State Committee Approves Big Incentives for Big Businesses
Posted June 17, 1998 7:00 a.m. EDT
GARNER — Landing the FedEx hub in Greensboro and convincing Nucor to put a steel mill in Hertford County are big victories for North Carolina, but they each have a big price tag.
The incentive packages given to the companies total more than $275 million.
FedEx decided North Carolina has friendly skies, and it only took a $115 million incentive package to convince them to put a hub in the Triad.
Nucor's plan to bring a steel mill to a rural section of the state really broke the mold, but it will cost $161 million in tax breaks.
"It's like a game of poker, and unfortunately, that's what it is and we have to play," Sen. David Hoyle said. "If you don't play in this game you lose."
The Senate Finance Committee just approved these incentives. Full legislative support will catapult our state into the high-dollar, high stakes industrial recruitment game. Some legislators are asking if it is a game we should be spending our tax dollars to play.
"I don't see why we have to subsidize a company that last year made as much money as the entire state budget was," Sen. Bob Shaw said.
There is proof that these incentives work, at least on a smaller scale. For example, the Perstorp Flooring company moved to Garner after an added incentive.
The state kicked in $300,000 to convince the floormaker to choose Garner as its only manufacturing site outside of Sweden.
"Well it put us on the map, internationally as well as nationally," Garner economic development director Rex Todd said.
The Department of Commerce says the big incentive deals are used cautiously, with preference to projects that will boost economically distressed areas.
Another high profile project in the southeast had a equally high price tag. Alabama offered a $253 million incentive package to convince Mercedes Benz to put a plant outside Birmingham.