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Group to sue state over incentives, ads
Institute will challenge policies on tax issues, business recruitment


By David Rice
JOURNAL RALEIGH BUREAU
Thursday, February 26, 2004

RALEIGH

A new legal-research group in Raleigh will wage lawsuits over constitutional issues involving the use of tax dollars for business incentives and to broadcast public-service ads using state officials, its chairman said yesterday.

The N.C. Institute for Constitutional Law will challenge state policies on business recruitment and tax issues, said William Graham, the former Superior Court judge and state banking commissioner who will head the group's board.

"The business incentives are the things that just jump out at you right now," Graham said, pointing to more than $200 million in incentives that the General Assembly approved in December for R.J. Reynolds Tobacco Co. and Merck & Co. "They get bigger and bigger and bigger."

Although state officials tend to say they must offer large incentive packages to win jobs because other states do it, "That is no rationale," Graham said. "I think it is way out of hand.

"It filters down to the local level, if you figure out how many counties have built shell buildings (to attract new business)," he said. "It's all taxpayers' money."

In addition to Graham, the group's board includes Robinson Everett, the Duke University law professor who successfully sued the state several times over congressional districts; Winston-Salem lawyer Bill Maready, who has already challenged business incentives twice in court; Ron Link, a former acting dean of the University of North Carolina Law School; and Art Pope, a former state representative who's an opponent of incentives.

Although the board appears to be a conservative group, Graham said that the institute could also find itself allied with liberal groups as it challenges state tax incentives for business recruitment.

The group will not involve itself in social issues or redistricting, Graham said. "The politicians themselves will sue over redistricting time and again," he said. "This is over the constitutional business issues or the constitutional tax issues."

Graham said that the institute would name its executive director, "a well-respected and very prominent current North Carolina public official," in the next week or so.

David Rice can be reached in Raleigh at (919) 833-9056 or at