Commissioners (Gang of 5) continue failed economic development policy | Eastern NC Now

    Publisher's Note: This article originally appeared in the Beaufort Observer.

    Warren Smith is a private citizen in Beaufort County who spent a career in the securities industry. He retired and moved to Beaufort County. He is, we can attest, an extremely bright individual and one who has a real passion that government should be operated in accord with sound business principles.

    In recent months he has done a massive amount of work and research on Beaufort County's economic development program. What he has discovered is that the approach Beaufort County has been using to attract economic growth and development has been a failure.

    Mr. Smith has made several presentations to the County Commissioners. Each time he has been summarily ignored by the Chairman, who moves on to something else. But the issue doesn't go away.

    Most recently the Commission and the Washington City Council gave away another chunk of money. They did so behind closed doors. But Mr. Smith is on top of it.

    He recently wrote the Commissioners a letter, a copy of which was provided to the media. We print it as provided, in toto:

Subject: Notes on Beaufort County Economic Development and Taxes

    Beaufort County can ill afford the economic development plan it is now using.

    The executive director of the Economic Development Commission is a Craven County resident, which means the lion's share of his tax supported $180,000 yearly compensation goes out of Beaufort County ($157,000 Economic Development Commission and $24,000 Committee of 100 salaries). We start out in the hole.

    Beaufort County needs to generate $180,000 in outside grants or local taxes every year just to fund this single salary expense, yet the Economic Development Commission generated no new grants from autumn 2007 through autumn 2011.

    The taxpayers of Beaufort County own two industrial parks (cost: $6,500,000):

    • Chocowinity is empty.

    • Washington has double taxes, high utilities, and requires subsidies to encourage buyers.

    o The Quick Start II building sits empty since early 2008

    o The entire project is home to less than 40 employees after five years.

    o The Brooks Boat Works building is empty and for sale


Taxpayers have committed $6,500,000 to a troubled investment.

    To demonstrate the difficulty of growing through grants:

    • In the last six months two One NC grants have been announced, one for $180,000 and one for $95,000.

    • Each of these will need to be matched by grants of local tax dollars ($180,000) and land ($95,000) to the respective businesses.

    • The land grant project will require an estimated $500,000 in infrastructure development grants from the state to properly develop the site.

    • Speaking in round numbers, one project plans to create 35 new jobs, while the second grant project will lay off 90 employees and then rehire all but 25 men. Both projects combined are expected create a total net new job increase of approximately 10 jobs over the next three to five years.

    Ten jobs created over three years will require:

    • $1,050,000 in state and local matched funding ($190,000 One NC plus $360,000 One NC plus $500,000 in development grants) and

    • Three years of $180,000 salary expense for the EDC executive director.

The total cost to taxpayers for these ten jobs will be $1,590,000.

    Warren Smith
     Beaufort County, NC
      January 21, 2012