Tax incentives are creating jobs
Greg Dail’s Jan. 15 diatribe against the county’s support for Novo Nordisk’s $1.8 billion expansion in Clayton insults one of the county’s most prestigious corporate citizens while showcasing a breathtaking indifference on the need for job-creation and economic investment.
Mr. Dail cites figures from media reports without offering much in the way of context. The fact is Novo Nordisk is doubling its Clayton workforce of roughly 700 – jobs that pay nearly twice the county’s average wage. The new jobs at Novo will spur $21.5 million in annual payroll impact in Johnston County, according to a countywide economic-impact assessment by N.C. State University. Construction of the company’s plant alone will result in 5,141 positions and $1.09 billion in local compensation, the study found.
Unmentioned in Mr. Dail’s assault is the fact that county tax incentives are performance-based. Companies must meet job creation and capital-expenditure targets in order to qualify for reimbursements from the county. And while I’m more than willing to let our counterparts in Forsyth County defend their own incentive practices, I do recall reading that in the aftermath of Dell Computer’s departure there, local governments “clawed back” some $26.5 million in payments and reinvested it elsewhere.
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Mr. Dail is correct that Novo also considered another of its existing locations in Massachusetts (a third in New Jersey also was on the short list). This month’s announcement by GE that it would relocate its headquarters to Massachusetts is ample evidence that northern locations, with their well-heeled universities and global air service, continue to be formidable competition for us.
I am otherwise in agreement with Mr. Dail about the importance of modest tax-rates, sensible regulation and affordable energy costs. But he fails to mention the most critical piece of all: well-trained workers. We’re left to assume Mr. Dail believes the county’s investment in the Workforce Development Center a decade ago was a similar waste of taxpayer money. I believe that the state-of-the-art training facility was a key factor in Novo’s decision to grow in our community.
Poker or not, Johnston County’s economic-development strategy is no game. Commissioners carefully consider the fiscal, economic and social benefits of new and expanding companies before authorizing local incentives. Moreover, as a former state legislator, I can assure Mr. Dail that North Carolina’s job-creation programs similarly demand quantifiable evidence that incentive grants result in a net plus for the state treasury.
Creating jobs in today’s highly competitive global economy is not easy. It gets complicated. But I don’t believe it’s asking too much that candidates for office take time to understand our economic-development programs before launching caustic attacks on their opponents that, if left unchecked, could cause unintended damage to our county’s well-earned reputation as a leading destination for success-minded businesses.
Chairman, Johnston County Economic Development Advisory Board