§ 143B-437.02. Site infrastructure development. - North Carolina Statutes

§ 143B‑437.02.  Siteinfrastructure development.

(a)        Findings. – TheGeneral Assembly finds that:

(1)        It is the policy ofthe State of North Carolina to stimulate economic activity and to create newjobs for the citizens of the State by encouraging and promoting the expansionof existing business and industry within the State and by recruiting andattracting new business and industry to the State.

(2)        Both short‑termand long‑term economic trends at the State, national, and internationallevels have made the successful implementation of the State's economicdevelopment policy and programs both more critical and more challenging; andthe decline in the State's traditional industries, and the resulting adverseimpact upon the State and its citizens, have been exacerbated in recent yearsby adverse national and State economic trends that contribute to the reductionin the State's industrial base and that inhibit the State's ability to sustainor attract new and expanding businesses.

(3)        The economiccondition of the State is not static and recent changes in the State's economiccondition have created economic distress that requires the enactment of a newprogram as provided in this section that is designed to stimulate new economicactivity and to create new jobs within the State.

(4)        The enactment ofthis section is necessary to stimulate the economy, facilitate economicrecovery, and create new jobs in North Carolina and this section will promotethe general welfare and confer, as its primary purpose and effect, benefits oncitizens throughout the State through the creation of new jobs, an enlargementof the overall tax base, an expansion and diversification of the State'sindustrial base, and an increase in revenue to the State and its politicalsubdivisions.

(5)        The purpose of thissection is to stimulate economic activity and to create new jobs within theState.

(b)        Fund. – The SiteInfrastructure Development Fund is created as a restricted reserve in theDepartment of Commerce. Funds in the fund do not revert but remain available tothe Department for these purposes. The Department may use the funds in the fundonly for the following purposes:

(1)        For site developmentin accordance with this section.

(2)        To acquire optionsand hold options for the purchase of land in accordance with subsection (m) ofthis section.

(c)        Definitions. – Thedefinitions in G.S. 143B‑437.51 apply in this section. In addition, thefollowing definitions apply in this section:

(1)        Department. – TheDepartment of Commerce.

(2)        Site development. – Anyof the following:

a.         A restricted grantor a forgivable loan made to a business to enable the business to acquire land,improve land, or both.

b.         A grant to one ormore State agencies or nonprofit corporations to enable the grantees to acquireland, improve land, or both and to lease the property to a business.

c.         A grant to one ormore local government units to enable the units to acquire land, improve land,or both and to lease the property to a business.

(d)        Eligibility. – Tobe eligible for consideration for site development for a project, a businessmust meet both of the following conditions:

(1)        The business willinvest at least one hundred million dollars ($100,000,000) of private funds inthe project.

(2)        The project willemploy at least 100 new employees.

(e)        Health Insurance. –A business is eligible for consideration for site development under thissection only if the business provides health insurance for all of the full‑timeemployees of the project with respect to which the application is made. For thepurposes of this subsection, a business provides health insurance if it pays atleast fifty percent (50%) of the premiums for health care coverage that equalsor exceeds the minimum provisions of the basic health care plan of coverage recommendedby the Small Employer Carrier Committee pursuant to G.S. 58‑50‑125.

Each year that a contract forsite development under this section is in effect, the business must provide theDepartment of Commerce a certification that the business continues to providehealth insurance for all full‑time employees of the project governed bythe contract. If the business ceases to provide health insurance to all full‑timeemployees of the project, Department shall provide for reimbursement of anappropriate portion of the site development funds provided to the business.

(f)         Safety and HealthPrograms. – In order for a business to be eligible for consideration for sitedevelopment under this section, the business must have no citations under theOccupational Safety and Health Act that have become a final order within thepast three years for willful serious violations or for failing to abate seriousviolations with respect to the location for which the grant is made. For thepurposes of this subsection, "serious violation" has the same meaningas in G.S. 95‑127.

(g)        EnvironmentalImpact. – A business is eligible for consideration for site development underthis part only if the business certifies that, at the time of the application,the business has no pending administrative, civil, or criminal enforcementaction based on alleged significant violations of any program implemented by anagency of the Department of Environment and Natural Resources, and has had nofinal determination of responsibility for any significant administrative,civil, or criminal violation of any program implemented by an agency of theDepartment of Environment and Natural Resources within the last five years. Asignificant violation is a violation or alleged violation that does not satisfyany of the conditions of G.S. 143‑215.6B(d). The Secretary of Environmentand Natural Resources must notify the Department of Commerce annually of everyperson that currently has any of these pending actions and every person thathas had any of these final determinations within the last five years.

(h)        Selection. – TheDepartment of Commerce shall administer the selection of projects to receivesite development. The selection process shall include the following components:

(1)        Criteria. – TheDepartment of Commerce must develop criteria to be used to identify andevaluate eligible projects for possible site development.

(2)        Initial evaluation.– The Department must evaluate major competitive projects to determine if sitedevelopment is merited and to determine whether the project is eligible andappropriate for consideration for site development.

(3)        Application. – TheDepartment must require a business to submit an application in order for aproject to be considered for site development. The Department must prescribethe form of the application, the application process, and the information to beprovided, including all information necessary to evaluate the project inaccordance with the applicable criteria.

(4)        Committee. – TheDepartment must submit to the Economic Investment Committee the applicationsfor projects the Department considers eligible and appropriate forconsideration for site development. In evaluating each application, theCommittee must consider all of the factors set out in Section 2.1(b) of S.L.2002‑172.

(5)        Findings. – In orderto recommend a project for site development, the Committee must make all of thefollowing findings:

a.         The conditions foreligibility have been met.

b.         Site development forthe project is necessary to carry out the public purposes provided insubsection (a) of this section.

c.         The project isconsistent with the economic development goals of the State and of the areawhere it will be located.

d.         The affected localgovernments have participated in recruitment and offered incentives in a mannerappropriate to the project.

e.         The price and natureof any real property to be acquired is appropriate to the project and notunreasonable or excessive.

f.          Site developmentunder this section is necessary for the completion of the project in thisState.

(6)        Recommendations. – Ifthe Committee recommends a project for site development, it must recommend theamount of State funds to be committed, the preferred form and details of theState participation, and the performance criteria and safeguards to be requiredin order to protect the State's investment.

(i)         Agreement. – Unlessthe Secretary of Commerce determines that the project is no longer eligible orappropriate for site development, the Department shall enter into an agreementto provide site development within available funds for a project recommended bythe Committee. Each site development agreement is binding and constitutes acontinuing contractual obligation of the State and the business. The sitedevelopment agreement must include all of the performance criteria, remedies,and other safeguards recommended by the Committee or required by the Departmentto secure the State's investment. Each site development agreement must containa provision prohibiting a business from receiving a payment or other benefitunder the agreement at any time when the business has received a notice of anoverdue tax debt and the overdue tax debt has not been satisfied or otherwiseresolved. Nothing in this section constitutes or authorizes a guarantee orassumption by the State of any debt of any business or authorizes the taxingpower or the full faith and credit of the State to be pledged.

The Department shall cooperatewith the Department of Administration and the Attorney General's Office inpreparing the documentation for the site development agreement. The AttorneyGeneral shall review the terms of all proposed agreements to be entered intounder this section. To be effective against the State, an agreement enteredinto under this section must be signed personally by the Attorney General.

(j)         Safeguards. – Toensure that public funds are used only to carry out the public purposesprovided in this section, the Department shall require that each business thatreceives State‑funded site development must agree to meet performancecriteria to protect the State's investment and assure that the projectedbenefits of the project are secured. The performance criteria to be requiredshall include creation and maintenance of an appropriate level of employmentand investment over the term of the agreement and any other criteria theDepartment considers appropriate. The agreement must require the business torepay or reimburse an appropriate portion of the State funds expended for thesite development, based on the extent of any failure by the business to meetthe performance criteria. The agreement must provide a method for securingthese payments from the business, such as structuring the site development as aconditional grant, a forgivable loan, or a revocable lease.

(k)        Monitoring andReports. – The Department is responsible for monitoring compliance with theperformance criteria under each site development agreement and foradministering the repayment in case of default. The Department shall pay forthe cost of this monitoring from funds appropriated to it for that purpose orfor other economic development purposes.

On September 1 of each yearuntil all funds have been expended, the Department shall report to the JointLegislative Commission on Governmental Operations regarding the SiteInfrastructure Development Program. This report shall include a listing of eachagreement negotiated and entered into during the preceding year, including thename of the business, the cost/benefit analysis conducted by the Committeeduring the application process, a description of the project, and the amount ofthe site development incentive expected to be paid under the agreement duringthe current fiscal year. The report shall also include detailed informationabout any defaults and repayment during the preceding year. The Departmentshall publish this report on its web site and shall make printed copiesavailable upon request.

(l)         Reserved forfuture codification purposes.

(m)       Options. – TheDepartment of Commerce may acquire options and hold options for the purchase ofland for an anticipated industrial site if all of the following conditions aremet:

(1)        The options arenecessary to provide a large, regional industrial site that cannot be assembledby local governments.

(2)        The acquisition ofthe options is approved by the Committee.  (2003‑435, 2nd Ex. Sess., s. 1; 2004‑124,s. 6.26(a), (b); 2009‑451, s. 14.5(a).)