Category Archives: North Carolina

Download Tax: How You Know the State’s Desperate for Revenue

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If North Carolina's Revenue Law's Study Committee has its way we residents will soon be paying state and local taxes on ringtones, movies and music we download.  According to the story the committee thinks the state would raise about $8 million and local governments would raise $4 million from the tax.  Considering how deep the revenue hole is for the state I'd say the stage is set for the legislators to enact this really bad idea. Why do I think it's a bad idea?  Well, it has to do with my professional life.

Back in the dark ages I started my career in direct marketing.  Put simply we sold things to people all over the country via mail (think catalogs) and one thing we had to track was the location of our purchasers.  If they lived in the state where our business was located we had to collect sales tax, but if they lived elsewhere we didn't have to.  There were some legal reasons having to do with interstate commerce that I didn't really grasp, but I was always thankful because the logistical headache of calculating all the different state and local tax rates around the country was an absolute nightmare. Also, because of shipping costs the cost to the consumer was pretty even if they purchased by mail versus purchasing from a store, but if you added tax it would become much more expensive to purchase by mail.  That's helpful to local businesses, but only if they carry the item you're trying to purchase.  What if they don't sell that item?  Then you, the consumer are paying shipping and taxes.  

In today's world it wouldn't be too difficult to set up an online shopping cart to automatically calculate taxes based on the buyers addresss, so as far as I know that issue doesn't really apply anymore.  What does bother me about this, though, is that because taxes on downloads aren't being applied in all states we North Carolinians might lose access to some online sellers who decide that it isn't worth doing business with North Carolinians because of the tax headache (calculating, collecting and paying taxes adds to a company's operational costs). That in turn could lead to fewer competitors in the marketplace and a rise in product costs that we'll also have to pay the extra 7%-ish in taxes on.

I'm also curious how the state plans to collect the taxes. In the offline world a retailer collects the tax at the point of sale and then sends it to the state.  Some businesses try to cheat and not send all the collected taxes, but if they do that and the state catches on then the state can take appropriate action.  How will they know when a seller in Fairbanks, Alaska sells a song download to me in Lewisville, North Carolina?  And if they do find out how will they go after the company in Alaska?  I'm sure there are ways, but won't it involve other states' agencies or the feds?  Basicaly, I'd think that the pain-in-rear aspect would prevent them from going after all but the biggest cheats.

All in all I'm just not sure it's such a great idea.

So Who’d You Vote for In the Soil and Water Conservation Supervisor Race?

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One of the adjustments you have to make when you move to North Carolina is dealing with a ballot that seems like it's 100 pages long when you vote.  I mean we vote for positions that are appointed in most other states, and to think that we citizens actually know who every joker on the ballot is is just plain ludicrous.

That's why it's not entirely shocking that a guy who ran for and won a Guilford County Soil and Conservation District Supervisor seat used a false name on the ballot and was actually a transient. The Rhino Times has the full story here.  

If you read the story you'll find that the alleged election fraudster had a landlord/roommate who was also his campaign manager until the two had a falling out.  Where'd the two meet?  Why at the Forsyth County Central Library in Winston-Salem.  I knew there was something fishy about that place, what with all those books.

Thanks to Ed Cone for the tip.  I'd also like to say that I agree with him that we have entirely too many positions on the ballot.  

North Carolina Gets $52.3 Million from HUD. Good News for Winston-Salem Officials’ Eminent Domain Dreams?

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Today I received a press release from Senator Burr's office announcing that North Carolina had received $52,303,004 from the federal Department of Housing and Urban Development's Neighborhood Stabilization Program.  According to the release "North Carolina may use this grant to assist individuals in purchasing foreclosed homes, acquiring and rehabilitating abandoned homes, establishing land banks for foreclosed homes, demolition of blighted properties, or redevelopment of vacant or demolished structures.  All NSP funds are required to benefit individuals or families at or below 120 percent of area median income (AMI) and at least 25 percent must be targeted at those living below 50 percent of AMI.  Funds awarded under this grant must be used within 18 months." 

You may recall that Winston-Salem officials recently met with our local delegates to the statehouse because they want to be able to use eminent domain to buy blighted properties and refurbish them to provide affordable housing, and they are asking our delegates to push for laws that will allow the city to do just that.  Now that the state has this grant money in hand I'm wondering if that push for a new law will gain even more traction? 

We North Carolinians are More Bummed Out Than the Rest of the Country

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Apparently people in the Southeast have a lower level of confidence in the economy than the rest of the country, and we here in North Carolina have the lowest confidence in the Southeast.  According to this article 70% of us have less confidence in our job security than six months ago and 35% of us feel it's likely we'll lose our jobs in the next six months. News like this won't help.

I have a bold prediction: ABC stores are going to do record business this year.

Piedmont Triad Entrepreneurial Network Shutting Down

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According to this article in TechJournal South the Piedmont Triad Entrepreneurial Network is shutting down because the entities that funded it have decided to go in a different direction.

CEO Jon Obermeyer tells TechJournal South that the foundations backing
PTEN, the Winston Salem Alliance, Action Greensboro, and High Point
Partners, all economic development organizations, declined to continue
supporting it.

The foundations invested $2.75 million in the organization, which was founded in 2004.

"They decided we were not a priority," Obermeyer notes. "It had nothing to do with our results."

He admits the early stage companies PTEN backed are slow on job creation. Many are still in proof of concept…

The companies it backed have raised an additional $8.8 million.

PTEN also distributed $635,000 in prizes to 35 companies through
its annual PTEN GAP business plan competition and did it a unique way
intended to train the companies to deal with investors.

"We gave them the money in tranches and they had to meet
milestones," explains Obermeyer. If they won $30,000, we gave them
three tranches of $10,000 each. If someone was working on a patent, we
would want to see a patent filing."

PTEN also launched the first nanotechnology conference in North
Carolina and ran it for three years. It received national press
coverage in the industry publication, "Smalltimes."

It held an investor conference in August. It had companies from
Memphis, Charlottesville, the Research Triangle and elsewhere present
in additon to Triad firms…

"We worked with other organizations such as the NC Council for
Entrepreneurial Development and the Piedmont Angel Networks. We were
doing all the right things," says Obermeyer.

"My question now, is who's going to do this work?"

This is definitely a negative development for the Triad.  While groups like PTEN may not create lots of jobs in the short term they tend to foster the development of the kinds of companies that attract dynamic people who in turn accelerate innovation that seeps into the surrounding business community.  In other words they create energy that attracts innovators and builders and those are exactly the kind of people we need in the Triad right now.  I think we have plenty of bankers and lawyers, but we're hurting for true entrepreneurs.

BTW, anyone else see opportunity to fill the gap here?

Who’s Moving? Apparently Not Many People in the Triad

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I stumbled across the blog for realtors Brad and Angela Lawrence and they have a chart on there that's just plain depressing, but before I get into that let me give them a compliment for having the blog in the first place.  I know I've taken some realtors and their association to task in the past, particularly for saying things that make them seem obtuse about current market realities, but that doesn't mean I have it in for all realtors. There are some I really respect and I think they play an important role in the housing market, so it's nice seeing Brad and Angela using blogs and email newsletters to augment their shoe leather sales.

Now, to the numbers.  They have a chart showing the housing market activity for the Piedmont Triad for the week of 11/1/08 – 11/7/08.  What struck me is that the percentage of listed homes that sold seems really low and more houses were newly listed than were sold, which means that the inventory of unsold homes actually grew.  I don't know if the numbers were higher or lower than historical norms, but they just seem really, really low.  Here they are by county:


The following numbers are the Pendings/Solds/New Listings/Actives for Week of 11/1/08 – 11/7/08

Source – Triad MLS

County Pendings SOLDS New Listings All Actives
Guilford 56 17 130 4620
Forsyth 39 22 111 3421
Davidson 8 11 34 1271
Randolph 10 8 34 748
Davie 0 0 14 407
Stokes 4 1 8 300
Surry 3 1 9 421
Yadkin 2 2 7 117
Alamance 7 1 7 378
Rockingham 9 3 13 548

If I'm doing my math right then there were actually 80% more homes newly listed (367) than were sold or pending sale (204). Also only 1.7% of all homes on the market were sold or pending sale.  This really can't be good, especially if those kinds of numbers are consistent for months on end.  Maybe someone out there with access to historic numbers can tell us if this is representative of the market over time.

On another post about where people look for home listings Brad and Angela say the following:

There are so many sources for buyers to use to find homes, with 80% plus buyers searching online, that is the preferred path.

In our area (Piedmont Triad), the preferred online search tool is Listingbook.com,
it is a service that is fed from our MLS every 30 minutes. No doubt it
is best search tool, it is far superior than any other search tool that
we have experienced. It allows buyers to have their own personal
account, save favorites, make property notes, communicate back and
forth with their agent through property notes, very customized search
critera and FREE………here are more benefits of Listingbook.

We do not know of any buyers that look in the newspaper or magazines
anymore, if we get a call, they saw it online or a yard sign.

What I really like about this is that they take the time to provide information that may not lead directly to a sale, but it does show their expertise and understanding of the market.  Good stuff.

North Carolina’s 4th and 5th Districts Could Be Interesting in a Month

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Thank God we only have a little more than a month until "Decision 08" as the tee-vee folks have dubbed this year’s election. That said I think there might be some interesting developments in two of North Carolina’s Congressional districts this year.

I’m beginning to believe that populist Democrat Roy Carter might have a chance at taking out Virginia Foxx.  She’s having a hard time painting him as a typical dirty-word-liberal, and her close ties to the Bush administration aren’t helping her. I’m not sure how the whole Wall Street bailout thing is going to work for her, because the last I heard she might be one of the House Republicans against the deal.  It might end up being a plus for her to be able to say she fought against bailing out the "fat cats on Wall Street", but on the other hand she might be too closely associated with the folks that got the country into this mess.

Over in the NC-4 Democratic incumbent David Price should be a lock in that district, but I’m getting the sense that challenger BJ Lawson might give Price a tougher run than people would imagine.  If nothing else I think Lawson is providing a lesson to other candidates in how to use the web as a campaign tool.  He has a very good blog while Price has a website that looks like something straight out of 1999 without any real substance. A perfect example of how much stronger Lawson’s online presence is, check out his extensive blog post about the government bailout versus the absolute lack of information on Price’s site.  Price doesn’t even have the typical, lame press release which of course makes his site uber-lame.

BTW, the only reason I found Lawson’s blog was because of the bailout post, which showed up in today in one of my Google Alert updates.  Google’s love of blogs is in and of itself a great reason for any candidate to have a blog.  Others would include the ability to communicate directly with constituents, the ability to frame an agenda without relying on mass media, and looking a little less out of it to the increasingly influential Millenial voters.

Back over in my home district I just found Virginia Foxx’s updated web presence which includes a blog and links to online video and pictures.  My hat’s off to her and her campaign, because it’s a vast improvement on her old site.   She’s only posted twice to her blog, but hopefully that will change as we enter the last month of the campaign.  She should check out her fellow Republican over in the NC-4 for a look at how it’s done.  Foxx’s opponent doesn’t have a blog, but he also has online video and links to Facebook and MySpace where he has profiles that look like they need to be fed and watered.

Foxx Hunt

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I’m no fan of my Congresswoman Virginia Foxx, but I’ve pretty much resigned myself to the fact that I live in a Congressional district that would probably throw a parade for Vladimir Putin before it would elect a Democrat.  Well, I might be wrong.  Here’s an interesting post at BlueNC by Frank Eaton in which he points to a poll that shows Foxx leading Democratic opponent Roy Carter by a mere 48-46 in a Public Policy Polling (PPP) poll. He writes the following:

The PPP’s own poll showed a ten point spread (51-41) back in July.
But now, at the start of the true fall campaign, with multiple daily
events across the district, introductory ads on TV and an increasingly
attentive media, people are beginning to understand that there’s
somebody running against Virginia Foxx in the 5th district. His name is
Roy Carter, a fiery mountain populist with a long record of service to
5th district families and their children. This guy could win!

Sometimes it takes the word a while to get to Washington, especially
when it’s coming from a largely rural, inaccurately studied district
like NC-05, which the party structure has habitually forsaken since
redistricting. But listen up: ROY CARTER IS WINNING THIS RACE DOWN
HERE. And he’ll continue to win this race until Virginia Foxx opens up
her war chest and starts running those crappy $150,000 TV ads in steady
rotation on Fox News here in the district.

SHE CAN BE STOPPED FOR VERY LITTLE MONEY. All that’s standing
between North Carolina and an easy Democratic pick-up in the Congress
is this continued reticence on the part of the Democratic
leadership–at both the state and national levels–to look at the true
dynamics of the race:

-Soft support for Virginia Foxx among republican and unaffiliated
voters indicated by low approval ratings for her and the current
administration.

-increased consciousness of the economic realities in the district and a desire for change.

-A compelling Democratic challenger who is overseeing an energized, creative, dynamic campaign.

Even though Eaton is not an objective source I think he makes some pretty good points.  Foxx is closely aligned with Bush and hence vulnerable to negative association.  I’m sure she has a stranglehold on the hard core Republicans in her district, but Carter presents a problem for her with centrists because he’s not perceived as some sort of "intellectual elite" or "tree hugger" Democrat.  He has a lot of qualities that residents of this meat and potatoes district are attracted to, and he won’t be easily dismissed with the usual "liberal elite" smear campaigns.

On the other hand Eaton’s also right that Foxx has a deep war chest and when she starts opening up the media campaigns Carter could be thumped if he doesn’t get similar air time, which means he needs a financial boost from somewhere. 

Hat tip to Ed Cone for the lead.