Incentive package -- denied

First time in over decade Caldwell board has turned down an eligible firm's request

By Marcie Young
Charlotte Observer Staff Writer

LENOIR --Caldwell County commissioners last week did something they've never done before. They denied an eligible incentive package.

It was the first time in more than a decade -- since the incentive plan was adopted -- that the board has said no to a company's request to get an economic development tax break.

And that, said rejected developer Hunt Shuford, just doesn't make sense.

"I am not happy with Caldwell County," said Shuford, a Hickory-based developer who is planning on building a 48,000-square-foot medical complex on U.S. 321 in Lenoir. "It's a very shortsighted decision on their part. ... and I've been pretty well slapped around."

Since 1997, commissioners have approved 48 incentive requests to return a portion of property taxes for companies and developers promising to add to the tax base or bring jobs to the county.

Shuford and partner David Looper's incentive application was denied by a 3-2 vote, with Republican commissioners Herb Greene and Faye Higgins in favor of approving the deal.

It was the first and only request to be rejected that met the county's guidelines, and Shuford and Looper say they don't understand why commissioners Ron Beane, John Thuss and Don Barrier decided against their specific project.

"We're confused," Looper said. "I just don't have an understanding as to why they would chose to reject our application (and accept others)."

Shuford and Looper pitched their plan to commissioners in August and asked that the board OK incentives that would help defray the cost of building a $10 million complex on geographically challenging land. The unexpected rocky conditions, Shuford said, tacked on an additional $350,000 to the project's cost.

Based on Caldwell's tax rate and the project's anticipated cost, a "tier two" incentive would have returned $49,492 to Shuford and Looper each year for four years, said Alan Wood, the county's senior development manager. The project, he said, met the guidelines necessary to be eligible for an incentive package.

But, in the months leading up to last week's vote, the plan to build a medical complex that would add physician offices and possibly an urgent care center drew criticism from officials at Caldwell Memorial Hospital, the county's largest healthcare facility.

At a December public hearing, hospital President Laura Easton told commissioners that other developers have shown interest in building similar facilities without the lure of a tax break.

"There would be so many people who would be happy to come in and partner and be involved with real estate development," she told commissioners. "Our belief is that ... you can do this without economic incentives."

Barrier, who served on the hospital board before becoming a commissioner in 2006, said he voted against the project because it seemed as though the medical center would be built regardless of receiving a tax break.

"That's a reward, not an incentive," he said. "I'm not of the mind that we need to give incentives whenever someone wants to build something."

But Greene, who helped mold the incentive plan in 1997, said he voted in favor of incentives for the medical complex because it would increase the county's tax base, which has been hard hit in recent years with the closing of several factories.

"Any time a project would increase the tax base, we've given the incentive," he said. "I was doing what I've done for 11 years by voting for what the whole incentive plan was meant to do."

Shuford said he is still planning on building the complex and hopes to break ground within four to six weeks.

"I'm very disappointed," he said. "But we will build that building and we will market it to the whole health-care industry. Hospitals, physicians, urgent care. Everything is on the table."

48 incentive packages passed
Until last week, Caldwell County commissioners had passed every incentive request -- 48 in all -- made since 1997 by companies and builders promising to add to the county's tax base or bring jobs to the area. The incentives, according to the county development office, are awarded for three to five years.

Incentive recipients include furniture factories, veterinary hospitals, commercial buildings, a recreation facility and a Lowe's home improvement store.

The Google and Vantage Foods incentive packages are not included in the count, said Senior Development Manager Alan Wood, because the companies made agreements with the county that exceed five years.

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