Friday, June 24, 2005
Leaders confident about Dell deal
They worry, however, about detrimental
effect of protracted legal challenge
By Richard Craver
Winston-Salem. Local officials expressed confidence yesterday that their incentive-laden contract with Dell Inc. would be found constitutional in court. But they are worried that, as word spreads about the lawsuit filed by the N.C. Institute for Constitutional Law, the ability of the community and state to recruit businesses could be hampered.
Site selectors said that the lawsuit could dampen the enthusiasm for North Carolina from businesses considering moving to the state. “The lawsuit may go nowhere in the long run,” said Loren Kennedy, the principal of Kennedy Advisors LLC of Raleigh. “But the problem is that along the way, North Carolina could establish a reputation for having a difficult economic-development process.”
The lawsuit challenges the legislation that came from the General Assembly, which granted more that $242 million in tax credits and other economic subsidies to lure Dell to North Carolina. It also challenges the local resolutions adopted by the Winston – Salem City Council and the Forsyth County Board of Commissioners that provided an additional $37 million.
Scott Millar, the president of the N.C. Economic Developers Association, said that the N.C. Supreme Court’s ruling in the Maready case “confirmed the constitutionality of economic-development incentives. Incentives are a reflection of the aggressive times that we live in and North Carolina must also compete or risk being left behind,”
Robert Orr, the executive director of the institute, said that there “is an incentive for the state and the communities to get this settled as quickly as possible. I have no doubt that there will be more lawyers on the other side than imaginable.