Incentives to win.

• Author: Mooneyham, Scott
• Position: CAPITALGOODS - Clearwater Paper Corp.

It wasn't happenstance. Gov. Beverly Perdue, delivering her State of the State address to the General Assembly back in February, recognized a company and its CEO, who stood in the House gallery. Gordon Jones of Clearwater Paper Corp. had announced the previous summer that the Spokane, Wash.-based company will build a tissue-paper plant in Cleveland County. "We used every tool in the toolbox to convince companies that the Tar Heel State deserves our reputation as the best place in the nation to do business," Perdue said.

By tools, she mostly meant business-recruiting incentives. To lure Clearwater, the state offered a Jobs Development Investment Grant, based on the plant's projected payroll taxes, worth up to $3.48 million, and $500,000 from the One North Carolina Fund, sometimes called the governor's "walking-around money." Golden LEAF, the nonprofit that gets half the state's proceeds from the national tobacco settlement, ponied up $3 million, most of it for job training.

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At the time, Perdue and the new Republican leaders of the General Assembly were engaged in a fight, the first of many to come, over the budget. Legislators wanted to direct her to where they felt she could find some savings, and that included incentive funds. She responded by uttering the four-letter word no politician can resist: jobs. That might explain why they have left the state's package of grants, tax breaks and other recruiting inducements untouched. (She won that skirmish, by the way, vetoing the bill and forcing Republicans to let her decide where best to search for state government's loose change. But she lost the battle when the Republicans rallied a handful of Democrats to override her veto of the final budget bill.)

Not so long ago, the nearly monolithic legislative support for incentives seemed to be cracking as more Republicans began voting against packages and GOP candidates for governor criticized them. Chucking rocks from the back row is easy, but once Republicans won control of the legislature, criticism wasn't enough. They needed to figure out something better.

There has been no serious attempt to rein in incentives or even call for a study of how the state compares with its neighbors these days, much less how effective something as relatively new as JDIG has been. A few bills were filed to restrict or even eliminate incentives for the film industry, but they appear to have about as much support as opening prisons or shuttering...