@NCCapitol

Senate GOP, Dems blame each other for failed jobs deal

Posted October 6, 2011 2:22 p.m. EDT
Updated October 7, 2011 7:29 a.m. EDT

— Senate Republican lawmakers are blaming "pay-to-play politics" for North Carolina losing a bid that would have brought hundreds of jobs to Brunswick County.

But Democrats are firing back, calling the accusation "nothing but a smokescreen."

Continental Tire announced Thursday that it plans to invest up to $1 billion and create up to 1,300 jobs at a new plant in Sumter County, S.C. North Carolina was the first choice for the plant, but the deal fell through after state leaders couldn't agree on the details of a package of around $100 million in tax credits and grants. 

Senate President Pro Tempore Phil Berger, R-Rockingham, said Thursday that he blames Perdue for losing the bid.

Berger said Senate Republicans worked with Perdue's administration for six months to develop a proposal, but refused to support it in the end because of "several serious concerns – including the governor’s plan that would line the pockets of her political supporters."

The Associated Press reported last week that the land proposed for the project was owned by a state legislator and Democratic Party donors who had given more than $52,000 to Perdue's campaigns.

Berger said GOP lawmakers were unwilling to sign off on what they perceive to be an unethical deal.

"Pay-to-play politics in North Carolina is, unfortunately, something we've seen time and time again. It has got to stop," Berger said. "This time it has cost us jobs. It's embarrassing to our state. It's something that we will not allow to the extent we have any control over it."

But emails released Thursday by the governor's office show Berger knew about the land owners' political donations in August. He did not stop the deal. Instead, he and his caucus continued to negotiate.

The sticking point, according to those emails, was the structuring of a forgivable $45 million loan. Continental wanted the money available by the end of 2012, but Berger wanted to space it out over 15 years, citing concerns about the cost of an executive order issued by the governor regarding pre-kindergarten funding.

The tiremaker wouldn't accept the lengthened schedule.

Berger also wanted Continental to consider other sites in North Carolina. But Commerce Secretary Keith Crisco said the site was selected by a consultant from Tennessee with no ties to the governor. He said he asked if Continental would consider other sites, but the company refused. Having already spent 11 months on site selection, the tiremaker wasn't interested in reopening that process. 

Crisco said Continental managers guaranteed him they would come to the state if their terms were met. He said Perdue and NC House Speaker agreed to those terms, but Berger would not.

"We never were able to get agreement on the proposal they guaranteed they would come to," he said. “When you put the numbers in (that) they requested, it was a great deal for North Carolina," Crisco said. 

"I know that this was a good project, I know that there was no one that was doing anything unethical," Crisco added. 

In a statement Thursday afternoon, Perdue said she had no involvement in selecting the Brunswick County site and that Berger was making "reckless accusations in order to evade responsibility for his own decision, a decision that cost North Carolina 1,300 jobs."

"I supported the package that would bring these jobs to North Carolina, because it was a good investment for our state," Perdue said. "Sen. Berger decided to oppose it, because he thought the jobs were not worth it. Now he should stand up and take responsibility for his decision."

The North Carolina Democratic Party said the jobs would have lowered Brunswick County's unemployment rate, currently 10.7 percent, to one of the lowest in the state at 8.1 percent.

"Berger would sooner destroy the economy in an attempt to hurt Gov. Perdue politically rather than make this happen and put people back to work," party spokesman Walton Robinson said.

Party Chairman David Parker said he blames Berger's "personal vendetta" against Perdue.

“Berger opposed the governor's proposals to stimulate the economy by reducing the corporate income tax, blocked extension of unemployment benefits and has done nothing to help grow jobs but instead focused his energies on passing divisive social issues," he said.

"Perhaps he should consider running for office in South Carolina because he certainly isn't looking out for North Carolinians," Parker added.

House Speaker Thom Tillis also issued a statement Thursday, saying he's "disappointed" the deal didn't come together. "It appears that politics became involved in what should have been a business decision."