Tar Heel Tattler - April 2006
Charlotte companies slip south of border
Charlotte recruiters know well the warm feeling of slipping their hands into pockets of other cities and pulling out corporate headquarters, offices or factories. But lately, they’ve been reminded too often how awful it feels to have their own pockets picked. And to make matters worse, the beneficiaries have been the city’s economic- development partners.
In February, Sharonview Federal Credit Union opened its new home in Lancaster County, S.C., just over the state line from where it was founded in 1955. Since November 2004, at least four other Queen City companies have announced similar moves. “There has been some talk that the South Carolina counties are actively recruiting up here in North Carolina, which we do not believe is the case,” says Angie Lawry, vice president of community relations for the Charlotte Regional Partnership, an economic-development group for 12 counties in North Carolina and four in South Carolina.
The Inspiration Network, a Charlotte-based Christian broadcaster, plans to move, taking at least 250 jobs, to Lancaster County in 2008. South Carolina officials were helpful but didn’t initiate contact, says John Roos, the network’s vice president of corporate communications and research. What attracted it was 93 acres of reasonably priced land five miles from the interstate loop around Charlotte. State incentives merely sweetened the deal, Roos says. Charlotte has a hard time competing because cheap land is scarce and it can offer incentives only for additional hires, while South Carolina can count existing jobs that move as new.
Normally, the Charlotte partnership wouldn’t care if a company moves over the state line, as long as it doesn’t move out of the region. But suspicion about South Carolina has grown loud enough that the partnership commissioned a study on why companies are moving, what beyond income-tax revenue the state loses and what, if anything, should be done about it. “It becomes an issue when it threatens to tear the region apart, and we don’t want that to happen,” Lawry says. That’s because the Palmetto State counties push the region’s population past 2 million and its work force to more than 1 million.
Ideas being floated include special North Carolina incentives to keep companies in Charlotte, persuading South Carolina to block incentives for companies moving from Charlotte to a neighboring county and cooperative ventures in which the states share incentive expenses and tax revenue. “We are missing the opportunity — North and South Carolina — if we’re spending our time fighting to retain existing businesses,” says Bob Morgan, president of the Charlotte Chamber of Commerce. “What if we were working together to apply those resources toward the attraction of new business that would be beneficial to the entire region?”