news-record.com

Gov. Bev Perdue is on a three city tour of the state touting a new legislative package she says would spur job creation. I’m going to catch her talk when she touches down in Lexington today.

Leaving aside (for the moment) about how she plans on paying for all of this, Perdue is proposing a suit of contracting preferences, tax credits and grants and other spending.

The proposed tax credits include one for small businesses that provide health insurance and other for "small business equipment purchases." Among the contracting provisions would be what Perdue calls a temporary "5% deduction from its bid price." Essentially, a bid by local small business will be deemed cheaper than an equivalent bid by an out of state or large business.

As for the grants and other spending, it's really a hodgepodge of items, including increased tourism promotion and restoring funding to the state's Small Business Assistance Network. 

Now, this smacks of a preview of the budget that Perdue is going to roll out on April 20. There's no price tag attached to the programs she's pitching today, but this is a proposal to expand government spending (and for the purposes of the budget, you can think of a tax credit as a cost) when lawmakers are already staring down what Rep. Mickey Michaux described as a $1.2 billion shortfall.

So it would be a little surprising if along with this proposed expansion Perdue isn't offering up some cuts that would pay for all of that. There's no mention of what those cuts might be as part of this morning's release.

Here's material from the news release:

ASHEVILLE – Gov. Bev Perdue today called on the General Assembly to pass a legislative package designed to assist small businesses in creating and maintaining jobs. The package includes tax incentives, grants and an expansion of the small business preference for companies seeking contracts with state government. Gov. Perdue is making the announcement as part of a three-stop JobsNOW tour of small businesses in Asheville, Lexington and Fayetteville.

 “Small businesses are the backbone of North Carolina’s economy, and a major driver in our economic recovery,” said Perdue. “They put our friends, neighbors and family members to work. They anchor our communities. Supporting small businesses means supporting jobs for North Carolinians.”

 The JobsNOW Small Business Package is focused on three areas of assistance:

1. Tax relief and tax incentives to boost the bottom line for small businesses

• Small Business Start-up Tax Relief – encourages investment in innovative small businesses by allowing favorable capital gains treatment of the founding interests in the business.
• Small Business Health Insurance Credit – provides a credit of $250 per employee to businesses that provide health insurance to employees making less $45,000. Applies to businesses with fewer than 25 employees. The credit was previously enacted and expired this year.
• Qualified Business Venture Tax Credit – expands this credit by raising the cap from $7.5 million to $10 million to spur more investments in entrepreneurial businesses.
• State tax break for small business equipment purchases.

2. Statewide support for small businesses

• Community Colleges -- Restore funding to the statewide Small Business Assistance Network within the state’s 58 community colleges.
• “InSource NC” – helps North Carolina businesses find the goods and services they need from other North Carolina businesses, through web-based buyer-supplier networks.
• Help North Carolina businesses capitalize on federal Small Business Innovation Research/Small Business Technology Transfer contracts by providing a matching state grant.
• Main Street Solutions – expanded grant funding for the revitalization of downtown districts in small towns, supporting small business growth.
• North Carolina Tourism Promotion – increased investment in marketing and advertising of North Carolina as a national tourism destination.
• Help small businesses get credit by funding the N.C. Small Business Assistance Fund that helps guarantee the remaining 5% on qualifying 95% SBA-backed small business loans.
• N.C. Farm Innovation Fund -- provides direct assistance to small family farms to improve energy efficiency, develop new markets and cultivate new value-added products.

3. Expand the N .C. Business Preference so more small businesses can compete for state contracts

• Codify Governor’s price-matching preference for North Carolina businesses in Executive Order No. 50.
• Further improve the chances of a qualified North Carolina small business to win a state contract during these tough economic times by temporarily allowing a 5% deduction from its bid price.
• Reserve state construction projects under $500,000 for small businesses and raise bonding threshold from $300,000 to $500,000.

In addition to the JobsNOW Small Business Package, Gov. Perdue continues to increase support for small businesses in North Carolina, including initiatives such as Biz Boost, the first N.C. Small Business Commissioner, Executive Order No. 50 that establishes a price-matching preference for state goods contracts, and a small business lending initiative to increase the flow of credit from banks to small businesses.

More later after I talk her from Perdue about all this.