County finances deteriorate while EDC staff prospers

Published 12:17 am Wednesday, September 21, 2011

To the Editor:

In May 2011, the executive director of the Economic Development Commission explained the logic of his industrial parks strategy:

“We have no more good buildings, so we either build them or give up. … However, without industrial parks, there is no way to efficiently build new buildings due to the expense of running industrial sized utilities. So, industrial parks and building programs go hand in hand.”

This is simply wrong. Actually, the vast majority of commercial buildings in the United States, big and small, are built by private developers and located outside of industrial parks. Realtors regularly find properties and match buyers with sellers of existing buildings. Architects and engineers working for private parties find suitable locations and undertake projects that far exceed the scale of anything built at the EDC’s industrial parks. This is exactly what real-estate developers do. They use their own money to build what they design and they build to any scale. If the buildings go unoccupied, then entrepreneurs bear the cost, not taxpayers.

Both of our industrial parks were initially promoted as being the key to attracting large manufacturers who would replace the textile and parts assembly firms that left Washington over the years. These were certainly prized employers, but they have been replaced by scores of smaller, more-diversified firms that have broadened and strengthened our economic base. Beaufort County’s aggregate employment rate has been unaltered by these changes. Traditionally, the county has 20,500 job-seekers and anywhere from 18,000 to 19,500 employed. Our local percentage of unemployed basically tracks the unemployment rate of the surrounding region and the nation. Rising to over 11 percent with recession, falling to near 5 percent with recovery. Today, unemployment is 11.3 percent. Ten years of EDC operating expenses ($3,000,000) and misallocation of taxpayer resources ($6,250,000) have brought no change in these numbers, but they have damaged the cash flow and balance sheet of the county.

Did anyone at the EDC ask why the large employers of the 1990s left town? It was not because they needed “industrial sized utilities.” They had those. They left to find cheaper labor and taxes. They left to reduce costs. Businesses seek out low operating costs, not cookie-cutter buildings requiring expensive industrial-park utilities. The EDC came up with the wrong answer to our problem. Its mistake is easily highlighted: buyers have repeatedly passed over Quick Start II, and, even with grant assistance, Washington Industrial Park has attracted fewer than 75 jobs, while Chocowinity Industrial Park is entirely vacant.

Beaufort County’s comparatively low property taxes were our greatest advantage in attracting residents and businesses. Our staggeringly expensive electric utility rates are, by far, our worst disadvantage. The EDC has contributed to raising our taxes with its misguided and costly real-estate strategy, while doing nothing to lower utility costs for local businesses.

Instead it built a fiefdom.

The industrial parks have served to develop EDC’s job security, not our economy. On the EDC’s watch, county finances have deteriorated, yet EDC staff has prospered.