HomeMy WebLinkAboutC.054.93010_0260REQUEST FOR APPROVAL OF REVISIONS TO THE IREDELL. COUNTY
INDUSTRIAL. INCENTIVE PROGRAM POLICY: County Manager Joel Mashburn saidt.S.158-
7.1 granted the authority for cities and counties to have incentive policies. (He then read the statute for the
members of the audience.)
Attorney Pope said G.S. 158-7.1 was challenged in the Mareadi, N. City of Win.sion .Salem lawsuit.
He said the North Carolina Supreme Court upheld the use of incentives and found there was authority,
provided that a public hearing was held as dictated in the statute. Pope said the existing, and the revised
Iredell County policy for industrial incentives, required public hearings.
Mr. Pope said he would address Mr. lfoupe's earlier statements. ht reference to consistency. Pope
said one purpose of having a written policy was to insure some level of fairness. He said that at one time.
the county used an unwritten, vague policy. Pope said an unwritten policy was good for flexibility;
however, there was a desire to use as much consistency as possible. Mr. Pope said the current and revised
policy offered some "wiggle" room, and this was because some industries were more attractive than others.
lie said some industries had a different quality of work force and some consumed massive quantities of water
and other natural resources. Pope said the incentive policy was somewhat flexible because of these issues.
In reference to the proof of offer from other counties, Mr. Pope said that to his knowledge, nothing
written had ever been requested. He said many times, the county was not competing or going "head to head"
with another county in North Carolina, but rather it was competing with another state, e.g., Alabama,
Georgia, or South Carolina. Mr. Pope acknowledged, however, that at other times in-state counties were
trying to recruit the same industry. Attorney Pope said the county had sought evidence that an incentive
was necessary to acquire a specific industry. Pope said the evidence was usually given by the economic
developers, e.g., Jeff McKay, Melanie O. Underwood, or the brokers involved. Mr. Pope said written proof
might be something that could be requested in the future. He mentioned that in the past, industrial incentives
had been used sparingly: plus not all industries even asked for them.
Mashburn said industries seeking incentives had to receive a favorable recommendation by either
the Greater Statesville Development Corporation (Jeff McKay) or the Mooresville -South Iredell Chamber
of Commerce (Melanie O. Underwood), Mr. Mashburn saidevery approved incentive was reduced to a
legal contract written by the county attorney and the industry's attorney. Mashburn said the industry agreed
to do certain things and so did the county. Mr. Mashburn said the county was released from its obigattons
ifthe industry did not fulfill its commitments.
Mr. Mashburn then summarized the revisions to the incentive policy. Ne mentioned that in
paragraph three, there were examples of ways the industries could be assisted. e.g.. site preparation, cost of
land, and job training. He said Economic Developer Melanie O. Underwood had prcvtously mentioned
concerns about this section. Mashburn went on to say that during the agenda briefing, Commissioner
Johnson suggested the examples could be deleted and the policy could be written to indicate that county
funds would be used in a manner consistent with G.S. 158-7.1.
Mashburn explained the following parameters in the revised policy.
1. An amount equal to.3 76 % ofthe capital investment maybe usedforincentivepa ments
for a period offiveyears. Mr. Mashburn said ifthere was a $10 million facility, the industry would
receive a $37,600 incentive, a year, for five years. He said this was comparable to the amount the
industry would receive under the existing policy. The difference is that the .376 is easier to apply.
(Presently, the tax rate is multiplied out and then 80% of this is multiplied out, times five years, and
then divided by five for each year.) Mashburn said that if an industry was eligible for the $37,600
a year, that in order to receive 100% of the incentive, the industry would be required to pay an
average wage that was 120% ofthe county's average wage. He said this was also different from the
current policy. (Under the current policy, a company paying 1 101/. of the county's average wage
is eligible for 100% of the incentive.) Mashburn said the current belief was that incentives
shouldn't be provided unless the industry was willing to pay at least 110% of the county's average
wage. He said one of the purposes of the policy was to raise the "bar" for wages being paid to
county citizens. (The old policy had a 90% and 80% wage eligibility clause. These percentages have
been deleted from the new policy.)