye of the beholder.  I’m a nurse; I know Medline’s stuff.  Yeah, I wonder about the property that they’re going to buy.  I just want the council to be mightily aware that change can occur with a lot of thoughtfulness.  [There are] many things that can be put there that can be conducive with the feel of the area.  It will impact our property values; I’m not sure if it’s going to be up or down.” – Patty O’Connor

 “It would be more than likely a warehouse use,” Watts responded, “just various facilities that would be on-site.”

“What we were told, when we talked to Medline [was] they’re looking at this being their global location,” Bradley told O’Connor.  Mainly, the company wants to clean up the 48.5-acre site to “have an attractive property across from their global headquarters,” the councilman explained.

“Beauty is in the eye of the beholder,” O’Connor countered.  “I’m a nurse; I know Medline’s stuff.  Yeah, I wonder about the property that they’re going to buy.  I just want the council to be mightily aware that change can occur with a lot of thoughtfulness.  [There are] many things that can be put there that can be conducive with the feel of the area.  It will impact our property values; I’m not sure if it’s going to be up or down.”

“If you drive around the city, Governors Green is next to the industrial park,” Bradley added.  “We just approved 600 homes behind ABB.  I haven’t seen any reduction in willingness to put large subdivisions in close proximity to ABB – that’s clearly manufacturing.  I sat at the December meeting, from what I’ve seen historically, it didn’t seem to have any negative impact on residential values.  It could also have a positive effect, in that your land becomes much more valuable.  It doesn’t appear to be a deterrent; people are buying houses next to light manufacturing.”

Logan Johnson, who lives at 1418 Squires Road in Mebane, was skeptical about the appraiser’s conclusion about what impact rezoning will have on residential property values. 

“I’m concerned that it wasn’t an independent appraisal,” Johnson told the council Monday night, referring to the fact that, in effect, Medline hired the appraisers.  (Kimley-Horn, the engineering firm that Medline has hired for its forthcoming facility in Mebane, contracted with Kirkland Appraisers to analyze the potential effect that rezoning would have on residential property values.)

“It changes the feel of where I live,” Johnson told the council.  “I don’t understand why we need to rezone it now.  Why can’t the future purchaser apply to rezone it?”

Auditori recalled week that she had asked the same question – why the property needs to be rezoned now – at last month’s meeting.  She also said that, while she would love to drive through Mebane and see farmland for years to come, “I don’t think that’s realistic.”

“We’ve got to do something with it within 60 days,” Bradley responded, apparently referring to a state law that requires municipalities to adopt zoning regulations within 60 days of annexation.

“This has been an Orange County initiative for industrial growth out there,” mayor Ed Hooks pointed out Monday night.  “The fact they asked us to annex this for water and sewer [service], the fact they were able to whittle down the usage for us, is quite unique.  I think we’ve shown that we’ve cared about the residences in this area.  The fact we are very careful with what goes there, I think, is a plus for this rezoning.”

Mebane’s city council agreed last fall to provide $803,000 in incentives to entice Medline to expand in the area, while Orange County’s commissioners approved $1.8 million in incentives for the company’s expansion.  The state and DOT have agreed to provide $1 million in road improvements on West Ten Road, including at the intersection with Buckhorn Road, which is approximately half a mile from an I-40/85 interchange.

Medline closed on purchase of 48.5-acre site in October 2019

Medline purchased the additional acreage on the south side of West Ten Road in late October 2019.  The medical supply company purchased a 34.37-acre parcel at 5414 West Ten Road for $578,000 from the Bruce Barclay Cameron Foundation and a second, 14.14 acre parcel for $390,000 from Carreno Developers, based on documents that were filed with Orange County’s Register of Deeds on October 29, 2019 to consummate the purchases.

The latest data from the state Department of Transportation (DOT) reveals an average of 1,700 daily trips along West Ten Road, according to information that was provided to the council this week.

Medline currently operates 43 distribution centers in the U.S.  The Mebane facility would be the company’s largest but eventually would be eclipsed by an even larger plant that Medline is planning to build in the Chicago area,  Dmitry Dukhan, vice president of real estate operations for Medline, said in an earlier interview with The Alamance News.

Medline will receive an estimated $4.3 million in state and local incentives in exchange for investing $65 million to build its new distribution center in Mebane, according to the state Department of Commerce.  The city of Mebane has agreed to provide $803,000 in cash and other incentives; Orange County has agreed to provide $1.8 million in performance-based cash incentives, contingent upon the company meeting job creation targets; and the state has agreed to provide $1.7 million in grant funding, training support, and road improvements.

The company anticipates creating up to 600 jobs over the next decade, as part of the incentives agreement that Orange County’s commissioners approved for Medline last fall.  The state commerce department estimates that annual pay for all new positions at the company’s distribution center in Mebane will average $34,468. Medline plans to complete construction of the distribution center on West Ten Road by the end of this year and to open it by the summer of 2021.

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