Easley Questions Goodyear Incentives Bill

Raleigh, N.C. — Gov. Mike Easley is delaying action on a bill promising up to $40 million in state grants to Goodyear Tire and Ribber Co. to upgrade its tire plant in Fayetteville.

The legislation would amend the state's Job Development Investment Grant program, which provides companies with grants. The size of the grant is based on how much income tax was withheld from employees' pay, and the recipients must meet specified job-creation goals.

Goodyear isn't named in the bill, but lawmakers said the legislation targets the company, which employs about 2,700 people in Fayetteville.

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

The bill 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.

After lawmakers passed the the incentive deal, Goodyear announced it would upgrade its Fayetteville tire plant.

"I think there may be a better way to skin this cat," Easley said. "We're all committed to trying to keep these jobs. Its just what's the best way to do it, and is this the best way to do it when you're talking about grants of this magnitude? Obviously, I have concerns about it."

The governor has until Sept. 1 to act. He declined to say whether he would sign or veto it, saying he hopes to work out a compromise solution in the next few weeks.

Lawmakers said they want Easley to sign the legislation.

"I don't know what the problems are. It would be very serious if he vetoed the bill. It would send a terrible message," said Senate Majority Leader Tony Rand, a Cumberland County Democrat.

State Rep. Nelson Dollar, R-Wake, said grants to a proven company like Goodyear are worth the cost, noting the state has given millions of dollars in tax breaks to entice Google and Dell to build operations in North Carolina.

"We have the good-paying jobs. It's not a pipe dream. It's something on the ground," Dollar said. "If we don't keep Goodyear here and keep them in that region, it's going to have a devastating impact on the economy."

State Rep. Rick Glazier, D-Cumberland, who co-sponsored the legislation, said he continues to work with Easley on the proposal and isn't panicking over the delay.

"I fully expect, I think these legislators and the governor expect, to see Goodyear keeping its plant in North Carolina," he said.