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Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory JJaannuuaarryy 22000088 Page Introduction 1 Summaries by Fund Source 1 Tax Incentives 3 General Fund 4 Department of Commerce 4 Higher Education 5 Transportation and Highway Fund 5 Appendix A- Glossary of Frequently Used Fiscal Terms 7 Appendix B - Funds by Fund Source and Type 9 Appendix C - Tax Incentives 10 Bill Lee Tax Credits 10 Tax Expenditure Summary 11 Tax Expenditure Detail 12 Appendix D - General Fund Programs 14 Department of Commerce Office of International Trade 14 Economic Development Information System ( EDIS) 15 Regional Offices 16 Executive Aircraft 17 Business ServiCenter 18 Commerce Finance 19 Economic Development Board 20 Industrial Development Fund ( IDF) 21 One North Carolina Fund 22 One North Carolina Small Business Fund 23 Job Development Investment Grant ( JDIG) 24 Job Maintenance and Capital Development Fund 25 Green Business Fund 26 Site Infrastructure Grant 27 Utility Account 28 Economic Development Reserve 29 Commerce Pass- Through Regional Economic Development Commissions 30 Table of Contents FRD Economic Development Inventory January 2008 Page NC Biotechnology Center 31 NC Institute for Minority Economic Development 32 Other Non- State 33 Rural Center - Institute for Rural Entrepreneurship 34 Rural Center - Microenterprise Loan Program 35 Rural Center - Rural Economic Transition Program 36 Rural Center - Research & Demonstration Grants 37 UNC ECU Community Engagement 38 FSU Business Center 39 NC Cooperative Extension Service 40 NCSU Economic Development Partnership 41 NCSU Industrial Extension Service 42 Small Business Technology Development Center 43 UNC- C Ben Craig Center 44 WCU Institute for the Economy and the Future 45 UNC- CH Office of Economic & Business Dev. 46 NCCCS Customized Industry Training 47 Focused Industrial Training 48 New and Expanding Industry Training 49 Hosiery Tech Center 50 Textile Center 51 Military Business Center 52 Small Business Center Network 53 Appendix E - Transportation & Highway Fund Programs Highway Fund Economic Development 54 SB 1005 Discretionary Funding 55 TIP - Economic Development Program 56 Contingency Fund 57 Short Line Infrastructure Program 58 Public Access Fund 59 Rail Industrial Access Program 60 Small Construction 61 FRD Economic Development Inventory January 2008 FRD Economic Development Inventory 1 January 2008 Introduction S. L. 2007- 522 ( Extra Session) requires the Joint Select Committee on Economic Development Incentives ( Committee) to compile a report that lists and quantifies all economic development incentives offered by the State. To fulfill this requirement, the Committee directed the Fiscal Research Division ( FRD) to create the following document – North Carolina Economic Development Inventory ( EDI). The EDI is an estimated measure of State spending on economic development. Spending can occur either by appropriation or tax incentives channeled through the tax system. The listing of tax incentives in combination with the listing of direct and support spending programs is intended to allow the General Assembly to analyze all State spending related to the goal of economic development. The EDI covers two types of State economic development spending: direct incentives and support programs. Direct incentives are defined as those programs that provide funds either directly to a company or to a county or a municipality for a specific company. Examples include tax credits, the Job Development Investment Grant ( JDIG), and the One North Carolina Fund. Support programs are those that exist to provide services to businesses or companies considering locating or expanding in the State. Examples include the North Carolina Community College System's Small Business Center Network or the Department of Commerce's Regional Offices. Programs that exist to administer direct incentives programs, such as the Commerce Finance Center, are included in this category. The inventory does not contain comprehensive figures on all State economic development spending in North Carolina, nor does it analyze all spending related to the State’s priorities on education and workforce development, the regulatory business environment or infrastructure projects such as highway construction. While these spending priorities may be considered a part of a State’s total economic development effort, the scope of this report is to account for spending identified as directly related to an economic development purpose. If the program would still exist if the State discontinued all business support services and incentives efforts, then it is not included in this inventory. Summary The EDI is divided into three sections based on the source of funds: Tax Incentives, General Fund appropriations, and Transportation. Tax incentives, or as they are often referred to tax expenditures, take the form of either Bill Lee tax incentives or tax incentive expenditures derived from provisions in the State’s tax code. Bill Lee tax incentive information is provided through FY 2006- 07, and tax incentive expenditures are estimated through FY 2007- 08. For General Fund programs, current appropriations levels are provided, as well as historical data back to FY 2002- 03. Transportation information includes program data from FY 2002- 03 through FY 2007- 08. In FY 2006- 07, total estimated tax credits and appropriations for economic development were approximately $ 1.291 billion. Table 1 below breaks these figures out for each fund source. Table 1: Economic Development by Fund Source, FY 2006- 07 Fund Source Amount Bill Lee Tax Incentives $ 93,763,666 Tax Incentives $ 1,012,600,000 General Fund Appropriations $ 117,526,439 Transportation $ 67,487,580 Total $ 1,291,377,685 FRD Economic Development Inventory 2 January 2008 Table 2 shows the aggregated spending and the overall growth rates since FY 2002- 03. Because data on other tax incentive expenditures have only been available since FY 2005- 06, only Bill Lee tax information is included in this table. Table 2: Economic Development Spending and Growth FY 2002- 03 to FY 2006- 07 ( In Millions) FY 02- 03 FY 03- 04 FY 04- 05 FY 05- 06 FY 06- 07 General Fund $ 42.0 $ 93.7 $ 65.7 $ 100.2 $ 117.5 Transportation $ 15.4 $ 20.6 $ 36.7 $ 58.7 $ 67.5 Bill Lee Act $ 74.2 $ 79.3 $ 66.4 $ 90.5 $ 93.8 Total $ 143.7 $ 200.1 $ 156.7 $ 240.6 $ 273.2 Nominal Annual Growth 47.1% - 12.8% 47.7% 11.8% Real Annual Growth* 43.9% - 15.4% 42.3% 8.9% * Adjusted for inflation using the Consumer Price Index, Bureau of Labor Statistics Tax incentives through the Bill Lee Act plus other tax incentives totaled $ 1.1 billion in FY 2006- 07. Tax incentives do not directly reduce any given appropriation, but rather have an indirect cost by lowering the General Fund availability for other appropriations. Ninety percent of all State spending on economic development is from tax incentives. In FY 2006- 07, the General Assembly appropriated $ 117.5 million for economic development to the Department of Commerce, the North Carolina Community College System ( NCCCS), and the University of North Carolina ( UNC). Figure 1 below shows the breakdown of these appropriations. That amount increased by 13 percent to $ 133.3 million in FY 2007- 08 ( see Figure 2). Fig. 1: General Fund Appropriations, FY 06- 07 Fig. 2: General Fund Appropriations, FY 2007- 08 NCCCS and UNC are playing an increasingly significant role in economic development. Combined, appropriations for economic development to these entities grew by over fifty percent between FY 2002- 03 and FY 2006- 07. Appropriations to Commerce administered programs, such as One NC and JDIG, GF Appropriations for Economic Development FY 2006- 07 Commerce 69% UNC 13% NCCCS 18% Total: $ 117,526,439 GF Appropriations for Economic Development FY 2007- 08 Commerce 72% NCCCS 16% UNC 12% Total: $ 133,253,720 FRD Economic Development Inventory 3 January 2008 increased by over 325 percent during the same period, from $ 19 million to $ 81.5 million. However, all of these appropriations still only represent 0.62 percent of the total FY 2006- 07 General Fund budget. Transportation appropriations are another component of economic development spending in the State. Appropriations in this category increased 337% between FY 2002- 03 and FY 2006- 07. The EDI categorizes economic development spending as direct incentives or support programs. By definition, all tax incentives are considered direct. Figure 3 shows State spending separated into these two categories. Ninety- five percent ($ 1.2 billion) of the $ 1.3 billion in State funding in FY 2006- 07 was targeted directly to a particular business or industry. Of that $ 1.2 billion, 82 percent ($ 1 billion) was tax incentives ( excluding Bill Lee). Bill Lee credits accounted for eight percent of direct economic development incentives, while transportation and General Fund appropriations were each five percent. Support programs, including State aid to non- State entities, accounted for five percent ($ 62 million) of FY 2006- 07 spending. Fig. 3: Economic Development Spending by Type The following sections provide summaries of State economic development programs by fund source ( tax incentives, General Fund appropriations, and Transportation). Detailed information on all of the incentives programs included in the EDI may be found in the appendices at the end of the document. Tax Incentives In 1996, the General Assembly enacted the Bill Lee Act ( G. S. 105 Article 3A), which set forth a comprehensive tax incentive program to compete with other states that had been adopting similar economic development legislation since the mid- 1980s. Since then, efforts to attract and retain businesses have led to numerous revisions of the Bill Lee Act, as well as enactment of additional tax programs. Tax incentive expenditures such as those in the Bill Lee Act may be considered spending programs conducted through the tax system. Tax expenditures are defined as an exemption, deduction, credit, refund, cap, or preferential tax rate that reduces the amount of tax revenue which would otherwise be collected from the taxpayer. In FY 2006- 07, tax relief intended for economic development purposes equaled an estimated $ 1 billion. An additional $ 174.6 million in Bill Lee tax incentives were generated during the 2006 tax year. The Bill Lee Act is an incentive program that allows tax credits against the income, franchise, or gross premiums insurance tax. Credits can be earned for job creation and investments. Certain eligibility requirements are required in order to earn the tax credits ( see Appendix C for more detail). The Act has been amended numerous times since its inception and, in 2007, was replaced with Article 3J credits. Article 3J credits represent a new system of credits intended to be more narrowly focused on job creation and investment. Since 2002, the nominal dollar amount of credits taken has increased by 26 percent. Total credits taken fluctuate from year to year because the credits are claimed against taxpayer tax liability, which can be highly variable and subject to swings in the business cycle. The number of credits generated Economic Development Spending by Type FY 2006- 07 Support Programs $ 62 mil 5% Direct Incentives $ 1,229.3 mil 95% Total: $ 1.3 billion FRD Economic Development Inventory 4 January 2008 in 2006 was 12 percent less than in 2002. Appendix C provides detailed data on the number of credits generated and taken, and the dollar amounts generated and taken since FY 2002- 03. In addition to Bill Lee Act or Article 3J credits, there are many other tax relief efforts targeting businesses and industries. All other tax relief efforts outside the Bill Lee Act credits are referred to as other tax incentive expenditures in this report. While there are many tax expenditures written into the General Statutes, some have been targeted specifically to businesses and industries. In FY 2007- 08, it is estimated that approximately $ 1.1 billion of a total $ 4.9 billion in tax expenditures had an economic development purpose. A tax expenditure with an economic development purpose is defined as a change to the tax code that directly reduces the tax liability of a particular business or industry. Tax changes that affect all taxpayers, both businesses and consumers, nonprofits, or are community service- based ( such as the Low- Income Housing tax credit) are not included as economic development tax incentive expenditures in this report. An example of a tax incentive that has an economic development purpose and is not a part of the Bill Lee Act incentives is the tax credit for North Carolina Research and Development ( G. S. 105- 129.55( a)), a credit allowed for qualifying research expenses. The Sales and Use tax incentives are the largest category of incentives identified as having an economic development purpose. They are estimated to be just under $ 500 million for FY 2007- 08. Appendix C provides additional detail on these tax incentive expenditures. Tax incentives reported here are estimates based on the Department of Revenue’s 2005 and 2007 Biennial Tax Expenditure Reports for 2005 and 2007, and the Department’s reports on the Bill Lee Act. For a variety of reasons including the availability of completed tax data and taxpayer confidentiality, some tax incentives cannot be estimated. As such, the economic development tax incentives data represents an estimation of the loss in revenue and not an actual accounting. General Fund Programs The General Fund Program section of the EDI includes data for economic development incentive programs that receive General Fund appropriations. Summary data is shown at the appropriation level, not the expenditure level, because many direct incentives programs provide grants that may be paid out over several years, causing expenditures to seem artificially low in any given year. Appendix D provides additional detail on all of the General Fund economic development programs. Department of Commerce. The Department of Commerce is the primary agency for economic development in the State. Commerce administers most direct incentives programs and provides most business support services ( except for workforce training). In addition, most State aid to non- profits for economic development programs goes through Commerce. In FY 2007- 08, the General Assembly appropriated a total of $ 97,558,980 to Commerce for economic development incentives and support. Commerce currently administers nine direct incentives programs, five of which received appropriations in FY 2007- 08. The largest of these are the Job Development Investment Grant ( JDIG), and the One North Carolina Fund. These two programs received 81% ($ 26.4 million) of the $ 32.5 million appropriated to direct incentive programs in FY 2007- 08. Other direct incentives programs were created with one- time appropriations that have carried forward from year to year as grants are awarded. For example, the General Assembly appropriated $ 24 million in FY 2003- 04 for the Site Infrastructure Grant. A grant agreement is currently being negotiated, but no expenditures are anticipated until 2009. In addition to direct incentives programs, the General Assembly appropriated $ 65 million to Commerce for economic development incentives support programs in FY 2007- 08. $ 56.4 million of this represents State aid to non- State entities that have an economic development purpose: $ 20 million for the NC Rural FRD Economic Development Inventory 5 January 2008 Economic Development Center, $ 15 million to the NC Biotechnology Center, $ 6.7 million to the Regional Economic Development Commissions, and $ 14 million to various other non- State programs. The remainder ( about $ 8.6) million is used by Commerce to administer the nine direct incentives programs and to provide various support services to business and industry. More detailed information on these programs may be found in Appendix D. Higher Education. An educated and skilled workforce is one of the key attributes that attracts businesses to locate and invest in a certain area. Consequently, the State’s total investment in education promotes economic development. However, this inventory highlights only those education programs that either directly benefit certain companies that the State seeks to attract or retain, or provide support to businesses through technical assistance and research. In FY 2007- 08, the General Assembly appropriated $ 12.7 million for three NC Community College System ( NCCCS) programs specifically designed to help entice certain companies to locate, expand, or remain in North Carolina: Customized Industry Training ( CIT), Focused Industrial Training ( FIT), and New and Expanding Industry Training ( NEIT). Each targeting different types of businesses, these programs provide funding to support assessment and specialized training for specific companies. NCCCS also received $ 8.7 million in FY 2007- 08 for four programs focused on providing technical assistance in specific industry sectors. The Hosiery Technology Center and the Textile Center offer product testing, research and development, and industry- specific training. The NC Military Business Center seeks to connect North Carolina businesses and individuals with military contracting and other defense- related business opportunities. Through counseling, referrals, information, and training, the Small Business Center Network promotes the development of small businesses within the state. As the State’s lead agency for providing workforce development training ( G. S. 115D- 1.1), all NCCCS institutions offer occupational continuing education courses. These courses provide individuals the opportunity to upgrade existing knowledge and develop new skills. While these courses indirectly benefit North Carolina businesses by developing a more educated workforce, they are not included in this inventory since they are open to the general public and are not provided directly to businesses. The Board of Governors for the University of North Carolina system ( UNC) has made economic development one of its six strategic priorities. The Board and the UNC System President have created an Economic Transformation Council with members appointed from each campus to carry out the campus response to the economic development strategic priority. The President is also advised on economic issues by an Associate Vice President for Economic Development Research, Policy and Planning. In FY 2007- 08, the General Assembly appropriated $ 14.4 million to UNC for three statewide economic development support programs: the North Carolina Cooperative Extension Service, the Industrial Extension Service, and Small Business Technology Development Centers. An additional $ 2.1 million was appropriated for various campus initiated programs such as the Ben Craig Center at UNC- Charlotte. Transportation Programs There is a close relationship between the strength of a region’s transportation infrastructure and its economic development potential. In addition to transportation projects that aid individual industries or companies, the network of highways and other transportation infrastructure aid the State’s overall economic development by tying North Carolina to the national and global economy. The overall transportation network allows firms within the State to more easily source materials from around world and to market their products aggressively. An inadequate transportation system creates bottlenecks that limit cost savings and inhibit growth. FRD Economic Development Inventory 6 January 2008 Transportation infrastructure projects do not guarantee that economic development will occur but they support economic development by lowering costs, saving time, and increasing reliability for users of the transportation network. Cost savings include: • Gathering raw materials and supplies; • Delivering products to customers; • Assembling employees; • Maintaining contact with customers and suppliers. The North Carolina Department of Transportation has several programs explicitly created to encourage and support economic development. The Department works with State and local economic development agencies and can commit significant resources in aid of major industrial recruiting projects. On a smaller scale the Department has programs to support individual industries or industrial parks ( e. g. turn lanes to improve truck access, better signals to improve traffic flow for employees, etc.) The Department also has programs to improve rail infrastructure. Information about specific transportation programs may be found in Appendix E. For additional information, please contact: Barry Boardman or Kristine Leggett Fiscal Research Division NC General Assembly 300 N. Salisbury St., Room 619 Raleigh, North Carolina 27603- 5925 ( 919) 733- 4910 barryb@ ncleg. net kristineL@ ncleg. net Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx AA GGlloossssaarryy FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] FRD Economic Development Inventory January 2008 Glossary of Frequently Used Fiscal Terms APPROPRIATION: An action by the General Assembly authorizing withdrawal of funds from the state treasury pursuant to Article V, Section 7 of the North Carolina Constitution. AVAILABILITY: The sum of the beginning General Fund Unreserved Fund Balance and General Fund revenues for a fiscal period. BILL LEE ACT: The William S. Lee Quality Jobs and Expansion Act provides for tax credits available to eligible companies expanding or relocating in North Carolina that hire within the North Carolina workforce to fill positions. Bill Lee was rewritten in 2005 – tax credits in the revised version are often referred to as 3J credits. CARRYFORWARD: Funds appropriated but unspent in the first fiscal year of a biennium which by authorized budget revision are brought forward for expenditure in the second fiscal year of the same biennium. DIRECT INCENTIVE: A spending program that provides funds either directly to a company; or to a local government for a specific company or project. They generally take the form of tax expenditures, direct appropriations, or grants. FULL- TIME EQUIVALENT ( FTE): The figure arrived at by converting an unduplicated head- count of full- time and part- time employees to an equivalent full- time count. GENERAL FUND: A pool of financial resources made up of a beginning credit balance, State tax revenues, and State non- tax revenues. These monies are appropriated for both the operation of State agencies and construction and renovation of State facilities. HIGHWAY FUND: The special fund to which revenues are deposited that are designated for transportation- related operations and capital improvements. NON- RECURRING: Term used to denote one- time revenues ( windfalls, reversions) or one-time expenditures ( grant- in- aid, capital). RECURRING: Term used to denote revenues or expenditures that will be continuing, such as sales and personal income taxes, or salaries, fringe benefits, utilities. REVERSIONS: Unspent appropriations returned to the General Fund or Highway Fund ( as applicable) at the end of each fiscal year. STATE AID FOR NON- STATE ENTITIES: Funds appropriated by the General Assembly to nongovernmental entities for a variety of purposes. Funds may or may not carry restrictions on expenditures. 7 FRD Economic Development Inventory January 2008 SUPPORT PROGRAM: A program that provides services to businesses in the State, usually to help the business improve efficiency, increase technology, or add jobs. Support programs may also take the form of State aid to non- State entities which in turn provide services or incentives to businesses. TAX EXPENDITURE: A reduction in the amount of tax revenue which would otherwise be collected from the taxpayer. These tax provisions may be viewed as spending programs conducted through the tax system. Tax expenditures take the following forms: • Exclusions, exemptions, deductions, and caps, which reduce taxable income; • Credits and refunds, which are subtracted from the taxes “ normally” due; • Preferential tax rates, which apply lower rates than would ordinarily apply. TAX INCENTIVE: A type of tax expenditure used to provide additional incentive for businesses to locate in the State, or to encourage the expansion of already established firms. 8 Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx BB SSuummaarryy CChhaarrttss FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] FY 02- 03 FY 03- 04 FY 04- 05 FY 05- 06 FY 06- 07 FY 07- 08 FY 08- 09 UNC Support $ 9,596,763 $ 11,704,378 $ 12,618,706 $ 14,576,476 $ 15,032,844 $ 16,582,873 $ 15,942,291 Direct $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 UNC Subtotal $ 9,596,763 $ 11,704,378 $ 12,618,706 $ 14,576,476 $ 15,032,844 $ 16,582,873 $ 15,942,291 NCCCS Support $ 5,388,598 $ 5,755,885 $ 8,153,963 $ 7,168,434 $ 8,253,283 $ 8,718,855 $ 8,618,855 Direct $ 7,990,573 $ 7,995,158 $ 9,993,012 $ 12,618,012 $ 12,743,012 $ 12,743,012 $ 12,743,012 NCCCS Subtotal $ 13,379,171 $ 13,751,043 $ 18,146,975 $ 19,786,446 $ 20,996,295 $ 21,461,867 $ 21,361,867 Commerce Support $ 5,921,160 $ 7,889,194 $ 7,840,415 $ 8,388,348 $ 8,732,196 $ 8,563,876 $ 8,277,281 Support ( Non- State) $ 12,533,974 $ 16,083,358 $ 21,284,890 $ 41,144,997 $ 30,044,997 $ 54,094,997 $ 28,581,247 Direct $ 569,713 $ 44,320,107 $ 5,820,107 $ 16,320,107 $ 42,720,107 $ 32,550,107 $ 5,320,107 Commerce Subtotal $ 19,024,847 $ 68,292,659 $ 34,945,412 $ 65,853,452 $ 81,497,300 $ 95,208,980 $ 42,178,635 Total General Fund Appropriations $ 42,000,781 $ 93,748,080 $ 65,711,093 $ 100,216,374 $ 117,526,439 $ 133,253,720 $ 79,482,793 Total Transportation $ 15,444,532 $ 20,567,821 $ 36,657,013 $ 58,689,606 $ 67,482,580 $ 37,000,000 $ 22,000,000 Bill Lee Incentives ( Taken) $ 74,196,701 $ 79,334,636 $ 66,446,464 $ 90,515,214 $ 93,763,666 Other Tax Incentives $ 1,006,800,000 $ 1,012,600,000 $ 1,058,200,000 Total Economic Development Spending $ 1,256,221,194 $ 1,291,372,685 $ 1,228,453,720 FY 02- 03 FY 03- 04 FY 04- 05 FY 05- 06 FY 06- 07 FY 07- 08 FY 08- 09 Direct, General Fund $ 8,560,286 $ 52,315,265 $ 15,813,119 $ 28,938,119 $ 55,463,119 $ 45,293,119 $ 18,063,119 Direct, Transportation $ 15,444,532 $ 20,567,821 $ 36,657,013 $ 58,689,606 $ 67,482,580 $ 37,000,000 $ 22,000,000 Direct, Bill Lee Act $ 74,196,701 $ 79,334,636 $ 66,446,464 $ 90,515,214 $ 93,763,666 Direct, Other Tax Incentives $ 1,006,800,000 $ 1,012,600,000 $ 1,058,200,000 Subtotal Direct $ 98,201,519 $ 152,217,722 $ 118,916,596 $ 1,184,942,939 $ 1,229,309,365 $ 1,140,493,119 $ 40,063,119 Support, General Fund $ 33,440,495 $ 41,432,815 $ 49,897,974 $ 71,278,255 $ 62,063,320 $ 87,960,601 $ 61,419,674 Total Support $ 33,440,495 $ 41,432,815 $ 49,897,974 $ 71,278,255 $ 62,063,320 $ 87,960,601 $ 61,419,674 Total Economic Development Spending $ 1,256,221,194 $ 1,291,372,685 $ 1,228,453,720 $ 101,482,793 Economic Development by Type Economic Development by Fund Source Data Not Available Data Not Available FRD Economic Development Inventory 9 January 2008 FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx CC TTaaxx IInncceennttiivveess FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Year1 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Credits Generated $ 198,385,012 $ 175,543,475 $ 167,895,925 $ 207,160,014 $ 174,459,922 $ -$ - Credits Taken $ 74,196,701 $ 79,334,636 $ 66,446,464 $ 90,515,214 $ 93,763,666 $ -$ - 1. Assumes that credits are generated and taken in the second half of the calendar year for the purpose of fiscal year calculations. General Statute Authorization: G. S. 105 Article 3A Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Total Credits ( a single taxpayer may take multiple credits) Generated 603 616 520 646 711 Taken 2,328 1,778 1,675 1,812 1,659 Tax Credits Eligibility: The taxpayer must satisfy all general eligibility requirements in order to qualify for any of the credits listed in Section III, except the credit for development zone projects. If a taxpayer is uncertain about its eligibility for a credit, the taxpayer may request specific advice in writing from the Secretary of Revenue. Eligible recipients must be an eligible business type and meet the wage standard for the credit. In addition, businesses must provide health insurance for employees, have good environmental and Occupational Safety and Health Act ( OSHA) records, and have no overdue tax debts. Article 3A only allows credits for certain kinds of businesses as described in G. S. 105- 129.2. Tax Incentives WILLIAM S LEE ACT ( ARTICLE 3A) Enacted in 1996, and revised many times since, the William S. Lee Act ( Bill Lee) provides tax credits that may be taken against State income, franchise, or gross premiums tax. The credits are for job creation, investment, worker training, and research & development. The level of tax credit allowed is determined by the county's economic well- being in which the economic activity is taking place. This act was replaced by Article 3J beginning in the 2007 tax year. FRD Economic Development Inventory 10 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 071 2007- 08 2008- 09 Corporate Income Tax $ 156.3 $ 140.8 $ 114.2 Franchise Tax $ 203.2 $ 168.2 $ 133.2 Sales Tax $ 473.1 $ 486.9 $ 496.1 Business & Energy Tax Credits ( Art. 3B) $ 29.7 $ 28.1 $ 26.5 Recycling Incentives ( Art. C) 2 $ 0.0 $ 0.0 $ 0.0 Research and Development Credits ( Art. 3F) $ 12.5 $ 21.5 $ 28.5 Major Computing Facilities ( Art. 3G) NA $ 2.0 $ 10.0 Railroad Intermodal Facilities ( Art. 3K) NA NA $ 0.2 Tax Credits for Growing Businesses ( Art. 3J) $ 0.0 $ 0.0 $ 69.1 Personal Income $ 7.7 $ 8.8 $ 8.8 Insurance companies $ 124.3 $ 156.3 $ 162.6 Piped Gas: Preferential rates $ 0.0 $ 0.0 $ 9.0 Total $ 1,006.8 $ 1,012.7 $ 1,058.2 Source: NCDOR Biennial Tax Expenditure Report, 2005 and 2007. 1. Estimated using linear interpolation, tax revenue growth rates, and industry employment statistics 2. Included with Corporate Tax for taxpayer confidentiality Expenditures ( In millions) Tax Incentives Other Tax Incentives: Tax Expenditures A tax expenditure is an exemption, deduction, credit, refund, cap, or preferential tax rate that reduces the amount of tax revenue which would otherwise be collected from the taxpayer. The tax expenditures included in this report are ones that directly reduce the tax liability of a particular business or industry. Tax expenditures that affect both businesses plus consumers, nonprofits, or are community service- based are not included. FRD Economic Development Inventory 11 January 2008 FY 2005- 06 FY 2006- 072 FY 2007- 08 Corporate Tax Double- Weighting Sales Apportionment 49.8 55.7 58.4 Holding Companies* - - - Recycling Facilities* - - - NC Ports 0.6 0.6 0.6 S& L Fees Credit 0.2 0.2 0.2 Poultry Composting 0.1 0.1 0.1 Oyster Shell Recycling - 0.1 0.1 Cigarette Exportation* - - - Film Industry Production 5.4 4 1 Qualified Investments 0.1 0.1 0 Combined for Confidentiality* 100.1 80 53.8 Corporate Tax Subtotal 156.3 140.8 114.2 Franchise Tax Double- Weighting Sales for Capital Stock 3.2 3.2 3.2 Caps for Holding- Companies 200 165 130 Franchise Tax Subtotal 203.2 168.2 133.2 Business & Energy Tax Credits ( Art. 3B) 29.7 28.1 26.5 Recycling Incentives ( Art. C)* Research and Development Credits ( Art. 3F) 12.5 21.5 28.5 Major Computing Facilities ( Art. 3G) - 2 10 Railroad Intermodal Facilities ( Art. 3K) - - 0.2 Personal Income Poultry Composting 0.1 0.1 0.1 Farm Equipment Credit 1.5 1.5 1.5 Qualified Business Investment 6 7 7 NC Ports 0.1 0.1 0.1 recycling Oyster Shells - 0.1 0.1 Personal Income Subtotal 7.7 8.8 8.8 Sales & Use Tax1 Out- of State Call Centers 14.1 14.1 14.1 Sales to Farmers 189.8 169.2 148.5 Communications Equipment** 14.1 31.1 44.5 Commercial Fishing 1.5 1.5 1.6 Laundries & Dry- cleaning 1 1.3 1.7 Diesel Fuel for Railroads 17 17 17 Packaging Costs for Mfg., producers, retailers 52.9 57.3 61.7 Bakery, thrift bread sales 0 0 0.1 Newspaper Ad Supplements 4 4.1 4.3 Other Tax Incentives: Tax Expenditure Details FY 2005- 06 through FY 2007- 08 12 FY 2005- 06 FY 2006- 072 FY 2007- 08 Other Tax Incentives: Tax Expenditure Details FY 2005- 06 through FY 2007- 08 Custom Computer Software 5 7.8 9.6 Commercial Aircraft 4 4 4 Data Center electricity and eligible property 0 0 1.8 Refunds to Eligible Businesses 0.5 0.5 0.5 Aviation Fuels Cap 5 4 3 Preferential Rates to industries 20.6 25 29.3 Mill machinery, etc. ( Art. 5F) 143.6 150.0 154.4 Sales & Use Tax Subtotal 473.1 486.9 496.1 Insurance companies 124.3 156.3 162.6 Piped Gas: Preferential rates for Mfg. And Farmers 0 0 9 * Data combined due to taxpayer confidentiality requirements. ** 2005 includes $ 10 million for cable equipment, unavailable in the 2005 report 1. Excludes tax expenditures for non- profits 2. Estimated using linear interpolation, tax revenue growth rates, and industry employment growth statistics 13 Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx DD GGeenneerraall FFuunndd PPrrooggrraamss FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,329,469 $ 2,424,925 $ 2,459,731 $ 2,434,724 $ 2,503,188 $ 2,503,188 $ 2,503,188 Receipts $ 288,881 $ 287,073 $ 210,980 $ 225,879 $ 244,943 $ 244,943 $ 244,943 Total $ 2,618,350 $ 2,711,998 $ 2,670,711 $ 2,660,603 $ 2,748,131 $ 2,748,131 $ 2,748,131 Positions ( FTE) 11.00 11.00 11.00 11.00 11.00 11.00 11.00 General Statute Authorization: 143B- 428 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Companies Assisted 261 234 264 272 301 Est. Value of Trade* $ 35,347,851 $ 45,635,063 $ 63,029,776 $ 129,204,002 $ 186,765,839 * Amounts shown are estimates by individual businesses assisted by International Trade of the total value of their exports/ imports. Budget and Expenditures Eligibility: Any North Carolina company can utilize the services provided by the International Trade Division. Department of Commerce Office of International Trade The International Trade Division provides expert assistance to North Carolina businesses looking to develop markets for their products overseas. Division employees help these companies make contacts and tap into resources to make the most of global business opportunities. The Division operates two domestic offices in Raleigh and High Point, and six international offices in Canada, Mexico, Germany, China, Korea, and Japan. Services provided by the division include preparing marketing plans, handling export operations, market research, advice on finance and insurance, and working to find customers and partners. Budgeted FRD Economic Development Inventory 14 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 375,000 $ 797,898 $ 797,898 $ 597,898 $ 297,898 Receipts Total $ - $ - $ 375,000 $ 797,898 $ 797,898 $ 597,898 $ 297,898 Positions ( FTE) 1.00 1.00 1.00 1.00 General Statute Authorization: NA Key Statistics: No relevant information to report. Budget and Expenditures Budgeted Eligibility: Anyone can access information on EDIS through the Department of Commerce website. Department of Commerce Economic Development Information System ( EDIS) Initially funded in FY 2004- 05, the Economic Development Intelligence System ( EDIS) is a web- based database system that provides users with access to a wide variety of analytical, statistical, and mapping tools to support strategic economic development activities and research. Companies seeking information about the State can search for business locations, find demographic data, create maps, and locate local support industries. It is anticipated that EDIS will be fully operational by November, 2007. FRD Economic Development Inventory 15 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,475,169 $ 1,548,365 $ 1,536,240 $ 1,605,287 $ 1,646,509 $ 1,738,956 $ 1,738,956 Receipts Total $ 1,475,169 $ 1,548,365 $ 1,536,240 $ 1,605,287 $ 1,646,509 $ 1,738,956 $ 1,738,956 Positions ( FTE) 19.75 19.75 19.75 19.75 19.75 21.75 21.75 General Statute Authorization: Key Statistics: 2002 2003 2004 2005 2006 Existing Industry Calls 2,766 2,897 2,410 2,099 2,245 Project Assignments 234 266 234 233 250 Eligibility: Anyone operating an existing business in North Carolina or seeking to locate a business in North Carolina may use the services offered by the Regional Offices. Regional Offices The Department of Commerce operates nine regional offices throughout the State to assist existing industry and to help attract new industry. Existing Industry Specialists call on existing companies to spot opportunities and problems in their early stages and to assist in issue resolution. Economic Developers work collaboratively with the Regional Economic Development Commissions to market the regions and to assist prospects. Offices are located in Greenville ( Eastern Region), Edenton ( Northeastern Region), Raleigh ( Research Triangle Region), Greensboro ( Piedmont Triad Region), Charlotte ( Charlotte Region), and Bryson City, Boone, and Fletcher ( Western Region). Calendar Year Budget and Expenditures Budgeted Department of Commerce FRD Economic Development Inventory 16 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,619,543 $ 3,483,854 $ 2,510,898 $ 2,575,175 $ 2,725,563 $ 2,665,869 $ 2,678,811 Receipts $ 1,037,898 $ 343,583 $ 381,829 $ 431,829 $ 368,733 $ 470,179 $ 470,179 Total $ 2,657,441 $ 3,827,437 $ 2,892,727 $ 3,007,004 $ 3,094,296 $ 3,136,048 $ 3,148,990 Positions ( FTE) 8.00 8.00 8.00 7.00 7.00 7.00 7.00 General Statute Authorization: 143B- 437.011 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Bus. & Industry Flights 71 73 74 83 70 Budget and Expenditures Executive Aircraft The Executive Aircraft Division provides air transportation for the Department for economic development and for use by State officials. The Division maintains two planes and one helicopter to provide transportation service to prospective businesses considering locations in the State. Eligibility: Executive Aircraft may be used by the Department or other State officials. Priority is given to the Business & Industry Division for economic development purposes. Budgeted Department of Commerce FRD Economic Development Inventory 17 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 533,500 $ 525,000 $ 525,000 $ 525,000 $ 525,000 Receipts Total $ 533,500 $ 525,000 $ 525,000 $ 525,000 $ 525,000 Positions ( FTE) 8.00 8.00 8.00 8.00 8.00 General Statute Authorization: 143B- 431( e); 143B- 432.1 Key Statistics: 2004- 05 2005- 06 2006- 07 Clients Served* 17,015 35,918 34,644 * Unduplicated headcount Department of Commerce Budgeted Business ServiCenter Transferred to the Department of Commerce in FY 2004- 05, the Business ServiCenter provides one- stop shopping to both entrepreneurs and small businesses. The ServiCenter provides businesses with information about existing programs and resources for small businesses, license requirements, and government contracts. Budget and Expenditures Eligibility: Anyone is eligible to use the Business ServiCenter. FRD Economic Development Inventory 18 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 390,135 $ 427,913 $ 414,910 $ 447,424 $ 532,664 $ 528,782 $ 529,245 Receipts Total $ 390,135 $ 427,913 $ 414,910 $ 447,424 $ 532,664 $ 528,782 $ 529,245 Positions ( FTE) 6.00 6.00 6.00 6.00 6.00 6.00 6.00 General Statute Authorization: G. S. 143B- 437, G. S. 143B- 437.01- 2, 143B- 437.07- 8, 143B- 437.50- 63, 143B- 437.70- 74 Key Statistics: No relevant information to report. Budgeted Budget and Expenditures Eligibility: NA Department of Commerce Commerce Finance The Commerce Finance Center oversees most economic development incentives programs administered by the Department of Commerce. They are responsible for the administration of One NC, Industrial Development Fund ( IDF), Industrial Revenue Bonds, Job Development Investment Grants ( JDIG), Site Infrastructure Grants, Green Business Fund, and the Job Maintenance and Capital Development Fund. In addition, Commerce Finance is responsible for tracking, maintaining, and analyzing incentive data over time. FRD Economic Development Inventory 19 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 106,844 $ 4,137 $ 10,136 $ 2,840 $ 1,374 $ 4,183$ 4,183 Receipts* $ 45,000 Total $ 151,844 $ 4,137 $ 10,136 $ 2,840 $ 1,374 $ 4,183$ 4,183 * Receipts in FY 02- 03 were from the NC Economic Development Association. General Statute Authorization: G. S. 143B- 434, 143B- 434.01, 143B- 437.03 Key Statistics: No relevant information to report. Eligibility: NA Department of Commerce Economic Development Board Created in 1977, the Economic Development Board is charged with oversight of State economic development, research, and planning and makes policy recommendations to the Secretary of Commerce, the Governor and the General Assembly. The Board is comprised of 37 people, including State government officials, citizens, and members of the General Assembly. Budget and Expenditures Budgeted FRD Economic Development Inventory 20 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 12,172,155 $ 8,555,293 $ 7,428,631 $ 5,169,577 $ 5,894,227 $ 4,953,792 $ 1,509,234 Appropriation $ 569,713 $ 320,107 $ 320,107 $ 320,107 $ 320,107 $ 320,107 $ 320,107 Receipts* $ 756,024 $ 472,531 $ 677,366 $ 781,669 $ 164,515 $ 821,693 $ 821,693 Subtotal Available Funds $ 13,497,892 $ 9,347,931 $ 8,426,104 $ 6,271,353 $ 6,378,849 $ 6,095,592 $ 2,651,034 Grant Payments $ 1,763,727 $ 682,362 $ 268,180 $ 377,126 $ 1,425,057 $ 4,316,569 $ 4,316,569 Loans Awarded $ 175,000 $ 67,500 $ 100,000 $ 100,000 Subtotal Expenditures $ 1,938,727 $ 749,862 $ 268,180 $ 377,126 $ 1,425,057 $ 4,416,569 $ 4,416,569 Legislative Adjustments $ ( 3,003,872) $ ( 1,169,438) $ ( 2,988,347) $ ( 169,789) Total EOY Availability $ 8,555,293 $ 7,428,631 $ 5,169,577 $ 5,894,227 $ 4,953,792 $ 1,509,234 $ ( 1,765,535) * Receipts are primarily interest earned on loans or loan principal repayments. General Statute Authorization: G. S. 143B- 437.01 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Number of Awards 6 5 4 7 4 Total Grants Awarded $ 1,065,000 $ 294,052 $ 800,000 $ 1,850,838 $ 123,079 Total Loans Awarded $ 242,500 $ 100,000 $ 0 $ 0 $ 0 Average Award Amt $ 217,917 $ 78,810 $ 200,000 $ 264,405 $ 30,770 Budget and Expenditures Eligibility: Projects must be located in Tier I or Tier II counties. Funding is limited to the lower of $ 500,000 per project or $ 5,000 per job created. Projects in Tier II counties require a 25% match by the local government. Eligible industries are the same as those for Article 3J tax credits: company headquarters, air courier services, information technology and services, manufacturing, and warehousing or wholesale trade. Department of Commerce Industrial Development Fund Created in 1989, the Industrial Development Fund ( IDF) assists town, city, or county governments with incentive industrial financing for eligible industries in Tier I or II areas. Grants may be awarded for improved public infrastructure, and loans are available for building renovations or equipment purchases. Budgeted FRD Economic Development Inventory 21 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 18,900,000 $ 1,800,966 $ 35,045,454 $ 32,372,182 $ 33,654,932 $ 43,728,432 Appropriation $ 20,000,000 $ 1,000,000 $ 6,000,000 $ 15,000,000 $ 14,000,000 Receipts* $ 75,000 $ 75,000 $ 75,000 Subtotal Available Funds $ 18,975,000 $ 21,875,966 $ 36,045,454 $ 38,447,182 $ 48,654,932 $ 57,728,432 Administration $ 300,000 $ 300,000 $ 300,000 $ 300,000 $ 300,000 $ 300,000 Grant Payments $ 910,534 $ 1,657,978 $ 2,373,272 $ 3,492,250 $ 3,626,500 Transfer to JWU $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 Transfer to DENR $ 650,000 Subtotal Expenditures $ 1,210,534 $ 2,957,978 $ 3,673,272 $ 4,792,250 $ 4,926,500 $ 950,000 Total EOY Availability $ 17,764,466 $ 18,917,988 $ 32,372,182 $ 33,654,932 $ 43,728,432 $ 56,778,432 * Receipts are repaid grants from recipients who have defaulted on their grant agreement. General Statute Authorization: G. S. 143B Article 10, Part 2H ( G. S. 143B- 437.70- 75) Key Statistics: 2002 2003 2004 2005 2006 Number of Awards 29 28 44 56 58 Total Grants Awarded $ 7,686,706 $ 4,188,000 $ 10,249,575 $ 9,231,750 $ 15,148,500 Average Award Amt $ 265,059 $ 149,571 $ 232,945 $ 164,853 $ 261,181 Budgeted Eligibility: Grants may be used for installation or purchase of equipment, structural repairs, improvements, or renovations to existing buildings, construction of utility infrastructure for existing or proposed buildings or for any other purpose specifically authorized by the General Assembly. Funds are disbursed in accordance with a schedule established in the agreement, usually in four equal installments. Eligible recipients must create new jobs, and a local match is required. Department of Commerce One North Carolina Fund Created in 1993, the One North Carolina Fund ( originally called the Governor's Industrial Recruitment Competitiveness Fund) provides grants to local governments to help recruit new and expanding businesses to create quality jobs in certain industries. Budget and Expenditures FRD Economic Development Inventory 22 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 478,158 $ 2,860,513 Appropriation $ 1,000,000 $ 5,000,000 $ 4,830,000 Subtotal Available Funds $ 1,000,000 $ 5,478,158 $ 7,690,513 Grant Payments* $ 521,842 $ 2,617,645 Subtotal Expenditures $ 521,842 $ 2,617,645 Total EOY Availability $ 478,158 $ 2,860,513 $ 7,690,513 * 75% of grant awards are paid upon award. The remaining 25% is paid after program performance/ completion criteria are met. General Statute Authorization: G. S. 143B Article 10, Part 2I ( G. S. 143B- 437.80- 83) Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # Grants Awarded 25 51 Total Grant Amount $ 1,078,100 $ 4,533,955 Average Grant Amt $ 43,124 $ 88,901 Budgeted Budget and Expenditures Eligibility: North Carolina based businesses that have received a SBIR/ STTR Phase I award from a federal agency are eligible for the grants. Businesses must certify that at least 51% of the research described in the federal SBIR/ STTR Phase II proposal will be conducted in the State and that the business will reamin a North Carolina- based business for the duration of the Phase II project. Department of Commerce One North Carolina Small Business Fund The General Assembly created the One North Carolina Small Business Fund in 2005 to provide matching funds of up to $ 100,000 to businesses that have been awarded federal Small Business Innovation Research ( SBIR) and Small Business Technology Transfer ( STTR) grants. FRD Economic Development Inventory 23 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 3,089,931 $ 7,797,730 $ 16,061,083 Appropriation $ 4,500,000 $ 9,000,000 $ 12,400,000 $ 12,400,000 Subtotal Available Funds $ 4,500,000 $ 12,089,931 $ 20,197,730 $ 28,461,083 Grant Payments $ 920,531 $ 3,356,423 $ 3,146,433 $ 14,250,000 Transfer to Utility Account $ 489,538 $ 935,778 $ 990,214 $ 4,750,000 Subtotal Expenditures $ 1,410,069 $ 4,292,201 $ 4,136,647 $ 19,000,000 Balance $ 3,089,931 $ 7,797,730 $ 16,061,083 $ 9,461,083 General Statute Authorization: G. S. 143B Article 10, Part 2G ( G. S. 143B- 437.50- 63) Key Statistics: 2003 2004 2005 2006 # Grants Awarded 6 18 10 19 Total Grant Liability $ 39,360,658 $ 107,576,413 $ 50,965,000 $ 188,533,424 Average Grant Amt. $ 6,560,110 $ 5,976,467 $ 5,096,500 $ 9,922,812 Budgeted Eligibility: Eligible projects are those that create a minimum of 10 jobs in a Tier I area or 20 jobs in Tier II or III areas. Up to 25 businesses can receive grants lasting up to 12 years. The maximum annual liability cannot exceed $ 15 million ($ 30 million in 2006; $ 25 million in 2007). Grant awards can be anywhere from 10% to 75% of withholdings for eligible positions. Projects must result in a net increase in employment in the State - awards cannot be granted to companies relocating from one place to another with no increase in employment. All award agreements must contain clawback provisions in the event the company does not meet stated performance levels. Budget and Expenditures Job Development Investment Grant ( JDIG) Department of Commerce The Job Development Investment Grant ( JDIG) is a discretionary grant program created in 2002 to provide incentives to companies who would choose to locate elsewhere if the grant were unavailable. The program is set to expire January 1, 2010. Grants are awarded by the Economic Investment Committee ( EIC). FRD Economic Development Inventory 24 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 5,000,000 Total $ 5,000,000 General Statute Authorization: G. S. 143B- 437.11 Key Statistics: No relevant information to report. Budgeted Eligibility: This new fund will provide grants to existing businesses in Tier I counties that are making significant capital investments in the State and that employ and will conitnue to employ at least 2,000 people. Businesses must meet wage standard requirements and provide health insurance for employees in order to qualify. Performance requirements and clawback provisions will be included in all grant agreements. No more than 5 grants may be made, the total aggregate cost of which may not exceed $ 60 million. No single agreement may exceed an annual cost of $ 4 million, and grant periods may not extend beyond ten years. Department of Commerce Job Maintenance and Capital Development Fund Created in 2007 ( S. L. 2007- 552 Extra Session), the Job Maintenance and Capital Development Fund provides incentives to existing companies in Tier I counties that will be making significant capital investments in the State. This is the first direct incentive program created for existing businesses that does not require job creation. Budget and Expenditures FRD Economic Development Inventory 25 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,000,000 Total $ 1,000,000 Positions ( FTE) General Statute Authorization: G. S. 143B- 437.4- 8 Key Statistics: No relevant information to report. Budgeted Budget and Expenditures Eligibility: The Department of Commerce is in the process of developing guidelines for this program. Department of Commerce Green Business Fund Created in 2007, the Green Business Fund will proivde grants to private businesses, non- profits, and State agencies to encourage the growth of a green economy in the State. Grants will be used to encourage the development of the biofuels and green building industries, and to leverage investments in additional clean technology and renewable energy products and businesses. FRD Economic Development Inventory 26 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 Appropriation $ 24,000,000 Subtotal Available Funds $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 Grant Payments Subtotal Expenditures Balance $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 General Statute Authorization: G. S. 143B-- 437.02 Key Statistics: No relevant information to report. Budgeted Eligibility: Eligible businesses must invest at least $ 100 million of private funds in the project and employ at least 100 new employees. Department of Commerce Site Infrastructure Grant The Site Infrastructure Grant was created in the 2003 Extra Session to provide grants or forgivable loans to businesses, governmental units, or non- profits to acquire or improve land for industrial purposes. Budget and Expenditures FRD Economic Development Inventory 27 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 842,910 $ 199,412 $ 110,315 $ 642,450 $ 1,603,176 $ 2,474,513 $ 2,131,043 Appropriation Transfer from JDIG NA NA $ 489,538 $ 935,778 $ 990,214 $ 937,007 $ 937,007 Receipts* $ 11,617 $ 42,597 $ 42,598 $ 50,343 $ 42,597 $ 42,597 Subtotal Available Funds $ 854,527 $ 199,412 $ 642,450 $ 1,620,826 $ 2,643,733 $ 3,454,117 $ 3,110,647 Grants or Loans $ 655,115 $ 89,097 $ 17,650 $ 169,220 $ 1,323,074 $ 1,323,074 Subtotal Expenditures $ 655,115 $ 89,097 $ 17,650 $ 169,220 $ 1,323,074 $ 1,323,074 Total EOY Availability $ 199,412 $ 110,315 $ 642,450 $ 1,603,176 $ 2,474,513 $ 2,131,043 $ 1,787,573 * Receipts are primarily interest earned on loans or loan principal repayments. General Statute Authorization: G. S. 143B- 437.01( b1); G. S. 143B- 437.61 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # Grants Awarded 1 0 0 2 1 Total Grant Amount $ 121,768 $ 546,845 100,000 Budgeted Eligibility: Utility Account funds are limited to use for utility infrastructure only, and they must be expended to create jobs in either manufacturing and processing, warehousing and distribution, or data processing. The infratucture or utility must be located on the site of the building or, if not located on the site, shall be directly related to the operation of the specific industrial activity. There is no maximum funding amount or job creation requirement. Department of Commerce Utility Account The Utility Account provides grants to local governments in Tier I and Tier II counties for the construction of or improvements to new or existing water, sewer, gas, telecommunications, high- spreed broadband, electrical utility distribution lines or equipment, or transportation infrastructure for existing or new or proposed industrial buildings to be used for eligible industrial operations. Funding is currently provided from JDIG grants to companies located in Tier III counties. 25% of these grants must be paid to the Utility Account. Budget and Expenditures FRD Economic Development Inventory 28 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 10,000,000 Appropriation $ 10,000,000 Subtotal Available Funds $ 10,000,000 $ 10,000,000 Grant Payments Subtotal Expenditures Balance $ 10,000,000 $ 10,000,000 General Statute Authorization: G. S. 143B-- 437.02 Key Statistics: Eleven government and non- profit entities recieved grants in two categories – economic development projects and site acquisition and infrastructure. The maximum funding available for individual economic development project grants was $ 500,000 per project. The maximum funding for individual site acquisition and infrastructure grants was $ 5 million per project. Budgeted Eligibility: Local governments and non- profits were eligible to apply for the grants. Department of Commerce Economic Development Reserve The General Assembly established the Economic Development Reserve in FY 2006- 07 to provide a source of funding for governments and nonprofits seeking to implement local economic development projects or acquire land for economic development purposes. Budget and Expenditures FRD Economic Development Inventory 29 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 5,830,000 $ 6,775,000 $ 8,525,000 $ 8,525,000 $ 6,775,000 $ 6,775,000$ 6,436,250 Total $ 5,830,000 $ 6,775,000 $ 8,525,000 $ 8,525,000 $ 6,775,000 $ 6,775,000 $ 6,436,250 General Statute Authorization: G. S. 158 Article 2 ( 158.8- 15) Budget and Expenditures Commerce - State Aid Regional Economic Development Commissions In FY 1993- 94, the General Assembly directed the Department of Commerce to develop a “ program for promoting the expansion of economic development efforts such that all counties in the State participate in and benefit from organized regional economic development activities [ and to] encourage county participation in public/ private partnerships for economic development through membership in regional economic development commissions” ( S. L. 1993- 769, Sec. 28.7). That year, three Regional Economic Development Commissions (“ Commissions”) were created in statute: NC's Southeast, NC's Northeast, and Advantage West. Three commissions had already been created by private partners: the Charlotte Regional Partnership, the Piedmont Triad Partnership, and the Research Triangle Regional Partnership. They began receiving State funding in FY 1994- 95. The seventh commission, originally called the Global Transpark but now named NC's Eastern Region, was created by the General Assembly in FY 1995- 96. FRD Economic Development Inventory 30 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 5,214,195 $ 5,792,708 $ 10,883,395 $ 12,083,395 $ 13,083,395 $ 15,583,395 $ 15,583,395 Total $ 5,214,195 $ 5,792,708 $ 10,883,395 $ 12,083,395 $ 13,083,395 $ 15,583,395 $ 15,583,395 Commerce - State Aid NC Biotechnology Center Created in FY 1984- 85, the NC Biotechnology Center is a private, non- profit organization whose mission is to support biotechnology research, development, and commercialization in the State. The Center administers several grant and loan programs, hosts conferences, collaborates with the community colleges on a workforce training initiative, and works with local community leaders to strengthen biotechnology throughout the State. Budget and Expenditures FRD Economic Development Inventory 31 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,294,779 $ 1,320,650 $ 1,337,495 $ 2,347,602 $ 1,847,602 $ 2,847,602 $ 2,847,602 Total $ 1,294,779 $ 1,320,650 $ 1,337,495 $ 2,347,602 $ 1,847,602 $ 2,847,602 $ 2,847,602 Commerce - State Aid NC Institute for Minority Economic Development Established in 1986, the Institute of Minority Economic Development ( the Institute) seeks to foster economic development within the State’s women and minority- owned business community through policy analysis, information and technical assistance, and resource expansion. The Institute concentrates its activities in the areas of business development, resource, data and information collection, and demonstration initiatives. Budget and Expenditures FRD Economic Development Inventory 32 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 NC Center for Automotive Research ( NCCAR) 1 $ 200,000 $ 7,500,000 $ 3,750,000 $ 3,500,000 Various Community Development Corporations $ 200,000 High Point Furniture Market2 $ 750,000 $ 1,750,000 $ 1,875,000 $ 875,000 Duplin Agribusiness Center $ 500,000 Gaston County Economic Development Commission $ 300,000 Kerr- Tar Regional Economic Development Commission $ 4,000,000 $ 2,175,000 Hoke County Regional Industrial Park $ 100,000 Johnson & Wales University ( JWU) 3 $ 2,000,000 Defense and Security Technology Accelerator4 $ 2,000,000 $ 1,500,000 Total Appropriation $ 200,000 $ 15,350,000 $ 5,500,000 $ 11,050,000 $ 875,000 Notes: 1. Formerly the Advance Vehicle Research Center ( AVRC) 2. $ 875,000 of the funds appropriated for the Furniture Market Authority in FY 2006- 07 was recurring. 3. JWU had previously received $ 4 million through the One NC fund. Their first direct appropriation occurred in FY 2007- 08.. 4. The $ 2 million appropriation in FY 2005- 06 was passed through the Community College budget. Budget and Expenditures Commerce - State Aid Other State Aid to Non- State Entities The following table lists most economic development funds provided to non- State entities on a non- recurring basis since FY 2004- 05 ( no funds were appropriated to programs other than those established within the Department of Commerce in FY 2002- 03 and FY 2003- 04). FRD Economic Development Inventory 33 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 144,000 $ 144,000 $ 144,000 $ 144,000 $ 144,000 Carryforward Total $ 144,000 $ 144,000 $ 144,000 $ 144,000 $ 144,000 General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. Budget and Expenditures Eligibility: The institute works with leaders in the State's 85 rural counties to develop workshops and community college- based grant programs to assist dislocated workers with business development training. The institute also provides grants to communities pursuing entrepreneurship as an economic development strategy. Commerce - State Aid Rural Economic Development Center - Institute for Rural Entrepreneurship The Institute for Rural Entrepreneurship works to stimulate and support the development of micro, small, and medium- size enterprises in North Carolina's 85 rural counties. The institute began in 2003 and receives funding from the State and the W. K. Kellogg Foundation. The figures below represent funding received via direct appropriation from the General Assembly. FRD Economic Development Inventory 34 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 Carryforward Total $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. Rural Economic Development Center - Microenterprise Loan Program Created in 1989, the Microenterprise Loan Program provides loans for the start- up or expansion of small businesses by individuals in rural areas who have sound ideas and do not qualify for bank loans. Note: State funding is provided to support the loan fund and operations of the loan fund. The Microenterprise Loan Fund receives funding from other entities as well. Budget and Expenditures Eligibility: Anyone who wishes to start or expand a small business in the 85 rural counties of North Carolina may apply. Specific emphasis is place on serving rural, low- income, female, and minority participants. Commerce - State Aid FRD Economic Development Inventory 35 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 3,800,000 Carryforward Total $ 3,800,000 General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. This program was created in 2007 as part of the Rural Economic Transition Program. Funding for this program comes from the State, Golden LEAF, and other funds at the Rural Center. The numbers below reflect the amount of funding provided by the State. Commerce - State Aid Rural Economic Development Center - Rural Economic Transition Program - Rural Venture Fund Budget and Expenditures Eligibility: Existing businesses with owner management experience that are located in Tier One counties. Eligible businesses must demonstrate growth potential and show that the owner would not receive equity or subordinated debt financing from other sources. FRD Economic Development Inventory 36 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,000,000 $ 2,500,000 $ 2,500,000 $ 13,700,000 $ 2,500,000 Carryforward Total $ 2,000,000 $ 2,500,000 $ 2,500,000 $ 13,700,000 $ 2,500,000 * The program began in 2004 but received FY 2003- 04 funding due to a budget surplus at the end of that fiscal year. General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. Eligibility: Units of local government, nonprofit organizations, or educational institutions located in one of North Carolina's 85 rural counties or a Tier One county. An applicant may be located outside of these areas so long as the project is located within the eligible areas. Budget and Expenditures Commerce - State Aid Rural Economic Development Center - Economic Infrastructure Program Research & Demonstration/ Economic Innovation Grants This program began in 2004 with the purpose of investing in major research and demonstration projects with the potential to stimulate business activity, job creation, and further public/ private investment in the State's 85 rural counties. FRD Economic Development Inventory 37 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 199,996 $ 192,834 $ 183,253 $ 114,466 $ 127,810 $ 147,326 Carryforward Total Expended $ 131,678 $ 177,424 $ 137,995 $ 78,962 Balance $ 68,318 $ 15,410 $ 45,258 $ 35,504 General Statute Authorization: Eligibility: East Carolina University Community Engagement Community Engagement is an active partnership between communities of eastern North Carolina and East Carolina University to develop, exchange, and apply knowledge, information, expertise, and resources for everyone's benefit. These resources include, but are not limited to faculty, staff, and students. Budget and Expenditures FRD Economic Development Inventory 38 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 75,000 $ 75,000 $ 78,750 $ 80,655 $ 86,705 $ 91,101 Carryforward Total $ 75,000 $ 75,000 $ 78,750 $ 80,655 $ 86,705 $ 91,101 Expended $ 75,000 $ 75,000 $ 78,750 $ 80,655 $ 86,705 General Statute Authorization: Budget and Expenditures Eligibility: Fayetteville State University Fayetteville Business Center The Mission of the Fayetteville Business Center is to promote economic development in the City of Fayetteville and the Murchison Road corridor by providing nurturing to entrepreneurs including business assistance in the growth and development of small business concerns. The FBC is a business incubator that began its formal operations on October 19, 2001. Budgeted FRD Economic Development Inventory 39 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 7,021,428 $ 6,898,207 $ 7,080,897 $ 7,816,589 $ 8,069,399 $ 8,631,444 $ 8,539,271 Carryforward Total $ 7,021,428 $ 6,898,207 $ 7,080,897 $ 7,816,589 $ 8,069,399 $ 8,631,444 $ 8,539,271 Expended $ 7,021,428 $ 6,898,207 $ 7,080,897 $ 7,816,589 $ 8,069,399 Balance General Statute Authorization: North Carolina State University/ North Carolina A & T State University NC Cooperative Extension Service Description: The North Carolina Cooperative Extension Service was established by the Smith- Lever Act on May 18, 1914. Cooperative Extension is supported by funding from all 100 county governments plus the Cherokee Reservation, the state government and the U. S. Department of Agriculture and through partnerships with other educational institutions, including North Carolina A& T State University, agencies and organizations. It is an educational partnership helping people put research- based knowledge to work for economic prosperity, environmental stewardship and an improved quality of life. Our educational programs focus upon: enhancing agricultural, forest and food systems; strengthening and sustaining families; developing responsible youth; building quality communities; and conserving and improving the environment and natural resources. Budget and Expenditures Budgeted Eligibility: NA Key Statistics: The following represent some selected economic benefits that were a direct result of Cooperative Extension Programs in 2006: By using Extension recommended practices, the diverse animal sectors gained $ 26.2 million, aquatic species ($ 2.3M); dairy producers ($ 2.5M); beef cattle producers ($ 13.3M); hog producers ($ 8.8M); the horse industry ($ 3.6M); and sheep and goat producers ($ 3.5M). Producers of field, fruit and vegetable crops implementing Extension recommended production and marketing practices increased their net income by over $ 90 million. The NC green industry increased income by $ 4.56 million using Extension programs. Finally, North Carolina 4- Hers saved their communities over $ 566,550 by performing community service projects, increasing their impact by over 32% from 2005. As a result of their 4- H project work, $ 543,572 was earned, and $ 429,613 was saved by 4- Hers. 4- Her’s received over $ 325,578 in scholarships to continue their education beyond high school. FRD Economic Development Inventory 40 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 121,200 $ 125,400 $ 126,729 $ 333,065 $ 849,719 $ 349,719 Carryforward Total $ 121,200 $ 125,400 $ 126,729 $ 333,065 $ 849,719 $ 349,719 Expended $ 121,200 $ 125,400 $ 126,729 $ 333,065 Balance General Statute Authorization: Key Statistics*: 2002- 03 2004 2005 2006 # of Jobs 200 370 200 Investment $ 25,000,000 $ 147,000,000 $ 65,000,000 Economic Development Partnership North Carolina State University Budget and Expenditures Eligibility: Industry, economic developers, and other agencies are eligible for EDP services . The Economic Development Partnership ( EDP) was created in 2003 to ally with Wake County Economic Development to transform high- tech research into well- paying jobs for the county. Since its inception, the EDP has expanded statewide its effort to serve as a portal to connect the unique resources of NC State University in order to enhance productivity and competitiveness of North Carolina’s existing and traditional industries as well as technology- based emerging companies. The EDP leverages university resources toward high priority industry clusters that are able to transform high- tech research into higher- skilled, higher- paying jobs and bring related corporate investment. The EDP works directly with industry, economic developers, the NC Department of Commerce, and other agencies to increase and retain jobs and investment in the state. * Nonwoven industry only Budgeted FRD Economic Development Inventory 41 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,888,243 $ 2,377,195 $ 3,333,306 $ 3,220,252 $ 3,573,270 $ 3,573,270 Carryforward Total $ 1,888,243 $ 2,377,195 $ 3,333,306 $ 3,220,252 $ 3,573,270 $ 3,573,270 Expended $ 1,888,243 $ 2,377,195 $ 3,333,306 $ 3,220,252 Balance General Statute Authorization: Key Statistics: No relevant information to report. Industrial Extension Service Created in 1955, the Industrial Extension Service ( IES) of NC State University helps small and mid sized manufacturers in the State apply innovative technologies and improve their product design, manufacturing processes and industrial management systems. IES provides direct engineering and technical assistance; continuing education in areas of product quality, manufacturing process, technology application; environmental assistance; and technical demonstrations, referrals and networking. North Carolina State University Budgeted Budget and Expenditures Eligibility: North Carolina manufacturers are eligible for service. FRD Economic Development Inventory 42 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,061,680 $ 2,003,254 $ 2,092,073 $ 2,089,491 $ 2,132,772 $ 2,217,495 $ 2,217,495 Carryforward Total $ 2,061,680 $ 2,003,254 $ 2,092,073 $ 2,089,491 $ 2,132,772 $ 2,217,495 $ 2,217,495 Expended $ 2,061,680 $ 2,003,254 $ 2,092,073 $ 2,089,491 $ 2,132,772 Balance General Statute Authorization: Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Clients Counseled 5,310 4,759 4,943 5,239 5,300 Hours of Counseling 53,065 54,784 63,061 64,337 55,500 Training Attendees 3,372 6,858 7,425 6,667 6,161 Training Events 204 264 257 213 304 Budget and Expenditures Budgeted Eligibility: SBTDC services are provided to clients in all 100 counties of NC through a statewide network of 75 employees in 17 offices. Management Counseling is free and educational services have a modest cost recovery fee. UNC Small Business Technology Development Center ( SBTDC) Created in 1984 by the Board of Governors, the SBTDC is a statewide business and technology extension service of the UNC system administered by NCSU. The SBTDC provides management counseling and educational services to small & mid- sized business in NC, as well as to start- up businesses. The primary focus is management counseling addressing financing, marketing, human resources, operations, business planning and feasibility assessment. In addition, SBTDC also provides targeted educational services focused on change management, strategic performance and leadership. Other programs include assistance with selling to government agencies, export financing, boating industries, technology development and commercialization. FRD Economic Development Inventory 43 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 81,295 $ 92,253 $ 88,590 $ 104,729 $ 116,058 $ 116,500 $ 116,500 Carryforward Total $ 81,295 $ 92,253 $ 88,590 $ 104,729 $ 116,058 $ 116,500 $ 116,500 Expended $ 81,295 $ 92,253 $ 88,590 $ 104,729 $ 116,058 Balance General Statute Authorization: Key Statistics: The Ben Craig Center was established in 1986 as a non- profit Business Incubator in partnership with the University of North Carolina at Charlotte. The Incubator Program, Education and Community events, and Advisory services offered by the BCC offer full support for dozens of companies each year. The BCC focuses on community businesses and University startups that benefit most directly from proximity to expertise, services, and equipment that only the BCC and the University can provide. Budget and Expenditures Eligibility: To be eligible to participate, the potential company must demonstrate high growth potential, six to twelve months worth of available funding, a scalable business model, a strong management team, current momentum, and willingness to participate in Ben Craig Center events. Retailers, construction contractors, businesses whose primary job creation is in commissioned sales ( e. g., real estate, insurance, etc.) and professional counselors ( e. g., accountants, attorneys, financial planners, etc.) are ineligible for consideration due to the nature of the Incubator program. Incubator clients have historically entered the program with 3- 5 employees and between $ 250,000 and $ 1.5 million in revenue or start- up capital. Incubator clients represent a broad range of business sectors, 44% technology, 39% service oriented, and 17% product sales. Budgeted Ben Craig Center UNC Charlotte FRD Economic Development Inventory 44 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 357,360 $ 394,024 $ 466,796 $ 723,620 $ 830,820 $ 837,364 $ 860,000 Carryforward Total $ 357,360 $ 394,024 $ 466,796 $ 723,620 $ 830,820 $ 837,364 $ 860,000 Expended $ 302,351 $ 338,266 $ 436,479 $ 667,442 $ 810,857 Balance $ 55,009 $ 55,758 $ 30,317 $ 56,178 $ 19,963 General Statute Authorization: Key Statistics: No relevant information to report. Western Carolina University Institute for the Economy and the Future ( IEF) Eligibility: The IEF conducts economic policy analysis and applied research, and administers public service projects on economic and community capacity building and strategic development. The economic development mission of the IEF is to attract, identify, qualify and assist regional businesses and to leverage the university's resources of research, science, engineering, arts and humanities faculty and students, as well as the core staff of the Institute ( analysts, planners, and faculty fellows) for business growth, including the transfer and application of new technologies and the commercialization of ideas. Budget and Expenditures Budgeted FRD Economic Development Inventory 45 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 32,201 $ 116,171 $ 118,104 $ 129,307 $ 138,170 $ 138,710 Carryforward $ 10$ 25 Total $ 32,201 $ 116,171 $ 118,104 $ 129,317 $ 138,195 $ 138,710 Expended $ 35,417 $ 109,152 $ 118,094 $ 129,292 Balance $ ( 3,216) $ 7,019 $ 10$ 25 General Statute Authorization: Key Statistics: 2004- 05 2005- 06 2006- 07 Major University- Community ED Summit Hosted 1 Interdisciplinary ED Seminars 3 4 9 Public Service Projects Coordinated/ Performed 1 1 2 Public Service Projects Funded by OEBD -- 2 14 $$ awarded by OEBD for ED Public Service Projects* -- $ 12,000 $ 213,514 Internal ED public service meetings/ presentations 120 103 70 External ED outreach meetings/ presentations 78 70 86 Eligibility: There are no specific eligibility requirements to access OEBD services. The Office will work with any person or group affiliated with UNC-Chapel Hill and interested in impacting economic development in the state. Likewise, any group, business, government, individual, etc. from the State of North Carolina may approach the Office for assistance in locating and accessing economic development resources at the University. UNC - Chapel Hill Office of Economic and Business Development Created in April 2004, the Office of Economic and Business Development ( OEBD) works to identify, articulate, and improve the economic development resources of UNC- Chapel Hill and connect those resources to North Carolina governments, communities, and businesses. Budget and Expenditures FRD Economic Development Inventory 46 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,625,000 $ 2,750,000 $ 2,750,000 $ 2,750,000 Carryforward Total $ 2,625,000 $ 2,750,000 $ 2,750,000 $ 2,750,000 Expended $ 101,127 $ 1,113,156 Balance $ 2,523,873 $ 1,636,844 General Statute Authorization: G. S. 115D- 5.1 Key Statistics: 2005- 06 2006- 07 Number of Projects 12 19 # of Trainees 297 1,253 Average Cost per Trainee $ 340 $ 888 Budget and Expenditures Eligibility: CIT resources are applied at the discretion of the North Carolina Community College System President upon the recommendation of the Vice President for Economic and Workforce Development to projects on behalf of private for- profit business/ industry where the company: 1. Has made an appreciable capital investment which involves the use of new technology; 2. Requires the enhancement of workforce skills to utilize the new technology; and 3. May or may not create net new jobs, but with the assistance will be more productive or more profitable, and as a result, will more likely remain a viable North Carolina corporate citizen. NC Community College System Customized Industry Training ( CIT) Created in 2006, the CIT program helps existing North Carolina businesses and industries improve their productivity and profitability to assure their continued presence in North Carolina. The program augments the services provided by NEIT and FIT, when their current guidelines do not apply. Budgeted FRD Economic Development Inventory 47 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,962,032 $ 1,962,032 $ 3,964,471 $ 3,964,471 $ 3,964,471 $ 3,964,471 $ 3,964,471 WTTF* $ 1,450,000 WIA* $ 599,684 Carryforward $ 1,829,481 $ 1,729,190 $ 839,746 $ 1,122,177 $ 783,246 $ 783,246 Total $ 5,241,513 $ 4,290,906 $ 4,804,217 $ 5,086,648 $ 4,747,717 $ 4,747,717 $ 3,964,471 Expended $ 3,552,714 $ 3,356,524 $ 3,682,040 $ 3,748,560 $ 3,916,821 Balance $ 1,688,799 $ 934,382 $ 1,122,177 $ 1,338,088 $ 830,896 * Worker Training Trust Fund ( WTTF); Workforce Investment Act ( WIA) General Statute Authorization: G. S. 115D- 5.1 Key Statistics: 2000- 01 2001- 02 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # of Fit Centers 40 40 40 37 36 36 36 # of Companies Served 630 754 834 701 797 623 563 # of Trainees 13,404 10,488 8,438 10,559 11,159 10,557 10,728 # of Skills Classes 1,519 1,100 955 1,071 1,205 1,074 603 Budgeted NC Community College System Focused Industrial Training ( FIT) Created in 1981, the FIT program ( originally called “ cooperative skills training”) provides customized training and services for North Carolina businesses to help them become more productive and competitive. FIT is directed toward workers who need to update their skills and technical knowledge because of technological changes. In addition to incumbent worker training, FIT centers assist with training needs assessment and the development of company- or industry- specific training plans. Funds are allocated among FIT centers based on the size of existing manufacturing base in the service area. Budget and Expenditures Eligibility: FIT services are available to manufacturing industries and companies whose main product is the design and programming of computers and telecommunication systems. Eligible trainees include the employees of such companies that are skilled or semi- skilled production workers, computer programmers, industrial maintenance workers, and front- line supervisors. FRD Economic Development Inventory 48 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 6,028,541 $ 6,033,126 $ 6,028,541 $ 6,028,541 $ 6,028,541 $ 6,028,541 $ 6,028,541 Carryforward $ 9,989,181 $ 9,053,569 $ 10,930,286 $ 11,094,476 $ 8,399,976 $ 4,954,728 Total $ 16,017,722 $ 15,086,695 $ 16,958,827 $ 17,123,017 $ 14,428,517 $ 10,983,269 $ 6,028,541 Expended $ 4,324,263 $ 4,156,409 $ 5,864,351 $ 8,703,156 $ 9,473,788 Balance $ 11,693,459 $ 10,930,286 $ 11,094,476 $ 8,419,861 $ 4,954,729 General Statute Authorization: G. S. 115D- 5.1 Key Statistics: 2000- 01 2001- 02 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # of Projects 203 155 131 121 164 197 208 New 82 65 52 38 70 92 97 Expanding 121 90 79 83 94 105 111 # of Trainees 24,068 14,771 10,610 10,117 12,398 23,799 19,380 Average Cost per Trainee $ 292 $ 365 $ 377 $ 380 $ 442 $ 352 $ 463 Budgeted NC Community College System New and Expanding Industry Training ( NEIT) Created in 1958, the NEIT program provides customized training assistance in support of new, full- time production positions created in the State of North Carolina. Resources may support training, assessment, program development, instructional costs, and training delivery. Budget and Expenditures Eligibility: Companies creating 12 or more production jobs in excess of their previous 3- year maximum employment level are eligible for assistance through NEIT. Eligible trainees include new front- line personnel involved in the direct production of goods and services and their first- line supervisors. FRD Economic Development Inventory 49 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 125,000 $ 125,000 $ 350,000 $ 600,000 $ 600,000 $ 726,006 $ 626,006 WTTF* $ 250,000 $ 120,000 $ 250,000 Carryforward Total $ 375,000 $ 245,000 $ 600,000 $ 600,000 $ 600,000 $ 726,006 $ 626,006 Expended $ 375,000 $ 245,000 $ 600,000 $ 600,000 $ 600,000 Balance * Worker Training Trust Fund ( WTTF) General Statute Authorization: No specific authorization; workforce development programs in general are authorized under G. S. 115D- 1. Budget and Expenditures Eligibility: Hosiery companies located in or doing business within North Carolina. NC Community College System Hosiery Technology Center Established in 1990, the Hosiery Technology Center assists the hosiery industry to compete in a global environment through training, research and development, hosiery testing, E- commerce and new product development. The center has a physical presence at Catawba Valley Community College and Randolph Community College; both colleges are located in two major regions of North Carolina where hosiery manufacturing is centered. Budgeted FRD Economic Development Inventory 50 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,402,489 $ 1,402,489 $ 1,213,401 $ 963,401 $ 963,401 $ 994,142 $ 994,142 Receipts $ 123,463 $ 116,334 $ 41,598 Carryforward Total $ 1,525,952 $ 1,518,823 $ 1,254,999 $ 963,401 $ 963,401 $ 994,142 $ 994,142 Expended $ 1,482,469 $ 1,517,926 $ 1,223,475 $ 963,400 $ 963,400 Balance $ 43,483 $ 896 $ 31,524 $ 1$ 1 General Statute Authorization: G. S. 115D- 67.1 Budget and Expenditures Eligibility: Textile business located in or doing business within North Carolina. NC Community College System Textile Center The Textile Center was reorganized and merged with Gaston College in 2005. It's current mission is to develop a world- class workforce for the textile industry in North Carolina and to support the textile industry by identifying problems confronting the industry and assisting the industry in solving them, garnering support from the textile industry for the work of the center, and serving as a statewide center of excellence that serves all components of the textile industry. To accomplish this mission, the Center does new and sample product development, product testing, training, and consulting. Budgeted FRD Economic Development Inventory 51 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,000,000 $ 200,000 $ 1,000,000 $ 1,250,000 $ 1,250,000 Carryforward $ 1,200,447 $ 543,112 $ 487,885 Total $ 2,000,000 $ 1,400,447 $ 1,543,112 $ 1,737,885 $ 1,737,885 Expended $ 651,611 $ 857,335 $ 1,055,227 Balance $ 1,348,389 $ 543,112 $ 487,885 General Statute Authorization: No specific authorization; workforce development programs in general are authorized under G. S. 115D- 1 Key Statistics: From the program's inception to August 2007, firms working with NCMBC won 287 contracts, worth $ 446- 724 million. As of August 2007, MatchForce. org had 9,532 NC businesses and 15,837 individuals registered to access the 10,219 contract and 2,804 job opportunities listed on the website. Budget and Expenditures Eligibility: Businesses and individuals in North Carolina interested in military contracting opportunities. NC Community College System NC Military Business Center ( NCMBC) Started in 2004, the mission of the NC Military Business Center is to leverage the presence of the military in North Carolina to promote economic development and quality of life for all. The Center seeks to increase military business for existing North Carolina companies, to integrate transitioning military personnel and family members into the workforce, and to support recruitment and development of defense- related businesses in North Carolina. To accomplish these goals, the Center provides free access to MatchForce. org, which helps connect NC businesses with military contracting opportunities. The Center also helps clients develop proposals and bid on military contracts. Budgeted FRD Economic Development Inventory 52 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 3,861,109 $ 4,228,396 $ 4,590,562 $ 5,405,033 $ 5,689,882 $ 5,748,707 $ 5,748,707 Carryforward Total $ 3,861,109 $ 4,228,396 $ 4,590,562 $ 5,405,033 $ 5,689,882 $ 5,748,707 $ 5,748,707 Expended $ 3,858,410 $ 4,162,271 $ 4,508,476 $ 5,343,047 $ 5,658,468 Balance $ 2,699 $ 66,125 $ 82,086 $ 61,986 $ 31,414 General Statute Authorization: No specific authorization; workforce development programs in general are authorized under G. S. 115D- 1. Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 3,038 2,979 2,931 2,219 2521 48,791 44,475 44,993 51,312 55,526 14,723 18,493 20,090 6,117 5,333 3,113 5,831 5,310 4,873 4,365 66,627 68,799 70,393 76,893 70,448 Budget and Expenditures Eligibility: Anyone in North Carolina interested in entrepreneurship. NC Community College System Small Business Center Network ( SBCN) The objective of the SBCN is to increase the success rate and the number of viable small businesses in North Carolina by providing high quality, readily-accessible assistance to prospective and existing small business owners and their employees. Each Small Business Center ( SBC) is a community- based provider of education and training, counseling, information, and referral. Confidential counseling services and access to resource libraries are free of charge. Some seminars and workshops require a minimal registration fee. The first 13 SBCs were established in 1984. The program was expanded, and by 1995 SBCs were located at all 58 community colleges. Budgeted * Counseling figures through FY 2004- 05 include services provided in person, over the telephone, and via e- mail. Starting in FY 2005- 06, figures have been adjusted to exclude telephone and short- term counseling. Total # of clients # of seminars/ workshops provided # of seminar/ workshop participants # of counseling clients* # of referrals FRD Economic Development Inventory 53 January 2008 Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx EE TTrraannssppoorrttaattiioonn FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 28,000,000 $ 38,000,000 $ 14,000,000 Programmed $ 7,395,000 $ 29,708,200 Expended $ 274,945 $ 8,784,665 General Statute Authorization: Key Statistics: No relevant information to report. Budget and Expenditures Eligibility: S. L. 2007- 323 provides that the funds are to be allocated equally among the fourteen Highway Divisions for economic development transportation projects recommended by the member of the Board of Transportation representing that Division in consultation with the Division Engineer and approved by the Board of Transportation. Funds not needed for economic development projects shall be used on spot safety needs to enhance safety, reduce congestion, improve traffic flow, reduce accidents, and for system preservation. Any remaining funds in each Division shall be used on Transportation Improvement Program projects. Department of Transportation Highway Fund Economic Development Funds are provided for economic development transportation projects. Funding began in FY 2005- 06. FRD Economic Development Inventory 54 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Authorized $ 15,000,000 $ 15,000,000 Programmed $ 16,814,981 $ 11,427,334 $ 1,123,959 $ 1,112,637 $ 1,621,096 Expended $ 2,544,532 $ 7,667,821 $ 11,757,013 $ 6,789,606 $ 4,582,580 General Statute Authorization: G. S. 136- 176 ( a1) Key Statistics: No relevant information to report. Eligibility: The projects had to be individually approved by the Board of Transportation. Funds were distributed according to the Equity Formula. Generally, project funding was limited to $ 400,000. Department of Transportation S. B. 1005 Discretionary Funding The Department of Transportation was directed to use certain Highway Trust Fund cash balances in FY2000- 01, FY2001- 02, and FY2002- 03 for highway improvement projects furthering economic growth and development. Budget and Expenditures FRD Economic Development Inventory 55 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Allocated $ 10,000,000 $ 10,000,000 $ 20,000,000 $ 20,000,000 $ 20,000,000 $ 20,000,000 $ 20,000,000 Programmed $ 9,415,000 $ 300,000 $ 5,388,000 $ 9,065,000 $ 24,422,000 $ 27,259,000 $ 9,616,000 Expended $ 5,720,465 $ 9,640,785 $ 13,752,707 $ 6,512,130 $ 14,535,922 General Statute Authorization: G. S. 143B- 150 f( 4) Key Statistics: No relevant information to report. Department of Transportation State Transportation Improvement Program - Economic Development Program The State Transportation Improvement Program is the State's seven- year plan for major transportation projects, as approved by the Board of Transportation. In recent years $ 20 million per year has been allocated for industrial recruitment projects approved by the Board. Budget and Expenditures Eligibility: The funds are generally used for significant industrial recruitment or expansion projects, generally developed in cooperation with state and local economic development agencies. The geographical distribution of State Transportation Improvement Program funds is by the statutory Equity Formula ( G. S. 136- 17.2A) and the project costs are charged to the funding region in which the project is located. Cities and others contribute to the funding of these projects. FRD Economic Development Inventory 56 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 Programmed- Econ Dev* $ 900,000 $ 900,000 $ 900,000 $ 900,000 $ 900,000 Expended- Econ Dev* $ 450,000 $ 450,000 $ 450,000 $ 450,000 $ 450,000 * Estimated Average General Statute Authorization: NA Key Statistics: No relevant information to report. Contingency Fund These funds are used for rural or small urban highway improvements. On average, approximately 6% of the funds have been programmed for economic development projects. Budget and Expenditures Eligibility: The funds are used statewide for rural or small urban highway improvements and transportation enhancements to public roads and public facilities, industrial access roads, and spot safety projects, including pedestrian walkways that enhance highway safety. Projects are approved by the Secretary of Transportation and the Board of Transportation. Department of Transportation FRD Economic Development Inventory 57 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,000,000 $ 1,000,000 $ 2,000,000 $ 1,000,000 Programmed ( Net) $ 1,954,692 $ 1,484,000 $ 2,041,000 Expended $ 139,207 $ 1,234,714 $ 1,067,309 General Statute Authorization: NA Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Grants made 9 10 12 Proj. carloads/ yr 49,999 52,073 49,992 Proj. jobs 4,994 4,620 4,141 Companies served 50 67 97 Eligibility: Short line and regional railroads are eligible. Recipients may receive a maximum of 50 percent of project costs. The following factors are considered: benefit/ cost ratio, project impact, safety impact, transportation system impact, employment impact, community development impact, and whether the project match exceeds the 50 percent requirement. Department of Transportation Short Line Infrastructure Program The program was created in 2005 to provide funds to short line railroads ( railroads that operate over a short distance or as switching or terminal railroads) to rehabilitate and modernize track and bridge infrastructure. The goal is to upgrade transportation infrastructure required to retain and attract industry. Budget and Expenditures FRD Economic Development Inventory 58 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Allocated - All Uses $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 Proggrammed for Economic Dev. $ 353,083 $ 129,605 $ 675,361 $ 657,121 $ 795,000 Expended- Econ Dev $ 255,909 $ 600,800 $ 139,587 $ 150,294 $ 734,458 General Statute Authorization: Key Statistics: No relevant information to report. Budget and Expenditures Eligibility: The maximum amount for school projects is $ 50,000. The amount for industries is generally based on the number of jobs created at $ 1,000 per job. The projects are approved by the Board of Transportation. Department of Transportation Public Access Fund These funds are used to provide access for schools, volunteer fire departments, and industries. FRD Economic Development Inventory 59 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 Programmed ( Net) $ 306,000 $ 777,903 $ 810,289 $ 317,597 $ 330,065 Expended $ 926,912 $ 239,783 $ 315,691 $ 275,512 $ 639,349 General Statute Authorization: Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Grants made 5 10 9 Annual rail car loadings 9,798 8,203 12,576 The Rail Industrial Access Program provides industries with an incentive to locate or expand their facilities in North Carolina. The funding helps ensure that companies have the railroad tracks needed to transport freight and materials by providing state funds to assist in constructing or refurbishing tracks. Budget and Expenditures Eligibility: Local governments, community development agencies, railroad companies and industries are eligible for funds to improve rail access. Approval of requests is based on economic benefit of the project, including the number of potential new jobs that will be created, the amount of capital investment, rail use, and the area's economic condition. The maximum grant is 50 percent of the project cost. Department of Transportation Rail Industrial Access Program FRD Economic Development Inventory 60 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 21,000,000 $ 28,000,000 $ 21,000,000 $ 21,000,000 $ 21,000,000 $ 35,000,000 $ 21,000,000 Programmed- Econ Dev* $ 210,000 $ 280,000 $ 210,000 $ 210,000 $ 210,000 Expended- Econ Dev* $ 75,600 $ 100,800 $ 75,600 $ 75,600 $ 75,600 * Estimated average General Statute Authorization: Budget Bills. S. L 2007- 323 Section 27.5 Key Statistics: No relevant information to report. Small Construction The Small Construction Program funds a variety of transportation projects for municipalities, counties, businesses, schools, and industries. On average, approximately one percent of funds are programmed for economic development projects. Budget and Expenditures Eligibility: These projects are recommended by the Board of Transportation Member representing the Division in which the project is to be constructed in consultation with the Division Engineer. The projects are approved by the Board of Transportation. There is a $ 250,000 maximum amount per request per year. Projects with a total cost greater than $ 150,000 require a resolution or letter of support from the city, town or county. Department of Transportation FRD Economic Development Inventory 61 January 2008
Object Description
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Title | North Carolina economic development inventory |
Other Title | Economic development inventory; FRD economic development inventory |
Date | 2008-01 |
Description | January 2008 |
Digital Characteristics-A | 475.21 KB; 76 p. |
Digital Format | application/pdf |
Pres Local File Path-M | \Preservation_content\StatePubs\pubs_borndigital\images_master\ |
Full Text | Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory JJaannuuaarryy 22000088 Page Introduction 1 Summaries by Fund Source 1 Tax Incentives 3 General Fund 4 Department of Commerce 4 Higher Education 5 Transportation and Highway Fund 5 Appendix A- Glossary of Frequently Used Fiscal Terms 7 Appendix B - Funds by Fund Source and Type 9 Appendix C - Tax Incentives 10 Bill Lee Tax Credits 10 Tax Expenditure Summary 11 Tax Expenditure Detail 12 Appendix D - General Fund Programs 14 Department of Commerce Office of International Trade 14 Economic Development Information System ( EDIS) 15 Regional Offices 16 Executive Aircraft 17 Business ServiCenter 18 Commerce Finance 19 Economic Development Board 20 Industrial Development Fund ( IDF) 21 One North Carolina Fund 22 One North Carolina Small Business Fund 23 Job Development Investment Grant ( JDIG) 24 Job Maintenance and Capital Development Fund 25 Green Business Fund 26 Site Infrastructure Grant 27 Utility Account 28 Economic Development Reserve 29 Commerce Pass- Through Regional Economic Development Commissions 30 Table of Contents FRD Economic Development Inventory January 2008 Page NC Biotechnology Center 31 NC Institute for Minority Economic Development 32 Other Non- State 33 Rural Center - Institute for Rural Entrepreneurship 34 Rural Center - Microenterprise Loan Program 35 Rural Center - Rural Economic Transition Program 36 Rural Center - Research & Demonstration Grants 37 UNC ECU Community Engagement 38 FSU Business Center 39 NC Cooperative Extension Service 40 NCSU Economic Development Partnership 41 NCSU Industrial Extension Service 42 Small Business Technology Development Center 43 UNC- C Ben Craig Center 44 WCU Institute for the Economy and the Future 45 UNC- CH Office of Economic & Business Dev. 46 NCCCS Customized Industry Training 47 Focused Industrial Training 48 New and Expanding Industry Training 49 Hosiery Tech Center 50 Textile Center 51 Military Business Center 52 Small Business Center Network 53 Appendix E - Transportation & Highway Fund Programs Highway Fund Economic Development 54 SB 1005 Discretionary Funding 55 TIP - Economic Development Program 56 Contingency Fund 57 Short Line Infrastructure Program 58 Public Access Fund 59 Rail Industrial Access Program 60 Small Construction 61 FRD Economic Development Inventory January 2008 FRD Economic Development Inventory 1 January 2008 Introduction S. L. 2007- 522 ( Extra Session) requires the Joint Select Committee on Economic Development Incentives ( Committee) to compile a report that lists and quantifies all economic development incentives offered by the State. To fulfill this requirement, the Committee directed the Fiscal Research Division ( FRD) to create the following document – North Carolina Economic Development Inventory ( EDI). The EDI is an estimated measure of State spending on economic development. Spending can occur either by appropriation or tax incentives channeled through the tax system. The listing of tax incentives in combination with the listing of direct and support spending programs is intended to allow the General Assembly to analyze all State spending related to the goal of economic development. The EDI covers two types of State economic development spending: direct incentives and support programs. Direct incentives are defined as those programs that provide funds either directly to a company or to a county or a municipality for a specific company. Examples include tax credits, the Job Development Investment Grant ( JDIG), and the One North Carolina Fund. Support programs are those that exist to provide services to businesses or companies considering locating or expanding in the State. Examples include the North Carolina Community College System's Small Business Center Network or the Department of Commerce's Regional Offices. Programs that exist to administer direct incentives programs, such as the Commerce Finance Center, are included in this category. The inventory does not contain comprehensive figures on all State economic development spending in North Carolina, nor does it analyze all spending related to the State’s priorities on education and workforce development, the regulatory business environment or infrastructure projects such as highway construction. While these spending priorities may be considered a part of a State’s total economic development effort, the scope of this report is to account for spending identified as directly related to an economic development purpose. If the program would still exist if the State discontinued all business support services and incentives efforts, then it is not included in this inventory. Summary The EDI is divided into three sections based on the source of funds: Tax Incentives, General Fund appropriations, and Transportation. Tax incentives, or as they are often referred to tax expenditures, take the form of either Bill Lee tax incentives or tax incentive expenditures derived from provisions in the State’s tax code. Bill Lee tax incentive information is provided through FY 2006- 07, and tax incentive expenditures are estimated through FY 2007- 08. For General Fund programs, current appropriations levels are provided, as well as historical data back to FY 2002- 03. Transportation information includes program data from FY 2002- 03 through FY 2007- 08. In FY 2006- 07, total estimated tax credits and appropriations for economic development were approximately $ 1.291 billion. Table 1 below breaks these figures out for each fund source. Table 1: Economic Development by Fund Source, FY 2006- 07 Fund Source Amount Bill Lee Tax Incentives $ 93,763,666 Tax Incentives $ 1,012,600,000 General Fund Appropriations $ 117,526,439 Transportation $ 67,487,580 Total $ 1,291,377,685 FRD Economic Development Inventory 2 January 2008 Table 2 shows the aggregated spending and the overall growth rates since FY 2002- 03. Because data on other tax incentive expenditures have only been available since FY 2005- 06, only Bill Lee tax information is included in this table. Table 2: Economic Development Spending and Growth FY 2002- 03 to FY 2006- 07 ( In Millions) FY 02- 03 FY 03- 04 FY 04- 05 FY 05- 06 FY 06- 07 General Fund $ 42.0 $ 93.7 $ 65.7 $ 100.2 $ 117.5 Transportation $ 15.4 $ 20.6 $ 36.7 $ 58.7 $ 67.5 Bill Lee Act $ 74.2 $ 79.3 $ 66.4 $ 90.5 $ 93.8 Total $ 143.7 $ 200.1 $ 156.7 $ 240.6 $ 273.2 Nominal Annual Growth 47.1% - 12.8% 47.7% 11.8% Real Annual Growth* 43.9% - 15.4% 42.3% 8.9% * Adjusted for inflation using the Consumer Price Index, Bureau of Labor Statistics Tax incentives through the Bill Lee Act plus other tax incentives totaled $ 1.1 billion in FY 2006- 07. Tax incentives do not directly reduce any given appropriation, but rather have an indirect cost by lowering the General Fund availability for other appropriations. Ninety percent of all State spending on economic development is from tax incentives. In FY 2006- 07, the General Assembly appropriated $ 117.5 million for economic development to the Department of Commerce, the North Carolina Community College System ( NCCCS), and the University of North Carolina ( UNC). Figure 1 below shows the breakdown of these appropriations. That amount increased by 13 percent to $ 133.3 million in FY 2007- 08 ( see Figure 2). Fig. 1: General Fund Appropriations, FY 06- 07 Fig. 2: General Fund Appropriations, FY 2007- 08 NCCCS and UNC are playing an increasingly significant role in economic development. Combined, appropriations for economic development to these entities grew by over fifty percent between FY 2002- 03 and FY 2006- 07. Appropriations to Commerce administered programs, such as One NC and JDIG, GF Appropriations for Economic Development FY 2006- 07 Commerce 69% UNC 13% NCCCS 18% Total: $ 117,526,439 GF Appropriations for Economic Development FY 2007- 08 Commerce 72% NCCCS 16% UNC 12% Total: $ 133,253,720 FRD Economic Development Inventory 3 January 2008 increased by over 325 percent during the same period, from $ 19 million to $ 81.5 million. However, all of these appropriations still only represent 0.62 percent of the total FY 2006- 07 General Fund budget. Transportation appropriations are another component of economic development spending in the State. Appropriations in this category increased 337% between FY 2002- 03 and FY 2006- 07. The EDI categorizes economic development spending as direct incentives or support programs. By definition, all tax incentives are considered direct. Figure 3 shows State spending separated into these two categories. Ninety- five percent ($ 1.2 billion) of the $ 1.3 billion in State funding in FY 2006- 07 was targeted directly to a particular business or industry. Of that $ 1.2 billion, 82 percent ($ 1 billion) was tax incentives ( excluding Bill Lee). Bill Lee credits accounted for eight percent of direct economic development incentives, while transportation and General Fund appropriations were each five percent. Support programs, including State aid to non- State entities, accounted for five percent ($ 62 million) of FY 2006- 07 spending. Fig. 3: Economic Development Spending by Type The following sections provide summaries of State economic development programs by fund source ( tax incentives, General Fund appropriations, and Transportation). Detailed information on all of the incentives programs included in the EDI may be found in the appendices at the end of the document. Tax Incentives In 1996, the General Assembly enacted the Bill Lee Act ( G. S. 105 Article 3A), which set forth a comprehensive tax incentive program to compete with other states that had been adopting similar economic development legislation since the mid- 1980s. Since then, efforts to attract and retain businesses have led to numerous revisions of the Bill Lee Act, as well as enactment of additional tax programs. Tax incentive expenditures such as those in the Bill Lee Act may be considered spending programs conducted through the tax system. Tax expenditures are defined as an exemption, deduction, credit, refund, cap, or preferential tax rate that reduces the amount of tax revenue which would otherwise be collected from the taxpayer. In FY 2006- 07, tax relief intended for economic development purposes equaled an estimated $ 1 billion. An additional $ 174.6 million in Bill Lee tax incentives were generated during the 2006 tax year. The Bill Lee Act is an incentive program that allows tax credits against the income, franchise, or gross premiums insurance tax. Credits can be earned for job creation and investments. Certain eligibility requirements are required in order to earn the tax credits ( see Appendix C for more detail). The Act has been amended numerous times since its inception and, in 2007, was replaced with Article 3J credits. Article 3J credits represent a new system of credits intended to be more narrowly focused on job creation and investment. Since 2002, the nominal dollar amount of credits taken has increased by 26 percent. Total credits taken fluctuate from year to year because the credits are claimed against taxpayer tax liability, which can be highly variable and subject to swings in the business cycle. The number of credits generated Economic Development Spending by Type FY 2006- 07 Support Programs $ 62 mil 5% Direct Incentives $ 1,229.3 mil 95% Total: $ 1.3 billion FRD Economic Development Inventory 4 January 2008 in 2006 was 12 percent less than in 2002. Appendix C provides detailed data on the number of credits generated and taken, and the dollar amounts generated and taken since FY 2002- 03. In addition to Bill Lee Act or Article 3J credits, there are many other tax relief efforts targeting businesses and industries. All other tax relief efforts outside the Bill Lee Act credits are referred to as other tax incentive expenditures in this report. While there are many tax expenditures written into the General Statutes, some have been targeted specifically to businesses and industries. In FY 2007- 08, it is estimated that approximately $ 1.1 billion of a total $ 4.9 billion in tax expenditures had an economic development purpose. A tax expenditure with an economic development purpose is defined as a change to the tax code that directly reduces the tax liability of a particular business or industry. Tax changes that affect all taxpayers, both businesses and consumers, nonprofits, or are community service- based ( such as the Low- Income Housing tax credit) are not included as economic development tax incentive expenditures in this report. An example of a tax incentive that has an economic development purpose and is not a part of the Bill Lee Act incentives is the tax credit for North Carolina Research and Development ( G. S. 105- 129.55( a)), a credit allowed for qualifying research expenses. The Sales and Use tax incentives are the largest category of incentives identified as having an economic development purpose. They are estimated to be just under $ 500 million for FY 2007- 08. Appendix C provides additional detail on these tax incentive expenditures. Tax incentives reported here are estimates based on the Department of Revenue’s 2005 and 2007 Biennial Tax Expenditure Reports for 2005 and 2007, and the Department’s reports on the Bill Lee Act. For a variety of reasons including the availability of completed tax data and taxpayer confidentiality, some tax incentives cannot be estimated. As such, the economic development tax incentives data represents an estimation of the loss in revenue and not an actual accounting. General Fund Programs The General Fund Program section of the EDI includes data for economic development incentive programs that receive General Fund appropriations. Summary data is shown at the appropriation level, not the expenditure level, because many direct incentives programs provide grants that may be paid out over several years, causing expenditures to seem artificially low in any given year. Appendix D provides additional detail on all of the General Fund economic development programs. Department of Commerce. The Department of Commerce is the primary agency for economic development in the State. Commerce administers most direct incentives programs and provides most business support services ( except for workforce training). In addition, most State aid to non- profits for economic development programs goes through Commerce. In FY 2007- 08, the General Assembly appropriated a total of $ 97,558,980 to Commerce for economic development incentives and support. Commerce currently administers nine direct incentives programs, five of which received appropriations in FY 2007- 08. The largest of these are the Job Development Investment Grant ( JDIG), and the One North Carolina Fund. These two programs received 81% ($ 26.4 million) of the $ 32.5 million appropriated to direct incentive programs in FY 2007- 08. Other direct incentives programs were created with one- time appropriations that have carried forward from year to year as grants are awarded. For example, the General Assembly appropriated $ 24 million in FY 2003- 04 for the Site Infrastructure Grant. A grant agreement is currently being negotiated, but no expenditures are anticipated until 2009. In addition to direct incentives programs, the General Assembly appropriated $ 65 million to Commerce for economic development incentives support programs in FY 2007- 08. $ 56.4 million of this represents State aid to non- State entities that have an economic development purpose: $ 20 million for the NC Rural FRD Economic Development Inventory 5 January 2008 Economic Development Center, $ 15 million to the NC Biotechnology Center, $ 6.7 million to the Regional Economic Development Commissions, and $ 14 million to various other non- State programs. The remainder ( about $ 8.6) million is used by Commerce to administer the nine direct incentives programs and to provide various support services to business and industry. More detailed information on these programs may be found in Appendix D. Higher Education. An educated and skilled workforce is one of the key attributes that attracts businesses to locate and invest in a certain area. Consequently, the State’s total investment in education promotes economic development. However, this inventory highlights only those education programs that either directly benefit certain companies that the State seeks to attract or retain, or provide support to businesses through technical assistance and research. In FY 2007- 08, the General Assembly appropriated $ 12.7 million for three NC Community College System ( NCCCS) programs specifically designed to help entice certain companies to locate, expand, or remain in North Carolina: Customized Industry Training ( CIT), Focused Industrial Training ( FIT), and New and Expanding Industry Training ( NEIT). Each targeting different types of businesses, these programs provide funding to support assessment and specialized training for specific companies. NCCCS also received $ 8.7 million in FY 2007- 08 for four programs focused on providing technical assistance in specific industry sectors. The Hosiery Technology Center and the Textile Center offer product testing, research and development, and industry- specific training. The NC Military Business Center seeks to connect North Carolina businesses and individuals with military contracting and other defense- related business opportunities. Through counseling, referrals, information, and training, the Small Business Center Network promotes the development of small businesses within the state. As the State’s lead agency for providing workforce development training ( G. S. 115D- 1.1), all NCCCS institutions offer occupational continuing education courses. These courses provide individuals the opportunity to upgrade existing knowledge and develop new skills. While these courses indirectly benefit North Carolina businesses by developing a more educated workforce, they are not included in this inventory since they are open to the general public and are not provided directly to businesses. The Board of Governors for the University of North Carolina system ( UNC) has made economic development one of its six strategic priorities. The Board and the UNC System President have created an Economic Transformation Council with members appointed from each campus to carry out the campus response to the economic development strategic priority. The President is also advised on economic issues by an Associate Vice President for Economic Development Research, Policy and Planning. In FY 2007- 08, the General Assembly appropriated $ 14.4 million to UNC for three statewide economic development support programs: the North Carolina Cooperative Extension Service, the Industrial Extension Service, and Small Business Technology Development Centers. An additional $ 2.1 million was appropriated for various campus initiated programs such as the Ben Craig Center at UNC- Charlotte. Transportation Programs There is a close relationship between the strength of a region’s transportation infrastructure and its economic development potential. In addition to transportation projects that aid individual industries or companies, the network of highways and other transportation infrastructure aid the State’s overall economic development by tying North Carolina to the national and global economy. The overall transportation network allows firms within the State to more easily source materials from around world and to market their products aggressively. An inadequate transportation system creates bottlenecks that limit cost savings and inhibit growth. FRD Economic Development Inventory 6 January 2008 Transportation infrastructure projects do not guarantee that economic development will occur but they support economic development by lowering costs, saving time, and increasing reliability for users of the transportation network. Cost savings include: • Gathering raw materials and supplies; • Delivering products to customers; • Assembling employees; • Maintaining contact with customers and suppliers. The North Carolina Department of Transportation has several programs explicitly created to encourage and support economic development. The Department works with State and local economic development agencies and can commit significant resources in aid of major industrial recruiting projects. On a smaller scale the Department has programs to support individual industries or industrial parks ( e. g. turn lanes to improve truck access, better signals to improve traffic flow for employees, etc.) The Department also has programs to improve rail infrastructure. Information about specific transportation programs may be found in Appendix E. For additional information, please contact: Barry Boardman or Kristine Leggett Fiscal Research Division NC General Assembly 300 N. Salisbury St., Room 619 Raleigh, North Carolina 27603- 5925 ( 919) 733- 4910 barryb@ ncleg. net kristineL@ ncleg. net Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx AA GGlloossssaarryy FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] FRD Economic Development Inventory January 2008 Glossary of Frequently Used Fiscal Terms APPROPRIATION: An action by the General Assembly authorizing withdrawal of funds from the state treasury pursuant to Article V, Section 7 of the North Carolina Constitution. AVAILABILITY: The sum of the beginning General Fund Unreserved Fund Balance and General Fund revenues for a fiscal period. BILL LEE ACT: The William S. Lee Quality Jobs and Expansion Act provides for tax credits available to eligible companies expanding or relocating in North Carolina that hire within the North Carolina workforce to fill positions. Bill Lee was rewritten in 2005 – tax credits in the revised version are often referred to as 3J credits. CARRYFORWARD: Funds appropriated but unspent in the first fiscal year of a biennium which by authorized budget revision are brought forward for expenditure in the second fiscal year of the same biennium. DIRECT INCENTIVE: A spending program that provides funds either directly to a company; or to a local government for a specific company or project. They generally take the form of tax expenditures, direct appropriations, or grants. FULL- TIME EQUIVALENT ( FTE): The figure arrived at by converting an unduplicated head- count of full- time and part- time employees to an equivalent full- time count. GENERAL FUND: A pool of financial resources made up of a beginning credit balance, State tax revenues, and State non- tax revenues. These monies are appropriated for both the operation of State agencies and construction and renovation of State facilities. HIGHWAY FUND: The special fund to which revenues are deposited that are designated for transportation- related operations and capital improvements. NON- RECURRING: Term used to denote one- time revenues ( windfalls, reversions) or one-time expenditures ( grant- in- aid, capital). RECURRING: Term used to denote revenues or expenditures that will be continuing, such as sales and personal income taxes, or salaries, fringe benefits, utilities. REVERSIONS: Unspent appropriations returned to the General Fund or Highway Fund ( as applicable) at the end of each fiscal year. STATE AID FOR NON- STATE ENTITIES: Funds appropriated by the General Assembly to nongovernmental entities for a variety of purposes. Funds may or may not carry restrictions on expenditures. 7 FRD Economic Development Inventory January 2008 SUPPORT PROGRAM: A program that provides services to businesses in the State, usually to help the business improve efficiency, increase technology, or add jobs. Support programs may also take the form of State aid to non- State entities which in turn provide services or incentives to businesses. TAX EXPENDITURE: A reduction in the amount of tax revenue which would otherwise be collected from the taxpayer. These tax provisions may be viewed as spending programs conducted through the tax system. Tax expenditures take the following forms: • Exclusions, exemptions, deductions, and caps, which reduce taxable income; • Credits and refunds, which are subtracted from the taxes “ normally” due; • Preferential tax rates, which apply lower rates than would ordinarily apply. TAX INCENTIVE: A type of tax expenditure used to provide additional incentive for businesses to locate in the State, or to encourage the expansion of already established firms. 8 Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx BB SSuummaarryy CChhaarrttss FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] FY 02- 03 FY 03- 04 FY 04- 05 FY 05- 06 FY 06- 07 FY 07- 08 FY 08- 09 UNC Support $ 9,596,763 $ 11,704,378 $ 12,618,706 $ 14,576,476 $ 15,032,844 $ 16,582,873 $ 15,942,291 Direct $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 UNC Subtotal $ 9,596,763 $ 11,704,378 $ 12,618,706 $ 14,576,476 $ 15,032,844 $ 16,582,873 $ 15,942,291 NCCCS Support $ 5,388,598 $ 5,755,885 $ 8,153,963 $ 7,168,434 $ 8,253,283 $ 8,718,855 $ 8,618,855 Direct $ 7,990,573 $ 7,995,158 $ 9,993,012 $ 12,618,012 $ 12,743,012 $ 12,743,012 $ 12,743,012 NCCCS Subtotal $ 13,379,171 $ 13,751,043 $ 18,146,975 $ 19,786,446 $ 20,996,295 $ 21,461,867 $ 21,361,867 Commerce Support $ 5,921,160 $ 7,889,194 $ 7,840,415 $ 8,388,348 $ 8,732,196 $ 8,563,876 $ 8,277,281 Support ( Non- State) $ 12,533,974 $ 16,083,358 $ 21,284,890 $ 41,144,997 $ 30,044,997 $ 54,094,997 $ 28,581,247 Direct $ 569,713 $ 44,320,107 $ 5,820,107 $ 16,320,107 $ 42,720,107 $ 32,550,107 $ 5,320,107 Commerce Subtotal $ 19,024,847 $ 68,292,659 $ 34,945,412 $ 65,853,452 $ 81,497,300 $ 95,208,980 $ 42,178,635 Total General Fund Appropriations $ 42,000,781 $ 93,748,080 $ 65,711,093 $ 100,216,374 $ 117,526,439 $ 133,253,720 $ 79,482,793 Total Transportation $ 15,444,532 $ 20,567,821 $ 36,657,013 $ 58,689,606 $ 67,482,580 $ 37,000,000 $ 22,000,000 Bill Lee Incentives ( Taken) $ 74,196,701 $ 79,334,636 $ 66,446,464 $ 90,515,214 $ 93,763,666 Other Tax Incentives $ 1,006,800,000 $ 1,012,600,000 $ 1,058,200,000 Total Economic Development Spending $ 1,256,221,194 $ 1,291,372,685 $ 1,228,453,720 FY 02- 03 FY 03- 04 FY 04- 05 FY 05- 06 FY 06- 07 FY 07- 08 FY 08- 09 Direct, General Fund $ 8,560,286 $ 52,315,265 $ 15,813,119 $ 28,938,119 $ 55,463,119 $ 45,293,119 $ 18,063,119 Direct, Transportation $ 15,444,532 $ 20,567,821 $ 36,657,013 $ 58,689,606 $ 67,482,580 $ 37,000,000 $ 22,000,000 Direct, Bill Lee Act $ 74,196,701 $ 79,334,636 $ 66,446,464 $ 90,515,214 $ 93,763,666 Direct, Other Tax Incentives $ 1,006,800,000 $ 1,012,600,000 $ 1,058,200,000 Subtotal Direct $ 98,201,519 $ 152,217,722 $ 118,916,596 $ 1,184,942,939 $ 1,229,309,365 $ 1,140,493,119 $ 40,063,119 Support, General Fund $ 33,440,495 $ 41,432,815 $ 49,897,974 $ 71,278,255 $ 62,063,320 $ 87,960,601 $ 61,419,674 Total Support $ 33,440,495 $ 41,432,815 $ 49,897,974 $ 71,278,255 $ 62,063,320 $ 87,960,601 $ 61,419,674 Total Economic Development Spending $ 1,256,221,194 $ 1,291,372,685 $ 1,228,453,720 $ 101,482,793 Economic Development by Type Economic Development by Fund Source Data Not Available Data Not Available FRD Economic Development Inventory 9 January 2008 FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx CC TTaaxx IInncceennttiivveess FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Year1 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Credits Generated $ 198,385,012 $ 175,543,475 $ 167,895,925 $ 207,160,014 $ 174,459,922 $ -$ - Credits Taken $ 74,196,701 $ 79,334,636 $ 66,446,464 $ 90,515,214 $ 93,763,666 $ -$ - 1. Assumes that credits are generated and taken in the second half of the calendar year for the purpose of fiscal year calculations. General Statute Authorization: G. S. 105 Article 3A Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Total Credits ( a single taxpayer may take multiple credits) Generated 603 616 520 646 711 Taken 2,328 1,778 1,675 1,812 1,659 Tax Credits Eligibility: The taxpayer must satisfy all general eligibility requirements in order to qualify for any of the credits listed in Section III, except the credit for development zone projects. If a taxpayer is uncertain about its eligibility for a credit, the taxpayer may request specific advice in writing from the Secretary of Revenue. Eligible recipients must be an eligible business type and meet the wage standard for the credit. In addition, businesses must provide health insurance for employees, have good environmental and Occupational Safety and Health Act ( OSHA) records, and have no overdue tax debts. Article 3A only allows credits for certain kinds of businesses as described in G. S. 105- 129.2. Tax Incentives WILLIAM S LEE ACT ( ARTICLE 3A) Enacted in 1996, and revised many times since, the William S. Lee Act ( Bill Lee) provides tax credits that may be taken against State income, franchise, or gross premiums tax. The credits are for job creation, investment, worker training, and research & development. The level of tax credit allowed is determined by the county's economic well- being in which the economic activity is taking place. This act was replaced by Article 3J beginning in the 2007 tax year. FRD Economic Development Inventory 10 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 071 2007- 08 2008- 09 Corporate Income Tax $ 156.3 $ 140.8 $ 114.2 Franchise Tax $ 203.2 $ 168.2 $ 133.2 Sales Tax $ 473.1 $ 486.9 $ 496.1 Business & Energy Tax Credits ( Art. 3B) $ 29.7 $ 28.1 $ 26.5 Recycling Incentives ( Art. C) 2 $ 0.0 $ 0.0 $ 0.0 Research and Development Credits ( Art. 3F) $ 12.5 $ 21.5 $ 28.5 Major Computing Facilities ( Art. 3G) NA $ 2.0 $ 10.0 Railroad Intermodal Facilities ( Art. 3K) NA NA $ 0.2 Tax Credits for Growing Businesses ( Art. 3J) $ 0.0 $ 0.0 $ 69.1 Personal Income $ 7.7 $ 8.8 $ 8.8 Insurance companies $ 124.3 $ 156.3 $ 162.6 Piped Gas: Preferential rates $ 0.0 $ 0.0 $ 9.0 Total $ 1,006.8 $ 1,012.7 $ 1,058.2 Source: NCDOR Biennial Tax Expenditure Report, 2005 and 2007. 1. Estimated using linear interpolation, tax revenue growth rates, and industry employment statistics 2. Included with Corporate Tax for taxpayer confidentiality Expenditures ( In millions) Tax Incentives Other Tax Incentives: Tax Expenditures A tax expenditure is an exemption, deduction, credit, refund, cap, or preferential tax rate that reduces the amount of tax revenue which would otherwise be collected from the taxpayer. The tax expenditures included in this report are ones that directly reduce the tax liability of a particular business or industry. Tax expenditures that affect both businesses plus consumers, nonprofits, or are community service- based are not included. FRD Economic Development Inventory 11 January 2008 FY 2005- 06 FY 2006- 072 FY 2007- 08 Corporate Tax Double- Weighting Sales Apportionment 49.8 55.7 58.4 Holding Companies* - - - Recycling Facilities* - - - NC Ports 0.6 0.6 0.6 S& L Fees Credit 0.2 0.2 0.2 Poultry Composting 0.1 0.1 0.1 Oyster Shell Recycling - 0.1 0.1 Cigarette Exportation* - - - Film Industry Production 5.4 4 1 Qualified Investments 0.1 0.1 0 Combined for Confidentiality* 100.1 80 53.8 Corporate Tax Subtotal 156.3 140.8 114.2 Franchise Tax Double- Weighting Sales for Capital Stock 3.2 3.2 3.2 Caps for Holding- Companies 200 165 130 Franchise Tax Subtotal 203.2 168.2 133.2 Business & Energy Tax Credits ( Art. 3B) 29.7 28.1 26.5 Recycling Incentives ( Art. C)* Research and Development Credits ( Art. 3F) 12.5 21.5 28.5 Major Computing Facilities ( Art. 3G) - 2 10 Railroad Intermodal Facilities ( Art. 3K) - - 0.2 Personal Income Poultry Composting 0.1 0.1 0.1 Farm Equipment Credit 1.5 1.5 1.5 Qualified Business Investment 6 7 7 NC Ports 0.1 0.1 0.1 recycling Oyster Shells - 0.1 0.1 Personal Income Subtotal 7.7 8.8 8.8 Sales & Use Tax1 Out- of State Call Centers 14.1 14.1 14.1 Sales to Farmers 189.8 169.2 148.5 Communications Equipment** 14.1 31.1 44.5 Commercial Fishing 1.5 1.5 1.6 Laundries & Dry- cleaning 1 1.3 1.7 Diesel Fuel for Railroads 17 17 17 Packaging Costs for Mfg., producers, retailers 52.9 57.3 61.7 Bakery, thrift bread sales 0 0 0.1 Newspaper Ad Supplements 4 4.1 4.3 Other Tax Incentives: Tax Expenditure Details FY 2005- 06 through FY 2007- 08 12 FY 2005- 06 FY 2006- 072 FY 2007- 08 Other Tax Incentives: Tax Expenditure Details FY 2005- 06 through FY 2007- 08 Custom Computer Software 5 7.8 9.6 Commercial Aircraft 4 4 4 Data Center electricity and eligible property 0 0 1.8 Refunds to Eligible Businesses 0.5 0.5 0.5 Aviation Fuels Cap 5 4 3 Preferential Rates to industries 20.6 25 29.3 Mill machinery, etc. ( Art. 5F) 143.6 150.0 154.4 Sales & Use Tax Subtotal 473.1 486.9 496.1 Insurance companies 124.3 156.3 162.6 Piped Gas: Preferential rates for Mfg. And Farmers 0 0 9 * Data combined due to taxpayer confidentiality requirements. ** 2005 includes $ 10 million for cable equipment, unavailable in the 2005 report 1. Excludes tax expenditures for non- profits 2. Estimated using linear interpolation, tax revenue growth rates, and industry employment growth statistics 13 Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx DD GGeenneerraall FFuunndd PPrrooggrraamss FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,329,469 $ 2,424,925 $ 2,459,731 $ 2,434,724 $ 2,503,188 $ 2,503,188 $ 2,503,188 Receipts $ 288,881 $ 287,073 $ 210,980 $ 225,879 $ 244,943 $ 244,943 $ 244,943 Total $ 2,618,350 $ 2,711,998 $ 2,670,711 $ 2,660,603 $ 2,748,131 $ 2,748,131 $ 2,748,131 Positions ( FTE) 11.00 11.00 11.00 11.00 11.00 11.00 11.00 General Statute Authorization: 143B- 428 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Companies Assisted 261 234 264 272 301 Est. Value of Trade* $ 35,347,851 $ 45,635,063 $ 63,029,776 $ 129,204,002 $ 186,765,839 * Amounts shown are estimates by individual businesses assisted by International Trade of the total value of their exports/ imports. Budget and Expenditures Eligibility: Any North Carolina company can utilize the services provided by the International Trade Division. Department of Commerce Office of International Trade The International Trade Division provides expert assistance to North Carolina businesses looking to develop markets for their products overseas. Division employees help these companies make contacts and tap into resources to make the most of global business opportunities. The Division operates two domestic offices in Raleigh and High Point, and six international offices in Canada, Mexico, Germany, China, Korea, and Japan. Services provided by the division include preparing marketing plans, handling export operations, market research, advice on finance and insurance, and working to find customers and partners. Budgeted FRD Economic Development Inventory 14 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 375,000 $ 797,898 $ 797,898 $ 597,898 $ 297,898 Receipts Total $ - $ - $ 375,000 $ 797,898 $ 797,898 $ 597,898 $ 297,898 Positions ( FTE) 1.00 1.00 1.00 1.00 General Statute Authorization: NA Key Statistics: No relevant information to report. Budget and Expenditures Budgeted Eligibility: Anyone can access information on EDIS through the Department of Commerce website. Department of Commerce Economic Development Information System ( EDIS) Initially funded in FY 2004- 05, the Economic Development Intelligence System ( EDIS) is a web- based database system that provides users with access to a wide variety of analytical, statistical, and mapping tools to support strategic economic development activities and research. Companies seeking information about the State can search for business locations, find demographic data, create maps, and locate local support industries. It is anticipated that EDIS will be fully operational by November, 2007. FRD Economic Development Inventory 15 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,475,169 $ 1,548,365 $ 1,536,240 $ 1,605,287 $ 1,646,509 $ 1,738,956 $ 1,738,956 Receipts Total $ 1,475,169 $ 1,548,365 $ 1,536,240 $ 1,605,287 $ 1,646,509 $ 1,738,956 $ 1,738,956 Positions ( FTE) 19.75 19.75 19.75 19.75 19.75 21.75 21.75 General Statute Authorization: Key Statistics: 2002 2003 2004 2005 2006 Existing Industry Calls 2,766 2,897 2,410 2,099 2,245 Project Assignments 234 266 234 233 250 Eligibility: Anyone operating an existing business in North Carolina or seeking to locate a business in North Carolina may use the services offered by the Regional Offices. Regional Offices The Department of Commerce operates nine regional offices throughout the State to assist existing industry and to help attract new industry. Existing Industry Specialists call on existing companies to spot opportunities and problems in their early stages and to assist in issue resolution. Economic Developers work collaboratively with the Regional Economic Development Commissions to market the regions and to assist prospects. Offices are located in Greenville ( Eastern Region), Edenton ( Northeastern Region), Raleigh ( Research Triangle Region), Greensboro ( Piedmont Triad Region), Charlotte ( Charlotte Region), and Bryson City, Boone, and Fletcher ( Western Region). Calendar Year Budget and Expenditures Budgeted Department of Commerce FRD Economic Development Inventory 16 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,619,543 $ 3,483,854 $ 2,510,898 $ 2,575,175 $ 2,725,563 $ 2,665,869 $ 2,678,811 Receipts $ 1,037,898 $ 343,583 $ 381,829 $ 431,829 $ 368,733 $ 470,179 $ 470,179 Total $ 2,657,441 $ 3,827,437 $ 2,892,727 $ 3,007,004 $ 3,094,296 $ 3,136,048 $ 3,148,990 Positions ( FTE) 8.00 8.00 8.00 7.00 7.00 7.00 7.00 General Statute Authorization: 143B- 437.011 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Bus. & Industry Flights 71 73 74 83 70 Budget and Expenditures Executive Aircraft The Executive Aircraft Division provides air transportation for the Department for economic development and for use by State officials. The Division maintains two planes and one helicopter to provide transportation service to prospective businesses considering locations in the State. Eligibility: Executive Aircraft may be used by the Department or other State officials. Priority is given to the Business & Industry Division for economic development purposes. Budgeted Department of Commerce FRD Economic Development Inventory 17 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 533,500 $ 525,000 $ 525,000 $ 525,000 $ 525,000 Receipts Total $ 533,500 $ 525,000 $ 525,000 $ 525,000 $ 525,000 Positions ( FTE) 8.00 8.00 8.00 8.00 8.00 General Statute Authorization: 143B- 431( e); 143B- 432.1 Key Statistics: 2004- 05 2005- 06 2006- 07 Clients Served* 17,015 35,918 34,644 * Unduplicated headcount Department of Commerce Budgeted Business ServiCenter Transferred to the Department of Commerce in FY 2004- 05, the Business ServiCenter provides one- stop shopping to both entrepreneurs and small businesses. The ServiCenter provides businesses with information about existing programs and resources for small businesses, license requirements, and government contracts. Budget and Expenditures Eligibility: Anyone is eligible to use the Business ServiCenter. FRD Economic Development Inventory 18 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 390,135 $ 427,913 $ 414,910 $ 447,424 $ 532,664 $ 528,782 $ 529,245 Receipts Total $ 390,135 $ 427,913 $ 414,910 $ 447,424 $ 532,664 $ 528,782 $ 529,245 Positions ( FTE) 6.00 6.00 6.00 6.00 6.00 6.00 6.00 General Statute Authorization: G. S. 143B- 437, G. S. 143B- 437.01- 2, 143B- 437.07- 8, 143B- 437.50- 63, 143B- 437.70- 74 Key Statistics: No relevant information to report. Budgeted Budget and Expenditures Eligibility: NA Department of Commerce Commerce Finance The Commerce Finance Center oversees most economic development incentives programs administered by the Department of Commerce. They are responsible for the administration of One NC, Industrial Development Fund ( IDF), Industrial Revenue Bonds, Job Development Investment Grants ( JDIG), Site Infrastructure Grants, Green Business Fund, and the Job Maintenance and Capital Development Fund. In addition, Commerce Finance is responsible for tracking, maintaining, and analyzing incentive data over time. FRD Economic Development Inventory 19 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 106,844 $ 4,137 $ 10,136 $ 2,840 $ 1,374 $ 4,183$ 4,183 Receipts* $ 45,000 Total $ 151,844 $ 4,137 $ 10,136 $ 2,840 $ 1,374 $ 4,183$ 4,183 * Receipts in FY 02- 03 were from the NC Economic Development Association. General Statute Authorization: G. S. 143B- 434, 143B- 434.01, 143B- 437.03 Key Statistics: No relevant information to report. Eligibility: NA Department of Commerce Economic Development Board Created in 1977, the Economic Development Board is charged with oversight of State economic development, research, and planning and makes policy recommendations to the Secretary of Commerce, the Governor and the General Assembly. The Board is comprised of 37 people, including State government officials, citizens, and members of the General Assembly. Budget and Expenditures Budgeted FRD Economic Development Inventory 20 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 12,172,155 $ 8,555,293 $ 7,428,631 $ 5,169,577 $ 5,894,227 $ 4,953,792 $ 1,509,234 Appropriation $ 569,713 $ 320,107 $ 320,107 $ 320,107 $ 320,107 $ 320,107 $ 320,107 Receipts* $ 756,024 $ 472,531 $ 677,366 $ 781,669 $ 164,515 $ 821,693 $ 821,693 Subtotal Available Funds $ 13,497,892 $ 9,347,931 $ 8,426,104 $ 6,271,353 $ 6,378,849 $ 6,095,592 $ 2,651,034 Grant Payments $ 1,763,727 $ 682,362 $ 268,180 $ 377,126 $ 1,425,057 $ 4,316,569 $ 4,316,569 Loans Awarded $ 175,000 $ 67,500 $ 100,000 $ 100,000 Subtotal Expenditures $ 1,938,727 $ 749,862 $ 268,180 $ 377,126 $ 1,425,057 $ 4,416,569 $ 4,416,569 Legislative Adjustments $ ( 3,003,872) $ ( 1,169,438) $ ( 2,988,347) $ ( 169,789) Total EOY Availability $ 8,555,293 $ 7,428,631 $ 5,169,577 $ 5,894,227 $ 4,953,792 $ 1,509,234 $ ( 1,765,535) * Receipts are primarily interest earned on loans or loan principal repayments. General Statute Authorization: G. S. 143B- 437.01 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Number of Awards 6 5 4 7 4 Total Grants Awarded $ 1,065,000 $ 294,052 $ 800,000 $ 1,850,838 $ 123,079 Total Loans Awarded $ 242,500 $ 100,000 $ 0 $ 0 $ 0 Average Award Amt $ 217,917 $ 78,810 $ 200,000 $ 264,405 $ 30,770 Budget and Expenditures Eligibility: Projects must be located in Tier I or Tier II counties. Funding is limited to the lower of $ 500,000 per project or $ 5,000 per job created. Projects in Tier II counties require a 25% match by the local government. Eligible industries are the same as those for Article 3J tax credits: company headquarters, air courier services, information technology and services, manufacturing, and warehousing or wholesale trade. Department of Commerce Industrial Development Fund Created in 1989, the Industrial Development Fund ( IDF) assists town, city, or county governments with incentive industrial financing for eligible industries in Tier I or II areas. Grants may be awarded for improved public infrastructure, and loans are available for building renovations or equipment purchases. Budgeted FRD Economic Development Inventory 21 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 18,900,000 $ 1,800,966 $ 35,045,454 $ 32,372,182 $ 33,654,932 $ 43,728,432 Appropriation $ 20,000,000 $ 1,000,000 $ 6,000,000 $ 15,000,000 $ 14,000,000 Receipts* $ 75,000 $ 75,000 $ 75,000 Subtotal Available Funds $ 18,975,000 $ 21,875,966 $ 36,045,454 $ 38,447,182 $ 48,654,932 $ 57,728,432 Administration $ 300,000 $ 300,000 $ 300,000 $ 300,000 $ 300,000 $ 300,000 Grant Payments $ 910,534 $ 1,657,978 $ 2,373,272 $ 3,492,250 $ 3,626,500 Transfer to JWU $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 Transfer to DENR $ 650,000 Subtotal Expenditures $ 1,210,534 $ 2,957,978 $ 3,673,272 $ 4,792,250 $ 4,926,500 $ 950,000 Total EOY Availability $ 17,764,466 $ 18,917,988 $ 32,372,182 $ 33,654,932 $ 43,728,432 $ 56,778,432 * Receipts are repaid grants from recipients who have defaulted on their grant agreement. General Statute Authorization: G. S. 143B Article 10, Part 2H ( G. S. 143B- 437.70- 75) Key Statistics: 2002 2003 2004 2005 2006 Number of Awards 29 28 44 56 58 Total Grants Awarded $ 7,686,706 $ 4,188,000 $ 10,249,575 $ 9,231,750 $ 15,148,500 Average Award Amt $ 265,059 $ 149,571 $ 232,945 $ 164,853 $ 261,181 Budgeted Eligibility: Grants may be used for installation or purchase of equipment, structural repairs, improvements, or renovations to existing buildings, construction of utility infrastructure for existing or proposed buildings or for any other purpose specifically authorized by the General Assembly. Funds are disbursed in accordance with a schedule established in the agreement, usually in four equal installments. Eligible recipients must create new jobs, and a local match is required. Department of Commerce One North Carolina Fund Created in 1993, the One North Carolina Fund ( originally called the Governor's Industrial Recruitment Competitiveness Fund) provides grants to local governments to help recruit new and expanding businesses to create quality jobs in certain industries. Budget and Expenditures FRD Economic Development Inventory 22 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 478,158 $ 2,860,513 Appropriation $ 1,000,000 $ 5,000,000 $ 4,830,000 Subtotal Available Funds $ 1,000,000 $ 5,478,158 $ 7,690,513 Grant Payments* $ 521,842 $ 2,617,645 Subtotal Expenditures $ 521,842 $ 2,617,645 Total EOY Availability $ 478,158 $ 2,860,513 $ 7,690,513 * 75% of grant awards are paid upon award. The remaining 25% is paid after program performance/ completion criteria are met. General Statute Authorization: G. S. 143B Article 10, Part 2I ( G. S. 143B- 437.80- 83) Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # Grants Awarded 25 51 Total Grant Amount $ 1,078,100 $ 4,533,955 Average Grant Amt $ 43,124 $ 88,901 Budgeted Budget and Expenditures Eligibility: North Carolina based businesses that have received a SBIR/ STTR Phase I award from a federal agency are eligible for the grants. Businesses must certify that at least 51% of the research described in the federal SBIR/ STTR Phase II proposal will be conducted in the State and that the business will reamin a North Carolina- based business for the duration of the Phase II project. Department of Commerce One North Carolina Small Business Fund The General Assembly created the One North Carolina Small Business Fund in 2005 to provide matching funds of up to $ 100,000 to businesses that have been awarded federal Small Business Innovation Research ( SBIR) and Small Business Technology Transfer ( STTR) grants. FRD Economic Development Inventory 23 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 3,089,931 $ 7,797,730 $ 16,061,083 Appropriation $ 4,500,000 $ 9,000,000 $ 12,400,000 $ 12,400,000 Subtotal Available Funds $ 4,500,000 $ 12,089,931 $ 20,197,730 $ 28,461,083 Grant Payments $ 920,531 $ 3,356,423 $ 3,146,433 $ 14,250,000 Transfer to Utility Account $ 489,538 $ 935,778 $ 990,214 $ 4,750,000 Subtotal Expenditures $ 1,410,069 $ 4,292,201 $ 4,136,647 $ 19,000,000 Balance $ 3,089,931 $ 7,797,730 $ 16,061,083 $ 9,461,083 General Statute Authorization: G. S. 143B Article 10, Part 2G ( G. S. 143B- 437.50- 63) Key Statistics: 2003 2004 2005 2006 # Grants Awarded 6 18 10 19 Total Grant Liability $ 39,360,658 $ 107,576,413 $ 50,965,000 $ 188,533,424 Average Grant Amt. $ 6,560,110 $ 5,976,467 $ 5,096,500 $ 9,922,812 Budgeted Eligibility: Eligible projects are those that create a minimum of 10 jobs in a Tier I area or 20 jobs in Tier II or III areas. Up to 25 businesses can receive grants lasting up to 12 years. The maximum annual liability cannot exceed $ 15 million ($ 30 million in 2006; $ 25 million in 2007). Grant awards can be anywhere from 10% to 75% of withholdings for eligible positions. Projects must result in a net increase in employment in the State - awards cannot be granted to companies relocating from one place to another with no increase in employment. All award agreements must contain clawback provisions in the event the company does not meet stated performance levels. Budget and Expenditures Job Development Investment Grant ( JDIG) Department of Commerce The Job Development Investment Grant ( JDIG) is a discretionary grant program created in 2002 to provide incentives to companies who would choose to locate elsewhere if the grant were unavailable. The program is set to expire January 1, 2010. Grants are awarded by the Economic Investment Committee ( EIC). FRD Economic Development Inventory 24 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 5,000,000 Total $ 5,000,000 General Statute Authorization: G. S. 143B- 437.11 Key Statistics: No relevant information to report. Budgeted Eligibility: This new fund will provide grants to existing businesses in Tier I counties that are making significant capital investments in the State and that employ and will conitnue to employ at least 2,000 people. Businesses must meet wage standard requirements and provide health insurance for employees in order to qualify. Performance requirements and clawback provisions will be included in all grant agreements. No more than 5 grants may be made, the total aggregate cost of which may not exceed $ 60 million. No single agreement may exceed an annual cost of $ 4 million, and grant periods may not extend beyond ten years. Department of Commerce Job Maintenance and Capital Development Fund Created in 2007 ( S. L. 2007- 552 Extra Session), the Job Maintenance and Capital Development Fund provides incentives to existing companies in Tier I counties that will be making significant capital investments in the State. This is the first direct incentive program created for existing businesses that does not require job creation. Budget and Expenditures FRD Economic Development Inventory 25 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,000,000 Total $ 1,000,000 Positions ( FTE) General Statute Authorization: G. S. 143B- 437.4- 8 Key Statistics: No relevant information to report. Budgeted Budget and Expenditures Eligibility: The Department of Commerce is in the process of developing guidelines for this program. Department of Commerce Green Business Fund Created in 2007, the Green Business Fund will proivde grants to private businesses, non- profits, and State agencies to encourage the growth of a green economy in the State. Grants will be used to encourage the development of the biofuels and green building industries, and to leverage investments in additional clean technology and renewable energy products and businesses. FRD Economic Development Inventory 26 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 Appropriation $ 24,000,000 Subtotal Available Funds $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 Grant Payments Subtotal Expenditures Balance $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 $ 24,000,000 General Statute Authorization: G. S. 143B-- 437.02 Key Statistics: No relevant information to report. Budgeted Eligibility: Eligible businesses must invest at least $ 100 million of private funds in the project and employ at least 100 new employees. Department of Commerce Site Infrastructure Grant The Site Infrastructure Grant was created in the 2003 Extra Session to provide grants or forgivable loans to businesses, governmental units, or non- profits to acquire or improve land for industrial purposes. Budget and Expenditures FRD Economic Development Inventory 27 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 842,910 $ 199,412 $ 110,315 $ 642,450 $ 1,603,176 $ 2,474,513 $ 2,131,043 Appropriation Transfer from JDIG NA NA $ 489,538 $ 935,778 $ 990,214 $ 937,007 $ 937,007 Receipts* $ 11,617 $ 42,597 $ 42,598 $ 50,343 $ 42,597 $ 42,597 Subtotal Available Funds $ 854,527 $ 199,412 $ 642,450 $ 1,620,826 $ 2,643,733 $ 3,454,117 $ 3,110,647 Grants or Loans $ 655,115 $ 89,097 $ 17,650 $ 169,220 $ 1,323,074 $ 1,323,074 Subtotal Expenditures $ 655,115 $ 89,097 $ 17,650 $ 169,220 $ 1,323,074 $ 1,323,074 Total EOY Availability $ 199,412 $ 110,315 $ 642,450 $ 1,603,176 $ 2,474,513 $ 2,131,043 $ 1,787,573 * Receipts are primarily interest earned on loans or loan principal repayments. General Statute Authorization: G. S. 143B- 437.01( b1); G. S. 143B- 437.61 Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # Grants Awarded 1 0 0 2 1 Total Grant Amount $ 121,768 $ 546,845 100,000 Budgeted Eligibility: Utility Account funds are limited to use for utility infrastructure only, and they must be expended to create jobs in either manufacturing and processing, warehousing and distribution, or data processing. The infratucture or utility must be located on the site of the building or, if not located on the site, shall be directly related to the operation of the specific industrial activity. There is no maximum funding amount or job creation requirement. Department of Commerce Utility Account The Utility Account provides grants to local governments in Tier I and Tier II counties for the construction of or improvements to new or existing water, sewer, gas, telecommunications, high- spreed broadband, electrical utility distribution lines or equipment, or transportation infrastructure for existing or new or proposed industrial buildings to be used for eligible industrial operations. Funding is currently provided from JDIG grants to companies located in Tier III counties. 25% of these grants must be paid to the Utility Account. Budget and Expenditures FRD Economic Development Inventory 28 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Carryforward Prior Year $ 10,000,000 Appropriation $ 10,000,000 Subtotal Available Funds $ 10,000,000 $ 10,000,000 Grant Payments Subtotal Expenditures Balance $ 10,000,000 $ 10,000,000 General Statute Authorization: G. S. 143B-- 437.02 Key Statistics: Eleven government and non- profit entities recieved grants in two categories – economic development projects and site acquisition and infrastructure. The maximum funding available for individual economic development project grants was $ 500,000 per project. The maximum funding for individual site acquisition and infrastructure grants was $ 5 million per project. Budgeted Eligibility: Local governments and non- profits were eligible to apply for the grants. Department of Commerce Economic Development Reserve The General Assembly established the Economic Development Reserve in FY 2006- 07 to provide a source of funding for governments and nonprofits seeking to implement local economic development projects or acquire land for economic development purposes. Budget and Expenditures FRD Economic Development Inventory 29 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 5,830,000 $ 6,775,000 $ 8,525,000 $ 8,525,000 $ 6,775,000 $ 6,775,000$ 6,436,250 Total $ 5,830,000 $ 6,775,000 $ 8,525,000 $ 8,525,000 $ 6,775,000 $ 6,775,000 $ 6,436,250 General Statute Authorization: G. S. 158 Article 2 ( 158.8- 15) Budget and Expenditures Commerce - State Aid Regional Economic Development Commissions In FY 1993- 94, the General Assembly directed the Department of Commerce to develop a “ program for promoting the expansion of economic development efforts such that all counties in the State participate in and benefit from organized regional economic development activities [ and to] encourage county participation in public/ private partnerships for economic development through membership in regional economic development commissions” ( S. L. 1993- 769, Sec. 28.7). That year, three Regional Economic Development Commissions (“ Commissions”) were created in statute: NC's Southeast, NC's Northeast, and Advantage West. Three commissions had already been created by private partners: the Charlotte Regional Partnership, the Piedmont Triad Partnership, and the Research Triangle Regional Partnership. They began receiving State funding in FY 1994- 95. The seventh commission, originally called the Global Transpark but now named NC's Eastern Region, was created by the General Assembly in FY 1995- 96. FRD Economic Development Inventory 30 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 5,214,195 $ 5,792,708 $ 10,883,395 $ 12,083,395 $ 13,083,395 $ 15,583,395 $ 15,583,395 Total $ 5,214,195 $ 5,792,708 $ 10,883,395 $ 12,083,395 $ 13,083,395 $ 15,583,395 $ 15,583,395 Commerce - State Aid NC Biotechnology Center Created in FY 1984- 85, the NC Biotechnology Center is a private, non- profit organization whose mission is to support biotechnology research, development, and commercialization in the State. The Center administers several grant and loan programs, hosts conferences, collaborates with the community colleges on a workforce training initiative, and works with local community leaders to strengthen biotechnology throughout the State. Budget and Expenditures FRD Economic Development Inventory 31 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,294,779 $ 1,320,650 $ 1,337,495 $ 2,347,602 $ 1,847,602 $ 2,847,602 $ 2,847,602 Total $ 1,294,779 $ 1,320,650 $ 1,337,495 $ 2,347,602 $ 1,847,602 $ 2,847,602 $ 2,847,602 Commerce - State Aid NC Institute for Minority Economic Development Established in 1986, the Institute of Minority Economic Development ( the Institute) seeks to foster economic development within the State’s women and minority- owned business community through policy analysis, information and technical assistance, and resource expansion. The Institute concentrates its activities in the areas of business development, resource, data and information collection, and demonstration initiatives. Budget and Expenditures FRD Economic Development Inventory 32 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 NC Center for Automotive Research ( NCCAR) 1 $ 200,000 $ 7,500,000 $ 3,750,000 $ 3,500,000 Various Community Development Corporations $ 200,000 High Point Furniture Market2 $ 750,000 $ 1,750,000 $ 1,875,000 $ 875,000 Duplin Agribusiness Center $ 500,000 Gaston County Economic Development Commission $ 300,000 Kerr- Tar Regional Economic Development Commission $ 4,000,000 $ 2,175,000 Hoke County Regional Industrial Park $ 100,000 Johnson & Wales University ( JWU) 3 $ 2,000,000 Defense and Security Technology Accelerator4 $ 2,000,000 $ 1,500,000 Total Appropriation $ 200,000 $ 15,350,000 $ 5,500,000 $ 11,050,000 $ 875,000 Notes: 1. Formerly the Advance Vehicle Research Center ( AVRC) 2. $ 875,000 of the funds appropriated for the Furniture Market Authority in FY 2006- 07 was recurring. 3. JWU had previously received $ 4 million through the One NC fund. Their first direct appropriation occurred in FY 2007- 08.. 4. The $ 2 million appropriation in FY 2005- 06 was passed through the Community College budget. Budget and Expenditures Commerce - State Aid Other State Aid to Non- State Entities The following table lists most economic development funds provided to non- State entities on a non- recurring basis since FY 2004- 05 ( no funds were appropriated to programs other than those established within the Department of Commerce in FY 2002- 03 and FY 2003- 04). FRD Economic Development Inventory 33 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 144,000 $ 144,000 $ 144,000 $ 144,000 $ 144,000 Carryforward Total $ 144,000 $ 144,000 $ 144,000 $ 144,000 $ 144,000 General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. Budget and Expenditures Eligibility: The institute works with leaders in the State's 85 rural counties to develop workshops and community college- based grant programs to assist dislocated workers with business development training. The institute also provides grants to communities pursuing entrepreneurship as an economic development strategy. Commerce - State Aid Rural Economic Development Center - Institute for Rural Entrepreneurship The Institute for Rural Entrepreneurship works to stimulate and support the development of micro, small, and medium- size enterprises in North Carolina's 85 rural counties. The institute began in 2003 and receives funding from the State and the W. K. Kellogg Foundation. The figures below represent funding received via direct appropriation from the General Assembly. FRD Economic Development Inventory 34 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 Carryforward Total $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 $ 195,000 General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. Rural Economic Development Center - Microenterprise Loan Program Created in 1989, the Microenterprise Loan Program provides loans for the start- up or expansion of small businesses by individuals in rural areas who have sound ideas and do not qualify for bank loans. Note: State funding is provided to support the loan fund and operations of the loan fund. The Microenterprise Loan Fund receives funding from other entities as well. Budget and Expenditures Eligibility: Anyone who wishes to start or expand a small business in the 85 rural counties of North Carolina may apply. Specific emphasis is place on serving rural, low- income, female, and minority participants. Commerce - State Aid FRD Economic Development Inventory 35 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 3,800,000 Carryforward Total $ 3,800,000 General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. This program was created in 2007 as part of the Rural Economic Transition Program. Funding for this program comes from the State, Golden LEAF, and other funds at the Rural Center. The numbers below reflect the amount of funding provided by the State. Commerce - State Aid Rural Economic Development Center - Rural Economic Transition Program - Rural Venture Fund Budget and Expenditures Eligibility: Existing businesses with owner management experience that are located in Tier One counties. Eligible businesses must demonstrate growth potential and show that the owner would not receive equity or subordinated debt financing from other sources. FRD Economic Development Inventory 36 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,000,000 $ 2,500,000 $ 2,500,000 $ 13,700,000 $ 2,500,000 Carryforward Total $ 2,000,000 $ 2,500,000 $ 2,500,000 $ 13,700,000 $ 2,500,000 * The program began in 2004 but received FY 2003- 04 funding due to a budget surplus at the end of that fiscal year. General Statute Authorization: n/ a - Funding is provided each year in the Appropriations Bill. Eligibility: Units of local government, nonprofit organizations, or educational institutions located in one of North Carolina's 85 rural counties or a Tier One county. An applicant may be located outside of these areas so long as the project is located within the eligible areas. Budget and Expenditures Commerce - State Aid Rural Economic Development Center - Economic Infrastructure Program Research & Demonstration/ Economic Innovation Grants This program began in 2004 with the purpose of investing in major research and demonstration projects with the potential to stimulate business activity, job creation, and further public/ private investment in the State's 85 rural counties. FRD Economic Development Inventory 37 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 199,996 $ 192,834 $ 183,253 $ 114,466 $ 127,810 $ 147,326 Carryforward Total Expended $ 131,678 $ 177,424 $ 137,995 $ 78,962 Balance $ 68,318 $ 15,410 $ 45,258 $ 35,504 General Statute Authorization: Eligibility: East Carolina University Community Engagement Community Engagement is an active partnership between communities of eastern North Carolina and East Carolina University to develop, exchange, and apply knowledge, information, expertise, and resources for everyone's benefit. These resources include, but are not limited to faculty, staff, and students. Budget and Expenditures FRD Economic Development Inventory 38 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 75,000 $ 75,000 $ 78,750 $ 80,655 $ 86,705 $ 91,101 Carryforward Total $ 75,000 $ 75,000 $ 78,750 $ 80,655 $ 86,705 $ 91,101 Expended $ 75,000 $ 75,000 $ 78,750 $ 80,655 $ 86,705 General Statute Authorization: Budget and Expenditures Eligibility: Fayetteville State University Fayetteville Business Center The Mission of the Fayetteville Business Center is to promote economic development in the City of Fayetteville and the Murchison Road corridor by providing nurturing to entrepreneurs including business assistance in the growth and development of small business concerns. The FBC is a business incubator that began its formal operations on October 19, 2001. Budgeted FRD Economic Development Inventory 39 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 7,021,428 $ 6,898,207 $ 7,080,897 $ 7,816,589 $ 8,069,399 $ 8,631,444 $ 8,539,271 Carryforward Total $ 7,021,428 $ 6,898,207 $ 7,080,897 $ 7,816,589 $ 8,069,399 $ 8,631,444 $ 8,539,271 Expended $ 7,021,428 $ 6,898,207 $ 7,080,897 $ 7,816,589 $ 8,069,399 Balance General Statute Authorization: North Carolina State University/ North Carolina A & T State University NC Cooperative Extension Service Description: The North Carolina Cooperative Extension Service was established by the Smith- Lever Act on May 18, 1914. Cooperative Extension is supported by funding from all 100 county governments plus the Cherokee Reservation, the state government and the U. S. Department of Agriculture and through partnerships with other educational institutions, including North Carolina A& T State University, agencies and organizations. It is an educational partnership helping people put research- based knowledge to work for economic prosperity, environmental stewardship and an improved quality of life. Our educational programs focus upon: enhancing agricultural, forest and food systems; strengthening and sustaining families; developing responsible youth; building quality communities; and conserving and improving the environment and natural resources. Budget and Expenditures Budgeted Eligibility: NA Key Statistics: The following represent some selected economic benefits that were a direct result of Cooperative Extension Programs in 2006: By using Extension recommended practices, the diverse animal sectors gained $ 26.2 million, aquatic species ($ 2.3M); dairy producers ($ 2.5M); beef cattle producers ($ 13.3M); hog producers ($ 8.8M); the horse industry ($ 3.6M); and sheep and goat producers ($ 3.5M). Producers of field, fruit and vegetable crops implementing Extension recommended production and marketing practices increased their net income by over $ 90 million. The NC green industry increased income by $ 4.56 million using Extension programs. Finally, North Carolina 4- Hers saved their communities over $ 566,550 by performing community service projects, increasing their impact by over 32% from 2005. As a result of their 4- H project work, $ 543,572 was earned, and $ 429,613 was saved by 4- Hers. 4- Her’s received over $ 325,578 in scholarships to continue their education beyond high school. FRD Economic Development Inventory 40 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 121,200 $ 125,400 $ 126,729 $ 333,065 $ 849,719 $ 349,719 Carryforward Total $ 121,200 $ 125,400 $ 126,729 $ 333,065 $ 849,719 $ 349,719 Expended $ 121,200 $ 125,400 $ 126,729 $ 333,065 Balance General Statute Authorization: Key Statistics*: 2002- 03 2004 2005 2006 # of Jobs 200 370 200 Investment $ 25,000,000 $ 147,000,000 $ 65,000,000 Economic Development Partnership North Carolina State University Budget and Expenditures Eligibility: Industry, economic developers, and other agencies are eligible for EDP services . The Economic Development Partnership ( EDP) was created in 2003 to ally with Wake County Economic Development to transform high- tech research into well- paying jobs for the county. Since its inception, the EDP has expanded statewide its effort to serve as a portal to connect the unique resources of NC State University in order to enhance productivity and competitiveness of North Carolina’s existing and traditional industries as well as technology- based emerging companies. The EDP leverages university resources toward high priority industry clusters that are able to transform high- tech research into higher- skilled, higher- paying jobs and bring related corporate investment. The EDP works directly with industry, economic developers, the NC Department of Commerce, and other agencies to increase and retain jobs and investment in the state. * Nonwoven industry only Budgeted FRD Economic Development Inventory 41 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,888,243 $ 2,377,195 $ 3,333,306 $ 3,220,252 $ 3,573,270 $ 3,573,270 Carryforward Total $ 1,888,243 $ 2,377,195 $ 3,333,306 $ 3,220,252 $ 3,573,270 $ 3,573,270 Expended $ 1,888,243 $ 2,377,195 $ 3,333,306 $ 3,220,252 Balance General Statute Authorization: Key Statistics: No relevant information to report. Industrial Extension Service Created in 1955, the Industrial Extension Service ( IES) of NC State University helps small and mid sized manufacturers in the State apply innovative technologies and improve their product design, manufacturing processes and industrial management systems. IES provides direct engineering and technical assistance; continuing education in areas of product quality, manufacturing process, technology application; environmental assistance; and technical demonstrations, referrals and networking. North Carolina State University Budgeted Budget and Expenditures Eligibility: North Carolina manufacturers are eligible for service. FRD Economic Development Inventory 42 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,061,680 $ 2,003,254 $ 2,092,073 $ 2,089,491 $ 2,132,772 $ 2,217,495 $ 2,217,495 Carryforward Total $ 2,061,680 $ 2,003,254 $ 2,092,073 $ 2,089,491 $ 2,132,772 $ 2,217,495 $ 2,217,495 Expended $ 2,061,680 $ 2,003,254 $ 2,092,073 $ 2,089,491 $ 2,132,772 Balance General Statute Authorization: Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Clients Counseled 5,310 4,759 4,943 5,239 5,300 Hours of Counseling 53,065 54,784 63,061 64,337 55,500 Training Attendees 3,372 6,858 7,425 6,667 6,161 Training Events 204 264 257 213 304 Budget and Expenditures Budgeted Eligibility: SBTDC services are provided to clients in all 100 counties of NC through a statewide network of 75 employees in 17 offices. Management Counseling is free and educational services have a modest cost recovery fee. UNC Small Business Technology Development Center ( SBTDC) Created in 1984 by the Board of Governors, the SBTDC is a statewide business and technology extension service of the UNC system administered by NCSU. The SBTDC provides management counseling and educational services to small & mid- sized business in NC, as well as to start- up businesses. The primary focus is management counseling addressing financing, marketing, human resources, operations, business planning and feasibility assessment. In addition, SBTDC also provides targeted educational services focused on change management, strategic performance and leadership. Other programs include assistance with selling to government agencies, export financing, boating industries, technology development and commercialization. FRD Economic Development Inventory 43 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 81,295 $ 92,253 $ 88,590 $ 104,729 $ 116,058 $ 116,500 $ 116,500 Carryforward Total $ 81,295 $ 92,253 $ 88,590 $ 104,729 $ 116,058 $ 116,500 $ 116,500 Expended $ 81,295 $ 92,253 $ 88,590 $ 104,729 $ 116,058 Balance General Statute Authorization: Key Statistics: The Ben Craig Center was established in 1986 as a non- profit Business Incubator in partnership with the University of North Carolina at Charlotte. The Incubator Program, Education and Community events, and Advisory services offered by the BCC offer full support for dozens of companies each year. The BCC focuses on community businesses and University startups that benefit most directly from proximity to expertise, services, and equipment that only the BCC and the University can provide. Budget and Expenditures Eligibility: To be eligible to participate, the potential company must demonstrate high growth potential, six to twelve months worth of available funding, a scalable business model, a strong management team, current momentum, and willingness to participate in Ben Craig Center events. Retailers, construction contractors, businesses whose primary job creation is in commissioned sales ( e. g., real estate, insurance, etc.) and professional counselors ( e. g., accountants, attorneys, financial planners, etc.) are ineligible for consideration due to the nature of the Incubator program. Incubator clients have historically entered the program with 3- 5 employees and between $ 250,000 and $ 1.5 million in revenue or start- up capital. Incubator clients represent a broad range of business sectors, 44% technology, 39% service oriented, and 17% product sales. Budgeted Ben Craig Center UNC Charlotte FRD Economic Development Inventory 44 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 357,360 $ 394,024 $ 466,796 $ 723,620 $ 830,820 $ 837,364 $ 860,000 Carryforward Total $ 357,360 $ 394,024 $ 466,796 $ 723,620 $ 830,820 $ 837,364 $ 860,000 Expended $ 302,351 $ 338,266 $ 436,479 $ 667,442 $ 810,857 Balance $ 55,009 $ 55,758 $ 30,317 $ 56,178 $ 19,963 General Statute Authorization: Key Statistics: No relevant information to report. Western Carolina University Institute for the Economy and the Future ( IEF) Eligibility: The IEF conducts economic policy analysis and applied research, and administers public service projects on economic and community capacity building and strategic development. The economic development mission of the IEF is to attract, identify, qualify and assist regional businesses and to leverage the university's resources of research, science, engineering, arts and humanities faculty and students, as well as the core staff of the Institute ( analysts, planners, and faculty fellows) for business growth, including the transfer and application of new technologies and the commercialization of ideas. Budget and Expenditures Budgeted FRD Economic Development Inventory 45 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 32,201 $ 116,171 $ 118,104 $ 129,307 $ 138,170 $ 138,710 Carryforward $ 10$ 25 Total $ 32,201 $ 116,171 $ 118,104 $ 129,317 $ 138,195 $ 138,710 Expended $ 35,417 $ 109,152 $ 118,094 $ 129,292 Balance $ ( 3,216) $ 7,019 $ 10$ 25 General Statute Authorization: Key Statistics: 2004- 05 2005- 06 2006- 07 Major University- Community ED Summit Hosted 1 Interdisciplinary ED Seminars 3 4 9 Public Service Projects Coordinated/ Performed 1 1 2 Public Service Projects Funded by OEBD -- 2 14 $$ awarded by OEBD for ED Public Service Projects* -- $ 12,000 $ 213,514 Internal ED public service meetings/ presentations 120 103 70 External ED outreach meetings/ presentations 78 70 86 Eligibility: There are no specific eligibility requirements to access OEBD services. The Office will work with any person or group affiliated with UNC-Chapel Hill and interested in impacting economic development in the state. Likewise, any group, business, government, individual, etc. from the State of North Carolina may approach the Office for assistance in locating and accessing economic development resources at the University. UNC - Chapel Hill Office of Economic and Business Development Created in April 2004, the Office of Economic and Business Development ( OEBD) works to identify, articulate, and improve the economic development resources of UNC- Chapel Hill and connect those resources to North Carolina governments, communities, and businesses. Budget and Expenditures FRD Economic Development Inventory 46 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,625,000 $ 2,750,000 $ 2,750,000 $ 2,750,000 Carryforward Total $ 2,625,000 $ 2,750,000 $ 2,750,000 $ 2,750,000 Expended $ 101,127 $ 1,113,156 Balance $ 2,523,873 $ 1,636,844 General Statute Authorization: G. S. 115D- 5.1 Key Statistics: 2005- 06 2006- 07 Number of Projects 12 19 # of Trainees 297 1,253 Average Cost per Trainee $ 340 $ 888 Budget and Expenditures Eligibility: CIT resources are applied at the discretion of the North Carolina Community College System President upon the recommendation of the Vice President for Economic and Workforce Development to projects on behalf of private for- profit business/ industry where the company: 1. Has made an appreciable capital investment which involves the use of new technology; 2. Requires the enhancement of workforce skills to utilize the new technology; and 3. May or may not create net new jobs, but with the assistance will be more productive or more profitable, and as a result, will more likely remain a viable North Carolina corporate citizen. NC Community College System Customized Industry Training ( CIT) Created in 2006, the CIT program helps existing North Carolina businesses and industries improve their productivity and profitability to assure their continued presence in North Carolina. The program augments the services provided by NEIT and FIT, when their current guidelines do not apply. Budgeted FRD Economic Development Inventory 47 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,962,032 $ 1,962,032 $ 3,964,471 $ 3,964,471 $ 3,964,471 $ 3,964,471 $ 3,964,471 WTTF* $ 1,450,000 WIA* $ 599,684 Carryforward $ 1,829,481 $ 1,729,190 $ 839,746 $ 1,122,177 $ 783,246 $ 783,246 Total $ 5,241,513 $ 4,290,906 $ 4,804,217 $ 5,086,648 $ 4,747,717 $ 4,747,717 $ 3,964,471 Expended $ 3,552,714 $ 3,356,524 $ 3,682,040 $ 3,748,560 $ 3,916,821 Balance $ 1,688,799 $ 934,382 $ 1,122,177 $ 1,338,088 $ 830,896 * Worker Training Trust Fund ( WTTF); Workforce Investment Act ( WIA) General Statute Authorization: G. S. 115D- 5.1 Key Statistics: 2000- 01 2001- 02 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # of Fit Centers 40 40 40 37 36 36 36 # of Companies Served 630 754 834 701 797 623 563 # of Trainees 13,404 10,488 8,438 10,559 11,159 10,557 10,728 # of Skills Classes 1,519 1,100 955 1,071 1,205 1,074 603 Budgeted NC Community College System Focused Industrial Training ( FIT) Created in 1981, the FIT program ( originally called “ cooperative skills training”) provides customized training and services for North Carolina businesses to help them become more productive and competitive. FIT is directed toward workers who need to update their skills and technical knowledge because of technological changes. In addition to incumbent worker training, FIT centers assist with training needs assessment and the development of company- or industry- specific training plans. Funds are allocated among FIT centers based on the size of existing manufacturing base in the service area. Budget and Expenditures Eligibility: FIT services are available to manufacturing industries and companies whose main product is the design and programming of computers and telecommunication systems. Eligible trainees include the employees of such companies that are skilled or semi- skilled production workers, computer programmers, industrial maintenance workers, and front- line supervisors. FRD Economic Development Inventory 48 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 6,028,541 $ 6,033,126 $ 6,028,541 $ 6,028,541 $ 6,028,541 $ 6,028,541 $ 6,028,541 Carryforward $ 9,989,181 $ 9,053,569 $ 10,930,286 $ 11,094,476 $ 8,399,976 $ 4,954,728 Total $ 16,017,722 $ 15,086,695 $ 16,958,827 $ 17,123,017 $ 14,428,517 $ 10,983,269 $ 6,028,541 Expended $ 4,324,263 $ 4,156,409 $ 5,864,351 $ 8,703,156 $ 9,473,788 Balance $ 11,693,459 $ 10,930,286 $ 11,094,476 $ 8,419,861 $ 4,954,729 General Statute Authorization: G. S. 115D- 5.1 Key Statistics: 2000- 01 2001- 02 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 # of Projects 203 155 131 121 164 197 208 New 82 65 52 38 70 92 97 Expanding 121 90 79 83 94 105 111 # of Trainees 24,068 14,771 10,610 10,117 12,398 23,799 19,380 Average Cost per Trainee $ 292 $ 365 $ 377 $ 380 $ 442 $ 352 $ 463 Budgeted NC Community College System New and Expanding Industry Training ( NEIT) Created in 1958, the NEIT program provides customized training assistance in support of new, full- time production positions created in the State of North Carolina. Resources may support training, assessment, program development, instructional costs, and training delivery. Budget and Expenditures Eligibility: Companies creating 12 or more production jobs in excess of their previous 3- year maximum employment level are eligible for assistance through NEIT. Eligible trainees include new front- line personnel involved in the direct production of goods and services and their first- line supervisors. FRD Economic Development Inventory 49 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 125,000 $ 125,000 $ 350,000 $ 600,000 $ 600,000 $ 726,006 $ 626,006 WTTF* $ 250,000 $ 120,000 $ 250,000 Carryforward Total $ 375,000 $ 245,000 $ 600,000 $ 600,000 $ 600,000 $ 726,006 $ 626,006 Expended $ 375,000 $ 245,000 $ 600,000 $ 600,000 $ 600,000 Balance * Worker Training Trust Fund ( WTTF) General Statute Authorization: No specific authorization; workforce development programs in general are authorized under G. S. 115D- 1. Budget and Expenditures Eligibility: Hosiery companies located in or doing business within North Carolina. NC Community College System Hosiery Technology Center Established in 1990, the Hosiery Technology Center assists the hosiery industry to compete in a global environment through training, research and development, hosiery testing, E- commerce and new product development. The center has a physical presence at Catawba Valley Community College and Randolph Community College; both colleges are located in two major regions of North Carolina where hosiery manufacturing is centered. Budgeted FRD Economic Development Inventory 50 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,402,489 $ 1,402,489 $ 1,213,401 $ 963,401 $ 963,401 $ 994,142 $ 994,142 Receipts $ 123,463 $ 116,334 $ 41,598 Carryforward Total $ 1,525,952 $ 1,518,823 $ 1,254,999 $ 963,401 $ 963,401 $ 994,142 $ 994,142 Expended $ 1,482,469 $ 1,517,926 $ 1,223,475 $ 963,400 $ 963,400 Balance $ 43,483 $ 896 $ 31,524 $ 1$ 1 General Statute Authorization: G. S. 115D- 67.1 Budget and Expenditures Eligibility: Textile business located in or doing business within North Carolina. NC Community College System Textile Center The Textile Center was reorganized and merged with Gaston College in 2005. It's current mission is to develop a world- class workforce for the textile industry in North Carolina and to support the textile industry by identifying problems confronting the industry and assisting the industry in solving them, garnering support from the textile industry for the work of the center, and serving as a statewide center of excellence that serves all components of the textile industry. To accomplish this mission, the Center does new and sample product development, product testing, training, and consulting. Budgeted FRD Economic Development Inventory 51 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,000,000 $ 200,000 $ 1,000,000 $ 1,250,000 $ 1,250,000 Carryforward $ 1,200,447 $ 543,112 $ 487,885 Total $ 2,000,000 $ 1,400,447 $ 1,543,112 $ 1,737,885 $ 1,737,885 Expended $ 651,611 $ 857,335 $ 1,055,227 Balance $ 1,348,389 $ 543,112 $ 487,885 General Statute Authorization: No specific authorization; workforce development programs in general are authorized under G. S. 115D- 1 Key Statistics: From the program's inception to August 2007, firms working with NCMBC won 287 contracts, worth $ 446- 724 million. As of August 2007, MatchForce. org had 9,532 NC businesses and 15,837 individuals registered to access the 10,219 contract and 2,804 job opportunities listed on the website. Budget and Expenditures Eligibility: Businesses and individuals in North Carolina interested in military contracting opportunities. NC Community College System NC Military Business Center ( NCMBC) Started in 2004, the mission of the NC Military Business Center is to leverage the presence of the military in North Carolina to promote economic development and quality of life for all. The Center seeks to increase military business for existing North Carolina companies, to integrate transitioning military personnel and family members into the workforce, and to support recruitment and development of defense- related businesses in North Carolina. To accomplish these goals, the Center provides free access to MatchForce. org, which helps connect NC businesses with military contracting opportunities. The Center also helps clients develop proposals and bid on military contracts. Budgeted FRD Economic Development Inventory 52 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 3,861,109 $ 4,228,396 $ 4,590,562 $ 5,405,033 $ 5,689,882 $ 5,748,707 $ 5,748,707 Carryforward Total $ 3,861,109 $ 4,228,396 $ 4,590,562 $ 5,405,033 $ 5,689,882 $ 5,748,707 $ 5,748,707 Expended $ 3,858,410 $ 4,162,271 $ 4,508,476 $ 5,343,047 $ 5,658,468 Balance $ 2,699 $ 66,125 $ 82,086 $ 61,986 $ 31,414 General Statute Authorization: No specific authorization; workforce development programs in general are authorized under G. S. 115D- 1. Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 3,038 2,979 2,931 2,219 2521 48,791 44,475 44,993 51,312 55,526 14,723 18,493 20,090 6,117 5,333 3,113 5,831 5,310 4,873 4,365 66,627 68,799 70,393 76,893 70,448 Budget and Expenditures Eligibility: Anyone in North Carolina interested in entrepreneurship. NC Community College System Small Business Center Network ( SBCN) The objective of the SBCN is to increase the success rate and the number of viable small businesses in North Carolina by providing high quality, readily-accessible assistance to prospective and existing small business owners and their employees. Each Small Business Center ( SBC) is a community- based provider of education and training, counseling, information, and referral. Confidential counseling services and access to resource libraries are free of charge. Some seminars and workshops require a minimal registration fee. The first 13 SBCs were established in 1984. The program was expanded, and by 1995 SBCs were located at all 58 community colleges. Budgeted * Counseling figures through FY 2004- 05 include services provided in person, over the telephone, and via e- mail. Starting in FY 2005- 06, figures have been adjusted to exclude telephone and short- term counseling. Total # of clients # of seminars/ workshops provided # of seminar/ workshop participants # of counseling clients* # of referrals FRD Economic Development Inventory 53 January 2008 Fiscal Research Division 1 February 2007 North Carolina Economic Development Inventory AAppppeennddiixx EE TTrraannssppoorrttaattiioonn FRD Economic Development Inventory Fall 2007 [ This page intentionally left blank] Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 28,000,000 $ 38,000,000 $ 14,000,000 Programmed $ 7,395,000 $ 29,708,200 Expended $ 274,945 $ 8,784,665 General Statute Authorization: Key Statistics: No relevant information to report. Budget and Expenditures Eligibility: S. L. 2007- 323 provides that the funds are to be allocated equally among the fourteen Highway Divisions for economic development transportation projects recommended by the member of the Board of Transportation representing that Division in consultation with the Division Engineer and approved by the Board of Transportation. Funds not needed for economic development projects shall be used on spot safety needs to enhance safety, reduce congestion, improve traffic flow, reduce accidents, and for system preservation. Any remaining funds in each Division shall be used on Transportation Improvement Program projects. Department of Transportation Highway Fund Economic Development Funds are provided for economic development transportation projects. Funding began in FY 2005- 06. FRD Economic Development Inventory 54 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Authorized $ 15,000,000 $ 15,000,000 Programmed $ 16,814,981 $ 11,427,334 $ 1,123,959 $ 1,112,637 $ 1,621,096 Expended $ 2,544,532 $ 7,667,821 $ 11,757,013 $ 6,789,606 $ 4,582,580 General Statute Authorization: G. S. 136- 176 ( a1) Key Statistics: No relevant information to report. Eligibility: The projects had to be individually approved by the Board of Transportation. Funds were distributed according to the Equity Formula. Generally, project funding was limited to $ 400,000. Department of Transportation S. B. 1005 Discretionary Funding The Department of Transportation was directed to use certain Highway Trust Fund cash balances in FY2000- 01, FY2001- 02, and FY2002- 03 for highway improvement projects furthering economic growth and development. Budget and Expenditures FRD Economic Development Inventory 55 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Allocated $ 10,000,000 $ 10,000,000 $ 20,000,000 $ 20,000,000 $ 20,000,000 $ 20,000,000 $ 20,000,000 Programmed $ 9,415,000 $ 300,000 $ 5,388,000 $ 9,065,000 $ 24,422,000 $ 27,259,000 $ 9,616,000 Expended $ 5,720,465 $ 9,640,785 $ 13,752,707 $ 6,512,130 $ 14,535,922 General Statute Authorization: G. S. 143B- 150 f( 4) Key Statistics: No relevant information to report. Department of Transportation State Transportation Improvement Program - Economic Development Program The State Transportation Improvement Program is the State's seven- year plan for major transportation projects, as approved by the Board of Transportation. In recent years $ 20 million per year has been allocated for industrial recruitment projects approved by the Board. Budget and Expenditures Eligibility: The funds are generally used for significant industrial recruitment or expansion projects, generally developed in cooperation with state and local economic development agencies. The geographical distribution of State Transportation Improvement Program funds is by the statutory Equity Formula ( G. S. 136- 17.2A) and the project costs are charged to the funding region in which the project is located. Cities and others contribute to the funding of these projects. FRD Economic Development Inventory 56 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 $ 15,000,000 Programmed- Econ Dev* $ 900,000 $ 900,000 $ 900,000 $ 900,000 $ 900,000 Expended- Econ Dev* $ 450,000 $ 450,000 $ 450,000 $ 450,000 $ 450,000 * Estimated Average General Statute Authorization: NA Key Statistics: No relevant information to report. Contingency Fund These funds are used for rural or small urban highway improvements. On average, approximately 6% of the funds have been programmed for economic development projects. Budget and Expenditures Eligibility: The funds are used statewide for rural or small urban highway improvements and transportation enhancements to public roads and public facilities, industrial access roads, and spot safety projects, including pedestrian walkways that enhance highway safety. Projects are approved by the Secretary of Transportation and the Board of Transportation. Department of Transportation FRD Economic Development Inventory 57 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 2,000,000 $ 1,000,000 $ 2,000,000 $ 1,000,000 Programmed ( Net) $ 1,954,692 $ 1,484,000 $ 2,041,000 Expended $ 139,207 $ 1,234,714 $ 1,067,309 General Statute Authorization: NA Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Grants made 9 10 12 Proj. carloads/ yr 49,999 52,073 49,992 Proj. jobs 4,994 4,620 4,141 Companies served 50 67 97 Eligibility: Short line and regional railroads are eligible. Recipients may receive a maximum of 50 percent of project costs. The following factors are considered: benefit/ cost ratio, project impact, safety impact, transportation system impact, employment impact, community development impact, and whether the project match exceeds the 50 percent requirement. Department of Transportation Short Line Infrastructure Program The program was created in 2005 to provide funds to short line railroads ( railroads that operate over a short distance or as switching or terminal railroads) to rehabilitate and modernize track and bridge infrastructure. The goal is to upgrade transportation infrastructure required to retain and attract industry. Budget and Expenditures FRD Economic Development Inventory 58 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Allocated - All Uses $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 $ 2,000,000 Proggrammed for Economic Dev. $ 353,083 $ 129,605 $ 675,361 $ 657,121 $ 795,000 Expended- Econ Dev $ 255,909 $ 600,800 $ 139,587 $ 150,294 $ 734,458 General Statute Authorization: Key Statistics: No relevant information to report. Budget and Expenditures Eligibility: The maximum amount for school projects is $ 50,000. The amount for industries is generally based on the number of jobs created at $ 1,000 per job. The projects are approved by the Board of Transportation. Department of Transportation Public Access Fund These funds are used to provide access for schools, volunteer fire departments, and industries. FRD Economic Development Inventory 59 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 Programmed ( Net) $ 306,000 $ 777,903 $ 810,289 $ 317,597 $ 330,065 Expended $ 926,912 $ 239,783 $ 315,691 $ 275,512 $ 639,349 General Statute Authorization: Key Statistics: 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 Grants made 5 10 9 Annual rail car loadings 9,798 8,203 12,576 The Rail Industrial Access Program provides industries with an incentive to locate or expand their facilities in North Carolina. The funding helps ensure that companies have the railroad tracks needed to transport freight and materials by providing state funds to assist in constructing or refurbishing tracks. Budget and Expenditures Eligibility: Local governments, community development agencies, railroad companies and industries are eligible for funds to improve rail access. Approval of requests is based on economic benefit of the project, including the number of potential new jobs that will be created, the amount of capital investment, rail use, and the area's economic condition. The maximum grant is 50 percent of the project cost. Department of Transportation Rail Industrial Access Program FRD Economic Development Inventory 60 January 2008 Fiscal Year 2002- 03 2003- 04 2004- 05 2005- 06 2006- 07 2007- 08 2008- 09 Appropriation $ 21,000,000 $ 28,000,000 $ 21,000,000 $ 21,000,000 $ 21,000,000 $ 35,000,000 $ 21,000,000 Programmed- Econ Dev* $ 210,000 $ 280,000 $ 210,000 $ 210,000 $ 210,000 Expended- Econ Dev* $ 75,600 $ 100,800 $ 75,600 $ 75,600 $ 75,600 * Estimated average General Statute Authorization: Budget Bills. S. L 2007- 323 Section 27.5 Key Statistics: No relevant information to report. Small Construction The Small Construction Program funds a variety of transportation projects for municipalities, counties, businesses, schools, and industries. On average, approximately one percent of funds are programmed for economic development projects. Budget and Expenditures Eligibility: These projects are recommended by the Board of Transportation Member representing the Division in which the project is to be constructed in consultation with the Division Engineer. The projects are approved by the Board of Transportation. There is a $ 250,000 maximum amount per request per year. Projects with a total cost greater than $ 150,000 require a resolution or letter of support from the city, town or county. Department of Transportation FRD Economic Development Inventory 61 January 2008 |
OCLC number | 601342751 |