Greensboro currently ranks #4 in the nation in the number of empty industrial parks under construction for cities with populations over 200, 000 up to 1 Million. Give that a minute to sink in. No one knows how long it might take to fill these empty industrial parks. Any number of Greensboro's 10, 20 and 30 year old industrial parks have yet to be filled.
Research Triangle Park in nearby Raleigh-Durham, built in 1959, still isn't full. And the 2500 acre Global TransPark in Lenoir County east of Raleigh with a modern airport big enough to land the largest airplanes in the world, nearby Interstate highways, railroads, port facilities, fiber optics, foreign trade zone designation, workforce development programs, onsite classrooms, new buildings ready to move in, hundreds of millions in available incentives and consistently named one of the 10 outstanding logistics parks in the South still remains at less that half capacity after almost 30 years.
And you know what? The outlook for commercial and industrial property sales isn't great. Yet the primary focus of economic development and incentives in Greensboro remains to this day, shovel ready sites, real estate development and logistics.
In my meeting yesterday with the Economic Development Department they gave me the IMPLAN analysis for something they called Project Tag. This was their name for the incentive package passed this past Tuesday night in the hopes of bringing a wholesale distributor of pharmaceutical products to Greensboro. Not a laboratory or a manufacturer but a logistics and distribution operation.
Project Tag is not a bad plan. It's expected to bring 25 jobs to Greensboro with the low end at just over $26,000 per year and the operations manager earning $70,000 a year. Not great but jobs just the same. And while I certainly can't fault city staff or the Greensboro City Council for making the effort there are 2 problems: the first is that it's not a done deal. The drug distributor is still looking at Richmond, Virginia hoping their staff and city council will offer a bigger, better deal than Greensboro offered.
And the second problem? This quote from the Jan, 31-Feb, 6 2014 print edition of The Business Journal that I swiped from the city offices from an article titled, Other states seduce as GSO mulls options by Catherine Carlock:
"There's not a single week goes by that I don't get a call from somebody asking me to move one of my companies from one state to the other. They're giving me $5 (million), $6 (million), $7 million in business incentives, education incentives, and at the end of three years I get a free building? It's not like Greensboro's not great... but it's a tough game out there, and we're sitting back and watching everybody play."
This same man was also quoted as saying,
"It's not a matter of having a great brochure... (or) great signs that point downtown. It's all about what's on the table for me. How many incentives am I going to get? What will I have once I get there?... You guys are sitting back figuring out how to play. I'm saying, 'where's the deal?"
Who was this man? He's my brother's boss. He's Russell Stellfox, President of Purolator Advanced Filtration, one of the companies Greensboro's economic development "gurus' have long touted as being one of their successes.
Don't worry, Russell Stellfox won't move Purolator out of Greensboro. You see, that's not his call to make. Mr Stellfox's bosses at Purolator's parent company, Clarcor, a multinational corporation with factories on almost every continent in the world and zero ties to Greensboro, will decide if and when Purolator pulls up stakes. Russell Stellfox will have little if any say in the matter. And frankly, being that would cost my brother the job he worked a lifetime to get it scares the hell out of me.
You see, those things always hang over our heads. I mean, seriously folks, 14 years ago I authored the book, Carrot On A Stick, I get it.
So what if we approached incentives altogether differently than we do today? What if we approached incentives in such as way as to make Greensboro at least somewhat immune from competing with other cities for companies that might not like our package and force our city to invest thousands in preparing studies for incentive plans that get passed but never used.
What if we stopped building shovel ready sites and started filling up the empty sites we already have? New and old.
The current economic development guidelines make it easier to get big loans from the City than to get smaller loans-- what's up with that?
What if our incentive packages were geared towards putting jobs where people live now?
What if we didn't have to always worry that companies might take the BBD (Bigger Better Deal) and skip town?
Now granted, I'm not saying there aren't risks to the ideas I'm about to propose but in looking at the way we do incentives now can you honestly say they aren't already risky as hell?
What Greensboro needs most of all is a local jobs program that focuses on the long term unemployed, builds small, locally owned businesses and supports existing locally owned small businesses-- an infrastructure designed to jump start the local economy from the bottom up instead of from the top down.
Imagine an incentive plan designed to put the long term unemployed back to work-- those who need work most and are least likely to get work. Imagine an incentive program that is tailored to locally owned start-ups? Imagine incentive deals that are designed to help existing local businesses expand?
Imagine an incentive package that re-purposes those abandoned big box retail stores with something that will pay far more than retail?
Imagine incentives for green jobs.
Imagine a plan that gets businesses started now, not years from now. Where someone walks in with an idea and after reviewing the idea a team is assembled to make that idea a reality before somebody else in some other city comes up with the same idea and beats Greensboro to the punch... again.
Now imagine the focus of this incentive program being on manufacturing-- the thing that once made Greensboro great. Only this time, instead of giant cotton and tobacco mills we concentrate on niche manufacturing of tangible goods. Personally I want to start a moped factory but I'm betting there are a thousand or more ideas floating around Greensboro for manufactured products that are just as good if not better. And don't let anyone fool you, Greensboro has the talent, what we're lacking is capital and political will.
And the fact is: we're not really lacking the capitol. The City of Greensboro has $272 Million Dollars invested in the stock and bond markets. That's right, the City of Greensboro is investing in corporations around the nation and quite possibly all around the world but not in the very businesses that exist right here in Greensboro. Why? Because Greensboro's small businesses aren't publicly traded.
But if the City of Greensboro were to establish a program that made it easy for Greensboro's local businesses to become publicly traded then that $272 Million Dollars of taxpayer monies could be pumped into the local economy instead of the wallets of Wall Street brokers. What's that? Not all stocks are traded on Wall Street. Ever heard of over the counter stocks? And if the City of Greensboro and citizens of Greensboro made up a large part of the stock holders these businesses would never leave Greensboro. As a matter of fact: just like the Green Bay Packers football team, it could be written into their corporate charters that they remain here for as long as they remain in business.
And for those local businesses for which becoming publicly traded simply isn't an option? What about them? There should be a way for the city to invest in them as well-- a loan program perhaps. Or perhaps the City could become a partner in those businesses and share in their profits? And if state law doesn't allow that then as much as I hate to suggest it I guess a non profit could be formed to partner with local start-ups and existing local businesses in such a way that allows the principals to eventually buy back the entire business. Then the profits made by the city or non profit would be reinvested in more local businesses.
Now I'll admit, there's lots of details to be worked out and I'm open to suggestions but history has proven that what currently passes for economic development has long failed Greensboro where we live in the 2nd hungriest metropolitan statistical area in the nation, have a poverty rate of over 21% and the highest unemployment of any comparable city in North Carolina. And if that's not reason enough to give my ideas some thought then I don't know what is.
And finally, I'm not certain if the law allows it but I think my proposed incentive packages should be taxed in some way so that those receiving incentives help provide for those who come behind them and the risk to the rest of Greensboro's taxpayers is reduced. In other words, I want what we call incentives to be a hand up, not a hand out.
Please continue reading Incentives In Greensboro: Part 32: William Heasley Weighs In
