The tiny coastal community of Cedar Point, 2.2 square miles at the southern tip of Carteret County, home to about 1,315 people, is hankering for more commercial development. The legislature gave the town a huge lift toward that dream in the form of $700,000 in state taxpayer money, a grant for economic development that exceeded Cedar Point’s annual budget.
“We are desperate for businesses to come into our area,” said Rep. Pat McElraft, a Carteret Republican.
Legislators set aside about $3 million in downtown revitalization and economic development money for Cedar Point and about 45 other towns from the state budget this year. Much of it is going to rural crossroads with populations of a few hundred to a few thousand, but some bigger towns are in on the money, too.
In the state budget this year, legislators handed out millions of dollars in grants to towns, individual schools, county fairs, local libraries, little museums, nonprofit groups and for-profit companies. These grants are called “member money” in the halls of the legislature. They're also known as pork.
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Legislators requested downtown money, said House Speaker Tim Moore, and he and Senate leader Phil Berger decided who would get it. “Everybody wanted more than they got, including myself,” Moore said.
Kings Mountain, the Cleveland County town where Moore lives, is getting $100,000 in economic development money. Shelby, the Cleveland County seat, is getting $50,000.
Berger had a different take on how downtown grants were decided after legislators put in their requests, and his explanation didn't involve he and Moore getting together to divvy up the money. "The final decision on whether or not anything was in the budget was based on whether or not the budget was going to garner enough votes to pass," Berger said.
The budget has items that wouldn't be in it if the decisions were entirely up to him, Berger said, but he supports the budget as a whole.
The state is bringing in more tax revenue than expected, he said, and grants to nonprofits won't obligate the state to keep sending them money year after year.
"I think it fits within, overall, our pledge to be fiscally responsible with the people's money," he said. "We're not growing the budget at rates that are unsustainable."
Critics across the political spectrum faulted the pork-stuffed budget. Even worthy nonprofits should have to apply for competitive grants and account for the taxpayer money they spend, said Brian Balfour, executive vice president of the conservative Civitas Institute.
"Is the money being spent as promised, and who is doing the tracking of that money?" Balfour asked. "It didn't go though the grant-making process in the state agencies. Is there going to be any kind of diligent follow-up to make sure the money is spent as promised?"
Money to spend
Republicans took control of the General Assembly in 2011 preaching fiscal responsibility. The state was struggling out of the recession, unemployment was more than 10 percent, and GOP budget writers were more interested in cutting or killing grant programs than adding them. No money was set aside for construction projects in individual towns, local parks or singular education initiatives.
The purse strings loosened as the economy improved and the state had more money to spend.
Republican budget writers began setting aside money for downtown restoration grants in 2015 — the year Moore became speaker — when 13 towns, including Shelby and Kings Mountain, split about $1.2 million. Since then, legislators have used the budget to sprinkle downtown money throughout the state — last year 53 cities and towns got $94,340 each. Shelby has received revitalization money four years in a row.
The appearance of the legislature's downtown grants coincides with increased budget carve-outs for education programs and nonprofit agencies since 2011. Pork spending was more prominent in this year's budget, with larger amounts going to more recipients, and more state money going to towns and counties for local amenities. For example, Lincoln County is getting $400,000 to outfit a new library. Burlington is getting $200,000 to renovate a community pool. The Greater Smithfield-Selma Area Chamber of Commerce is getting $4,000 to help build a dog park.
The Smithfield-Selma chamber is donating land behind its office for the dog park, and the state's $4,000 will be used for fencing and other materials, said President Mike Mancuso. The chamber office is close to the Carolina Prime Outlets mall in Smithfield, hotels and restaurants. The dog park will spur economic development, Mancuso said, drawing people traveling the highway looking for a spot to exercise their dogs.
"As a traveler, I'm always looking for a pet-friendly place to go," Mancuso said. "The chamber is always looking for ways to help the community and businesses in the community. I think this does both."
The town of Lansing in the state’s mountainous northwest corner is getting $25,000 in downtown revitalization money from the new state budget. Lansing town clerk Marcy Little said town leaders weren't sure how they could use the money, but they were happy to get it.
Lansing doesn’t have a traditional downtown, and it doesn't have many people. The 2010 census put the population at 158. The town has one stop sign. Its sole traffic light was removed six or seven years ago.
But the town has amenities, Little said, including a park that a state Parks and Recreation Trust Fund grant helped expand, good fishing, and a 4-mile trail for mountain biking.
“At this point we are in a rebuilding phase,” she said. “We totally appreciate our district legislators. This is going to be very helpful to us.”
Unlike Lansing, the eastern Wake town of Zebulon has a downtown, one that Mayor Bob Matheny has ideas for sprucing up. The state's $50,000 grant to Zebulon can be used to improve streetscapes and set up a revolving-loan program for businesses to improve their exteriors.
Zebulon has been focused on its downtown for years, Matheny said, and state money will be important to that effort.
"Money comes in and takes pressure off of your tax collection dollars," he said. "This can supplant what we would spend, and may enlarge what we would spend."
In the 2016-2017 budget, legislators set aside nearly $5.8 million for individual towns, along with another $1.4 million for 15 other local projects such as a livestock arena, a town hall repair, a community arts center and a city’s parking management plan. More than $800,000 went to a half-dozen other groups, including $250,000 that passed through a Randolph County economic development group to expand NASCAR legend Richard Petty’s custom car shop.
The unincorporated community of Cleveland in Johnston County — home to about 27,000 in an area without a downtown — used some of the $30,000 it received last year to mail residents information about a parks and recreation tax district local leaders want.
"We didn't ask for the money, but we were thankful for it," said Denton Lee, spokesman for the group of organizers. "There was no other funding for getting out consumer information."
Legislation that would have let Johnston hold a nonbinding public vote on the tax district passed the House last session, but languished in a Senate committee.
The Cleveland parks association will keep trying to get the tax district, Lee said. There is some money left over from the state's $30,000, but Lee didn't know how much. Greater Cleveland Chamber of Commerce President Kimberly Lawter said about $10,000 of the $30,000 has been spent.
Help for troubled incumbents?
Pork is in the eye of the beholder. The Civitas Institute found more than $30 million in pork, while Senate Democrats counted more than $100 million in pork projects. Civitas did not put the downtown grants on its pork list.
Sen. Dan Blue of Raleigh, the Senate's Democratic leader, said budget pork is meant to help Republican legislators vulnerable in the 2018 election.
Pork projects "go excessively in areas where their incumbents are at risk," he said. The marquee example of helping endangered Republicans was the $200,000 aimed at 35 schools in Sen. Jeff Tarte's Mecklenburg County district. The money was to be funneled through the charity DonorsChoose, but the earmark was erased after the group said accepting the money would violate its principles.
Legislators began gradually adding education grants back into the budget after 2011. This year $13 million for individual school construction, school safety and instructional programs sits in the shadow of the big expenditures for teachers, transportation and books. Some of the school money will pass through nonprofits.
For example, the Franklin County Education Foundation is getting $60,000 to reimburse 600 county teachers $100 each for classroom materials. The Cary Chamber of Commerce is getting $25,000 for education support programs.
Rather than parceling out money on their own, Republicans should have sent it to state agencies for competitive grant programs, where applications can be evaluated and grants awarded based on merit, Blue said.
The state Commerce Department has several programs that help rural towns and counties. One of its grant programs, the Main Street Solutions Fund, didn't get any state money this year. Main Street Solutions is a matching grant program for towns that has a goal of helping small businesses create and retain jobs.
Other state agencies have grant programs that give money to organizations and nonprofits that legislators decided to directly send taxpayer money.
For example, the state Department of Natural and Cultural Resources has grant programs for arts organizations, and gives grants to science and children's museums. The Department of Insurance gives grants to volunteer fire departments.
"It's a much more efficient and I think productive way to make those kinds of grants," Blue said, "rather than arbitrarily listening to a legislator who passed by one of these places during his time at home on the weekend and decided, 'I'll fund it so that they'll like me.' "