Lenoir adopts limits on business incentives
Lenoir is raising the bar for companies that want to get paid for moving or expanding here.
The Lenoir City Council approved a revision Tuesday night to its guidelines for economic development incentives. If the median wage of the jobs the company is bringing will pay less than the county average, the city will not offer tax credit incentives at all, but if the median income is above the county average, incentives will be given based on number of jobs created. A tax credit incentive lets a company recoup a percentage of the new property taxes that its move or expansion creates here.
City officials did not know the average county income Tuesday night, but U.S. census figures say the median individual worker income from 2007-11 was $25,326 and the average wage per job in 2007 was $34,051. Median wages often are lower than average because a small number of high wages skews the average.
For a company bringing in 20 to 75 new jobs, the new guidelines recommend a three-year tax credit at 1 percent per new job; for 76 to 100 new jobs, a three- to five-year credit; and for more than 100 jobs, a five-year tax credit, all capped at a maximum credit of 75 percent.
City Manager Lane Bailey pointed out the difference in basing the incentives on the median income of the new jobs and not the average income: An average can be skewed by even one high income, but the media is the exact middle point among the individual jobs, so that if there are 20 jobs, then half pay more and half pay less. The median income is a better gauge for efforts to “raise the bar” for county employers, Bailey said.
“It’s an improvement over our current situation as long as we stick to our guns,” said Councilman T.J. Rohr, cautioning against wavering from the guidelines. Rohr case the lone vote against the incentives guideline, saying he opposes any tax incentives.
City attorney Edward Blair it would be important to clarify that meeting the guidelines would not entitle acompany to incentives.
In other business, the council voted to terminate a contract with the Ferguson Group, a Washington D.C.-based consulting firm that helps small communities get federal grants. Lenoir has contracted with the group since December 2012, paying $5,000 per month for the group to help notify the city of federal grants and to help the city get those grants approved.
But the last federal grant the city received was a grant for firefighter assistance about five years ago.
While most of the city’s grant monies come from the state, Lenoir is seeking federal grant money through a number of initiatives, but those efforts will continue with or without the contract with The Ferguson Group.
Even without the Ferguson Group, the city has contacts in Washington, council members said, mentioning U.S. Rep. Mark Meadows, R-11th, and Anthony Foxx, former mayor of Charlotte and current U.S. secretary of Transportation.