North Carolina’s Caldwell County ponied up $250 million in tax breaks to Google to entice it to build a data center there but didn’t study whether the deal made good financial sense.
For a community that has watched jobs fall away with the demise of its once-proud furniture industry, the allure of a big name company coming in with high-tech replacement employment has to be nearly irresistible.
It may have been a little too intoxicating for officials in Caldwell County. Once an agreement with Google was secured to bring a computer center and a bunch of jobs to the area, the various numbers associated with this economic development became known.
That must have led to several people reading those accounts and spewing Cheerios across their computer monitors. The Charlotte Observer reported Google would receive three decades of forgiveness for state and local tax payments.
Estimates put that savings at $250 million, a figure the report called one of the biggest in the state’s history. Detailed incentives from the local area have not been released yet; what is known has come from state records, said the report.
The rush to rebuild the depressed economy may have persuaded local officials to skip an economic study, even though the state did one for a nearly $5 million job creation grant they provided to Google. That study found the grant should result in $45.3 million in state revenue over twelve years.
One can’t blame local officials for wanting to revive the area and keep the community from being relegated to a footnote. But they do need to make sure it isn’t a temporary revival. Thirty years is a long time to bet.
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