@NCCapitol

@NCCapitol

NC ladling on incentives in battle for executive jobs

Posted November 27, 2018 3:06 p.m. EST
Updated November 27, 2018 3:12 p.m. EST

— A proposal to sweeten the incentives North Carolina offers to attract businesses to the state is quickly moving through the Senate.

Senate Bill 820 would more than double the cap on annual awards to businesses through the Job Development Investment Grant program, from a maximum of $6,500 per job per year to $16,000 per job per year.

Sen. Paul Newton, R-Cabarrus, a co-sponsor of the bill, said the existing cap has been in place since 2002 and is now making North Carolina less competitive in the battle for high-paying executive positions tied to corporate headquarters.

"When you get a headquarters located in your state, it becomes the center of gravity for that company," said Newton, a former Duke Energy executive. "Benefits will flow to existing citizens of North Carolina, even without job creation, but jobs will be created where the corporate headquarters is."

Sen. Jerry Tillman, R-Randolph, another co-sponsor, said the $6,500 cap was put in place with top salaries of $150,000 or so a year. The state is vying for headquarters where executives will be paid $300,000 to $400,000 a year, he said, so the incentives must be adjusted.

"That's why we're doing that, to attract some headquarters for some big boys, for deep pockets who are out there looking," Tillman said. "It'll put another carrot out there to come to North Carolina. South Carolina has done things like this in the past, and they're beating us to the draw on a lot of these things."

The changes would cost North Carolina an estimated $7.1 million over the next five years, according to legislative Fiscal Research staff, based on the number of people with salaries of more than $150,000 who have been part of JDIG grants in recent years.

The Senate Finance Committee approved the bill without opposition. It could reach the Senate floor as early as Wednesday.