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State Hopes Corporate Incentives Pay Off

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RALEIGH, N.C. — North Carolina is giving up million of dollars in revenue for an investment in jobs, but the question is whether the state will get a return on this kind of investment.

Lowe's Home Improvement has built a regional distribution center in the middle of rural Northampton County. By the end of the year, 800 workers will have jobs in that area. The deal to land Lowe's cost state and local governments both land and tax breaks worth millions.

Next week during a special session, Gov. Mike Easley will ask lawmakers to come up with

a deal to lure Merck

to the Treyburn Corporate park in Durham County. The nation's second-largest pharaceutical firm would manufacture vaccines at a new $300 million plant, providing jobs for 200 workers. Right now, Merck is trying to decide between North Carolina and Georgia.

"You need these incentives really in the final negotiations to make sure they come here and not to come equally competitive places in other states," said Dan Gerlach, who works with Easley's budget affairs office.

When it comes to economic development and jobs, Gerlach insists money should do the talking.

"North Carolina is a great business climate ranked the first in the nation, but we need to keep our competitive edge," Gerlach said.

Rep. Sam Ellis, R-Wake, is among those who oppose incentives. He said North Carolina can attract new industry without having to give away millions.

"I see no reason to give away the farm just to get a few more chickens," he said.

There is also a bidding war over Pergo, which has a floor manufacturing plant in Garner. The company is considering an expansion in the Triangle, but it could choose a site outside North Carolina.


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