My top priority going into this coming session of the General Assembly is to continue finding ways to put the people of this state back to work.
North Carolina has been a national leader over the past year in job creation and improving the unemployment rate, thanks at least in part to our efforts to recruit industry, promote small business and keep this state fiscally sound.
The U.S. Bureau of Labor Statistics has shown some promising trends in North Carolina over the past year. North Carolina ranked second in the nation for new job growth between September 2009 and September 2010, adding 49,300 jobs over that time. During that same time period, the state had the fourth-largest drop in the unemployment rate, 1.3 percentage points. The state was also second nationally in September with 10,100 jobs added in the previous month.
These gains can be attributed to the outstanding climate this state has spent decades building. Our business support and infrastructure systems are allowing us to recover more quickly than other states and position us well going forward. This week, I wanted to give you some information about some of the things we did during this past session to help support business and job creation. I hope you will contact me if you have any questions.
Thank you as always for the opportunity to serve you and our community.
Tax Relief and Business Investment
The state allocated $34 million so that it can provide a refundable income tax credit to small businesses in 2010 and 2011. The credit is equal to 25 percent of what the business pays in unemployment insurance tax on wages paid to employees. Small businesses are defined as those with $1 million or less in gross annual receipts. An estimated 125,000 businesses across the state will qualify for the credit.
Since its beginning in 2003, the Job Development Investment Grant (JDIG) has committed $750 million in grants to 100 grantees, resulting in more than $7 billion in investment and over 30,000 new jobs. In 2009 alone, JDIG entered into 16 grant agreements, which will result in the creation of over 5,000 new jobs and the retention of 6,000 existing jobs. The General Assembly put $6 million into the program for this year.
The One North Carolina Small Business Fund within the Department of Commerce received $1.5 million this year. The program provides matching funds for businesses trying to obtain federal research grants under the Small Business Administration.
Since 2003, through the One NC Fund the state has made more than 300 awards, totaling $71 million for the creation of 40,000 jobs and capital investment of $6.9 billion. In 2009, $8.5 million was committed to 40 grantees for job creation and retention of over 14,000 jobs and $550 million in capital investment
The Main Street Solutions Program got $1.5 million and a two-year time limited position to administer the program. This program provides grants to active Main Street Communities and designated micropolitans with populations between 10,000 and 50,000 people. Grants are to be used to support downtown economic development, historic preservation initiatives, and other public and private improvement projects that will support small businesses and job creation.
The Rural Center’s Building Reuse and Restoration Program received $3.1 million to help rural communities compete for and attract new and expanding businesses. Funding for small-scale regional community development projects is also included. The center also received $1 million to continue the Small Business Assistance Fund and $1 million to help farmers improve energy efficiency, develop new markets or develop new products.
We authorized the Department of Commerce to administer the Small Business Jobs Preservation and Emergency Assistance Fund in the amount of $1 million. Money from the fund may be used for: (1) emergency bridge loans where clear ability to repay has been established but credit remains unavailable and (2) other purposes related to small business job preservation as approved by the department. The amount of a loan made to a small business is limited to an aggregate total of no more than $35,000.
Community Colleges
In recent years, North Carolina communities have experienced tremendous job loss, particularly in the manufacturing industry. This has resulted in an unprecedented number of people going to our community colleges to learn new skills and retrain for new jobs. Enrollment continues to soar at these institutions. In this year’s budget, we fully funded enrollment growth in community colleges growth ($122 million for fiscal year 2010-11) to ensure that students are not denied services. A well-educated and well-trained workforce benefits the people and businesses in this state.
The Small Business Center Network housed within North Carolina community colleges also plays an important role in assisting small businesses throughout the state. We allocated $5.75 million to the program this year so that it can help North Carolinians start and grow their own businesses. Each community college in the state is home to a small business center, meaning that a center is located within a 30-minute drive of almost all North Carolinians. Many of the services offered are free of charge.
The North Carolina Rural Entrepreneurship through Action Learning, or NC REAL, is a nonprofit organization within the community colleges that helps encourage entrepreneurship and small business creation. NC REAL’s training programs and curriculum have helped thousands of people create jobs throughout our state. We appropriated $263,300 for the 2009-10 fiscal year and the 2010-11 fiscal year.
We also appropriated $1.25 million for the NC Military Business Center so that it can continue with its important work. The primary purpose of the center is to help small- and medium-sized businesses throughout the state that are seeking federal contracts, with a focus on military-related contracts. The center also helps highly-trained military personnel transition to civilian employment and recruits new defense-related businesses to the state.
In our state budget, we changed the law to relieve some of the burdens on small businesses. Previously, the state required businesses that collect $10,000 or more a month in sales tax to prepay a portion of the tax. The new law raises that threshold to $15,000 this year and $20,000 next year, allowing more businesses to pay as they go. The state’s budget law also changed annual state reporting requirements for limited liability corporations. The businesses had been required to file annual reports on April 15, regardless of how long they had been formed, meaning that businesses in operation for only a few weeks or days had to immediately file an annual report. The new law requires conforms to the IRS schedule, allowing businesses to file their first annual reports on the April 15 following their year of organization.
Economic Incentives
We created a new tax credit for interactive digital media. Under the new credit, a taxpayer that develops such media in this state is allowed a credit for allowable expenses over $50,000.
The state budget bill (SL2009-451) extends the sunset on the following expiring tax credits and refunds: the tax credit for mill rehabilitation; the tax credit for qualified business investments; the sales tax refund for air passenger carriers; and the sales tax refund for motorsports aviation fuel.
We provided incentives for renewable energy efforts. The bill (SL2010-167) extends credits for constructing renewable fuel facilities and biodiesel producers and reinstates and expands the credit for a renewable energy property facility. The law also clarifies that real property donated for conservation purposes can only be used for those purposes.
Budget items
Meetings/Events
I plan to attend the following meetings/events:
Please invite me to attend your county, city, community or civic, etc. meetings or events.
As I’ve said many times before, I hope you will continue to let me know how you feel about the issues that are being debated by the North Carolina Legislature and the challenges you and your family are facing each day.
By working together, we can make Northampton, Vance and Warren Counties and all regions of North Carolina a better place to live, work and raise a family.
Please remember that you can use the General Assembly’s website to look up bills, view lawmaker biographies and access other information. The site also contains detailed information about the state budget and legislative schedules.