State Politics

NC House votes 87-32 for jobs incentives

Despite opposition from some Republicans and Democrats, the state House gave initial approval Wednesday to Gov. Pat McCrory’s N.C. Competes jobs incentives plan with an 87-32 vote.

The plan would double the money available in what is now known as the Job Development Investment Grant or JDIG. The fund, used to lure major employers to the state, is largely out of money but would get a $22.5 million infusion if legislators approve.

A final vote will be taken in the House on Thursday. From there, the fast-moving bill heads to the Senate. One of the bill sponsors, Rep. Bob Steinburg, a Republican from Edenton, explained the haste during Wednesday’s debate.

“This bill is on a fast track because we’re talking about an automobile industry coming to North Carolina, perhaps even three,” Steinburg said. “We are incentivizing those three businesses.”

The McCrory administration has worked closely with House Republicans to draft the bill. McCrory has said he currently has little to offer major employers considering North Carolina.

But some of the House’s most conservative members spoke out against the plan, saying they are fundamentally opposed to all incentives because they interfere with the free market.

In addition to replenishing incentive grant funds, the bill includes a narrowly tailored tax break for major manufacturing facilities locating in one of the state’s poorest areas. The so-called “single sales factor” modification recalculates a company’s tax burden to a lower rate. Under the bill, the formula would apply only to companies investing $1 billion or more in what the state considers a high-poverty county.

Bill sponsors say that provision is designed to lure an automaker to one of several sites being marketed to the industry. Steinburg says an automaker would create a “ripple effect,” bringing other businesses that wouldn’t be getting incentives. He pointed out that the sites are in poor, rural areas such as Edgecombe County.

“If we can transform these two destitute parts of the state – Eastern and Western North Carolina – then we truly will be one North Carolina,” Steinburg said.

In another effort to help rural areas, Rep. Paul Tine – an unaffiliated legislator from Kitty Hawk – added a provision Wednesday to expand projects eligible for JDIG’s utility fund. JDIG grants to urban counties include a payment to the fund, which goes toward infrastructure in poorer counties.

Also in the bill: $20 million for an infrastructure grant program that helps companies build new industrial sites. The bill also contains tax credits for jet fuel and technology data centers – an aspect of the legislation that has prompted some Democrats to vote no because the credits favor specific industries and companies.

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