UNC's Northeast campus gets reprieve
Closing or combining one or more of the 17 campuses of the University of North Carolina System is a hot-button issue that state education and political have avoided for many years. But some of the Republicans running the state legislature want to make it happen because they question whether the state can afford to keep so many campuses afloat.
Last week's action at the General Assembly again showed the complexity of higher education politics in North Carolina.
Senate Republicans included a measure in the proposed state budget to study closing any campus that has lost 30% or more of its enrollment between July 1, 2010, and June 30, 2013 and issue a report to the General Assembly next year. The measure was made public May 29. The Senate voted down the plan a day later after an outcry from the Legislative Black Caucus.
Only one institution fit that bill – Elizabeth City State University, which of course happens to be the sole public four-year institution in northeast North Carolina, the state’s most economically troubled region. The area needs to improve its education system – from kindergarten to the state university– as much as any place in the state, but lacks the private resources to make that happen. The university has an endowment of $5 million.
ECSU is a Historically Black University, which would make its closing particularly difficult because many North Carolina African-Americans have a passionate interest in protecting HBUs, for obvious historic reasons.
Dissolving the university would leave a vast area of the state without a public four-year university. (Take time to read this terrific Business North Carolina story on the troubled Northeast region).
The region also has much less political influence after the departure of former Senate Pro Tem Marc Basnight, the Manteo Democrat who was among Raleigh’s most powerful lawmakers for more than a decade, before the Republican takeover in 2012.
Lest there be any doubt on who pushed this effort, the 32-member UNC Board of Governors has not discussed potential campus closings or mergers at any recent meetings, says Joni Worthington, spokeswoman for the System. The group did not meet in May.
The ECSU Board of Trustees received no notice that such a plan was in the offing, said Chairman Abdul Rasheed. He said no N.C. senator had taken responsibility for including the measure in the budget bill. He said UNC System President Tom Ross has said no board members is supporting the closure of ECSU. It would be shortsighted for the state to close an institution that is vitally important for its distressed region, Rasheed said.
Rasheed was the first person in his family to attend college, a typical story for students at ECSU, he said. He is CEO of the Raleigh-based N.C. Community Development Initiative, which promotes economic development in low-income areas.
Here's the ECSU Chancellor's comment on the issue.
Mooresville tops list of fastest growing cities in NC
Mooresville, located about 30 miles north of Charlotte in Iredell County, is the fastest growing city in the state, according to NerdWallet's latest analysis of North Carolina cities with more than 20,000 residents.
The San Francisco-based financial advisory company based its list of Cities on the Rise in North Carolina on population growth, employment growth and income growth from 2009 to 2012.
The study evaluated all 41 cities with more than 20,000 residents. Here are the top five:
2. Chapel Hill
4. New Bern
To view the full results, click here.
Belk's profit falls despite jump in e-commerce
Charlotte-based Belk Inc. had a rough first quarter, net profit falling more than 30% — to $19.3 million — compared with the same period last year. But there is good news.
As we mentioned last October, the family-owned department-store chain is pouring money into e-commerce, hiring Ivy Chin from QVC to oversee e-commerce and digital sales. Despite a major hiccup on Black Friday, the investment seems to be paying off. Sales from Belk.com increased 42.4% in the first quarter compared with last year. That bolstered same-store sales by 1.8%.
“First quarter sales comparisons were challenging due to our large increases last year and the soft selling environment this year,” Chairman and CEO Tim Belk said in a statement. “We did, however, manage to retain most of last year’s gains while experiencing continued growth in our online business. Although the investments we are making in the company will continue to impact our short-term profitability, we are building a solid foundation for long-term growth and success. We recently increased our regular dividend and completed a stock repurchase to reflect our commitment to drive strong returns for our shareholders.”
Texas school district hopes to lure NC teachers with higher pay
A former Guilford County Schools superintendent has come back to North Carolina to recruit talented teachers for Texas' largest school district, the Greensboro News & Record reports.
Terry Grier left the Guilford County school system in 2009 to lead the Houston Independent School District, where, according to the classified ad promoting the jobs, the starting annual salary for teachers is now $46,805, more than 50% higher than North Carolina's starting salary of $30,800.
A spokeswoman said this weekend's job fair, which will be held in Raleigh, is the second recruiting event the Houston district has held in the state this year. The first was in Chapel Hill.
The efforts highlight a need for raising teacher pay in North Carolina, which ranks near the bottom nationwide.
Today, Sen. President Pro Tem Phil Berger Sr. proposed a new teacher pay plan that would increase teacher pay by an average of more than 11%, though teachers would have to give up tenure to be eligible for pay raises. Berger said his proposal would be the largest teacher pay increase in state history.
RTP chosen for national STEM mentoring program
Research Triangle Park is among seven communities chosen as part of a national STEM mentoring effort to attract more students, particularly girls and underprivileged kids, to careers in science, technology, engineering and math.
The seven grand-prize winners, announced today at the White House Science Fair, will share $1 million in financial support from US2020, a partnership of educational non-profits and corporate leaders in STEM-based fields including Cisco, Chevron, Discovery Communications, HP and Fidelity Investments.
The Research Triangle Park Foundation cites the state's No. 36 national ranking in math and science scores and No. 48 ranking in financial investment per student as motivation for entering the competition.
RTP, with its coalition of 41 corporate sponsors and educational groups, was selected from 52 city/regional coalitions from around the nation. Other winners were Allentown, Pa., Chicago, Ill., Indianapolis, Ind., Philadelphia, Pa., San Francisco, Calif., and Wichita, Kan.
Click here to view the full list of RTP coalition members and learn more about the US2020 organization.
Reynolds American adding 200 jobs in Forsyth County
Reynolds American announced it will create 200 new jobs over the next four years at its Tobaccoville plant where it will produce VUSE electronic cigarettes.
The company plans a "multi-million dollar investment" in the 2-million-square-foot plant and will begin installing new equipment this summer.
Reynolds CEO Susan Cameron said in a statement that VUSE is the top-selling vapor cigarette in Utah and Colorado, where subsidiary R.J. Reynolds Vapor Co. carried out the first full-market rollout of the product. The company plans to market and distribute the product nationwide beginning this summer.
Another big announcement could be just around the corner for Winston-Salem-based company. Reuters reported this week that Reynolds is in late-stage talks to potentially acquire Greensboro-based Lorillard. The second- and third-largest U.S. tobacco companies have a combined market value of nearly $55 billion.
In N.C., your dollar goes just as far as it should
North Carolina economic developers like to crow about the state’s low cost of living, and a new interactive chart created by NPR seems to back them up. Based on data released this month by the U.S. Department of Commerce’s Bureau of Economic Analysis, the chart compares metro areas’ median annual income based on cost-of-living expenses. For instance, the median income in Washington, D.C., is a whopping $44,452. However, that feels like $35,029 when judged against other U.S. cities because it’s so darn expensive to reside in our nation’s capital. Raleigh-Cary’s median, on the other hand, is just $35,012 — and that’s just about what it feels like to live there.
Lowe's still catching up
Lowe’s is doing fine, but still playing catch-up with Home Depot.
The Mooresville-based retailer, North Carolina’s third largest public company, reported first quarter net income that exceeded analyst estimates even as harsh weather in the Northeast United States hampered sales.
Lowe's had net income of $624 million, or 61 cents a share. Twenty-five analysts surveyed by Bloomberg had projected 60 cents. About 30% of Lowe’s stores are in the Northeast, where a string of storms curtailed shopping earlier this year.
For the 20th straight quarter, Atlanta-based Home Depot Inc. had better comparable store sales than its Tar Heel rival. We noted the trend in our May edition.
During the first quarter, sales at stores open more than a year increased 2.6% at Home Depot, versus 0.9% at Lowe’s. Home Depot had profit of $1.4 billion during the quarter, more than doubling Lowe’s.
Charlotte boy wins Buffett's business challenge
A 15-year-old from Charlotte was named the individual winner of a national entrepreneurship competition for kids that was judged by a panel led by Warren Buffett.
Jake Johnson's concept for Beaux Up, a customizable bow-tie company, was selected as one of two grand prize winners from more than 4,000 entries. The winners received $5,000 and 10 shares of Berkshire Hathaway B Stock.
The "Grow Your Own Business Challenge" is part of the Secret Millionaires Club animated TV show that is narrated by Buffett and is sponsored by the Fairholme Foundation, the charitable arm of Miami-based Fairholme Capital Management.
Click here to view Jake's pitch for Beaux Up.
Report: Rising sea level puts Hatteras lighthouse at risk
Cape Hatteras Lighthouse is one of 30 national landmarks at risk due to effects of climate change, according to a new study.
The report by the Union of Concerned Scientists, a Cambridge, Mass.-based alliance of more than 400,000 scientists and citizens, shows how rising sea levels, floods and wildfires brought on by carbon emissions are threatening many of the country's historic sites. Other sites found to be at risk include Charleston Historic District in South Carolina and Virginia's Historic Jamestown.
The iconic black-and-white striped lighthouse, weighing more than 4,800 tons, was moved nearly 3,000 feet inland in 1999. Persistent efforts to rebuild dunes and prevent coastal erosion are often nullified by hurricanes and strong storms.
The National Parks Service reported more than 2.3 million people visited the National Seashore in 2012, spending $135 billion and supporting more than 1,800 jobs.
Durham-based Chimerix hopes to raise $60M in stock offering
Chimerix Inc. plans to sell 6.2 million shares of common stock in a public offering.
The drug-development company plans to use $60 million from the sale to fund current and future clinical studies for brincidofovir, an antiviral drug for patients with compromised immune systems including transplant patients.
The present clinical study was initiated by a social media campaign led by the parents of Josh Hardy, a critically ill 7-year-old, in which they urged Chimerix to provide their son with the experimental medication although it was not yet approved by the FDA.
Last week, Whitehouse Station, N.J.-based Merck decided to end its 2-year-old licensing agreement to develop and market the company’s treatment for HIV. Chimerix, which received a $17.5 million upfront payment as part of the deal, could have received up to $151 million more if Merck had not opted out of the agreement.
No estimated share price was indicated on the Durham-based company's filing.
Chimerix shares closed at $16.82 on Monday. Share prices reached a 52-week high of $27.14 on March 14. The company reported $37 million in cash and $63 million in short-term investments as of March 31.
Bye-bye, Bobcats. Hello, Hornets!
Three hundred and sixty-four days after announcing they would switch, the Charlotte Bobcats officially became the Charlotte Hornets today. Team owner Michael Jordan wasn’t at the press conference this afternoon at Time Warner Cable Arena, but President and COO Fred Whitfield, Chief Sales and Marketing Officer Pete Guelli and a good number of teal-clad fans were. A lot was said about restoring Hornets to Mecklenburg County, where it boasts centuries of history and was the name of the city’s first NBA team before it moved to New Orleans, but the press conference made clear that the switch from Bobcats blue and orange to Hornets teal and purple was mostly about the green.
According to Guelli, the team hopped into the top 10 of NBA season tickets sales last summer just on the promise of the rebranding, which will cost the team about $4 million. When asked if the price tag was worth it, Whitfield noted that the franchise has broken the nightly merchandise-sales record five times since announcing the impending changeover. This off-season — the Bobcats’ season ended when they lost in the first round of the playoffs to the Miami Heat — the Hornets are No. 1 in the NBA in new season-ticket sales, and 90% of existing season-ticket holders renewed.
Ticket-sales’ rise mirrors the improvement of the team, which just three seasons ago recorded the worst season in NBA history. Last year, buoyed by free-agent signee Al Jefferson and rising-star Kemba Walker, the Bobcats made the playoffs for the second time in the franchise’s 10-year history. While Guelli says a sustained winner will definitely bolster the club’s bottom line, he thinks there would’ve been a similar surge in sales if the team still stunk — as long as they stunk as the Hornets. “We saw that success before we even stepped on the court this year. We simply announced the name — our season-ticket sales skyrocketed.”
Here are other upcoming milestones in the changeover:
June 5 — Hugo returns (“Much like the logo,” says Whitfield, “you will see similarities but with a refresh.”)
June 7 — Honey Bee auditions
June 19 — New uniforms are unveiled
State incentive programs favor urban areas
State business incentive programs are fueling jobs growth in wealthier counties at the expense of poorer, rural counties, according to a new report.
The report from the North Carolina Justice Center, which advocates for low-income residents, states that since 2007, the Department of Commerce has awarded more than 70% of incentive grant dollars – $592 million of $840 million – to the state's 20 wealthiest counties. Durham, Mecklenburg and Wake counties received more than a third of the total.
The findings reflect a statewide population trend of migration toward urban areas. The most recent report from the U.S. Census Bureau shows that only eight counties grew by 2% or more between 2010 and 2013, and all were clustered in the metropolitan areas of Charlotte, the Triangle and Wilmington. Almost half of the state's 100 counties lost population during the same time.
New office tower for Charlotte
Charlotte will have a new 25-story downtown office building by 2017, with construction to start this fall in a project led by MassMutual Financial Group and Charlotte’s Spectrum Properties, MassMutual's Cornerstone Real Estate Advisors said today.
Plans for an office tower at the corner of Tryon and Third streets have been discussed for nearly a decade by the two companies. MassMutual’s Babson Capital Management Group, which manages nearly $200 billion in assets, will be the anchor tenant, according to a company statement. Babson, which has its headquarters in Springfield, Mass., now has offices in the Duke Energy Center in downtown Charlotte. Babson Capital Chief Executive Officer Tom Finke lives in Charlotte.
Babson Capital managed $150 billion in fixed-income investments as of Dec. 31, 2013, while its Cornerstone Real Estate Advisors group oversaw $41.4 billion of assets, according to Babson’s website.
Separately, Crescent Communities has provided renderings of a proposed 27-story office building, called Tryon Place, near the intersection of Tryon and Stonewall streets, about four blocks from the MassMutual development, the Charlotte Business Journal reported in March. No tenants have been disclosed for that project.
Moogfest loses $1.5 million, looks ahead to 2015
Last month's Moogfest music and technology festival lost more than $1.5 million, the Asheville Citizen-Times reports. The figure is based on a grant application filed with Buncombe County.
The electronic music festival expanded from three to five days and added a technology conference this year, with an objective of attracting new tech companies to the Asheville area.
Organizers estimate the festival, held April 23-27, attracted more than 25,000 people to its free events, and ticket sales brought in more than $712,000. Expenses totaled more than $2.7 million, including $1.5 million for artists.
Moog Music Inc. projected Moogfest would generate $30 million in visitor spending, double that of the previous year, but official estimates are not available yet.
Attracting an underwriting sponsor for 2015 will be key, and organizers say seven companies, including Google, SAS Institute, Microsoft and Red Hat have expressed interest.
N.C. Today: Growth in NC startups bucks national trend
New business startups in North Carolina increased in 2013, while the growth rate of new ventures declined nationally, according to Kansas City, Mo.-based Ewing Marion Kauffman Foundation. The state ranked 13th overall on the Kaufmann Index of Entrepreneurial Activity.
Montana had the fastest growth rate in startups, while Iowa, Rhode Island and Indiana were deemed the least entrepreneurial states. Generally, Western states had the highest ratings, while states in the Midwest and Northeast lagged.
The overall decline in entrepreneurship is probably due to an improved labor market, with fewer people pressured to start their own businesses, according to the report.
Jim Goodnight, teacher advocate?
Higher teacher pay is the cause celebre in North Carolina these days. SAS Institute CEO Jim Goodnight recently visited Fortune magazine’s New York offices to press the case for North Carolina’s teachers, prompting a column by Editor Andy Serwer. North Carolina children are the losers because starting public-school teachers earn less than $31,000 a year, especially poorer kids who don’t have the money to attend private schools, Goodnight said.
Of course North Carolina teachers have been saying this for decades. So what has changed? Five reasons, according to Rodney Ellis, president of the Raleigh-based N.C. Association of Educators, which has about 70,000 members and is affiliated with the National Education Association, the biggest U.S. teachers union.
His answers are edited for brevity.
1. Teachers are leaving our state in droves and when parents learn that a teacher they respect and appreciate in their child’s school is leaving because they cannot afford to provide for their families on an N.C.’s teacher salary, they become frustrated and begin to speak in support of salary increases to keep teachers in their schools.
2. Many teachers in North Carolina qualify for government assistance, including food stamps and Medicaid. Concerned citizens in North Carolina do not appreciate the idea of their valued teachers qualifying for food stamps.
3. North Carolina ranks 46th in the nation in teacher pay and last among southeastern states. I believe North Carolinians are a prideful people and are embarrassed by the abysmal ranking of our state in teacher pay.
4. Former Gov. Jim Hunt has launched an “Aim Higher” campaign challenging the state to move teacher pay to the national average. Hunt is widely regarded as a true education governor and his campaign has brought the plight of teacher salary to the attention of some influential residents who agree that teachers deserve at least the national average salary.
5. I believe the combined efforts of the NCAE, Gov. Hunt, parents and concerned citizens are putting pressure on lawmakers to do something about teacher pay now. This demand has led to the development of alternative compensation proposals. The attention these proposals receive is contributing to teacher salaries becoming a “hot button” issue.
Unemployment, labor force dips
North Carolina’s unemployment rate continued its decline in April, according to figures released today, falling 0.1 percentage points from the prior month to 6.2%. The U.S. rate fell from 6.7% to 6.3%.
Though that’s 2.2 percentage points less than the same time last year, at least one North Carolina observer is less than impressed.
“The April employment report is another entry in the series of mixed reports recorded over the last few months,” said John Quinterno, a principal with Chapel Hill-based South by North Strategies, Ltd., a research firm specializing in economic and social policy, in a statement. “In April, North Carolina experienced a modest gain in the total number of payroll jobs in the state for the second month in a row. Yet compared to [a] year earlier, a smaller share of the state’s working-age population was participating in the labor force.”
In April 2013, there were 4,711,403 Tar Heel in the labor force. That fell by nearly 1% compared with the year before. The number of employed increased 1.6% to 4,387,118. The labor force did increase over March — by about 10,000.
“While positive, the pace of payroll growth in North Carolina has not quickened over the past year,” Quinterno says. “Between April 2013 and April 2014, the total number of payroll jobs in North Carolina grew by 1.4 percent, a rate similar to those seen in prior years. Between April 2012 and April 2013, the total of number payroll jobs in North Carolina rose by 1.7 percent, while between April 2011 and April 2012, the rate of growth also was 1.7 percent. From April 2010 to April 2011, the rate of growth was 1.4 percent. No matter how one cuts the data, North Carolina has experienced the same basic slow rate of job growth for the last four years.”
N.C. Today: Raleigh's Crabtree Valley area continues growth with announcement of new project
A Fort Worth, Texas-based real-estate development group announced Carolina Row at Crabtree Valley, a retail and residential project in one of Raleigh's most prominent retail locations.
The project, part of a 30-acre planned development, will include up to 150,000 square feet of shops and restaurants, a hotel and 700 residential units. The News & Observer reports the company will invest $90 million in the project.
Trademark Property Company, which has developed similar commercial centers in Texas, California, Tennessee and Mississippi, plans to begin construction in spring 2015 with a grand opening slated for late 2016.
Carolina Row will be located across the street from Crabtree Valley Mall and a pedestrian bridge will connect the two properties.
Built in 1972, Crabtree Mall began as a 251,000-square-foot shopping center near what is now I-440 back when indoor malls were a novel concept, and it drew shoppers from across Eastern N.C. and the Triangle area. It now boasts 1.3 million square feet of retail and restaurant space.
The changing economy
The U.S. Census Bureau released an infographic today on how America's employment picture changed from 1997 to 2012. It's part of the economic census, released every five years. The most glaring takeaway: the health-care and social-assistance sector now employs more people than any other segment. Fifteen years ago, manufacturing was the U.S.'s leading employer. A similar trend has occured in North Carolina, as outlined by Senior Contributing Editor Edward Martin in our February issue.
Toyota would have loved us
Charlotte came in second when Toyota decided last month to put a consolidated U.S. headquarters in a Dallas suburb, a loss that feels even more painful after a report that the likely economic impact will be $7.2 billion over the next 10 years. Even if that analysis is inflated it’s clear the move would have transformed Charlotte.
The Japanese automaker plans to invest more than $300 million in a Plano, Texas headquarters operation for as many as 4,000 workers. Toyota jobs in California, New York and Kentucky will move to Texas, which offered the company $40 million from a public deal-closing fund controlled by Texas Governor Rick Perry. Plano is paying $6.75 million if Toyota creates at least 2,900 jobs and completes a 1 million-square-foot building.
North Carolina has not disclosed what it offered Toyota in incentives. Texas had the advantages of a more central location, no state income tax and closer ties with Toyota, which builds Tundra trucks at a San Antonio plant.
Longevity and leadership at the top also probably mattered. Toyota’s top U.S. executive praised Perry as he explained the relocation decision process.
North Carolina has had four governors since Perry took office in 2000.
Still, when those Toyota workers battle north Dallas’s traffic and pay $100-plus a month in tolls for their daily commute, one suspects they will wish they were living in the Queen City.
N.C. Today: Education chief focus of Gov. McCrory's budget proposal
On the opening day of the North Carolina General Assembly, Gov. Pat McCrory proposed a $20.99 billion budget that includes pay raises for teachers and state employees.
Unlike McCrory's previous recommendation, which would only increase pay for new teachers, today's proposal would give teachers with more than seven years' experience a salary increase of 2% to 4.3%. Teachers who have taught less than seven years would get a 7.1% increase, bringing the base pay for teachers to $33,000, from $30,800 now.
State employees would receive an average 2% salary increase.
The budget calls for community colleges to receive an additional $16.8 million to train workers in fields such as engineering, advanced manufacturing and health sciences that offer promising job prospects. However, the governor's plan reduces the budget for the UNC system by about 2%.
Also included in the governor's budget is funding for 19 additional positions in the state Department of Natural Resources to oversee coal-ash ponds.
The governor estimates the state's Medicaid shortfall, once expected to be as high as $131 million, will come in around $70 million. McCrory suggests adding $50 million to state reserves as a cushion if spending on the government's health insurance program for low-income citizens exceeds projections.
Seth Klarman's Charlotte deal
Downtown Charlotte got a lot more interesting because of the vision of Afshin Ghazi and George Cornelson, the developers of the EpiCentre complex that includes Dale Earnhardt Jr.’s Whiskey River bar, a bowling alley and other entertainment venues. As often happens in real estate, however, a later owner is cashing in on the entrepreneur’s vision.
The later owner of the EpiCentre is Wall Street legend Seth Klarman, whose Boston-based Baupost Group in 2010 backed Charlotte real estate investors Doug Stephan and Geoffrey Curme in taking over more than $90 million of the development's debt. Now the Baupost-backed group has sold the complex to Los Angeles-based CIM Group for $130.5 million, the Charlotte Business Journal reports. CIM also owns downtown Charlotte’s BB&T Center. The EpiCentre opened in late 2007, just in time for the financial crisis that rocked Bank of America Corp. and prompted the sale of Wachovia Corp. to Wells Fargo & Co. Ghazi and Cornelson, who had borrowed from Regions Bank, lost ownership of the complex in 2012 after a lengthy battle in bankruptcy court.
Klarman returned $4 billion of his clients’ money at the end of last year and had 40% of his remaining $27 billion portfolio in cash as of March, according to various media reports. His letters to clients are highly regarded by money managers. His latest missive, disclosed by journalist Tyler Durden of the Zero Hedge website in March, painted a worrisome picture. It concludes:
“Six years ago, many investors were way out over their skis. Giant financial institutions were brought to their knees. The survivors pledged to themselves that they would forever be more careful, less greedy, less short-term oriented.
“But here we are again, mired in a euphoric environment in which some securities have risen in price beyond all reason, where leverage is returning to rainy markets and asset classes, and where caution seems radical and risk-taking the prudent course. Not surprisingly, lessons learned in 2008 were only learned temporarily. These are the inevitable cycles of greed and fear, of peaks and troughs.”
Sounds like it’s time for a round down at Whiskey River.
N.C. Today: Tobacco still growing strong in NC
North Carolina farmers harvested 181,900 acres of tobacco in 2013, a 10% increase over the year before, and will likely produce even more in 2014, the Wilmington Star-News reports.
Most of N.C.'s tobacco is exported to about 50 countries, including China, where smokers prefer the flavor of U.S.-grown tobacco. Last week, The Wilson Times reported that quality, flue-cured tobacco was in short supply globally last year. Wilson County, which billed itself as the largest bright leaf tobacco market of the world in the early 20th century, ranked third in the state in 2012 flue-cured tobacco production, behind Johnston and Sampson counties.
North Carolina accounted for half of U.S. tobacco production last year, and almost 80% of flue-cured tobacco, according to the N.C. Department of Agriculture.
The federal government passed a law in 2004 changing regulations of U.S. tobacco production. Over the past decade the feds have spent billions of dollars compensating quota owners and farmers who stopped growing the crop.
CEOs high on North Carolina
Business might be better in Texas, but it’s still pretty darn good in North Carolina, according to Chief Executive magazine’s annual ranking of the best and worst states for business. Based on 500 CEO surveys, it grades states based on tax and regulatory policy, workforce and quality of life. Texas finished first, respondents praising its schools, while California was last, chief executives slamming its regulatory red tape.
North Carolina was fourth, surrounded by regional rivals. Editors claimed last year’s tax-code overhaul was “hailed as by some as any state’s best in two decades.” However, CEOs were quick to point out that not every region of the state is flourishing. “Areas in North Carolina like Raleigh, Charlotte, Cary, Chapel Hill and Durham have been great places for technology companies,” one respondent said. “The workforce in these areas have [sic] very talented candidates. The western part of the state does not fare as well.” North Carolina also ranked fourth in best states for biotech.
Five best states for business in 2014
4. North Carolina
5. South Carolina
Five worst states for business
49. New York
47. New Jersey
Raleigh PR company wins top honors for campaign featuring Alice Cooper
French/West/Vaughan won 20 awards at the North Carolina Chapter of the Public Relations Society of America annual awards banquet.
Raleigh-based FWV won three awards, including "Best in Show" for its work on behalf of Fretlight Guitar, a campaign that promoted the company's LED system for learning to play guitar that featured 70s rocker Alice Cooper.
Check out one of FWV's videos featuring Cooper here.
N.C. Today: Charlotte pharmaceutical to be acquired for up to $658 million
Chelsea Therapeutics will be sold to Denmark-based H. Lundbeck A/S for up to $658 million. Lundbeck will market Chelsea's Northera, a treatment for a condition that causes dizziness and fainting and affects an estimated 300,000 people with diseases such as Parkinson's. Northera was approved by the FDA in February.
It's the second major acquisition of a North Carolina-based drug company announced within the past two weeks; Morrisville's Furiex Pharmaceuticals will be acquired by New York-based Forest Labs in a deal that could reach $1.5 billion.
Chelsea is led by Joseph Oliveto, who joined Chelsea in 2008 and was named CEO in January. Oliveto previously worked for Durham-based Pappas Ventures, a life-sciences venture capital firm, and for Swiss pharmaceutical company Hoffman-LaRoche.
The deal is expected to close in the third quarter.
N.C. Today: Raleigh, Charlotte make list of best cities for entrepreneurs
Consumer-finance website NerdWallet.com released its second annual list of the Best Cities to Start a Business.
Raleigh came in at No. 4 on the list, while Charlotte was No. 18.
Small-business lending is increasing. San Francisco-based Wells Fargo & Co., which claims the second-highest percent of the retail-banking market share in North Carolina, announced a new initiative last week to loan small businesses $100 billion by 2018.
Criteria used in the ranking included access to funding, local economy and affordability.
NCBA launches financial-literacy program
North Carolina ranks 37th in financial literacy in the U.S., according to an April report that analyzed 12 metrics — including share of residents with a “rainy-day fund.” The same month, North Carolina Bankers Association Foundation Inc. announced an initiative it hopes will improve the state’s standing.
The North Carolina Center for Financial Literacy will attempt to be a link between local financial-education programs, transferring what works in one place to those areas that struggle. It will be based at the trade association’s Raleigh headquarters and led by Jan Dillon, a 26-year-old Randolph County native and Elon University School of Law grad. She joined NCBA spokesman Brandon Wright to talk about the center. The interview has been edited for brevity and clarity.
What is financial literacy?
Dillon: The basic ability to manage your own finances and plan for the future. Planning for retirement is really important, especially for the up-and-coming generations that will live a little longer.
Why is it important for the NCBA to tackle?
Dillon: Studies show the state has very low levels of financial literacy.
Wright: Since the recession, we’ve seen some of the lowest interest rates for the longest period of time in our nation’s history. Consumers have had cheap credit for a long time. We want to make sure that when interest rates and market conditions change consumers are ready.
Why are things so bad in North Carolina?
Dillon: We have large rural areas. Sometimes educational opportunities don’t reach everywhere in our state.
Wright: Look to the east of Interstate 95. For all intents and purposes, it is a third-world country. I don’t want anyone to think that’s a criticism of Fayetteville or Wilmington or anything like that, but it is certainly in very poor economic condition. And to the west, in the mountains. As a teacher told me just the other night, she loves Common Core, but there are certain technological advancements that just haven’t settled into rural areas yet. That is part of Jan’s focus.
How will you fix the problem?
Dillon: Active and experiential learning is more effective. For example, there are programs that allow elementary-school children to open savings accounts. That’s something we want to focus on. Also technology. There are quite a few software programs that involve avatars, games.
What age segment are you focusing on?
Dillon: Just like learning a foreign language, the sooner you learn those habits, the better. We’re working with the N.C. Department of Public Instruction and other nonprofits who focus solely on K-12 financial education and going from there. But we think it will expand to all ages.
What’s the state of financial education in North Carolina schools?
Dillon: The North Carolina Essential Standards do include personal finance. In K-8, it’s included in social studies and math. In high school and somewhat in middle school, there are business-technology courses. In high school, everyone takes a civics course that includes it in the curriculum. We want to interweave personal finance through all subjects and work with teachers on special development so that they feel qualified to teach personal finance. We can define standards, provide more resources and determine what the best resources are.
Dillon: I can tell you about our Camp Challenge program for middle schoolers. We’re using a new software program from Everfi called Vault. It involves avatars and games, interactive lessons that kids at camp will do on tablets. Beyond that we bring in speakers from banks and businesses to talk about entrepreneurship. That’s sort of a pilot program for us. Of course, things are different in different parts of the state. We want to work with our network to focus it regionally and locally.
Do you consider yourself financially literate?
Dillon: I do have a budget. I have a spreadsheet I use month to month, and I share that with a lot of people — even more recently.
N.C. Today: Aqua NC rate increase leads to policy change for water utilities
The News & Observer reported that Aqua North Carolina, the state's largest private water utility, won a 5.2% average rate increase for its more than 87,000 customers in 52 North Carolina counties.
The company, a division of Bryn Mawr, Pa.-based Aqua America, had originally requested a 19% increase, but adjusted its proposal with one provision: that it would be allowed to raise rates in the future without public hearings.
The N.C. Utilities Commission granted its request, in the form of a new state policy that allows all water utilities to raise rates to pay for routine maintenance expenses by up to 5% without formal cases that would require a public hearing.
Customers opposed to the rate increase complained about Aqua's water quality, which they claimed at times was too poor for consumption, but apparently that only made Aqua's case stronger: the Commission stated those complaints showed Aqua's need for the rate increase to pay for system upgrades.