Local Politics

Bill Targets Goodyear for State Grants

Posted July 25, 2007
Updated July 26, 2007

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— As legal battles rage over using state money to lure new business to North Carolina, a legislative committee on Wednesday approved language in a bill to provide Goodyear with up to $40 million over the next decade to upgrade its tire plant in Fayetteville.

House Bill 1761 includes amendments to the state's Job Development Investment Grant program, which provides companies with grants based on how much income tax was withheld from employees' pay if the companies meet specified job-creation goals.

The amendments would expand the scope of companies eligible for JDIG money to include "multinational heavy industry manufacturing" facilities that maintain their existing work force and agree to invest at least $200 million to upgrade their plants over the next five years.

Language approved Wednesday by the House Appropriations Committee calls for creating a $40 million fund to offer grants to up to five such companies, provided each company is located in an economically distressed county, has at least 2,400 full-time employees at the time of the grant and doesn't go below that head count.

Although Goodyear isn't named in the bill, Rep. Rick Glazier, D-Cumberland, said the bill is targeted at the company, which has a tire plant in Fayetteville that is Cumberland County's largest private employer. The plant employs about 2,500 workers with average pay and benefits of about $90,000.

"We couldn't pay that kind of incentive to bring that kind of job to North Carolina, and we've got them," Glazier said. "In the short term, we've got to engage in strategies to assist plants (to) modernize and stay and assist technological companies in their coming to the state."

A similar state-funded deal for Google was challenged in a lawsuit filed Wednesday in Wake County.

The North Carolina Institute for Constitutional Law alleges a $4.7 million state grant and tax exemptions worth an estimated $90 million that were given to Google to convince the search engine giant to build a $600 million data center in Lenoir violate the state constitution.

Google said in a statement Wednesday afternoon, contending that the lawsuit has no merit.

The Institute for Constitutional Law previously challenged incentives paid to Dell Inc. for a computer manufacturing and distribution hub in Forsyth County.

"It involves special treatment," said Aldean Webster, executive director of the Institute for Constitutional Law. "It's not surprising that we would have other businesses -- now those that are already present -- trying to get on the gravy train."

Glazier acknowledged that he doesn't like business incentives, but said that they are part of the economic development industry -- unless a judge rules them invalid.

"(This is) probably some of the best money we will ever invest truly in jobs," he said.

21 Comments

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  • blossom3100 Jul 27, 2007

    Well Rand321, I too am a small business owner. I can't see why you would say such. Take all the small companies and their employees and then take all the large companies with their employees, and see which has the bigger tax base. But they do nothing for the small businesses except make sure the IRS keeps you inline. Why can't these large multi-billion dollar companies afford to pay their own way, just like I do. Hypocrites everywhere.

  • LocalYokel Jul 25, 2007

    $40,000,000 is probably slightly less than the sum of CEO's bonuses over that ten year timeframe.

  • ladyblue Jul 25, 2007

    Will will these politicians learn that as soon as the tax breaks are over these places lay off and even blackmail us to give more breaks or they'll pull out all together. Isn't it a crying shame that our country has to pay manufacturing to come to work but they'll blackmail us if we don't. They think nothing about people making a living or just moving on to another country. Who started this mess anyway of allowing our companies to go over seas or south of the Border. Tell me how America got in this shape...

  • jimmy2 Jul 25, 2007

    And they wonder why we keep having to deal with budget shortages. More money taken out of our pocket that we will probably have to make up with increased taxes. Not to mention, that these idiots can't seem to get their job done on time. The budget should have been submitted and approved by June 30th, now they are on overtime spending more of our money.

    Great job "Sleezly and Company"...

  • Bat Man Jul 25, 2007

    State agency budgets are suffering and they do this. I don't want to hear one word from anyone in state government about the budget being in bad shape.

  • rand321 Jul 25, 2007

    Higher net worth and income individuals do make assessments of the individual tax rates in states all the time. the top individual rate is up for discussion all the time as it pertains to retaining or attracting these folks to NC. Many of them are executives that do bring corporate headquarters with them.

    I am a small business owner in NC and do not have luxury to move to another state (at the current time). however, my business benefits dramtically by more jobs and greater disposable income. I would like to see more Dell's Honda and google plants with their higher than average Nc salary anytime. It benefits my company and allows us to hire even more people.

  • Brick Tamland Jul 25, 2007

    These tax breaks need to be done away with in every state. There should be a federal law against it. Then everyone will have the same playing field and will have to rely on illegal bribes like the good ol days.

  • Nancy Jul 25, 2007

    Think this is bad? Check out what Weasley has given away to a honda airplane engine plant over in the Burlington area - all for a measley 70 jobs. It will boil your blood.

    http://www.airportbiz.com/web/online/Top-News-Headlines/Burlington-likely-to-land-engine-plant/1$12671

  • Doctor Dataclerk Jul 25, 2007

    We are the largest private employer in our county and the only grant that we participate in is paying the taxes so our legislators can give it to fortune five hundred companies who don't need it anyway. What a system.

  • olivedrabby Jul 25, 2007

    Corporate welfare at its finest - brought to you by corrupt politicians.

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