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Editorial: With incentives, one size doesn't fit all

Friday, November 13, 2009

(Updated 3:00 am)

The City Council was right on the money in allocating $3.3 million to extend water and sewer service to two areas near Piedmont Triad International Airport.

Guilford commissioners, however, should think twice before awarding the full $373,000 LabCorp wants to bring 373 lower-paying jobs here.

While both involve economic incentives -- always controversial -- the circumstances are much different. There's little question that beefing up infrastructure near the airport will help woo developers wanting to be near the FedEx regional hub. Build there and the jobs will come.

What LabCorp, headquartered in Burlington, has in mind isn't as clear. The company, which provides medical laboratory and testing, hasn't yet offered many details on what it wants to build or where in the county. Apparently, the jobs would pay an average of $26,000 annually, much less than the county's $40,000 average wage. Of course, that doesn't mean they would go wanting, particularly with an unemployment rate above 10 percent.

Still, commissioners ought to consider the long-range payoff. Commissioners Chairman Melvin "Skip" Alston, for example, has suggested granting two-thirds of the company's request. That sounds like a reasonable starting point for discussions, given what's now known.

In light of the Dell fiasco, government officials need to be more mindful of how and when they award incentives, as well as to demand more accountability from recipients.

Yet that doesn't mean choking off the money flow altogether. Upgrading land near the airport fits nicely into regional plans for an "aerotropolis" that would encourage logistics providers to relocate all across the Triad.

But growth also comes in smaller increments. The tough job is deciding who gets the money -- based on what they have to offer.

What do you think?

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Panacea

November 13, 2009 - 9:28 am EST

Don't give LabCorp a dime. If they are really planning to come to Guilford County, they will come with or without incentives.

No corporate welfare!

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maxinedog

November 13, 2009 - 12:16 pm EST

Yeah! don't give them a dime unless they pay a high wage for jobs that are only available to college degree holders, people who don't go to college should stay unemployed until they go to college. Let's reserve our incentive money so that it benefits the more educated, no need to help the uneducated at the expense of the privileged! College educated people unite to protect your lifestyle!

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Panacea

November 13, 2009 - 12:34 pm EST

You clearly have not read my other posts on corporate welfare.

This has nothing to do with the type of job LabCorps "plans" to offer. LabCorps is probably planning to come to Guilford County anyway. It has become standard practice for big business to shake down local governments for "incentives" (re kickbacks). The sad thing is, officials almost always take the bait. The incentives never produce enough return to justify the investment.

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maxinedog

November 13, 2009 - 5:27 pm EST

Almost everyone agrees that the Greensboro would fare better in a world where incentives were completely prohibited across the board. However, if we refuse to play the game by the rules because we don't like the rules, we run the risk of riding our high moral horse on a road that leads to higher unemployment. In this case the jobs are entry level, so it is at the expense of those who can ill afford it. I wonder where these people will find entry level jobs elsewhere, before we turn these down, we should have an answer to that question, right now we don't. The politicians answer is that we would rather spend the money in some other way (we all know that this money will be spent, not saved), I wonder if that expenditure will result in jobs with benefits, or on some other political favor.

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Panacea

November 13, 2009 - 7:14 pm EST

That's the usual argument for giving these companies their welfare.

Ask the folks at Dell how well things are going.

Incentives won't keep a company here if the management decides their money would best go elsewhere.

Winston-Salem found that out the hard way. At least city leaders were smart enough to tie incentives to specific objectives. The state just threw my tax money away.

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Andrew Brod

November 13, 2009 - 9:42 pm EST

maxinedog is right. The "usual argument" is the usual argument because it's realistic. Yes, of course we can refuse to play the incentives game. But doing so would probably come at a significant cost. If we want to incur that cost because we have a moral objection to so-called corporate welfare, then fine. But let's be honest about the cost.

As for Dell, the editors are wrong that it was a "fiasco." W-S got its money back and we got some pretty good jobs for four years. Were we hoping for more? Of course, but it's hardly accurate to say that this was a big loss for the region in general or W-S/Forsyth in particular. Moreover, it wasn't an accident that "city leaders were smart enough tie incentives to specific objectives." That's the way all smart cities and counties do it. It's how it's done here in Guilford County, for example.

I'm not saying that the Labcorp incentives are a good idea. They might not be. But it's off the mark to claim that incentives are always a bad idea unless one views them through a moral rather than an economic prism.