Cabarrus board votes for Celgard incentive

By Hugh Fisher

hfisher@salisburypost.com

CONCORD — The Cabarrus County Board of Commissioners approved a divisive tax incentive grant for lithium ion battery manufacturer Celgard during Monday's business meeting.

The board voted 4-to-1 to approve the incentive package, which includes a $350,000 payment to reimburse site preparation costs and no more than $819,672 in tax breaks.

In return, Celgard will be required to invest at least $57.4 million in improvements and property in the county.

Celgard plans to expand its facilities in Mecklenburg County and build a new plant in Cabarrus.

According to a January release from Celgard, the Cabarrus County plant is expected to employ 209 workers by 2014.

Cabarrus Economic Development Corporation President and chief executive John Cox said the provision requires Celgard to pay back the tax breaks if the company doesn't hold up its end of the bargain.

" ... If they don't buy the property, don't build the facility, don't pay their taxes, they don't get anything at all," Cox said.

Cox referred back to the Board of Commissioners' record of supporting tax incentives for businesses.

"In fact, if you approve this request tonight, since 2004 your board will have increased capital development in Cabarrus County through the incentive process alone by over $400 million," he said.

Cox also credited past tax incentive grants with creating "thousands of jobs" in Cabarrus.

"It has been a good investment," he said.

Not everyone in the audience agreed.

Twelve people spoke during the public hearing regarding the proposed incentive package, which is being offered in conjunction with grants and incentives from the City of Concord and the state, as well as federal stimulus dollars.

Thomas Hill, representing the Libertarian Party of Cabarrus County, said he felt the incentives would create an unequal playing field for local businesses.

"We just have a moral problem with where the money comes from," Hill said.

He said that taxpayers would bear the brunt of the incentives, while incentives aren't available to small business owners equally.

Thomas Sheppard, a board candidate, also spoke against the incentive plan.

"I want to suggest that government does not need to be in the business of charity, whether it be for individuals or businesses," he said.

Ric Starnes of Concord was adamant about his opposition to the proposed tax incentive, especially after Cabarrus County Attorney Richard Koch mentioned that he'd learned Monday afternoon that Celgard did not agree with a provision in the draft county agreement.

"You've got things in this deal you haven't been able to answer yet," Starnes said.

And Starnes took issue with the provision reimbursing Celgard $350,000 after the site is prepared.

Carl Tyson of Concord agreed.

"There's just too many holes in this and too many questions," Tyson said.

White and Commissioner Bob Carruth asked Koch questions regarding the disputed language, which involves a "clawback" provision designed to ensure reimbursement in case Celgard fails to make the required investments.

Other residents spoke in favor of the measure because it could help create jobs.

"I'm here in support of incentives," Wayne King of Concord said. "I don't like them, but the U.S. Supreme Court has decided they're legal.

"And if were going to play on a level playing field, unfortunately we have to use the tools available to bring the jobs to Cabarrus County that we need."

Richard Callahan of Salisbury traveled to the meeting to ask Cabarrus County leaders to support the incentive.

"Every county in America would love a chance at these jobs," Callahan said.

And Jack Fahy of Concord spoke of his experience looking for employment after he was laid off following Windstream's acquisition of CTC.

"If it takes incentives to bring Celgard and their jobs here, then I am for it," Fahy said.

White said he wanted to be sure that the clawback provisions were in place before the agreement was finalized.

"It's important to us to have jobs here, but it's important to us to protect the county," he said.

White also likened the county's choice in offering incentives to finding money on the ground and deciding whether to pick it up.

"What we're doing is we're bending and picking that penny up and putting it in our pocket," he said.

White said that performing a rough cost-benefit analysis led him to see the plan "giving $1.1 million back to taxpayers," without taking into account extended economic effects.

That "multiplier effect," Commissioner Liz Poole said, included the money those new workers would spend in Cabarrus County that would then be spent again by those businesses.

Commissioner Coy Privette cast the lone vote against the measure.

He said the decision by Cabarrus and other governments to give tax breaks was not good policy in a bad economy.

"If a location is a profitable location, if it has a good work ethic, people will locate there," Privette said.