Roy Cooper has a chance to keep a campaign promise. Let’s see if he does.
On the evening of June 25, the North Carolina House of Representatives passed House Bill 1080 —Revenue Laws Recommendations — and sent it to the governor for his signature.
This Republican-backed bill makes several provisions with minimal impact, but one is quite substantial. One section extends the sunset on the Jobs Development Investment Grant Program (JDIG), set to expire on January 1, 2021, and extends the program for 10 years to January 1, 2030.
Civitas has written about JDIG many times and has a long record of criticizing this program. JDIG is a discretionary incentive program that provides cash grants directly to new and expanding companies to offset the cost of locating or expanding a facility in the state.
In short, JDIG is what we call “corporate welfare,” and both Democrats and Republicans are guilty of picking winners and losers with taxpayer money.
In terms of the cost to taxpayers, analysis from the non-partisan General Assembly’s Fiscal Research Division found that “a likely estimate indicates an increase of between $329 million and $843 million between FY 2021-22 and FY 2030-31.”
Now is where we get back to Gov. Roy Cooper.
As a gubernatorial candidate and as governor, Cooper has railed against what he called “corporate tax giveaways.” For example:
- April 18, 2016 – “Right now you have corporate tax giveaways at the expense of education and the middle class.” (Asheville Citizen-Times)
- October 13, 2016 – “We do not need to raise taxes. We need to stop the continuing corporate tax giveaways and put more money in the pockets of middle class families. Under Governor McCrory, most families are paying more while those at the top are getting record breaks.” (Wilmington Star News)
- January 25, 2017 – “That’s going to be one of the major battles during this General Assembly session. Are we going to invest in education and our people, or are we going to continue with further corporate tax giveaways?” (Raleigh News & Observer)
As I stated earlier, both Democrats and Republicans have historically been guilty of playing economic “winners and losers” by doling out taxpayer dollars to the most politically-connected corporations. It keeps tax rates artificially high. It’s not fair. It’s legal bribery. It’s a vote-buying scheme. And it’s wrong.
But Roy Cooper made a promise on the campaign trail. According to Politifact’s Coop-O-Meter, he made a promise to create a new economic development plan for the Old North State.
As House Bill 1080 comes to his desk in the last year of his term, will Gov. Cooper opt to keep a campaign promise, or will he sign the bill for a “business as usual” economic plan for the next 10 years?
I doubt it. First, you’ll notice that Politifact’s Coop-O-Meter has zero campaign promises marked as “promises kept.”
Second, despite all of his rhetoric against “corporate tax giveaways,” Gov. Cooper has given JDIG grants away at a dizzying rate – at one point averaging $1.2 million in incentive giveaways per day.
JDIG is a discretionary program, meaning that if Gov. Cooper and his Department of Commerce want to stop signing incentive deals, they can do so at any time. Instead, we’ve seen the Cooper administration offer massive incentive deals to major corporations such as Allstate Insurance, Lowe’s, Microsoft, and Credit Suisse. Of course, we shouldn’t forget the $2 billion that was offered to Amazon for HQ2.
I hope Gov. Cooper lives up to his campaign promise. If he doesn’t, he should stop lying to North Carolina taxpayers about his stance on corporate tax breaks — he’s not opposed to them; he just wants to pick who gets them.