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NC commerce secretary unveils details on private nonprofit, but some lawmakers are worried

Associated Press

RALEIGH, N.C. (AP) -- Creating a private nonprofit corporation to perform many duties of the state Commerce Department and regional economic commissions would help North Carolina's economy grow in both rural and urban areas, Commerce Secretary Sharon Decker said Wednesday.

Decker offered more details to a House commerce committee about a proposed North Carolina Economic Development Partnership, almost two months after Republican Gov. Pat McCrory unveiled the concept. The administration wants the General Assembly to pass legislation before adjourning this summer to get the idea rolling.

While areas like Charlotte and Raleigh are growing rapidly, Decker said, more than 80 counties are still struggling with high unemployment, with rates in some areas staying above 10 percent for several years.

"We can't grow those communities and forget the rest of North Carolina," said Decker, who lives in Rutherford County in the western part of the state. Rutherford has a jobless rate of 11.9 percent. "Although we've spent a lot of money and we've done a lot of good work, the needle isn't moving. So it says to me we've got to do things differently."

The change would shift many of the department's responsibilities for travel and tourism, international trade and economic recruitment within the partnership, which would still be overseen by the governor and other state officials.

A private board appointed by McCrory and legislative leaders would manage the board and hire the partnership's top executives. The McCrory administration envisions outside companies or investors giving to the partnership to further its work and later provide matching funds for state incentives to recruit new businesses and assist existing ones. The Commerce Department that remains would still manage workforce training and award public funds for economic incentives to companies that agree to create jobs and investments.

Lawmakers who peppered Decker with questions for nearly an hour didn't necessarily oppose the plan, but several raised concerns about the partnership taking over the duties of seven regional commissions and the scaling back of funds to other nonprofit economic groups.

The commissions cover all 100 counties and promote their areas to encourage business expansion. Instead, partnership workers would be dispersed to eight new "prosperity zones" to work closely with local leaders and businesses to evaluate their region and what strategy should be used.

The Senate budget approved last week would eliminate the seven commissions this July. Decker said she'd prefer the commissions be shut down at the end of December or by June 2014 to give time for the new regional strategy to take off.

Commissions such as Advantage West in the mountains are helping local economies, said Rep. Susan Fisher, D-Buncombe.

"If we're doing a good job, why should we have to reinvent them?" Fisher asked Decker.

Decker responded that the new structure would encourage the continued use of initiatives that are working well while creating the new statewide strategy.

Others are worried that the state government will ignore the special needs of minority economic development or rural areas. The North Carolina Rural Economic Development Center and minority-focused programs would see funding reductions from the state in the near future.

"How are we not going to get lost in the shuffle because we don't have a lot of voices?" asked Rep. Chris Whitmire, a Republican whose district includes rural and far-west Polk and Transylvania counties.

Decker said the partnership concept would promote more local planning to address specific advantages and needs. But the partnership would be involved to ensure that the efforts of the counties would fit inside the state as a whole and its marketing strategy.

McCrory already has directed Decker to come up with a new strategic branding for the state that Decker hopes would be introduced next summer when the men's and women's U.S. Open golf tournaments are held on successive weeks at the Pinehurst resort.

"We're going to be at the center of the world's stage," Decker said.

Decker said there will be a firewall between the government department and the nonprofit partnership to ensure that economic incentives and other public decisions are awarded in a transparent way. Even with the partnership, she said, the state will still need targeted incentives to offer new and existing business to expand.

"We need arrows in our quiver. We need tools to compete," Decker told reporters later.

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