Apparently embarrassed by a recent Civitas Review blog post concerning HB713, which would have extended tax credits to million dollar film production studios instead of to the citizens of North Carolina, Rep. Bill Owens (D-Pasquotank) decided to hide the tax credits for Hollywood millionaires in another bill in an effort to sneak it through the legislature. As if that was not bad enough, the tax credits for film studios were made even more generous in the new legislation. Rep. Owens rolled several “economic incentives” bills, including the film credits bill, into HB1973, innocuously, and incorrectly, entitled the “Keeping North Carolina Competitive Act.”
In the bill, Rep. Owens included granting favorable tax status to wood chippers, which is a suspiciously specific provision. Furthermore, Owens included language establishing favored tax status for businesses locating in the newly established “Eco-Industrial Parks.” Owens then admitted that the legislation was designed specifically for a county in his district. In other words, these tax exemptions are well-hidden pork projects paid at the expense of North Carolina taxpayers in the way of lost revenue that might be spent on teacher retention or transportation infrastructure.
During the Commerce, Small Business and Entrepreneurship Committee meeting where Owens’ “Keeping North Carolina Competitive Act” was seen for the first time, Reps. Marilyn Avila (R-Wake) and Mitch Gillespie (R-McDowell) voiced concerns that the bill, 19 pages in total, was expected to be passed out of committee the very day it was introduced. In under an hour, Reps. Avila and Gillespie claimed, the committee would be unable to fully consider or make an informed vote on a 19 page bill that they had not seen prior. The legislators were told by Owens that it was imperative that the bill keep moving because the 2010 session would be short – no matter that many committee members would not understand the bill.
Perhaps a more effective way to keep North Carolina competitive would be to lessen the tax burden on businesses in general. The Tax Foundation ranks North Carolina’s 2010 tax environment 39th nationally. Rep. Owens may find that lowering taxes for everyone actually helps the economy instead of a select few. Playing favorites may be a way to get re-elected but economic growth will result from a more favorable tax environment for everyone.