Follow the Money: Issue 86


Feb 25th, 2011
by Elizabeth Lincicome

Governor vetoes bill in order to protect incentives giveaways 

 

This week the governor vetoed the Legislature’s budget-savings bill in order to protect money in some of the state’s largest incentives funds. Shrouded in secrecy, Perdue’s office sent out a message on Twitter that pointed to several potential projects across the state that they said could be jeopardized if the governor’s deal sweeteners were taken away. The names of the companies being recruited weren't mentioned. The Twitter message went on to say there were "several other, new projects promising 900 jobs and a more than $100 (million) investment that may need a grant to seal the deal." Referencing the “but for” test, Republican lawmakers have said their bill would still allow Perdue to come to the Legislature to approve incentives to lure businesses if they are really necessary during the remainder of the fiscal year. “Perdue's veto proves she'd rather roll the dice with your tax dollars than protect jobs now and right-size state government," tweeted Senate leader Phil Berger.

 

Ukranian billionaire bails out chicken processor, plans to ask Chatham County for incentives

 

Ukrainian billionaire Oleg Bakhmatyuk is buying the North Carolina assets of Townsends, a chicken processor that filed for bankruptcy late last year. Townsends employs around 1200 people in Chatham County. Even though the deal has been decided, Townsends CEO David Purtle said the company plans on asking Chatham County for economic incentives. "We're probably going to ask the local community to help us with some of the water costs and some of the infrastructure costs so that we remain in a competitive position. Basically, what we want is to make sure we're competitive in the world market." N.C. Commerce officials have said any buyer would likely qualify for grants to help offset the cost of running natural gas lines to Townsends' feed mills and hatchery. It is doubtful that Billionaire Bakhmatyuk needs any financial help from Chatham County. He is also the largest shareholder in the Ukraine's leading egg producer, and he owns multiple food, transportation, real estate, and financial companies.

 

Eaton Corp. gets incentives to expand

 

State and local officials have promised auto-parts maker Eaton Corp. up to $5 million in incentives to expand its facility in Roxboro, NC. Eaton Corp., a publicly traded company, employs 3,000 people across the state, and 200 of these workers are based in Roxboro. The company also has operations in Raleigh, Morrisville, and Youngsville. Officials at the state Department of Commerce defended the use of incentives by saying the company was also considering building a site in Mexico. 

 

Gates Corp. also gets incentives to expand

 

Another auto-parts maker, Gates Corp., will receive incentives to expand its North Carolina operations. Gates Corp. will receive a state grant worth as much as $100,000 to add 58 jobs over the next three years. The jobs will pay average annual salaries of $24,723, less than the average of $27,508. The Jefferson plant already employs 265 people. Gates was founded in 1911, and is one of the world's largest makers of belts and hoses for the automotive and other industries.

 

QVC receives money from One NC Fund

 

Multimedia retailer QVC has received a $1 million grant from the One North Carolina Fund. QVC says it will add jobs in Rocky Mount, as part of an expansion of its distribution facility there. The company is headquarted in West Chester, PA. As of last year, the company employed 541 full-time workers and 998 part-time workers in Rocky Mount.

 

Quote of the week: 

 

“I personally hate [incentives]. I think it's the wrong thing to do. I wish Congress would pass something to make them illegal.”

-Gov. Bev Perdue

The Raleigh News & Observer 2/21/11