The Real Cost of Buying Land | Eastern North Carolina Now

    Publisher's note: The author of this post is Julie Tisdale, who is city and county policy analyst for the Carolina Journal, John Hood Publisher.

    RALEIGH     There was an interesting headline out of Buncombe County that caught my eye. Officials there were disappointed to learn that Deschutes Brewery had chosen to open up its East Coast facility in Roanoke, Va., rather than Asheville. This was despite the county spending $6.8 million to buy 137 acres specifically for the project. And so the headline read, "Land used to lure Deschutes Brewery could be sold."

• Hours after learning that Deschutes Brewery had chosen Roanoke, Virginia, over Asheville to establish its eastern U.S. operation, Buncombe County Manager Wanda Greene said she would recommend the sale of the 137 acres area officials had offered to the company.

    Within hours. Because the county had bought that land specifically with the brewery in mind. This wasn't just land they happened to own anyway and were willing to sell to the brewery. This was land they'd acquired last year for the purpose of offering it to the brewery. Why exactly should Buncombe County be in the land acquisition business for a private company?

    (Does this remind anyone else of the Greensboro-Randolph Megasite project?)

    For the sake of the taxpayers who paid for the land, I hope Buncombe County is able to sell it and not at a loss. Officials are saying they're confident they'll be able to do just that, and their tone seems pretty nonchalant about the whole thing.

• "We worked really hard to get them to come here," Greene said of the Bend, Oregon-based craft-beer brewer. "It just didn't work out."

    And later on...

• Despite losing to Roanoke, [Buncombe County Commission Chair David] Gantt said Tuesday that buying the land remained a wise decision for the county."The Ferry Road property is one of the last large parcels suitable for economic development left in our County," he said.

    Hopefully, this will turn out to be revenue-neutral for Buncombe County. But even if it does, Greene and Gantt seem to be missing a larger issue. Buncombe County has held that land for a year, which means for a year it's been unavailable for any other economic development.

    "One of the last large parcels" was just taken out of play for everyone other than the county's preferred business. If the land had been available, it's impossible to know what ideas other businesses might have come up with to use the space.

    In economics, that's called opportunity cost. It's the value of all that would otherwise have been created with that resource, in this case, the land. And we have absolutely no way of quantifying it.

    Maybe the land would have remained empty and unused, but maybe not. By buying it and setting it aside as part of a bid for this brewery, though, the county effectively removed any possibility of the land being used for economic benefit. That should not be the approach of local governments - or of state or federal governments, for that matter.

    Additionally, I wonder about the other costs incurred in trying to woo this brewery. To mention but one, how much time - with salaries paid by taxpayers - was spent trying to get this particular business to come, rather than improving the overall environment for all businesses?

    The real losers here aren't county officials or "the county," but rather all the taxpayers whose money was spent in a failed bid, the businesses who were denied access to the land, and the people who would have been employed by any businesses that might have popped up if the land had been available.

    When I see this story, I'm sad about all that loss, and I'm reminded that governments really aren't very good at picking winners, at knowing what companies are going to want to do and where they're going to want to locate. So perhaps they should stick to the things they are better at and let businesses acquire land on their own.