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L 4 3 <br />C restive <br />• A survey of local government incentives in North Carolina found the average minimum <br />threshold for job creation to be 10. Lee County's policy would be significantly higher <br />than its competitors. <br />• Most policies treat existing business different than new business. The next clause <br />addressing investment thresholds does recognize existing businesses differently. Most <br />incentive policies have lower thresholds for investment and job creation for existing <br />businesses. <br />• The clause does not address retention of jobs, which is just as important as new job <br />creation. Many companies today make significant investments in capital that allow for <br />job retention. In fact, Lee County should encourage existing businesses to deploy new <br />technology to remain competitive, even if that new technology means job losses or only <br />retention. This is why many incentive policies only address investment, not job creation. <br />• The School of Government commented on retention in the second job creation scenario <br />in their memo. "For example, company is making significant equipment purchase to <br />streamline operations. It could install the equipment in Lee County or another <br />jurisdiction. Once complete, the company won't need quite as many workers because the <br />equipment is more efficient. Company asks for incentives if Lee County wishes for the <br />company to install the equipment in Lee County and thereby retain some jobs in Lee <br />County. Alternative is to lose all jobs. I (Tyler Mulligan) interpret the law as allowing an <br />incentive in such a circumstance. Job retention in this situation is similar to job creation, <br />because in the absence of incentives, this company will have zero jobs in Lee County. <br />The incentives are offered to induce the company to keep more than zero employees in <br />the county." <br />Clause 5 <br />"All jobs counted towards the incentive must be full -time employee, defined as a person <br />employed at 35 hours or more a week, with a salary or wage package that includes health <br />benefits positions that are reported monthly by the company to state Employment Security." <br />• This is consistent with the NC Department of Commerce. <br />Clause 6 <br />"A new business must create at least $20 million in new investment in the County to be <br />considered for an incentive. An existing Company must invest a minimum of $10 million to be <br />considered for an incentive. Under either option, the investment must be verified as taxable <br />property under North Carolina law and verified by the Lee County Tax Office." <br />• A survey of local government incentives in North Carolina found the average minimum <br />threshold for investment to be $1 M - $2M for new businesses and approximately $1 M for <br />existing businesses. Lee County's policy would be significantly higher than its <br />competitors. <br />• The majority of businesses recruited to Lee County are small businesses and will not <br />meet thresholds for investment. Such high thresholds will make Lee County <br />uncompetitive for the very kinds of businesses that have been its mainstay. <br />Creative Economic Development Consulting, LLC <br />PO Box 706, Elkin, NC 28621 • 336 - 526 -1332 • www.creativeedc.com <br />