A North Carolina county is at it again. Tonight, Durham County Commissioners will vote on a plan to offer $800,000 in incentives to a New York City company, Sentinel Data Centers, as part of a plan to lure them to the county. Sentinel is looking for a location for a new data center.
And for this $800,000, how many jobs does Durham County expect will be created? 19. That’s right, just 19. That’s a subsidy of more than $42,000 per job.
We’ve seen this pattern over and over. Governments – whether city, county, or state – spend large sums of money attracting companies to create small numbers of jobs. Often things don’t go to plan. Even fewer jobs than expected actually emerge. Or tax revenues aren’t as expected. Or a company sticks around for a year or two and then leaves. And yet, here’s Durham, looking at doing the same thing again.
The problem is that governments aren’t really very good at determining which businesses will be successful, how successful they will be, how many people they’ll need to employ, how they’ll grow or shrink, or whether the economic conditions and a hundred other factors will keep them around for the long term. Rather than offering specific incentives to particular companies, Durham County should ensure that it provides a low-tax, competitive business environment for any business looking for a place to locate.
