Published 12:00 am Sunday, September 29, 2013

SALISBURY — As Gov. Pat McCrory reorganizes the N.C. Department of Commerce and pushes a new strategy for economic development, one of his top advisers was in town last week to talk about the changes.
Tony Almeida, a Salisbury resident and senior adviser to McCrory on jobs and the economy, spoke to the Salisbury Rotary Club. Almeida retired after 32 years at Duke Energy, where he served as vice president for economic development. 
He and McCrory have been friends for more than 30 years. Both started working for Duke Energy in the 1970s.
Almeida sat down with the Post for a short interview. Here are edited excerpts from the conversation:

Q. Give us a status update on the state’s new economic development strategy.
A. From an organizational standpoint, what we’re talking about doing is moving the sales and marketing functions that are currently in the Department of Commerce to a nonprofit, to a public-private partnership.
At least eight other states have done this and had this kind of organizational structure, probably some of them for 20 years. As we went through the transition process between the election and inauguration, we benchmarked with a lot of those states and saw a lot of good things. This will involve the business development, existing industries group; the travel, tourism, sports, marketing film group; international trade; marketing and branding group and will involve the small business entrepreneurship group. So those that are focused on growing jobs, growing investment in North Carolina, will be moved to that nonprofit.

Q. What are the biggest obstacles to job growth and economic development in rural counties like Rowan, and how will the state’s new model help?
A. The biggest obstacle in the state continues to be the need to move our workforce up the education ladder — move those that have high school degrees to where they have community college degrees or certificates, move those at that level up to bachelor’s degrees and moving on up. As we look at the workforce in North Carolina today, you’re talking about 28 percent that has post-secondary education. When you look at what’s projected for 2020, 40 percent of the jobs will need post-secondary education. Education continues to be the big challenge for us.
In rural areas, we’re working hard on the infrastructure, the transportation links. There’s a lot of good work that has been done and will be done on water and sewer and that kind of infrastructure. We need to focus on getting natural gas into all 100 counties … and then broadband connectivity is another key in some rural areas. We have situations where young people go to school and they have the connection with their laptop or their iPad and then they go home and there’s no broadband connectivity.
One thing we’re really excited about is the new rural division in the Department of Commerce (led by Patricia Mitchell). … Pat knows rural North Carolina, and she is absolutely passionate about bringing economic development and job creation to rural North Carolina.

Q. That was my next question. What will the new Rural Economic Development Division do for Rowan?
A. There will be a keen focus on community planning. There will be a keen focus on the infrastructure piece, and making sure that water and sewer, site development and site preparation support are there. If there is a broadband connectivity issue here, we’ll be looking at a statewide plan and certainly including all 100 counties in that.

Q. How will the state’s new approach boost economic development and attract jobs along the I-85 corridor?
A. One of the key things that will come from this public-private partnership will be a keen focus on our target industries, and we will have specific business developers, seasoned business developers, for each of those target industries. And we have the new North Carolina Economic Development Board working on a new strategic plan. Some obviously will be life sciences, agribusiness, military and defense, financial services and information technology, (as well as) advanced manufacturing in all of those sectors.
With those business developers and with a much better focus on existing business — helping them grow and expand — I think the I-85 corridor, as well as the I-40, I-77, I-26, all of our corridors, the whole state, will see a much better, targeted, strategic focus then we’ve had before.

Q. Considering the controversy surrounding Salisbury’s launch of Fibrant, what do you think about local governments competing with private industry for new sources of revenue?
A. In that situation, the General Assembly has appropriate statutes that are in place, which as I recall allow those that have been grandfathered to continue to operate. This administration is about the opportunity for the private sector to grow jobs, to do research and development, to create investment, to enhance productivity. … And we do that by improving the business climate, by making sure infrastructure is in place, by making sure we have a seasoned, experienced, talented workforce and those kinds of things. This administration wants to create an environment for the private sector to create jobs and bring investment to the state.

Q. What’s more important for jobs and economic development — investing in infrastructure, retail expansion or recruiting new manufacturers?
A. They’re all important. The beauty of manufacturing is that it brings the ripple effect, the spin-off. Suppliers come, and the suppliers create more spin-off, with people buying houses and purchasing in retail stores and all of that. Certainly, retail has its place and Rowan County has a wonderful corporate citizen in Food Lion and certainly Cheerwine and others, but I think the beauty of manufacturing is the ripple effect and the spin-off that it creates.

Q. Obamacare: Good or bad for jobs and economic development in North Carolina?
A. As I have made presentations across the state, I continually have small and medium-sized businesses come to me and say our biggest challenge … is health care. What they’re telling us is that Obamacare is really a challenge when it comes to certain requirements that it puts on businesses, particularly small businesses that have trouble providing for those kinds of benefits for their employees.

Q. Did the state make the right decision to not expand Medicaid and turn back the federal funds that were offered?
A. Medicaid in the most recent fiscal year was over budget by $500 million. The Medicaid system in North Carolina is broken; the state internal auditor has proven that with a report several months ago. … Let’s fix the Medicaid system in North Carolina, and then we can look at a potential expansion if that is an opportunity. But let’s fix the system first. I think that’s what we’re focused on.
Q. Many good, young teachers have left the Rowan-Salisbury School System because they can earn more doing the same job in neighboring states like Virginia. What is the governor’s office doing to improve teacher pay and retain talented teachers?
A. Attracting, retaining and rewarding our good teachers is a priority for this administration. The governor (has said) that we’ve got to find an additional funding stream so that we can attract, retain and reward our good teachers in North Carolina.
We realize it’s important and we need to focus on solutions.

Q. Any progress in finding that funding stream?
A. We’re continuing to look.

Q. I know you have to go shortly. What else would you like to add?
A. You haven’t asked about tax reform. … The tax reform plan that was passed this year by the General Assembly and signed by the governor is historic. What it does in terms of reducing the tax rates so they go from being the highest in the Southeast to where we are, at or below our neighbors, is going to give us a competitive advantage as a state.
Eliminating loopholes and special-interest tax credits as a part of that was important, and some modest expansion of the sales tax base that was done was important as well. I think that, plus regulatory reform and what we’re doing in workforce development, is really creating a much more competitive business climate for the state.