County incentives attract jobs and tax revenue

County incentives attract jobs and tax revenue
September 28
03:00 2017

Ten companies that received county incentives created 1,171 jobs and $2.87 million in a net tax benefit for the county as of 2015.

During a briefing, County Economic Development Specialist Kyle Haney gave an overview of the county’s development investments to spur growth in Forsyth.

“The county has two basic types of economic development projects we deal with,” he said last Thursday, Sept. 21. “There is the standard business incentives that are used to help persuade companies to come here over other locations, and … the county has done some work in infrastructure improvement.”

Economic incentives are given to companies over a set period of time to encourage them to either locate or expand their facilities locally. The maximum incentive is no more than half of the company’s expected county property taxes. An incentive deal is based on jobs created, which the company typically agrees will pay a certain amount of wages, along with the capital investment it plans to make. Failure to meet the job and investment goals results in lower incentive payments.

The county pays companies based on their performance for the previous year, so numbers Haney presented were for incentives paid in the 2016-2017 fiscal year for jobs those companies had in 2015. The 10 companies received a total of $1.78 million and paid almost $4.7 million in taxes.

The results between companies vary. For instance, Piedmont Propulsion created 11 jobs in its expansion when its goal was 10. Its investment goal was $800,00 but ended up investing close to $1.2 million. The county has paid it $3,115 so far for an incentive deal approved in 2011.

Herbalife also exceeded its goal of 298 jobs with 348 jobs created. It still hadn’t reached its investment goal of nearly $85.5 million, with investment of nearly $79.3 million. Thus far the county has paid it $269,252 for the 2012 incentive deal.

Inmar had 70 jobs in its expansion with a goal of creating 97. It invested $53.7 million, far exceeding its $25 million goal. The county has paid it $191,021 for the 2012 incentive deal.

Lowe’s Data Center met its goal of 20 jobs that pay $77,412 on average but far exceeded its $100 million investment goal with nearly $760 million in investment because it was constantly getting new equipment. It received $2 million for a 2004 incentive deal.

Other companies have had more difficulty reaching their goals. Deere-Hitachi had only created 26 of its 230 job goal in the planned expansion of its Kernersville factory, which already had 700 employees, after experiencing a downturn in its industry. It did exceed its $54 million investment goal with a $61.5 million investment and has received $180,336 in incentives so far. The factory hired more people last year and still plans to meet its employment goal.

Caterpillar has also had difficulties in its industry, forcing mass layoffs. It added Progress Rail to its local facility this year to bolster the jobs there. During the transition, the city and county lowered the minimum number of jobs it can have and not have to pay back its incentives. Its goal is 392 jobs. It did exceed its investment goal of $426 million with nearly $434 million in investment. So far it’s received $608,858 in incentives.

Other companies included Pepsi Bottling Ventures expansion, which created 164 jobs (with a goal of 150) and received $83,964 in incentives; United Furniture, which created 212 jobs (with a goal of 100) and has received $19,386 in incentives; Polyvlies, which created 20 jobs (with a goal of seven jobs) and has received $18,283 in incentives and Reason to Believe, which created 11 jobs (with a goal of eight) and has received $200,000 in incentives.  

Companies that have made agreements with the county that‘ll start in the future include Beaufurn, Corning, HP Fabrics and Johnson Controls and more Herbalife incentives. These five companies cumulatively have investment goals of $82 million, plans to create 898 jobs and may receive up to $1.24 million in incentives.

The county has also made nearly $1.3 million investment in infrastructure projects for the Church Street Parking Deck, Innovation Quarter, Wexford Biotech Place and Union Cross Road that are designed to attract businesses and have brought in $1.5 million in taxes paid on those investments.

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Todd Luck

Todd Luck

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