UPDATE --- Subsequent to passing of the bill to provide incentives to Goodyear in Fayetteville, Governor Easley decided to veto the bill. Click
here to read about the veto and why he did it...
The original blog entry follows...
North Carolina gives away big money to entice companies to set up shop in the state and create jobs. Much has been reported in recent news about the relatively new trend and debates continue to rage about whether the huge incentives are worth the cost. The state offered Dell $242 million in cash and tax breaks to bring 2,000 jobs to the Triad and the jobs pay an average of $28,000 per year.
A big ruckus is still being made over the giveaway to entice Google to the western part of the state. In exchange for incentives, the company would build a $600 million data center near Lenoir and create as many as 210 jobs with average salaries of $48,000. Breaks given by the
state would save Google up to $90 million over three decades. Local business recruiters also earmarked up to $4.8 million to the company if it meets job-creation goals. Including incentives offered by local leaders, Google could receive more than $260 million over 30 years.
Just before adjourning the 2007 session, the NC General Assembly approved a new incentive to give Goodyear Tire & Rubber Company up to $40 million over 10 years
just to stay in Cumberland County. In return the company has to invest at least $200 million in its factory but it would not have to create any jobs and or have to keep all of the 2,750 existing workers.
Wouldn't it be nice if the Legislators would grant tidy sums to all the state residents that have lost their jobs in recent years due to a declining economic climate and businesses leaving the state and region?
What do you think? Leave your comments below after reading the report on the latest incentive...
News and Observer
August 4, 2007
Jonathan B. Cox, Staff Writer
Goodyear could get $40 million
State offers incentives package if the tiremaker stays in Cumberland County
Goodyear Tire & Rubber Co. could get as much as $40 million from the state over 10 years if it keeps producing in Fayetteville -- even if it lays off workers. Before adjourning, the General Assembly approved a new incentive program written to sway one of Cumberland County's largest private employers as it considers factory closings and expansions.
Goodyear would have to invest at least $200 million in its factory to get the assistance. But it would not have to create any jobs or keep all 2,750 existing positions.
"Goodyear has been a wonderful corporate citizen in our part of the state," said Sen. Tony Rand, a Fayetteville Democrat and one of the legislature's most powerful members. "It makes a great deal of sense to keep one of our most important industrial citizens."
The incentive comes as Goodyear trims domestic production of low-end tires in favor of more profitable models.
Last year, the company said that it would stop making about
10 brands of tires -- some made in Fayetteville -- sold under the names of wholesale customers. Since that time, the company has also announced plans to end tire production at a factory in Canada and close a Texas plant.
Goodyear's decisions angered unionized workers, who went on strike last year. Its actions have also sparked fears in several U.S. communities, where leaders worry that they could lose a major employer.
Officials in Alabama and Tennessee have cobbled together incentives packages to entice Goodyear to upgrade plants instead of shutting them down.
"Everybody spends a lot of money to bring these kinds of plants in," said Jim Cooper, executive director of the Obion County Joint Economic Development Council in Tennessee. Goodyear employs about 2,500 at a plant there in Union City.
"Not a whole lot of emphasis is put on keeping them," he said. Read more...
North Carolina has established a new organization to review its many programs, determine if benefits are worth the cost and recommend changes where needed.
