More research shows we need a careful review of economic development in Beaufort County | Eastern NC Now

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

    Beaufort County's economic development program has been based on false assumptions that are contradicted by the best available current research.

    At the most recent "annual report presentation" by Economic Development Director Tom Thompson, as well as a recent article by Committee of 100 Chair Tom Richter it was repeated that "industry ready" buildings are essential (note that word) attracters of new businesses locating in a county. That mantra has been the standard bearer of the Economic Development Commission and the Committee of 100 since their inception. Mr. Thompson even stated on several occasions that "studies show" that 85% (or some such number) of businesses make availability of such buildings a "go/nogo" criterion. When challenged neither he nor the EDC or Committee of 100 could produce the "study."

    The research however shows just the opposite--that incentives such as buildings are not effective attractors of business.

    We recently published an article that contains a link to a study done for the N. C. General Assembly by the UNC Center for Competitive Economies that reported that economic development incentives are not the major reason a business chooses to locate in an area, and those that are used are relatively ineffective in creating jobs. That study concluded that the tax environment is more important than incentives such as those Beaufort County has used.

    Now we have even more evidence.

    John Hood, writing in his Daily Journal in the Carolina Journal cites several similar studies that have all come to similar conclusions as the UNC study. Essentially most of the current research says that the tax and regulatory environment is what makes the most difference in stimulating business growth (new) and development (expansion of existing enterprises). Another interesting finding Hood writes about it which businesses create jobs. It turns out that it is not the large, established firms but rather the small startups that go on to succeed...targets that are noticeably absent in Beaufort's economic development program.

    Commentary

    Beaufort County is at a crossroads in its approach to economic development. It will choose to continue down the road it has been traveling (as indicated by Richter's recent article) or it will choose to change its model of promoting economic growth and development.

    Beaufort is now considering replacing Mr. Thompson, who is retiring.

    We would suggest that now is the time for a thorough and honest assessment of the past strategy and the alternative strategies that may be available to Beaufort County going forward. And we would respectfully suggest that an object assessment requires looking at the best available research.

    The leadership of the EDC, Committee of 100 and the County should do their homework before they hire anybody. They should develop a strategic plan for economic development that should be the basis for the criteria used to select a replacement for Mr. Thompson.

    Because we have been critical of Mr. Thompson and the strategy Beaufort County has used for the last decade or so there are those who think we are opposed to economic development. Nothing could be further from the truth. We simply want an effective use of not only our tax dollars but the inherent assets Beaufort County possesses...and we think they are numerous. But such effectiveness will require strong and effective leadership. We urge the EDC, the Committee of 100 and the County Commission and City Council to provide that leadership.