About 60 percent of grants issued through North Carolina’s primary jobs incentives program haven’t delivered on their promises, according to a report from the liberal N.C. Justice Center.
The report analyzes Job Development Investment Grants issued between 2002 and 2013, which have promised up to $662.19 million to 102 companies if they create a target number of jobs.
The Justice Center found that 62 of those grants were cancelled because the companies didn’t create enough jobs, meaning the state didn’t give them the grant money.
Most of the failed grants were issued under former Govs. Mike Easley and Bev Perdue. It’s too soon to know how many of the JDIG deals announced by Gov. Pat McCrory have fulfilled promises.
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“If North Carolina continues to use incentives to pick winners and losers in economic development, the state needs to do a much better job of picking winners,” said Allan Freyer, who heads the center’s Workers’ Rights Project and wrote the report.
The report comes one day after The News & Observer published its own analysis of the JDIG program. The analysis found that McCrory has largely depleted the fund by promising nearly $300 million in grants, much of it for companies in Wake and Mecklenburg counties.
Later this week, N.C. House Republicans are expected to unveil an economic development bill that addresses the incentives program. McCrory has said the legislature must provide more funding in order to lure major employers to the state.
Freyer says his findings suggest that state leaders shouldn’t expand grant funding. “To address these problems, legislators should resist adding to the state’s incentive programs and instead focus on strengthening the performance standards that hold recipient firms accountable for the promises they make,” he said.
The report recommends that the state use a better analysis to determine whether companies will deliver on job promises and target the grants to high growth industries like aerospace, biotechnology and advanced textiles.