RALEIGH — A German tire manufacturers decision to ditch North Carolina and build a $500 million plant in South Carolina has sparked a political blame game.
Republican Senate leader Phil Berger pointed the finger squarely at Democratic Gov. Bev Perdue on Thursday, saying numerous questions plagued the deal to lure Continental Tire to Brunswick County including ethical concerns that a Democratic state senator and Democratic donors owned the land where the company planned to locate.
Weve tried to convince (Perdues) administration that this deal reeked of cronyism, Berger said. Now, pay-to-play politics has cost our state...
Perdues administration rejected the assertion and blamed Senate Republicans, saying the project, which would have brought more than 1,300 jobs to an economically depressed area just east of Wilmington, failed because Republican legislators refused to endorse $45 million in cash incentives.
It appears to me that everybody is trying to cover their tail, said Commerce Secretary Keith Crisco, whose department is charged with luring economic development projects to the state. This was a game-changer for the Southeast.
The public airing of details about a secretive economic development deal complete with dueling press conferences, a flurry of partisan statements and the release of hundreds of pages of public records is highly unusual. It illustrates just how much the issue of job creation has become politically charged amid persistent high unemployment and in advance of next years election.
In its announcement, Continental said it would begin construction in mid-2012 on a 1-million-square-foot facility in Sumter County, S.C., as part of a company-wide expansion to meet the growing demand for automotive tires.
Continental did not explain why it rejected North Carolinas bid, but state commerce officials said ethical questions raised about the lands owners did not play a role.
The investors who stood to profit from the deal included state Sen. Michael Walters, a Proctorville Democrat, and other major Democratic donors. Walters said he filed paperwork Aug. 25 recusing himself from the matter to avoid a conflict of interest.
The governors office said the administration played no role in selecting the site.
When Berger first raised concerns about the lands ownership, the commerce secretary said he approached Continental about picking another site, including one a landowner offered for free.
The company said the alternatives didnt fit its parameters, Crisco said.
The commerce secretary said Continental made it clear that it wanted up-front cash incentives to make the project happen. Senate leaders proposed $45 million spread out over 15 years, so the company went in a different direction.
The $45 million was what they said they clearly needed to come here it wasnt a bargaining thing, Crisco said.
Its the second time in recent years that Continental spurned North Carolina. In 2006, it closed a plant in Charlotte and two years later moved its corporate headquarters south across the border to Fort Mill.
Crisco said the companys history with the state did not play a role in the recent negotiations. He took an open and forgiving approach to land the huge project, he said.
North Carolina began courting the company under an initiative code-named Project Soccer in March, according to documents obtained through a public records request.
Within two months, the Commerce Department involved top lawmakers because the incentives package all together valued near $100 million would have required legislative action. The company considered eight different locations in North Carolina before it picked the Mid-Atlantic Logistics Center near the border of Brunswick and Columbus counties as a finalist.
The Senates concerns about the project developed in late August.
As Hurricane Irene neared the coast, Berger called the governor before 5 p.m. on Aug. 25, according to emails he sent to his chief of staff.
He told her the Senate leadership could no longer support the proposal because of ethical issues. Berger also asked about the involvement of Womble Carlyle, a lobbying firm that employs her son, Garrett Perdue.
The governor told him that she didnt know about the property ownership or her sons firms involvement.
Despite his objections, Berger continued to negotiate the deal for weeks afterward.
Berger said that doesnt indicate that his concerns were satisfied.
We made it crystal clear to them that the land issue didnt go away, he said in an interview. Republican House Speaker Thom Tillis, who largely supported an incentives deal, struck a softer tone but also blamed politics. Now, it appears that politics became involved in what should have been a business decision, he said in a statement.
The governors office did not make her available for an interview Thursday.
The back-and-forth didnt satisfy Dewey Hill, a Democratic lawmaker who represents Brunswick County, which had a 10.7 percent unemployment rate in August.
Im frustrated, he said. We need the jobs.