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Senate | June 5, 2014 | Committee Room | Base Budget

Full MP3 Audio File

Good morning, everybody. Y’all take your seats. We’ll go ahead and get started. First, let me introduce our Sergeant at Arms, Anderson Meadows, right behind me, Canton Lewis, over there, Steve Wilson, Ed Kesler, Charles Marsalis, and Hal Roach. And our Senate pages this morning, Charles Baden from Raleigh, sponsored by Senator Pate, John Hayden Sylvester from Richlands, sponsored by Hunt, is my great-nephew, Conner Mendenhall from Franklinton, sponsored by Senator Barefoot, Cameron McNeil from Greensboro by Senator Berger, Thomas Barr from Chocowinity, sponsored by Senator Cook, Aaron McKinney from Marion, sponsored by Senator Hise. This morning we’re going to hear two PCSs. Do we have a motion to hear the committee substitute for Senate Bill 3 and the committee substitute for Senate Bill 743? [SPEAKER CHANGES] So move. [SPEAKER CHANGES] So moved by Senator Jackson. Senator Davis, would you like to present Senate Bill substitute Senate Bill 3. [SPEAKER CHANGES] Thank you, Mr. Chairman and committee members. Delighted to be here to present this PCS to you this morning. This PCS changed the entirety of the language in Senate Bill 3. It’s entitled JMAC Modifications. JMAC, the JMAC program is a program that’s operated by the Department of Commerce, and it’s been in effect since 2007. Has a total aggregate funding of about $69 million. And these funds are used to help retain high paying, good benefit, high quality jobs in North Carolina that are dealing with specific challenges. And so far, there’ve been about three companies that have taken advantage of this. I think Goodyear Tire, Bridgestone Firestone has been another one, Weyerhaeuser has been another one. And this modification, this Senate Bill 3, will just expand the eligibility criteria. Most of you know that the current EPA is really clamping down on emissions, and particularly in coal emissions in our country. And this is going to help some companies to adapt to those changes. Most of you already know that to be able to get the large reduction in emissions. The cost benefit analysis gives, it’s pretty affordable. But the final, small reduction in emissions costs a lot of money. So, we need to help keep high quality, high paying jobs in North Carolina. So, this PCS would like to add about $10 million total aggregate to this plan, from 69 to $79 million. And it also would expand it to not only include tier one counties, but also tier two. Tier one counties that are eligible for this money still would be eligible. As a matter of fact, their eligibility would be increased somewhat because their investment would reduce from 69 million to 50 million in order to qualify for these funds. The employee thresholds for this program in tier one counties remains at about 330. For our tier two counties to qualify, they would have to have 800 employees. I have a specific company in mind for these funds. In my district we have Evergreen. Many of you might know that as Champion Paper Mill. Evergreen is a company that has about $450 million a year in business. They’re the largest employer in North Carolina west of Charlotte. They have a payroll of 1,400 people in North Carolina, 1,200 of them are in Waynesville or Canton in Haywood County. Their average salary is about $75,000 a year, $95,000 with benefits and salary. They pay about a million dollars in property tax to Haywood County. About a million dollars in property tax to the town of Waynesville. They pay a franchise tax of about $300,000.

And they’re good corporate citizens. They’ve been in the area for about a hundred years. And what this bill would allow them to do, it would help them be able to comply with the latest EPA emissions. Which are going to require a significant investment by Evergreen. As a matter of fact, it’s going to be about 50 million dollars. Evergreen has five coal fired boilers in their operation and this is going to convert two of those to natural gas. And I have been working through Congressman Meadows’ office in the US House, and he has been contacting the EPA. And they really don’t care about all these jobs or apparently don’t. They just want us to comply with this. And so this is going to help Evergreen comply, or could help. They’re going apply for it. It could allow them to access some of these funds in order to comply with the latest EPA emissions. The capital investment for this project is going to be about 50 million dollars and so this would allow them to access about 2 million dollars a year, for a total of 6 years or a total of 12 million dollars. Mr. Chairman, I think I’ve sort of summarized what we’re after. I’d be glad to entertain any questions. [SPEAKER CHANGES] Okay thank you Senator Davis. Any questions or comments of Senator Davis? Senator Tillman has made a motion before we get to that we’re going to have Senator Payton. [SPEAKER CHANGES] Thank you, Mr. Chair. Senator Davis, you mentioned that two of the five coal fired boilers were going to be transitioned or refitted to burn natural gas. How about the other three? Are they going to be deactivated, or what’s their future? [SPEAKER CHANGES] No, they will still be coal. But they also use coal and wood chips, actually. And so this is going to allow Evergreen to comply with the latest EPA regulations that are required to be in place by 2019, I think is the date. And so there by converting two of their boilers to natural gas it’s going to allow them to comply with these regulations. And this company is a good corporate citizen. They’ve spent 330 million dollars since 1990 in environmental regulations, cleaning up their operations. So they’re a good corporate citizen. They’ve never asked for any money from the state in the past, and they’ve been here a hundred years. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Yes sir, thank you. So then they will meet the compliance as far as emissions are concerned, as far in advance as we’re able to know, so I would think that there’ll be ample natural gas delivered potentially so that if future restrictions are placed upon them, they can rise to meet that. And also with natural gas coming in where it’s never come in before there’s a possibility that other businesses might want to convert over to natural gas as well, is that part of the plan as well? [SPEAKER CHANGES] Absolutely. That will give them a commercial supply. Right now they do not have a commercial supply. To run another line would require about 80 miles of an industrial size pipe to get the natural gas there. And at a cost of about 80 million dollars. And so we just can’t do that yet. But the natural gas company is going to invest about over 2 million dollars in purchasing some pumps to be able to use the existing lines and get them the adequate source of natural gas to meet the latest regulations. [SPEAKER CHANGES] Senator Robinson. [SPEAKER CHANGES] Thank you, Mr. Chair. Senator Davis, I think helping companies to be more compliant with the EPA is a great thing. The only other question I have is do you have any idea of other companies possibly that we will be bringing in, in terms of bringing in new jobs that would benefit from this appropriation? [SPEAKER CHANGES] I do not have any in mind yet, but it certainly will, if you build it they will come. So we anticipate that having a commercial supply of natural gas there will help existing companies that are already there, industry. And we will certainly be able to attract others as well. But I don’t have any specific names in mind at this time. [SPEAKER CHANGES] Senator Ford. [SPEAKER CHANGES] Thank you, Mr. Chairman. Senator Davis, I’m not sure if you can answer this question, maybe staff. But can I get some clarification as to what does it mean to be in a Tier 1 and a Tier 2 area? [SPEAKER CHANGES] We went through this. We’ll need to get a

some clarification on exactly what it means. It has to do with unemployment population, salary level - and Tier 1 is the lowest in North Carolina. I think there are about 35 counties in Tier 1. Somebody gave us a handout last week about that. ?? [SPEAKER CHANGES] ??. Yes, Dan. [SPEAKER CHANGES] The tier ranking system is the ranking system for all 100 counties in the state. Tier 1 is the 40 most economically distressed counties in the state. Tier 2 is the middle 40, if you will. And Tier 3 are the least economically distressed, and it's the last 20. [SPEAKER CHANGES] One of the reasons that we would really like to see this happen is that Evergreen has about a 240 million dollar impact per year in western North Carolina. And that would expand to other counties that are Tier 1. We have some of their employees come from those counties as well. [SPEAKER CHANGES] Senator Tucker. [SPEAKER CHANGES] Senator Davis, this may be for Daniel as well. This change would not impact the economic funding for Tier 1 counties. It would make this change correct. [SPEAKER CHANGES] That is correct. As a matter of fact it will enhance their eligibility for these programs. [SPEAKER CHANGES] Other questions. Senator Goolsby. [SPEAKER CHANGES] Thank you, Mr. Chairman. I know this is a little off-point. You may not know the answer Senator Davis. Do you know how much these new regulations are going to increase the power prices to the people in the area in which you live? [SPEAKER CHANGES] My guess is they're going to go up with these new regulations, but hopefully by supplying natural gas there that customers, residential and other commercial customers, will be able to have a smaller carbon footprint in the western part of the state. [SPEAKER CHANGES] Senator Bryant. [SPEAKER CHANGES] Thank you, Mr. Chairman. Senator Davis, what's the time period on getting this changed over? What's the EPA - What kind of time frame are they putting on it? [SPEAKER CHANGES] It has to be done by 2019, and these boilers, I guess it takes a little over two years once you put in your order to get those. And so we're backed up into a time. What we're asking for is an agreement of understanding with the Department of Commerce that takes care of these funds to be able to commit to this project, and so it needs to be done by 2019. Does that answer your question? [SPEAKER CHANGES] Alright, other comments? Questions? Alright, do we have a motion? Senator Tillman makes a motion unfavorable as to the bill, but favorable as to the committee substitute. All in favor say aye. All opposed? Alright, Senate Bill 3 committee substitute has passed. The next bill is committee substitute for Senate Bill 743. Senator Brown. [SPEAKER CHANGES] Thank you, Mr. Chairman. I know many of you have seen this bill many times, or one like it. We debated this bill yesterday in commerce, and I'm trying not to go through all of that again in the details I did yesterday in commerce, but there's a new piece I do want to talk about. Again, part one of the bill establishes the framework for the Department of Commerce to contract with a non-profit corporation to assist the Department in fostering and retaining jobs in business development, international trade, marketing, and travel and tourism. And the bill incorporates a number of requirements regarding contracting. Those deal with limitations on scope, oversight, contractual prerequisites, mandatory contract terms, reporting, and ?? of laws in part one. And then in part two of the bill, it renames North Carolina Board of Science and Technology as the North Carolina Board of Science, Technology, and Innovation. Part three talks about the eight geographic regions for collaboration and coordination planning. Part five modifies existing education districts to match the prosperity zones. There's eight prosperity zones. Then we get into the new section that I will talk about today, which is part six of the bill. And this would create or would enact the Film and Entertainment Grant fund in the Department of Commerce. As many of you know, the film industry today has a tax credit that

What we think creates a lot of uncertainty on what that cost is. It was projected at one time I think to be somewhere at 25-30 million dollar cost range. Now it’s projected to be as much as a 90 million dollar cost to the state. But again, there’s a lot of uncertainty as to what that cost is. What this bill will do is adopt some rules that creates more of a grant program for the film industry. It will allow the secretary ?? and commerce, it’ll allow the secretary to issue grants that may be given up to a period of three years. The funds cannot be used for productions unless they meet the minimum qualifying expenses. Funds cannot go to more than one production company for a single production. Funds cannot go to a production that is obscene, political advertising, fund raising, marketing, news programming, live sporting events, radio productions, typical things that you wouldn’t expect a grant to go to, I would guess. And priority for the funds are based on reasonable expectations of benefit to the state, using among other factors percentage of North Carolina residents employed. It allocates 20 million dollars to be used for those grants. I think that’s about as much detail as I can get into at this point. I think that pretty much breaks it down. [SPEAKER CHANGES] Thank you Senator Brown. Questions or comments from the committee. Senator Ford. [SPEAKER CHANGES] Thank you, Mr. Chairman. Thank you Senator Brown. I understand you to say we’ve got 20 million, and this is non-reoccurring funds, is that correct? [SPEAKER CHANGES] That is correct. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] My understanding was there was 60 million in credits last year. Is that correct? [SPEAKER CHANGES] I am not sure exactly what happened, that amount was. It was a tax credit. That’s how it was administered last year. So that was a moving target, which created part of the problem we had as a state. We didn’t know exactly what that would be, because it was a tax credit. [SPEAKER CHANGES] Mr. Chairman, follow up. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Can we get staff to answer that question? [SPEAKER CHANGES] Staff, can you answer that question? Yes they do. [SPEAKER CHANGES] Yes, in the 2012-2013 year, cost was about 60 million, 60.1. The preliminary data we have on 13-14 is 35.4 million but that’s not final data. [SPEAKER CHANGES] Thank you, Mr. Chairman. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Sure. [SPEAKER CHANGES] Maximum payouts for films and TV is at 5 million, is that correct? [SPEAKER CHANGES] That’s it. [SPEAKER CHANGES] Follow up, Mr. Chairman? The maximum payout from my understanding last year was 20 million. Is that correct? [SPEAKER CHANGES] Senator Brown, do you have [SPEAKER CHANGES] I do not. Staff will have to help me with that. [SPEAKER CHANGES] Yes, that is correct. [SPEAKER CHANGES] Follow up, Mr. Chair. [SPEAKER CHANGES] Yes sir. [SPEAKER CHANGES] My question, Senator Brown, is based upon the numbers that I just read off. What gives you and the supporters of this particular PCS confidence that we’re going to have some success with issuing these new credits and support? [SPEAKER CHANGES] It’s my understanding that the film industry really likes North Carolina. It likes the environment in North Carolina. It likes the weather in North Carolina. It likes the layout of North Carolina. They want to stay here. In our discussions with the film industry, I think they understand the uncertainty we have how much it will cost the state each and every year. And I think creating this certainty is important. Plus as we continue with tax reform, having it as a tax credit has become a problem for us, because as you know we’ve tried to eliminate some of the tax credits, if not most of them, as we’ve tried to reform our tax policies. So again, this just moves it to an appropriation. It allows us to look at it every single year. If it makes sense, we can always add more. If it’s not producing the jobs that we think it should, we don’t have to allocate anything. And that’s the choice that we can make and as you know, we can’t put a burden or pass any bill that the following legislature can’t change. So I think this gives us a little more clarity on what those dollars are being spent on. And I think addresses a lot of issues that we’ve been trying to change. [SPEAKER CHANGES] Last follow up, Mr. Chair. [SPEAKER CHANGES] All right, follow up. [SPEAKER CHANGES] I’m going to support this, because I believe in the film industry and what it can do for our state and more importantly regionally as well as they move to different parts of the state to bring new industry here. My challenge again is making forth the state is balancing its needs with

The reform of our tax code. But if we’re going to get into the film business, I think we need to do it in a meaningful way. And so I question the sincerity of us wanting to see this industry successful, as relations to what we’ve done in the past and what we’re looking to do in the future. And so I think it’ll be important for us to keep an open mind, Senator, going forward about the return on the investment for this state. I understand that we want to make an investment but I’m really looking at where are we really going to benefit from these new programs versus what we’ve got in the past, and so I thank you for your consideration and I look forward to discussing it more with you later. [SPEAKER CHANGES] Senator Rabin. [SPEAKER CHANGES] Thank you, Mr. Chair and thank you Senator Brown and thank you for your support, Senator Ford. I believe that the grant program is the proper mechanism for us to be using at this time. Of course I support the film industry and I hope we’re taking a step here to retain that film industry and to give them a chance to grow during the recession. This industry and agriculture are really the only two industries in the state that do continue to grow. But having said that, I applaud those that have worked so hard on this bill because it does a lot of things for the state and I think it does a lot of things for the industry. It identifies the players. It identifies the three major segments in that industry. And I’m particularly proud of the priorities that are set forward in this bill to help bring North Carolina more into the light worldwide and to help encourage tourism and other things that this whole program is doing. Another thing that I like about this, that I support very strongly, is that we are putting this under the auspices of the secretary of commerce, if you will, and I think that’s where it should be. And we are giving the secretary some leeway and some negotiating powers. Something that we are doing for the industry, we are giving them an additional five years to 2020 for the sunset, plus we are allowing the three year contract for the secretary to enter into if they need to be in negotiating with the industry. And that I believe shows that we want to be good partners, that we’re serious. And that we will continue to look at this and hopefully expand it in the future. Thank you for your support again, Senator Ford. [SPEAKER CHANGES] Mr. Chairman if I could say, Senator Ford, 20 million dollars is a pretty good incentive. I mean if you look at what other businesses get, I would dare say that most would sure love to have a 20 million dollar incentive. [SPEAKER CHANGES] Other questions or comments from the committee? Seeing none, [SPEAKER CHANGES] Mr. Chairman? [SPEAKER CHANGES] Yes. [SPEAKER CHANGES] I think Senator Bryant wants to run in amendments. [SPEAKER CHANGES] Mr. Chairman. [SPEAKER CHANGES] Senator Bryant, you want to explain your amendment? [SPEAKER CHANGES] I would prefer to ?? [SPEAKER CHANGES] All right [SPEAKER CHANGES] Thank you, Dan. [SPEAKER CHANGES] Under the bill, certain entities have to be reported if the entity receives an award from the department and if the entity has made a donation of any sort to the non-profit corporation. There’s a requirement that that be reported as a transparency or sunlight to prevent any apparent or to help with any appearance of impropriety. This amendment would also require that for those entities that have reported, if what they’ve given to the non-profit is in excess of $1,000 when the announcement of the award is made by the department of commerce, it has to be accompanied by a note disclosing the gifts that have been made or alternatively, the non-profit within seven days can also disclose publicly that a gift was made. [SPEAKER CHANGES] Questions or comments on the amendment? [SPEAKER CHANGES] Mr. Chairman. [SPEAKER CHANGES] Yes Senator Brown. [SPEAKER CHANGES] I think our secretary’s okay with this amendment, and it’s fine with me. [SPEAKER CHANGES] I’m sorry, the copies will be here shortly but, this is consistent with what we discussed in the commerce committee meeting, tightening it up by creating a $1,000 floor so that every donation or gift is not having to be

Thanks, Senator Bryant. Further comments, questions on the amendment. All in favor of the amendment, say aye. All opposed no. Amendment passes. And now to the Senate Bill Committee Substitute 743, further discussion and debate. [SPEAKER CHANGES] Mr. Chairman. [SPEAKER CHANGES] Senator Goolsby. [SPEAKER CHANGES] Thank you, sir. I do appreciate this, what I hope is an initial effort to help make sure that what has been in the past our film tax credit is going to continue to move forward now as a grant. And I do understand from Senator Rucho the overriding concern about tax credits and making sure as we move forward with tax policy we move away from credits to grants. And I understand the desire of the Senate for certainty when it comes to how much money we’re going to be spending a year. 20 million dollars is a start, but compared to what we had last year, it looks like it’s about a third of what we had. A lot of things about the bill I do really appreciate. As Senator Rabin said, we’ve got about a 2020 sunset, which is extremely important for us. One thing I have heard over and over again from the film industry is how they need more certainty for long term planning. Additionally is that the grants can be given for up to three years. Which is very good for series and other folks who want to come here long term, in particularly down my way and Senator Rabin’s way where we’ve got long term series that are very good for our local economies. Another thing I appreciate about this legislation is I’ve said this in the past, is making North Carolina a stickier place to do business. So that when you come here, you don’t just come and leave. What you want to develop the infrastructure, you want to put the studios in. You want to put the production companies here. And that has been a problem I have seen in the past, is that we’ve had shell companies that have been created so the money flows through there but the jobs don’t necessarily come to North Carolina. They might go to California or somewhere else, but the money flows through. And this I believe is a good effort that will have our secretary of commerce be able to overlook these companies and make sure that they’re doing business in North Carolina. North Carolinians are getting hired, and that we have our own home grown businesses that are starting to start up instead of just being one of many places whoever gets the best deal, is who gets it. The more that we can encourage our own businesses to be here, and then the movie industry to grow things in North Carolina, the better it’s going to be for us. And I do appreciate this initiative. I hope we can see more money put into this as we move it through the system. But it’s a very valuable business down our way and all across the state, but particularly down in Eastern North Carolina, it’s seen us through some very hard times and we appreciate that. [SPEAKER CHANGES] Thank you Senator Goolsby. Senator Tillman. [SPEAKER CHANGES] Mr. Chairman, there’s another way of looking at this. We’re trading 93 million dollars in uncapped tax credits for a controlled 20 million dollar grant program. Where we’ll have control over it and competitive look at who’s there and can decide who we want and how much of that 20 million, Madame Secretary, how much of that 20 million we may want to award and what percentage we want to award. We don’t have to give the maximums in this amendment. And I’d much rather have it that way than an uncapped tax program where everybody can come in and get it and we don’t have any control over it. Well we’ve got some that’s been very questionable, that grabbed that money because they did meet the minimum qualifications and so they got it. And some of them for nefarious reasons, that wasn’t even related very much to movie making. It just got under Senator Goolsby, the wire, by getting that money so this will root that out, because we’re going to take a close look at them. So I like what we’re trying to do here. And it does, 20 million is a whole lot better than zero, which is what it was going to be. [SPEAKER CHANGES] Senator Tucker. [SPEAKER CHANGES] Thank you, Mr. Chair. Senator Brown, I just want to not overshadow your bill with film tax credits, this North Carolina economic development partnership modification is huge. It gives the secretary flexibility. It gives her an opportunity to respond with the public private partnership. It requires her to raise money. And to make this partnership solvent throughout the state. It does not add overhead. They have shared responsibilities with different divisions of government. I’m going to commend you on that effort. Also Senator Rabin and Senator Goolsby, primary Senator Rabin, I couldn’t vote for film tax credit, now I can.

My last question, well I just want to make one comment to acknowledge to the committee that Ms. Bryant, Senator Bryant’s amendment passed unanimously in this committee. I wanted to recognize that, that it was unanimous. And then secondly, I’m going to get a video camera and film a day in the life of a small business in North Carolina. Will there be any tax credit for my HVAC company if I were to do that, or is this just exclusive to the film industry? [SPEAKER CHANGES] Senator Tucker, I think you will get yours when I get mine. [SPEAKER CHANGES] Two years after we’re dead. I understand. I understand. [SPEAKER CHANGES] Senator Tillman, did you want to say something? [SPEAKER CHANGES] Thank you, I did. I know when you’ll get it, Senator Brown, Senator ??. You’ll get it on the 12th. Of never. [SPEAKER CHANGES] Other comments or questions. Senator Robinson. [SPEAKER CHANGES] Thank you, Mr. Chair. Just in terms of the film industry, wanted to say and Senator Brown I think I told you my alignment with the North Carolina School of the Arts and this does support the arts and I think that’s important. So I’m glad to see you all support the arts too. But the question I have is does this allow for the School of the Arts, Black Theater, anybody who’s producing in North Carolina, if they meet the other qualifications, to also apply for a credit, or a grant? Does this allow them, because they also produce. Does this allow them or qualify them to apply for a grant? [SPEAKER CHANGES] I am honestly not sure of that answer so. [SPEAKER CHANGES] Senator Rabin. [SPEAKER CHANGES] Senator Robinson, if they meet the criteria, and if they apply, if the follow, if they jump through the hoops and they meet the criteria laid out in the bill. Anyone that meets the criteria can apply for the grant. But there are criteria set out. And it has to be, and there are some that are laid out in this bill that do not, that specify the ones [SPEAKER CHANGES] Follow up, Senator Robinson. [SPEAKER CHANGES] Yeah, I saw those, and I read through them. But it still didn’t answer my question because the School of the Art does productions. They do film, etcetera. And they may have to move to another level, so I wanted Dan, I think he’s looking. And I’d like for him to answer that. [SPEAKER CHANGES] Do you have an answer? [SPEAKER CHANGES] Yes sir. The bill is couched in terms of a production company which is a person engaged in the business of making original motion picture, television or radio images for theatrical, commercial, advertising or educational purposes. I don’t know of anything in the bill that would preclude them from qualifying. [SPEAKER CHANGES] Senator Ford. [SPEAKER CHANGES] Thank you, Mr. Chairman. I just htough about another question. Please and I think you for your patience. I’m not a part of commerce, but as I look through this bill, Sanator Brown, to your understanding would this bill allow the department of commerce secretary to contract with the existing regional partnerships in the state? [SPEAKER CHANGES] I would say so, if she feels like that’s the best thing to do. I may let the secretary answer that question as well. And I think the bill would allow that. [SPEAKER CHANGES] Mr. Chair. [SPEAKER CHANGES] That’s my understanding. We could contract with non-profits for these specific purposes as outlined here. [SPEAKER CHANGES] Follow up, Mr. Chair. [SPEAKER CHANGES] Follow up. [SPEAKER CHANGES] Thank you very much before, for answering that. I know across the state we’ve got some well established and successful regional partnerships that are doing what this particular model is looking to do across the state. And I would encourage the secretary to do that where it works, and not compete. I look at this and I look at what we’re already doing. Folks, some of this stuff is already working. And my sincere desire is that we work in partnership with those folks who are having some reasonable success across the state, and continue that and not compete with them. [SPEAKER CHANGES] Senator Ford, I would say that the Charlotte partnership and the Wake County partnerships probably were working, maybe better than the other. But I would argue that some of those partnerships were really struggling with this. And it really hurt the process process be able to react a whole lot quicker, make decisions quicker when it comes to trying to recruit some of these bigger industries wanting to come to North Carolina. [SPEAKER CHANGES] I see some, Secretary Decker. [SPEAKER CHANGES] I would just say that our intention is not to duplicate. There are all types of economic development efforts going on state wide. Regional, local

subregions. It's shaping up in many different ways across the state which is what we hoped would happen. So the conversation that's happening with those already involved in business development and commerce is with those local folks to say "How best do we work together?" and "How do we organize in a way that doesn't duplicate, that particularly puts more emphasis on areas that need more support?" Dr. Mitchell has been very engaged in conversations with our business development folks to say "How do we put more resources in our more rural areas for example, because we do have strength in the urban core and there are some resources already in place there." As you know, in Charlotte specifically, there is a study right now between the Charlotte partnership and the Charlotte chamber of commerce as they begin to think about "How better do we work in a new environment?" So we're in close conversation with both of those groups and we'll continue that. We don't need to be duplicating. Resources are too scarce to double up. [SPEAKER CHANGES] Thanks, secretary. Do we have any questions or comments from the committee? Alright. Senator Brown is a member of the committee. Made some motions for us in bill 743 unfavorable as to committee substitute number one, but favorable as to committee substitute number two as amended with amendment to be rolled into a new PCS. All in favor say "Aye". All opposed "No". Then the bill of 743 is amended, substitute committee substitute is approved. Committee is adjourned.