Politics & Government

Here’s why John Lassiter was pushed out as head of NC economic development agency

Democratic Gov. Roy Cooper asked Charlottean John Lassiter, left, to step down as chairman of North Carolina’s Economic Development Partnership board after he helped dilute the governor’s influence on the board. Former Gov. Pat McCrory, right, appointed him to the job.
Democratic Gov. Roy Cooper asked Charlottean John Lassiter, left, to step down as chairman of North Carolina’s Economic Development Partnership board after he helped dilute the governor’s influence on the board. Former Gov. Pat McCrory, right, appointed him to the job. ogaines@charlotteobserver.com

Democratic Gov. Roy Cooper asked Charlottean John Lassiter to step down as chairman of North Carolina’s Economic Development Partnership board after he helped dilute the governor’s influence on the board.

Lassiter announced Tuesday that he’ll resign at the end of the month as chairman of the partnership, the private-public group that oversees the state’s economic development efforts. In a letter, he said he wanted to focus on his legal staffing business.

But Cooper adviser Ken Eudy said Friday he asked Lassiter, a Republican, to step down in January after the chairman engineered a change to the group’s bylaws in December.

Lassiter said the board changed the bylaws to bring the board into line with its statutory authority.

The governor has nine appointments to the 17-member board. Before December, he could change those appointees at any time. Now Cooper can remove members only for “misfeasance, malfeasance, and nonfeasance.” Because terms are staggered, that means he won’t have named a majority of the board until his final months in office.

“It was clearly a hijacking of the board,” Eudy said Friday.

Asked about the circumstances of his decision, Lassiter said, “The timing was right for me to step away and focus on my family and growing business.

“The goal was to build a high-performing and sustainable organization to attract jobs and capital investment in our state,” he added. “We were able to do just that.”

The move reflects Cooper’s continued tensions not only with the Republican-controlled General Assembly but with appointees of his Republican predecessor, Pat McCrory.

December’s move by the partnership board came days after legislators passed laws to limit Cooper’s authority in other areas, including hiring.

The partnership is an independent non-profit created in 2014 in hopes of streamlining job recruitment, which had been done by the Commerce Department.

At the time, Lassiter said the existing system was “noncompetitive against other states.” Critics said the change wasn’t needed. The new organization took economic development out of the hands of the Commerce secretary, who’s appointed by the governor.

This year the partnership is getting $21.4 million in state money. It’s unclear when Cooper will name a new chairman to replace Lassiter, whose term was due to expire in 2018. Like other board members he’s not paid.

Eudy said Lassiter refused a request to step down in January. Then he was asked in March and in April.

By then, Lassiter had tried to extend the contract of Chris Chung, the partnership’s executive director. His contract now runs until January 2018. In his resignation letter, Lassiter called Chung “the brightest star in business recruitment in the country.”

Eudy alluded to the proposed extension Monday in a letter to the partnership board.

“The governor’s office informed Mr. Lassiter that it was not a good management practice for a departing chairman to negotiate a contract extension,” he wrote. “…Mr. Lassiter remains adamant that he should negotiate Mr. Chung’s contract extension before his imminent departure.”

In an interview, Eudy said, “This is not about Chris or his performance.

“We like Chris and look forward to continue working with him… It’s bad management for an outgoing chairman to negotiate a contract that he will leave with the new chairman and the rest of the board. It’s just a bad management practice and he knows better.”

As recently as January, Cooper had raised the possibility of severing the state’s ties to the partnership and making changes to the Commerce Department. The group’s five-year contract with the state expires in 2019.

In his letter to the board, Eudy said deferral of a contract decision “will go a long way toward cementing (the Partnership’s) relationship with Gov. Cooper and and his Department of Commerce.”

Jim Morrill: 704-358-5059, @jimmorrill

  Comments