Tier System

My involvement in the local business community offers exposure to the foolishness in North Carolina law that is largely unknown by men and women who pursue other careers.

Currently, a local businessman trying to survive in today’s economy faces untangling a web of 100+ years of laws granting special favors and preferential tax treatment to groups.

Of all the creations of our state government’s planned economy crowd, the strangest may be the “Tier Designation.”

Most people have never heard of it, but it affects everyone in our state. “Tier Designation” is an annual ranking by the Commerce Department dividing counties into three categories in order to help the bureaucracy in Raleigh determine who gets the most ‘loot’ from state government.

The result is striking. Now, business incentives are not just given to help a city in North Carolina compete against a city in Virginia or South Carolina, but they are also given to help one North Carolina county compete against another. Social planners in Raleigh use this technique to redistribute our tax dollars within the state to deal with perceived inequalities.

It actually happened when Facebook chose to locate its new data center in Rutherford County. Raleigh told that business considering locating a plant in Catawba County that they would receive more tax subsidies by choosing to locate in Rutherford County instead of Catawba.

In other words, we have state government shoving business from one county to another – that’s what “Tier Designation” does.

You have to wonder how Catawba County, which is part of an area that has lost 30,000 jobs, missed being ranked as a “Distressed County” on the “Tier Designation”. Instead, when we compete for new business with our neighbors, we also compete with the state which provides a greater subsidy to a business that locates in Rutherfordton rather than Hickory.

When the government starts picking winners and losers between businesses it’s bad enough. When they start picking winners and losers between counties it’s even worse.

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