Local News

Dell Incentives Bill Signed Into Law

Posted November 8, 2004

— Gov. Mike Easley signed into law on Friday an incentives package designed to lure Dell Inc. to build an East Coast computer manufacturing plant in the Triad.

The bill, which provides for most of the $242 million deal being offered by North Carolina to the computer giant, was given final approval by lawmakers Thursday night.

Easley called the legislators back to Raleigh just two days after the election because he said the targeted company wants to start building as soon as possible.

Administration officials have said the plant could generate more than 2,300 jobs - 2,000 of them permanent - while potentially creating 5,000 to 6,000 additional jobs through suppliers or related industries.

The crux of the package is a tax credit for each personal computer or peripheral equipment that Dell would produce over a 15-year period. The credit would be capped annually but could rise if the company meets higher employment levels. Credits ultimately would be reduced if plant employment dropped by 40 percent in any one year.

Easley has said Dell may make a final decision next week. A Dell spokeswoman at corporate headquarters in Round Rock, Texas, didn't immediately return a phone call Friday seeking comment.

Some legislators and interest groups complained the package was too rich to attract jobs in an urban area that on average would pay $28,000 annually. They also said the package would allow Dell to pay no corporate or franchise taxes in some years.

Still, the House and Senate approved the bill Thursday after rejecting several amendments.

One would have allowed the public access to paperwork on state efforts to ensure companies asking for tax credits generate the projected number of jobs required to get the rebates.

Only some state officials now have the right to inspect those claims. The measure, by Sen. Hugh Webster, R-Alamance, would have made the paperwork subject to the state open records laws.

"We need sunshine that allows us to know," Webster said. "Neither us nor the press nor the public can look at it."

Sen. David Hoyle, D-Gaston, co-chairman of the Senate Finance Committee, agreed with the concept - but said it wasn't the right time.

"But doing that could jeopardize it, it could be the straw that breaks the camel's back and these jobs would go to Tennessee or Virginia," Hoyle said before the amendment failed by a vote of 23-25.

Hoyle said he would work with Webster next year to provide "transparency" to the tax credit process.

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