Buncombe proposes $27M subsidy for Pratt & Whitney

Pratt and Whitney engines
THE PRICE OF FREEDOM: A proposed economic development incentive for Pratt & Whitney, a division of defense contractor Raytheon Technologies, would cost Buncombe County taxpayers $27 million. Photo courtesy of Economic Development Coalition for Asheville-Buncombe County

Buncombe County’s political and business elites gathered at the Grove Park Inn on Oct. 22 to crow over what they called the region’s biggest-ever economic coup: a $650 million investment by aerospace manufacturer Pratt & Whitney in a new manufacturing facility to be located on undeveloped forestland alongside the French Broad River near Biltmore Park.

It wasn’t until a Board of Commissioners briefing on Nov. 5, however, that Buncombe officials revealed the potential price of their success. Under the terms of a proposed economic development incentive agreement, county taxpayers would subsidize Pratt & Whitney — a division of military contractor Raytheon Technologies, a Fortune 50 company with revenues of over $77 billion last fiscal year under the leadership of CEO Gregory Hayes, whose total compensation was $21.5 million in 2019 — to the tune of $27 million.

The deal will not be finalized until the board’s next meeting at 5 p.m. Tuesday, Nov. 17. The commissioners will vote on whether to approve the incentive following a public hearing, which will likely be held virtually due to the COVID-19 pandemic.

Tim Love, Buncombe County’s director of intergovernmental relations, explained that the incentive would be paid in annual installments over at least 10 years. The money would also be tied to the company’s fulfillment of promised targets regarding jobs, capital investment and average wages. Pratt & Whitney has agreed to create 800 jobs with an average annual wage of $68,000, more than double the county’s per capita income as of 2018.

The amount of the incentive, added board Chair Brownie Newman, was designed to be revenue-neutral for the county. Pratt & Whitney is expected to pay roughly $2.5 million annually in property taxes on its facility’s equipment, as well as excise taxes on the value of the 100-acre site that it will receive for $1 from Biltmore Farms. The county’s incentive is estimated at $2.6 million per year.

Love stressed that, while the county won’t see a net property tax gain from Pratt & Whitney over the period of the incentive, local residents would immediately benefit from over 1,000 temporary construction jobs created to build the facility. And, once fully operational, the plant is expected to have an area payroll impact of $74 million per year, some of which would be spent in the local economy.

“There’s going to be benefits when we talk about corporate philanthropy, hiring practices, competitiveness in our region,” Love added. “We think there are a lot of indirect benefits that are important to note that we’re not going to quantify for you today.”

If approved, the county’s incentive to Pratt & Whitney would be its largest to date by $8 million, exceeding a $19 million total subsidy to Canadian auto parts maker Linamar. The county’s largest economic development deal with a local company has been a roughly $3 million subsidy to Black Mountain-based Ingles Markets arranged in 2010.

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About Daniel Walton
Daniel Walton is the Assistant Editor of Mountain Xpress, regularly contributing to coverage of Western North Carolina's government, environment and health care. His work has previously appeared in Capital at Play, Edible Asheville, and the Citizen-Times, among other area publications. Follow me @DanielWWalton

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7 thoughts on “Buncombe proposes $27M subsidy for Pratt & Whitney

  1. Harold

    No. No incentives. Corporations must sink or swim on their own.

    “We THINK there are a lot of indirect benefits that are important to note that we’re not going to quantify for you today.”

    Of course you’re not going to “QUANTIFY…”

    Because those “indirect benefits” are actually directly imaginary.

    These imbeciles fall for this capitalist con every single time.

    But that’s what you get when you have imbeciles in charge.

    • luther blissett

      “Corporations must sink or swim on their own.”

      Except they don’t: look at the absurdity of the Foxconn deal in Wisconsin. Corporations can move resources as they see fit. That’s why they can extract tribute from municipalities, which can’t.

      The piece of the puzzle to look at here, perhaps, is Biltmore Farms’ stake, given that it is a property developer (sorry, “community development” company) and land doesn’t move. It goes without saying that Biltmore Farms has more sway with the county than any of us stiffs. Anyway, that location is more “just across from Bent Creek” which tells you Jack Cecil’s broader plans for “Biltmore Park West” once it gets that bridge built across to Brevard Road.

      https://wlos.com/news/local/biltmore-farms-plans-750000-square-foot-manufacturing-facility-in-buncombe-county

  2. Reily

    Has anyone, anyone at all considered the environmental Impacts on the French broad from this project? If so, id really like to know what you guys think they are.

  3. dyfed

    Am I the only person who thinks that actual high-wage tech and industrial jobs moving into the county is an incredibly good thing?

    Yeah, they had to offer a tax break to come. Who cares? If they hadn’t come, they wouldn’t have paid property taxes anyway! This is a net gain for the county, the city, and the region, and the effects of this victory will last for decades.

    • luther blissett

      Of course it’s a net gain. There’s the beginnings of a high-skill manufacturing cluster which will create its own incentives for others to invest in the area.

    • indy499

      Then folks could complain that we only have service jobs and high housing costs.

  4. Jarrod

    Wish Asheville and Buncombe tax payers like myself and family would get a tax subsidy or improved services. This is a slap in the face to the tax paying citizenry and the French Broad eco system.

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