A state House committee approved legislation Wednesday that would create a loan program allowing local governments to borrow money to construct industrial facilities.
House Bill 108 would establish a Site and Building Development Fund for low-interest loans from the state to counties and municipalities. The program is separate from Gov. Pat McCrory’s N.C. Competes jobs plan, which is contained in House Bill 117, now awaiting Senate review.
The new proposal comes a day after Republican senators criticized McCrory’s proposal for more incentives funding. Senate leader Phil Berger has scheduled a 3:45 p.m. news conference Wednesday to unveil “a major economic development bill” of his own.
The bill’s sponsor, Republican Rep. Paul Stam of Apex, says the loan fund is needed because smaller communities don’t have construction-ready sites or shell buildings to offer companies. Without that, jobs are likely to go elsewhere.
“This is about helping some of the parts of the state that desperately need it and providing shell buildings,” said Rep. Charles Jeter, a Mecklenburg County Republican who co-sponsored the bill. Jeter noted that he and Stam had disagreed about McCrory’s incentives bill but both support the loan program.
The bill doesn’t set aside money for the loans; Stam says he won’t request any until the House budget process begins. He said the loans can be funded through existing Department of Commerce allocations. “This is not a big new money spending thing,” he said.
A group of economic developers said the program is needed. “The lack of ready-to-go sites and/or buildings has been a real detriment to the attraction of business and industry to this state,” said longtime economic developer Bob Lee. “If you don’t have a site ready, you can’t hang that industry on a sky hook.”
But Rep. Chris Millis, a Hampstead Republican, said the loans represent a government overreach. “I believe it creates false demand, I believe it creates saturation of the market,” he said. “I believe these subsidized loans go way too far.”
With Wednesday’s favorable vote in the House commerce committee, the loan proposal now moves to the appropriations committee.