Business

HB2 ‘hasn’t moved the needle’ on NC’s economy, Commerce Secretary says

N.C. Commerce Sec. John Skvarla speaks at Charter Communications Monday morning about apprenticeships
N.C. Commerce Sec. John Skvarla speaks at Charter Communications Monday morning about apprenticeships The Charlotte Observer

Major sporting events like the NBA All-Star Game have pulled out of North Carolina over House Bill 2, and prominent business leaders have criticized the bill for damaging the state’s economy. But state Commerce Secretary John Skvarla says the bill’s business impact isn’t anything to worry about.

“It hasn’t moved the needle one iota,” Skvarla told the Observer Monday during a visit to Charter Communications’ training center in Matthews.

North Carolina is in the “best position” it’s ever been in, financially and operationally, Skvarla added, citing the state’s taxes, regulation, quality of life, workforce and environment that make it an attractive place for companies to relocate.

PayPal first announced plans to open an operations center in Charlotte in March, but reversed course days after HB2 was passed, saying that it “perpetuates discrimination.” Skvarla dismissed the notion that such cancellations damage the economy, and said instead that there’s been “a lot of rhetoric” perpetuating that idea.

“PayPal wasn’t even a grain of sand on the beach,” he said. “It was 400 call center jobs over five years. Much too much is being made of PayPal.”

When the state announced PayPal was coming to Charlotte in March, however, the commerce department painted the move as a big win for the state. “North Carolina’s technology-savvy workforce will provide the perfect fuel for PayPal’s continued growth,” Skvarla said in a news release at the time. “This company’s global reputation for innovation and customer service makes it a strong fit for our state’s business-friendly community.”

The news release said the Charlotte operations center would include employees in customer service, risk operations, engineering and technology.

These days, when it comes to new businesses interested in moving to the state, Skvarla said Monday he hears the most from three states: California, New York and Illinois.

“The message is the same from every one of them, and it’s as recent as last week: ‘Get me the hell out of here. I cannot afford to grow my company where I am,’” Skvarla said.

North Carolina still has “hundreds of active projects” in its pipeline, he noted, though he declined to name them yet. The state, he added, boasts the world’s 23rd largest economy and has the lowest tax rate in the southeast.

Gov. Pat McCrory, who appointed Skvarla, signed HB2 into law in March to overturn a Charlotte non-discrimination ordinance. HB2 sets a statewide definition of nondiscrimination that excludes gender identity and sexual orientation. It also mandates that transgender individuals use the restroom in government facilities that corresponds with the gender on their birth certificates.

“House Bill 2 has severely damaged our state’s economy and reputation, and Gov. McCrory continues to pass the blame and refuses to accept responsibility for his law,” said Jamal Little, press secretary for Attorney General Roy Cooper, the Democrat running for governor.

Skvarla’s upbeat outlook about the state’s economy post-HB2 doesn’t jibe with what local business leaders have said. Charlotte Hornets President Fred Whitfield, for example, said last week that the franchise has been “hit hard” since the bill’s passage. Performers like Maroon 5 have moved their shows from the Spectrum Center, which the Hornets are responsible for booking, and countless others aren’t even considering Charlotte any more, Whitfield said.

Johnny Harris, one of Charlotte’s most influential real estate developers, said after the NBA decided to pull the 2017 All-Star Game from Charlotte that for every one company that decides to relocate to North Carolina that another 10 probably are not, deterred by HB2.

“I’ve been saying to anyone that would listen to me from the very first day that it’s a train wreck,” Harris said this summer.

Skvarla was in Charlotte Monday to promote Charter Communications’ apprenticeship program, which is the largest of its kind in the state.

Job-training fits into the “Carolina Comeback” campaign on which McCrory is running. That positive message is at odds with the doom-and-gloom economic messaging of Republican presidential nominee Donald Trump.

“He’s running a national election. He hasn’t bothered to look in terms of the specifics,” Skvarla said. “He’s just trying to get votes on an emotional appeal, conversely just like HB2 is an emotional appeal.”

Katherine Peralta: 704-358-5079, @katieperalta

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