The NC House budget included a provision for the state to sell the controversial Jennette’s pier located in Nags Head. The pier opened three years ago after the 2009 legislature approved $25 million to fund its construction.
House legislators say this move could generate revenue for the state to help other priorities – including the Clean Water Management Trust Fund.
Selling the pier is a good idea, and Civitas applauds efforts for the state government to sell off its non-essential assets. Hopefully this move would inspire state lawmakers to seek other opportunities to downsize the amount of property and buildings requiring millions of taxpayer dollars for upkeep.
Moreover, by unloading the pier the state would not only bring in a one-time windfall of millions of dollars, it would rid itself of ongoing upkeep and operational costs that some estimates projected to be roughly $500,000 per year (see pg. 12).
The sale would also boost local property tax revenue to Dare County from the private owners, and generate tax revenue to the state due to the commercial activity. The extra revenue would ease the tax burden on everyone else.
State funding for the pier was controversial from the start, as many questioned the legitimacy of approving $25 million for an extravagant pier during the depths of the recession and the state budget facing shortfalls exceeding $4 billion.
Indeed, a May 2009 Civitas poll asked likely voters if they approved of $25 million is state tax money going to build a pier. 66% said they strongly or somewhat opposed, while only 20% were strongly or somewhat in favor.
Furthermore, funding for the pier was sold in 2009 in part on the basis of aggressive ‘job creation’ claims – which turned out to be wildly exaggerated.
Many opposing the sale of the pier will object by saying “we paid $25 million for the pier, we can’t sell it because it would be like throwing that money away if the state can’t recoup the $25 million in the sale.” This notion, however, is wrongheaded. That $25 million is sunk costs – it is already spent and gone. The only relevant decision is what to do going forward. Continuing to pay for operations and upkeep of the pier will simply be throwing good money after bad.
Jennette’s pier was a boondoggle from the start, and the state now has a chance to right this wrong by unloading it.