Risk Gain

I’m not sure that Government understands risk:

State officials said they believe Dell also should give back about $6 million in tax breaks the company received between 2005 and 2007, but a Dell spokesman said the company is entitled to keep the money since it was operating at the time.

“Our belief and our understanding is that we met the performance thresholds required for those incentives during those years, and are not obliged to repay those,” spokesman Jess Blackburn said.

The state of North Carolina negotiated with Dell to open a plant here.  To incent the company to do so, we offered them tax breaks and grants, both locally and at the State level.  It was understood that if Dell left or closed, that money would have to be returned.

Well, Dell did leave, the plant did close and:

…the company agreed to repay more than $26 million in local grants and $1.5 million in state grants, acknowledging that it didn’t live up to its end of the deal by not keeping a specified number of jobs in Forsyth County.

So.  What is all the hullabaloo about?

Turns out that the State of North Carolina is in a bit of trouble financially.  And they could use any money they can wrangle out of the evil capitalists.  And why not, the Feds are doing the same thing with great success.  So our good Govna is going out, bad mouthing Dell and demanding that they pay money back:

“I will fight them if they want to fight about this,” Perdue said. “They made some agreements. We offered some incentives. The locals offered some incentives, and they need to live up to their side of the bargain. If that means going to court, I guess we will.”

Turns out, however, that the money she wants to get back is money that Dell “saved” while they were in business and operating.  This isn’t money that we paid to Dell, it was simply money that they didn’t pay to us while they employed our people.

House Minority Leader Paul Stam issued a statement Tuesday saying the dispute could have been resolved long ago. Lawmakers defeated an attempt to include language in the state incentives package that would have required Dell to forfeit all credits it received from the state if it didn’t have at least 1,200 employees at the computer plant within five years, said Stam, R-Wake.

So not only is Purdue going after money that Dell doesn’t really owe us, she is poisoning the well in doing so.   Who in the world is going to wanna open a business here when they get treated like this?

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