Hard ball

Some public officials were bullied by Google when the company sought tax breaks for a facility. It is not a pretty story

Thanks to laws that mandate release of documents pertaining to the recruitment of industry, North Carolinians now have a clear and very ugly picture of just what went on behind the scenes as Caldwell County officials and legislators sought to land a Google computer center for Lenoir. It was no small deal: Google could bring as much as a $600 million investment and 200 jobs. The company got a sweet little arrangement, too, with tax breaks that could amount to $100 million over 30 years.

Incentives are just part of the recruiting game these days. States and localities have to balance what they can offer -- in Google's case, huge tax breaks on things such as electricity and equipment used by the company -- versus the economic benefit of having a company come to town. And companies are not shy about asking for the moon and stars, because the market is very competitive.

In fact, a News & Observer report Thursday showed just how rough a company can be.

Google demanded, for example, that public officials not mention its name during negotiations over legislation to grant some specific tax breaks. The company even wanted those involved in the deal to sign nondisclosure agreements. Incredibly, some Caldwell County officials did sign, as did some lawmakers. To their credit, officials of the state Department of Commerce did not sign.

Demands of this sort are outrageous, of course. Google should have known better than to make them, given that the people it was pressuring worked not for the company but for the public. But those who did sign shirked their responsibility to the public, and doubtless justified it in their own minds by thinking that the ends of a computer center were worth the means of getting there.

Google also seemed to use intimidation in the course of negotiations, at one point ordering legislation written precisely as the company wanted it. As The N&O reported last week, Google executive Rhett Weiss wrote state Commerce Secretary Jim Fain in an e-mail message last summer, "Without the legislation being passed with its correct substance, our project will not proceed in North Carolina." Weiss also asked, "Will creating and operating a North Carolina facility continue to be so hassle-prone?"

Hassle-prone? With $100 million in tax breaks, Google should be grateful for such hassles.

This is an embarrassment. It conjures an image of local and state officials being forced to grovel, in addition to pledging a tremendous amount of incentive money. This, despite the fact that North Carolina is a business-friendly state, attractive on its own merits to companies large and small seeking to establish branches or headquarters. The community college system for worker training, the availability of land, accessibility to airports and interstate highways -- all these things are incentives, and already in place.

It may well be that state and local governments will continue to have to play the negotiating game in business recruiting, but some restraint and dignity are called for. Thanks to disclosure laws, the public now can see just how tough a game it is.