Site Selection Magazine recently revealed its list of Top US Economic Development Groups. For 2015, the Top US Economic Development Groups are based on four objective project criteria: jobs, capital investment, jobs per capita and investment per capita as tracked in Conway’s proprietary New Plant Database. The magazine included additional criteria such as the creativity of economic development strategy; scope of project activity; and the ability to accurately document the link between the EDO and real results.ly document the link between the EDO and real results.
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Showing posts with label Economic Development. Show all posts
Showing posts with label Economic Development. Show all posts
Monday, May 25, 2015
Friday, May 25, 2012
Incentives are Wise Investment for S.C.
The current debate in the General Assembly over economic development incentives for data centers has South Carolina residents once again thinking about the overall value of using tax breaks to encourage job creation. While we should always look closely at any legislative measure that could impact state revenues, it has been proven that South Carolina’s incentives strategy creates jobs and ultimately generates a net gain in tax revenue.
South Carolina has a rich heritage in manufacturing and textiles and we need to continue to cultivate a business climate where our manufacturing companies can thrive. But in addition, the Palmetto State needs to build upon this base to create an environment that is attractive to technology-oriented businesses that support the knowledge economy.
Data centers require millions of dollars to build and operate, represent a significant capital investment in a community and create high-paying jobs. The incentives packages offered to manufacturers don’t necessarily translate to high-tech businesses. Data centers would gain more benefit from incentives tied to sales taxes on computer equipment, software and electricity.
When choosing to invest in a new location and create jobs, companies look at many factors — real estate, workforce, transportation infrastructure, utilities and more — but to think that incentives are not part of the mix would be naive. As businesses and their site consultants work through the complicated process of selecting a location, millions of their own dollars are on the line.
Having a competitive, up-to-date incentives package that helps present South Carolina as a location where business can thrive is crucial.
Our neighboring states are very aggressive when it comes to providing incentives. We need to be competitive. Some may fear that South Carolina will be drawn into an “arms race” in which businesses play states against each other to receive ever-larger tax breaks, but with so many other factors coming into play, the reality is that companies can’t make location decisions based on incentives alone.
Still, at a time when state and local budgets continue to be tight, can we really afford to offer new tax breaks? The answer is simple: economic development incentives that create jobs and attract corporate investment result in spending that brings in more tax dollars than are paid out. There is an increase in opportunities for local suppliers, vendors and service providers as those dollars circulate through the community — a rising tide that lifts the quality of life and creates opportunities for everyone.
For example, a cost-benefit analysis of the incentives package offered to online retailer Amazon.com determined that incentives would cost the state $25 million over 10 years but yield $1.7 billion in revenue over the same period.
The calls for fiscal austerity in all matters of government have been loud, but when confronted with that kind of data, many of the arguments against incentives seem penny wise and pound foolish.
The good news is that most of our state’s economic development incentives come in the form of tax credits that are directly tied to investment and job creation. For example, a payroll tax credit may not be triggered until a certain hiring threshold is met. If the business doesn’t create the jobs it promised, it simply won’t qualify for credits.
The good news is that most of our state’s economic development incentives come in the form of tax credits that are directly tied to investment and job creation. For example, a payroll tax credit may not be triggered until a certain hiring threshold is met. If the business doesn’t create the jobs it promised, it simply won’t qualify for credits.
Furthermore, economic development incentives are not solely designed to attract companies from outside our state. Incentives also reward existing businesses that invest and create jobs in South Carolina. A company such as Michelin, which has been in South Carolina since the 1970s, has continued to hire workers and build new facilities, helping to make our state No. 1 in the nation in tire production. Many “born in South Carolina” companies have received assistance from incentives packages that helped them grow here without having to look for friendlier environments elsewhere.
Just as the recruitment of BMW 20 years ago helped lead to a blossoming of automotive-related job creation in South Carolina, high-tech companies can help position our state in the knowledge-based economy for the next 20 years. They will attract like-minded companies that want to do business with each other and establish South Carolina as a place where high-tech firms can succeed. Modernizing our incentives program to fit the knowledge-based economy is an important step in that direction.
Brian Gallagher is director of marketing and Shane Bolding is Industrial Manufacturing SBU Leader for O’Neal, Inc., a Greenville-based integrated design and construction firm.
This article originally appeared in the
Greenville News on May 25, 2012.
Greenville News on May 25, 2012.
Written by
Brian Gallagher and Shane Bolding
Brian Gallagher and Shane Bolding
Thursday, May 05, 2011
Job Creation Through Solar Energy
This Op-Ed appeared in the Greenville News on April 16, 2011.
As the 2011 legislative session continues, one of the top concerns of South Carolina citizens continues to be job creation. Right now, over 10 percent of our citizens are unemployed, many of them skilled workers. As our lawmakers search for viable options to put our state back to work, we are missing out on a veritable gold mine of economic development: alternative and renewable energy production, particularly solar energy.
Despite recent investment announcements by businesses, traditional manufacturing jobs in South Carolina have consistently declined during the past few decades. Many states around the U.S. ¬ particularly those in the Southeast - have been aggressively developing strategies and incentives to attract clean and green industries that will result in investment and job creation.
Last year, the South Carolina Legislature took positive steps towards embracing clean energy. The Economic Competitiveness Act included a tax credit for manufacturers of green energy equipment and materials. While this is a critical first step, it is not enough to attract investment and stimulate demand for solar energy. Our state needs to implement legislation that includes new tax credits for large-scale utility and commercial installations, as well as an increase in incentives for residential installations.
There is a direct correlation between incentives that stimulate demand in solar energy and capital investment in manufacturing facilities and green job creation. A recent Clemson University study revealed that establishing commercial and residential incentives in South Carolina would be net revenue positive.
Currently, electricity generated from renewable resources such as wind and solar typically costs more than power generated from coal, nuclear or natural gas. In the last few years, additional manufacturing capacity, increased demand and technological advances have driven down the cost of solar energy. While a gap between the cost of traditional and renewable power still exists, it is closing - and incentives can help close that gap sooner.
The reality is that energy prices will remain volatile. Increased demand from the United States and from China, India and developing countries will drive energy prices higher. Reliable and stable energy is central to our country’s economic security and environmental future. Solar will not replace fossil and nuclear as primary fuel sources in the U.S., but solar technology has a role in a more balanced energy portfolio.
We have tremendous resources in South Carolina that we can leverage for clean and green energy. We have the Savannah River National Laboratories, Clemson University, the University of South Carolina, our technical colleges, and others that are engaged in renewable energy education and research. One of the major utilities serving South Carolina, Duke Energy, is viewed nationally as a leader in solar technology. However, the majority of their solar projects are not in South Carolina; they are in states that have legislation that encourages and incentivizes solar.
North Carolina has a comprehensive incentive program for renewable energy production companies. Incentives are attractive to these businesses – so much so that in the last three years, nearly 300 companies chose to relocate to or open locations in North Carolina, resulting in over 12,500 green jobs. Tennessee and Georgia, which also have more attractive incentives than South Carolina, have landed several large manufacturers during the last few years that produce materials and products for the solar industry.
It is inevitable, given the finite nature of fossil fuels, that the federal government will pass legislation mandating alternative renewable energy programming for each state. When it does, demand for solar products, designers and installers will spike. Right now, the infrastructure to service this industry is going to our neighboring states. It would be prudent for our lawmakers to implement an energy program that best meets our state’s needs rather than waiting for a program to be written for us.
We must leverage our strengths that are attractive to green businesses and become a leader in the emerging green economy. These strengths include an educated and trained workforce; strong partnerships between our universities and businesses, and a link between our legislative agenda and economic development. We are well positioned to be a leader in green industries. Now we need the vision to create conditions so the manufacturing investments and new jobs come to South Carolina, not North Carolina, Georgia and Tennessee.
As the 2011 legislative session continues, one of the top concerns of South Carolina citizens continues to be job creation. Right now, over 10 percent of our citizens are unemployed, many of them skilled workers. As our lawmakers search for viable options to put our state back to work, we are missing out on a veritable gold mine of economic development: alternative and renewable energy production, particularly solar energy.
Despite recent investment announcements by businesses, traditional manufacturing jobs in South Carolina have consistently declined during the past few decades. Many states around the U.S. ¬ particularly those in the Southeast - have been aggressively developing strategies and incentives to attract clean and green industries that will result in investment and job creation.
Last year, the South Carolina Legislature took positive steps towards embracing clean energy. The Economic Competitiveness Act included a tax credit for manufacturers of green energy equipment and materials. While this is a critical first step, it is not enough to attract investment and stimulate demand for solar energy. Our state needs to implement legislation that includes new tax credits for large-scale utility and commercial installations, as well as an increase in incentives for residential installations.
There is a direct correlation between incentives that stimulate demand in solar energy and capital investment in manufacturing facilities and green job creation. A recent Clemson University study revealed that establishing commercial and residential incentives in South Carolina would be net revenue positive.
Currently, electricity generated from renewable resources such as wind and solar typically costs more than power generated from coal, nuclear or natural gas. In the last few years, additional manufacturing capacity, increased demand and technological advances have driven down the cost of solar energy. While a gap between the cost of traditional and renewable power still exists, it is closing - and incentives can help close that gap sooner.
The reality is that energy prices will remain volatile. Increased demand from the United States and from China, India and developing countries will drive energy prices higher. Reliable and stable energy is central to our country’s economic security and environmental future. Solar will not replace fossil and nuclear as primary fuel sources in the U.S., but solar technology has a role in a more balanced energy portfolio.
We have tremendous resources in South Carolina that we can leverage for clean and green energy. We have the Savannah River National Laboratories, Clemson University, the University of South Carolina, our technical colleges, and others that are engaged in renewable energy education and research. One of the major utilities serving South Carolina, Duke Energy, is viewed nationally as a leader in solar technology. However, the majority of their solar projects are not in South Carolina; they are in states that have legislation that encourages and incentivizes solar.
North Carolina has a comprehensive incentive program for renewable energy production companies. Incentives are attractive to these businesses – so much so that in the last three years, nearly 300 companies chose to relocate to or open locations in North Carolina, resulting in over 12,500 green jobs. Tennessee and Georgia, which also have more attractive incentives than South Carolina, have landed several large manufacturers during the last few years that produce materials and products for the solar industry.
It is inevitable, given the finite nature of fossil fuels, that the federal government will pass legislation mandating alternative renewable energy programming for each state. When it does, demand for solar products, designers and installers will spike. Right now, the infrastructure to service this industry is going to our neighboring states. It would be prudent for our lawmakers to implement an energy program that best meets our state’s needs rather than waiting for a program to be written for us.
We must leverage our strengths that are attractive to green businesses and become a leader in the emerging green economy. These strengths include an educated and trained workforce; strong partnerships between our universities and businesses, and a link between our legislative agenda and economic development. We are well positioned to be a leader in green industries. Now we need the vision to create conditions so the manufacturing investments and new jobs come to South Carolina, not North Carolina, Georgia and Tennessee.
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