Staff reporter John Lentz has a 1A story in today’s newspaper on what the grants — from the Department of Commerce’s Economic Development Administration and the Golden LEAF Foundation — will mean for Scotland County.
While it may be too early for county officials to go into great detail about how the project will unfold, the announcement certainly sounds like welcome news compared with Scotland’s recent jobless rate and the planned departures of QualPak and Mowhawk.
What we know so far is that the money will be used to build a business incubator to house start-up companies and entrepreneurs within Scotland County. The project will also tap the resources of such partners as the Small Business Center at Richmond Community College and the Small Business Technology Development Center at the University of North Carolina Pembroke.
But will the incubator really help? There is no question that it is good deal for new businesses. They get a break on rent and office equipment and all the resources needed to guide a new venture.
But will the incubator help Scotland in the long run?
A study by the National Business Incubation Association found that for every $1 in subsidy, incubators generate nearly $5 in tax revenues and a host of other benefits. The study looked at about 50 incubators. The study failed say how long the companies had been out of the incubators on average — making it difficult to evaluate survival rates or companies’ commitment to their towns.
There have been no definitive studies that have tracked incubated businesses and compared them with companies that managed on their own.
Our local leaders have faith in the project. U.S. Rep. Larry Kissell has predicted that incubator will create 60 new jobs and help leverage an additional $2 million in private investment.
In announcing the award Kissell said: “I’m so pleased to see our tax dollars coming back home to help create jobs and promote small businesses right here in Scotland County.”
We hope the congressman is right and that this project gives back a lot more to taxpayers than it will take.