RFP Research
♦ In a presentation to community luminaries a short time ago, according to several who attended the by-invitation-only event, the presenters emphasized the need for allowing economic development funds to be “flexible and discretionary”. They warned against too many restrictions on those funds. This seems to be taken as a cue that county commissioners should trust the economic development authority with what some might call “walking around money” with which they can bargain for new businesses, unencumbered with too many restrictions on how that taxpayer money can be spent.
Attendees learned that once a site selector narrows a search to a handful of final locations from which to choose, the negotiations over incentives become more important. This is the phase where site selectors aggressively seek the highest dollar value of tax abatements available, since this is the pool of money out of which site selectors traditionally get the most money for their services.
In the earlier stages of site selection, the selectors may plan visits to communities on the short list, and seek what was referred to in the presentation as “managed access” to business leaders and elected officials who might be friendly to the incentives they’re seeking. Thus, it appeared that incentives influence the location decisions, since the site selectors are motivated to maximize their fees, which encourages them to promote our community as more business-friendly to the companies they represent. Incentives can be a “make-break” factor in selecting between competing sites in different communities, and these incentives apparently become more progressively important as each stage of the site selection process unfolds.
The brightest news for Rowan County in years came with Duke Energy’s announcement a couple months ago of the “Carlton Site” off Long Ferry Road. This 600 acres site has a large upside, including a small number of landowners who can be counted on one hand. But in order to be successfully developed, it will require water and sewer line extensions. Look for the City of Salisbury to beg alms of the county to pay about $2 million to extend water lines, and just under $2 million to extend sewer service to the site.
Why is that, you may ask? Traditionally if a site is located outside of Salisbury, the city demands that if the county wants the site to be served by Salisbury-Rowan Utilities, the county commissioners must pay to have utilities placed, then turn over the lines to the City of Salisbury for FREE. This is done so the industries can buy water and sewer services from Salisbury, allowing Salisbury alone to profit from the sale of those services.
The City of Salisbury has never offered any repayment whatsoever to the county for the infrastructure improvements that the county has provided to any site outside of the city limits, nor any share of the profits they make off the county’s investment. Therefore, the utility extensions are 100% give, with zero “take”. This is typically illustrates Salisbury’s entitlement attitude toward the county taxpayers who enrich the City of Salisbury coffers. This system is very costly, and inhibits economic growth in our county.
It could be concluded that in Rowan County and many other parts of the State, municipal control over the region’s water and sewer services is one of the largest obstacles to job creation and economic growth in North Carolina. As lobbying groups like the NC Metropolitan Mayors Coalition and the NC League of Municipalities push for greater revenue growth for municipalities, the unincorporated areas of our State continually are being left behind. And that poses a burden on industries seeking to relocate to our State, because if they come to a municipality, they are subject to both county and municipal taxation—commonly called “double-taxation”.
To conclude, in the States gaining in job creation and economic growth, there are more pro-active, business-friendly utility models, which do not permit a local “water municipality” from swallowing the economic development potential by vampiring profits from the sale of water and wastewater services in order to prop up their other operations. The current model in our county, with the so-called “Salisbury-Rowan Utilities” serving our needs, is an outmoded, colloquial model that serves only one municipality that owns the region’s water and wastewater utility: the City of Salisbury. Add this failed system of allocating infrastructure to the high poverty and low literacy rates and it is the recipe for generational poverty. Changes are needed. We routinely hear about necessary changes to the education system in our county, which requires more ‘county’ funding. But if there were a more fair and equitable system of financing the local water and wastewater utility system, without siphoning off profits to one municipal colossus, there would be more money available for education, infrastructure and other services, promoting job creation and economic development.
