3 companies bring at least 3,900 jobs to South Carolina

by Eric Frazier, Charlotte Observer, June 16, 2014.

hree companies will bring a combined 3,900 new jobs to York and Chester counties, S.C. Gov. Nikki Haley announced Monday in the Palmetto State’s biggest job-recruitment day in recent memory.

Two of the companies are Charlotte firms crossing the state line, raising questions about North Carolina’s economic competitiveness. A top North Carolina economic development official said the state had tried and failed to win one of the companies and keep the other two from leaving.

Haley downplayed talk of any jobs rivalry, however, and focused on her state’s achievement, which could eventually bring more than 7,000 positions if projections hold true:

• Singapore-based Giti, the world’s 10th-largest tire maker, will invest $560 million in Chester County, creating 1,700 jobs. Giti, which sells tires in the U.S. under the brand names GT Radial and Primewell, will build a manufacturing facility just off Interstate 77 at S.C. 9, about 40 miles south of Charlotte.

The announcement came as welcome news for a county hard-hit by textile job losses in recent decades. As Springs Industries shed most of the 15,000-plus textile workers it once employed in the region, Chester County’s jobless rate surged to above 20 percent by June 2009 and stayed above it until March 2010. It’s now 6.9 percent.

“Oh Lord, jobs, jobs, jobs,” said Sue Misenheimer, who’s lived in Chester County since 1965. “We need jobs so bad.”

• Lash Group, a health care consulting company, will consolidate operations spread across several Charlotte sites into a new $57.3 million, 250,000-square-foot headquarters in the master-planned Kingsley development in Fort Mill. Lash Group is partnering with Childress Klein and The Springs Co. to build the headquarters.

Tracy Foster, Lash Group president, said the company will employ 1,200 in Fort Mill, and projects that number to double in a few years. The firm expects to spend $90 million total if growth projections hold.

• LPL Financial said it will also move from Charlotte to the Kingsley development. The financial services firm will move about 1,000 employees who work in three southwest Charlotte buildings to a new campus it will start building in 2015.

The company plans to invest a total of $150 million by 2022, LPL officials said. Haley said the number of jobs created could eventually reach 3,000.

The blitz of announcements came one after another Monday. Haley and S.C. Commerce Secretary Bobby Hitt said they couldn’t recall a day when more new jobs were announced in South Carolina.

Hitt said the biggest day of Haley’s administration before Monday came last year when Boeing announced an expansion of its North Charleston jet factory and 2,000 new jobs.

N.C. tried to win projects

Monday’s news spurred soul-searching in North Carolina, where John Lassiter, head of the N.C. Economic Development Board, confirmed that the state tried to keep the two Charlotte companies and lure the Singaporean tire maker.

“It gives us some real-life examples of the kinds of things we need to work with our legislators on to keep North Carolina competitive,” he said.

“You’ve got to think through how you can remain competitive when incentives can make it lucrative for a company to move 10 miles from their current location.”

Giti, the tire maker, will develop a 1,100-acre site that Chester County has been seeking to develop for years. The county kept losing out on major plant relocations and expansions.

Chester residents and officials attending the press conference gave the visiting Singaporeans – including the country’s ambassador to the United States – several standing ovations, and pieces of cake shaped like a tire.

“What a day it is for Chester County,” said longtime County Supervisor Carlisle Roddey. “We’ve been the bridesmaid so many times it seems like we’ve filled up the landfill with bouquets.”

Giti Tire’s products are sold in more than 100 countries, according to the company’s website, and its announcement in Chester County featured employees from around the globe joining the celebration live through Skype.

The plant will be the fourth major tire plant in South Carolina, solidifying the state’s claim as the nation’s leading tire exporter. Currently, those companies in South Carolina make 84,000 tires a day.

Giti Chairman Enki Tan said he was gratified by the warm welcome and family atmosphere. He added: “This plant here in Chester, we’re going to make it the best plant we ever had.”

Tan said the new facility will occupy 1.8 million square feet, and will churn out 5 million tires a year. Officials from Wal-Mart, which sells Giti tires, were also on hand Monday.

Tan added that hiring for the plant, the company’s first in North America, will begin immediately.

It wasn’t clear Monday how much the jobs will pay.

South Carolina offered an incentives package that included $37.8 million to buy and prepare the land, $2 million toward water and sewer preparation, and an as-yet unspecified amount of job development tax credits – essentially refunds of employee withholding taxes.

Mecklenburg and its neighboring South Carolina counties have long competed over job-recruitment projects. In December, Mecklenburg lost a closely fought battle for a Chinese yarn factory and 500 jobs when the firm announced it was heading to Lancaster County.

Hitt, the South Carolina commerce secretary, said the state gave both the Lash Group and LPL Financial $2 million to help prepare their sites in Fort Mill, as well as tax credits based on how many employees they hire.

Foster, the Lash Group president, and Mark Casady, CEO of LPL Financial, both deflected or declined to answer reporters’ questions about what, if anything, Charlotte and North Carolina officials did to try to keep their companies from jumping the state line.

Both pointed instead to the opportunity to build new cutting-edge workplaces in Fort Mill. Casady acknowledged that many of his employees likely will continue living in Charlotte and simply commute to work in Fort Mill.

“We see ourselves as staying in the Charlotte region,” Foster said, adding that her firm will keep a smaller presence in Charlotte through 2019.

No ‘closing fund’

Lassiter, head of the N.C. Economic Development Board, said the state tried to keep the two firms from leaving, but the companies could get more incentives in South Carolina.

North Carolina, like most states, gives incentives only on the projected new employees, he said. Since they are new to South Carolina, they can get incentives there based on both their current and projected new employees.

Since similar rules apply in both states, he said, the converse would have been true had Charlotte lured two firms from Fort Mill.

Given the circumstances, “we had half as much money to work with on exactly the same program,” he said. “Every state has exactly the same exposure, but we’ve just got to figure out ways to minimize our exposure” given the proximity to the border.

Lassiter said the state was hamstrung in pursuing Giti by the fact that it doesn’t have a so-called “closing fund” like the one South Carolina used for the $37.8 million it is spending on the tire factory site.

He said most states have job development grants and community college-based workforce training systems – two of North Carolina’s key tools for attracting industry.

“The closing fund is oftentimes what is needed to differentiate your state from other states,” he said. “Closing funds are a very big deal in manufacturing projects.”

Benefiting from Charlotte

York and Chester officials said they benefit from being part of the Charlotte region, but that doesn’t mean they won’t compete with the city for jobs. Chester County Economic Development Director Karlisa Parker thanked the Charlotte Regional Partnership, among other job recruitment groups, for its help.

Haley declined when reporters asked her to compare her state’s job-recruitment efforts to North Carolina’s. “I’m not going to get into what North Carolina’s doing. What I can tell you is South Carolina’s doing a lot right.”

Hitt said some of Charlotte’s economic growth will inevitably spill across the state line since Charlotte sits so close to it.

“Our opportunity is to facilitate that growth, make sure people have (transportation) access and education so we get the benefit of it,” he said. “It’s balanced metropolitan growth, that’s what’s going on here.”

OBSERVER STAFF WRITERS ELY PORTILLO, MEGAN CASSELLA, RICK ROTHACKER, JOHN ARWOOD AND (ROCK HILL) HERALD STAFF WRITER DON WORTHINGTON CONTRIBUTED.