County, China Grove expecting incentive repayment from Tuscarora

Published 12:10 am Sunday, July 3, 2016

By Josh Bergeron

SALISBURY — By Friday, the Town of China Grove and Rowan County expect Tuscarora Yarns to repay tax incentives it received during its time operating a southern Rowan plant.

When Tuscarora decided to relocate from North Main Street to Thom Street in 2011, China Grove and Rowan County governments approved incentive agreements that equated to a 75 percent refund of property taxes on new investment over five years. That incentive agreement, however, included a provision that would require the repayment of incentives in the event of a mass layoff or plant closure. When it notified local and state government of its closure in March, Tuscarora began a 120-day countdown for repayment, according to County Attorney Jay Dees.

Because Tuscarora filed its WARN notice — required for large layoffs or plant closures — on March 8, Dees said Rowan County expects payment by the end of the week — July 8. China Grove expects payment by the same date, according to Town Manager Ken Deal. Figures provided by Dees show Tuscarora owes approximately $70,000 to county government. The company owes China Grove roughly the same amount, according to Deal.

Rowan Works Economic Development Director Robert Van Geons said the company is aware of the repayment requirement. Dees said Rowan County is willing to work with Tuscarora to receive repayment for incentives “in the most efficient and beneficial way possible.”

The Tuscarora plant in China Grove was actually scheduled to close on May 9. Depending on the interpretation, the actual date of closure could be considered the start date for the 120-day countdown.

“Whether the company and Rowan County disagree as to the beginning of the 120-day period, we will endeavor to work with the company to honor the terms of the agreement in a mutually respectful manner,” Dees said in an email.

When asked about the incentive repayment, China Grove Mayor Lee Withers noted the positives resulting from Tuscarora’s new investments. Withers said China Grove received more tax revenue than it would have otherwise. The company also created a number of new jobs as a result of the new investments.

The company employed 57 people at a North Main Street location before its 2011 move. A total of 123 jobs were affected when the plant closed.

Van Geons said “the vast majority” of employees at Tuscarora’s plant found a new job prior to the plant’s final closure.

“This is an unfortunate outcome that no one envisioned when the project started in 2010,” Van Geons said. “In my opinion, the company did a good job helping their employees find new opportunities.”

The mission now, Withers said, is to develop a more educated and trained workforce that would attract new businesses.

“We’ve got to make sure we can fulfill our end of the bargain and provide that workforce that future companies desire,” he said.

Van Geons said he is working to find new projects that could redevelop or reuse the Thom Street location used by Tuscarora.

Contact reporter Josh Bergeron at 704-797-4246.