High stakes game

Editorial by Greensboro News-Record, December 10, 2013.

Kevin Baker said it best: A Boeing aircraft manufacturing facility “is exactly what we’re preparing the airport to be ready for.” The question is whether North Carolina is prepared to compete in the recruiting battle to land what the director of PTI Airport calls a “monster project.”

Based on experience, some industry observers have their doubts. Taxpayers might, too.

If Boeing were simply looking for a location where it could thrive, PTI might be a leading candidate. The airport owns plenty of land ripe for development, which it will connect to its runways via a taxiway over future Interstate 73. Highway and rail access is excellent. Also, because of local aviation firms such as Timco and Honda Aircraft, GTCC has good training programs for workers in this field.

In fact, PTI is submitting a proposal at Boeing’s request — along with as many as three dozen other locations. What it needs is significant support from the state, which might have to offer incentives worth more than $1 billion to enter this game.

South Carolina reportedly put up at least $500 million to win a Boeing assembly plant in 2009. It’s in North Charleston, and the same location may be considered for the next Boeing facility.

South Carolina has beaten North Carolina for other big projects, and the 2011 tussle for a Continental Tire plant employing more than 1,500 workers turned into a fiasco for North Carolina.

Then-Gov. Bev Perdue and Republican state Senate leader Phil Berger blamed each other for blowing the deal. Perdue said the legislature wouldn’t approve enough incentives; Berger said Perdue’s ineptitude was at fault.

“We know now that South Carolina paid far less to land Continental,” he said then, citing a potential cost of $100 million to North Carolina. Actually, we know now that South Carolina paid more than that — $31 million up front plus $118 million in tax breaks over 10 years that were approved later.

The Boeing project would be much larger, which is why the cost of winning it would run many times more. North Carolina’s conservative legislature philosophically opposes incentives, asserting that low tax rates, reasonable land and labor costs, skilled workers and other “business climate” advantages ought to suffice. If only that were true. A Boeing or an auto manufacturer can have all those things and more. What they bring to a region is immense: thousands of jobs, investments worth hundreds of millions of dollars, scores of supporting businesses — plus prestige and a winning attitude. Boeing would secure the Triad’s aviation industry claim.

But success is a long shot. It would require local efforts and unprecedented state backing. And because Charlotte Douglas International Airport and the Global TransPark near Kinston apparently also are competing, the prospect of in-state wrangling is worrisome. The state should discourage that.

Adding to the complications, Gov. Pat McCrory is reorganizing the state’s economic development structure. Is there an effective agency at present? To make sure, the governor should take personal leadership of the recruiting effort and incentives negotiations. But he’ll need legislative approval for a high-dollar deal. The sky is not the limit.