Executive summary 8 I. Introduction 26 II. State government capability 28


NORTH CAROLINA DEPARTMENT OF COMMERCE



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NORTH CAROLINA DEPARTMENT OF COMMERCE

The North Carolina Department of Commerce is the State’s lead agency for economic, community and work force development. The Department also has under its auspices the information technology function for State government and agencies that regulate commerce in the State. The Department of Commerce is an Executive branch agency. The head of the Department, the Commissioner of Commerce, is appointed by and reports directly to the Governor. The Secretary serves as a member of the Governor’s Cabinet.


The Commerce Department’s strategic plan focuses on three main goals:


  1. Keep North Carolina competitive for high value, technologically competitive industries and companies by actively recruiting and encouraging the expansion of industries such as telecommunications and biotechnology, and companies that apply new and innovative technology in traditional industries such as textiles and furniture.

  2. Increasing economic opportunities for North Carolina in a global economy by attracting growing businesses.

  3. Improving economic opportunities for all North Carolinians, through programs targeted to people and places not currently enjoying economic prosperity.



State Infrastructure Council

The North Carolina State Infrastructure Council was created by the General Assembly when it passed the Clean Water and Natural Gas Critical Needs Bond Act of 1998 (SB 1354). In addition to members of the General Assembly, the Council includes representatives of local governments, the Secretary of Commerce, the Secretary of Environment and Natural Resources, and professionals with particular expertise in wastewater treatment and water supply and distribution and related fields.


The duties of the Council under SB 1354 are:


  • To plan and develop a state Strategic Plan that addresses North Carolina’s water supply and distribution and wastewater treatment needs;

  • To evaluate the State’s natural resource base and existing water and sewer systems and to project statewide future needs for water and sewer;

  • To analyze the current and proposed statutes, rules and programs that address or affect state water and sewer needs;

  • To analyze the roles of state and local government and other parties in addressing water and sewer needs and to recommend appropriate roles for each with regard to addressing future water and sewer needs; and

  • To anticipate the impact of infrastructure development on natural resources and to make recommendations on how to minimize those impacts.

The location of water distribution and sewer treatment plants must be carefully planned so that the facilities are not placed in areas that are prone to flooding or other natural hazards. In addition, the placement of infrastructure can have profound ramifications for growth, and communities must take care that the provision of water and sewer does not encourage new development to take place in floodplains and other hazardous areas.



State Economic Development Board

The State Economic Development Board, governed by NCGS 143B-434, is comprised of leaders from business, education, and workforce communities around the State. The Department of Commerce provides staff support to the Board.


The Economic Development Board serves as the State’s top economic development policy advisory body and is responsible for recommending economic development policy to the Governor. Appointments to the Board are made by the Governor, the Speaker of the House and the President Pro Tempore of the Senate. In 2002, the Board wrote the Comprehensive Economic Plan for the State. The Plan addresses approaches to issues including incentives, recruitment, and retention strategies, workforce development, development of future technologies, coordination of State agencies, rural development, and marketing.

NC Board of Science and Technology

The Board of Science and Technology seeks to encourage, promote, and support scientific, engineering, and industrial research applications in North Carolina. The Board also works with the General Assembly and the Governor to put into place the infrastructure that keeps North Carolina on the cutting edge of science and technology. The 19-member Board is comprised of representatives of state government, universities, industry and non-profit organizations.



The Oregon Inlet Project

The Department of Commerce, through the office of the Assistant Secretary for Administration, was designated the lead agency in charge of the Oregon Inlet Project on the North Carolina Outer Banks. The purpose of the project, to be carried out by the U.S. Army Corps of Engineers, was to provide a safe, navigable channel from the Atlantic Ocean through Oregon Inlet to Roanoke Sound and connecting channels to Pamlico Sound. Vessels using the inlet represent both commercial and recreation fishing interests. The Corps has been attempting to maintain the 14-foot deep by 40-foot wide channel across the ocean bar at Oregon Inlet since 1962.


Maintenance of both the Oregon Inlet channel and the Herbert C. Bonner Bridge spanning the inlet continues to be problematic for the Corps, Commerce and DOT from both political and technical perspectives. NCDOT awarded on July 26, 2011 a $215.8 million contract to replace the bridge to the design-build team of PCL Civil Constructors Inc. and HDR Engineering Inc. of the Carolinas. The contract amount is $25.8 million less than NCDOT’s estimated cost to build the new bridge.
Construction was set to begin in early 2013; however, it is on hold pending the results of an ongoing lawsuit and the receipt of final construction permits. PCL Civil Constructors was scheduled to open the new bridge to traffic in spring 2015. Pending a favorable outcome of the lawsuit, a new schedule for construction will be established once all permits have been received. It will take about 2.5 to 3 years to build a new bridge from the start of construction. A portion of the existing bridge will remain in place and be transformed into a fishing pier.
NCDOT also continues work on Phase II of this project, which includes long-term solutions to the portions of N.C. 12 that were damaged during Hurricane Irene in 2011.
The Corps had proposed construction of two jetties at Oregon Inlet, one of which would extend nearly two miles, at an initial cost of $108 million, with annual dredging costs of $6.1 million. In 2003, the White House Council on Environmental Quality, the U.S. Army Corps of Engineers, and the Interior and Commerce Departments decided not to proceed with the proposed navigation project at Oregon Inlet. The agreement resolved a 30-year process seeking to reconcile complex engineering and economic issues with the goal of improving navigation safety and protecting the fishing industry, the Cape Hatteras National Seashore, and the Pea Island National Wildlife Refuge.
Instead of the jetty project, the Corps will improve the current 14-foot navigation channel and work with the National Oceanic and Atmospheric Administration to enhance boating safety by providing the public with more accurate and up to date navigational data on changing sand conditions in the channel. Sand from channel dredging will be used for beach nourishment projects along the coast.

Public Staff of the Utilities Commission

The Public Staff of the Utilities Commission reports directly to the Utilities Commission rather than the Secretary of Commerce. The Public Staff reviews, investigates, and makes recommendations to the Utilities Commission on the reasonableness of rates and adequacy of service provided by all public utilities in the state. The Public Staff is also charged with ensuring the consistency of the public policy of assuring an energy supply adequate to protect the public health and safety. (For information regarding the Utilities Commission, see discussion of the Commission in the State Government Section of this Capability Appendix).



Rural Electrification Authority

The Rural Electrification Authority is responsible for ensuring that customers in the predominantly rural areas of the State have access to adequate, dependable, affordable electricity and telephone services.



State Ports Authority

The Ports Authority staff operates and promotes the use of North Carolina’s port facilities including deep-water ports at Morehead City and Wilmington; intermodal terminals in Charlotte and Greensboro; and the harbor at Southport. The State Ports Authority Board of Directors governs the Authority, and the Secretary of Commerce serves as an ex-officio member of the Board. The Ports Authority has recently received grants from the U.S. Department of Homeland Security to improve security at the State’s ports.


The Ports Authority works with the U.S. Coast Guard, the U.S. Army Corps of Engineers, and state and local emergency management authorities in preparation for hurricane landings. Each port has a hurricane team including representatives from all major functional areas, from Facilities and the Port Police to the Crane and Cargo Departments. The hurricane plan has been developed and refined over the years with review after every major storm to ensure that all concerns and potential problems are anticipated and handled.
At both the Wilmington and Morehead City Ports, preparations for hurricanes include sandbagging vulnerable buildings, securing and blocking warehouse doors, and moving to shelter any small equipment, vehicles or other items that could readily blow or float away. For the safety and security of Ports facilities and equipment, the Authority’s policy is that no ships may remain at dock during a hurricane.

Business and Industry Division

The Division of Business and Industry leads North Carolina’s business and industrial recruitment efforts. The Division’s industrial developers work closely with other public and private development organizations to attract new industries to the State. The Division also offers retention and expansion services to companies currently located in North Carolina through seven regional offices.



Division of Tourism, Film and Sports Development

The goal of the Division of Tourism, Film and Sports Development is to strengthen the State’s tourism, film and sports industries to enhance the economic well-being and quality of life for all North Carolinians. The NC Tourism Board was created in 1991 to promote the sound development of travel and tourism industries in North Carolina. The Board performs its functions in accordance with GS 1430B-434.1. The Board advises the Secretary of Commerce on factors relating to the promotion and development of tourism throughout the state.


Tourism has grown into one of the state’s largest industries. Annually, more than 49 million people visit North Carolina and leave behind $12 billion. North Carolina ranks sixth in the Nation in person-trip volume by state. The Governor has recognized travel and tourism as one of the most important industries in the State. He has vowed to continue the bold and aggressive programs designed to keep and create jobs in the tourism field.

Tourism Grant Programs

The Division of Tourism manages several grant programs to provide aid to local communities and non-profit tourism organizations with their local and regional tourism marketing and development projects. The Tourism Matching Funds Program assists statewide, regional and local destination marketing organizations and local governmental entities to market their areas as travel destinations. Grants are based on the economic distress ranking of the state, providing as much as $7,500 per grant to projects in the 20 least affluent counties. Grants are awarded for projects with the greatest potential for positive economic impact on the state and local economies. The Rural Tourism Development Grant program is intended to encourage the development of new tourism projects and activities in rural areas of the state. Consideration is given to projects in more economically distressed rural counties for grant awards.

Hurricane Evacuation of Coastal Counties

While tourism is an economic boon for many North Carolina communities, the State is aware of the need to ensure the safety of all our visitors. A large percentage of tourist dollars are spent in our coastal communities. During the height of the summer tourist season, populations in some coastal towns and counties can swell 10-fold. Unfortunately, the most popular time for visiting the shore coincides with hurricane season, potentially putting thousands of out-of-town visitors and year-round residents at risk. The decision to evacuate the coast is made by county and State officials based on predictions of a hurricane’s intensity and landfall, using the best data available from the National Hurricane Center and other reliable sources of weather information. The decision to evacuate is a difficult one, which can impact thousands of businesses who can lose several days or even weeks of income. However, on the few occasions when the order to evacuate has been made, by and large the population of coastal counties has been cooperative, and evacuation has gone smoothly.

Policy, Research and Strategic Planning Office

The Policy, Research and Strategic Planning Office maintains data on the state’s economy for use by industrial clients and the public. The Division publishes the annual Economic Scans of all 100 counties in the state as well as quarterly Economic Trends reports. The unit analyzes the impact of trends and changes in the state’s economy and recommends refinements in the Department’s programs in response to those analyses. The Division also provides staff support to the North Carolina Economic Development Board.


The data compiled by the Policy, Research and Strategic Planning Office can also be useful for local governments during development of their hazard mitigation plans. Such economic figures can greatly assist in assessing vulnerability to various natural hazards throughout the State.

Division of Community Assistance

The Division of Community Assistance (DCA) assists local governments across the State through education, community development, growth management, and downtown revitalization. DCA has three major components: the Main Street Program, the CDBG Program, and the Community Planning Program. DCA also serves local governments through the Appalachian Regional Commission North Carolina Office. A staff member from the Division of Community Assistance serves on the State Hazard Mitigation Advisory Group.



Division of Community Assistance Main Street Program


The Main Street Program works to stimulate economic development within the context of historic preservation. The Program encourages imaginative use of business and government resources to support local revitalization initiatives. DCA provides direct assistance to 53 Main Street communities, and indirect assistance to countless other communities throughout the state.
Since the program began in the fall of 1980, NC Main Street communities have seen more than $789 million of new investment and experienced a net gain of 10,000 jobs in their downtowns. More than 2,400 buildings have been renovated, and new business start-ups exceed 5,400.

All projects conducted through the Main Street Program are initiated locally, by local decision. DCA does not control the project outcome beyond supplying education, technical assistance, and advocacy services. Communities are selected to participate in Main Street through a competitive application process, and although location of a floodplain or other hazardous area is not used as a criteria for participation, if DCA is aware of a potential flooding or other hazard problem, the Division will bring the issue to the attention of the community. Business start-ups, renovations, and other activities that take place through the Main Street program do not necessarily include flood-proofing or other mitigation techniques to strengthen structures against floods or other hazards, but DCA will advocate for such action if a flooding or other hazard problem is evident.



Division of Community Assistance Community Planning Program


Through five regional offices, professional planners in the Community Planning Program make their knowledge accessible to local governments for a wide variety of projects. Each Office is staffed with planners who are available to assist counties and municipalities with a wide range of specialized assistance, including:


Downtown revitalization

Historic preservation

Neighborhood conservation

Strategic planning

Growth management

Community appearance

Board/committee goal setting

Land use planning

Economic development

Community Planning Program staff provide other types of assistance to municipalities and counties in the areas of public administration (capital budgeting, annexation, and water and sewer rates) and by developing new services and products to help meet local needs. Regional staff also assist communities and counties through interlocal and regional approaches to community economic development and growth management.


Land use planning guidelines prepared by DCA are available for use by North Carolina communities and state agencies. The purpose of the guidelines is to help define the necessary components of a local land use plan. They emphasize protection of local and regional water quality, but beyond this they provide a broader community and regional context for many community interests. Hazard mitigation and hazard areas are a major priority whenever DCA staff works with a community on the preparation of a local land use plan. DCA planning staff have also assisted local governments throughout the state meet the requirements for preparing and adopting local hazard mitigation plans in accordance with the Disaster Mitigation Act of 2000 and Senate Bill 300.

Division of Community Assistance CDBG Program


The Division of Community Assistance oversees the comprehensive community economic development strategies that are carried out by State governmental agencies and their allies. DCA administers the North Carolina Small Cities Community Development Block Grant (CDBG) program to improve the economic well-being and quality of life for all North Carolinians. All North Carolina Small Cities are eligible to apply for funds except for the 23 entitlement cities that receive funds directly from HUD. All counties except the two HUD-designated urban counties of Wake and Cumberland are eligible to apply for Small Cities CDBG funds.
In 2004, the State received over $50 million from the U.S. Department of Housing and Urban Development (HUD) for specific categories in the CDBG program. 2004 categories for CDBG funds include:
Community Revitalization: to strengthen neighborhoods and rehabilitate homes of low to moderate-income citizens.
Scattered Site Housing: to address most critical housing needs of families.
Infrastructure: local governments may obtain grants to improve existing infrastructure or provide new infrastructure to existing neighborhoods experiencing serious health or environmental problems.
Economic Development: to provide grants or loans to local governments for creating and retaining jobs.
Housing Development: helps promote new housing development by providing infrastructure or removing hazardous materials or vacant land acquisition. Priority goes to rental housing in Tier 1/Tier 2 counties, State Development Zones, infill locations, and reuse or existing buildings.
Urgent Needs: to help communities recover from disasters that threaten public health and safety where sufficient funds are not available. In 2002 and 2003, priority funding was made available to counties determined to have critical water shortage needs due to the 2002 drought.
Capacity Building: to help non-profits design and carry out CDBG activities in partnership with local governments.

Division of Community Assistance State Development Zones Program


The State Development Zones Program offers incentives, including tax incentives, for businesses that locate in designated development areas. Priority consideration for CDBG funding is given to projects in designated Development Zones. In order to receive priority consideration, a local government needs a strategy for revitalizing the Zone and a committee in place to oversee the strategy.
An extensive range of eligible projects allows a locality to tailor projects to respond to unique challenges and opportunities. To qualify, a project must construct, improve, acquire, or convert real property for community development purposes, including housing, commerce, industrial and non-profit use. Zone improvement projects are administered by qualifying non-profit agencies certified by the Secretary of Commerce.
Criteria for State Development Zones are tied to income, population size, and municipal status according to Census Tract and Block Group poverty rates. Formal criteria for creating State Development Zones does not take into consideration whether the area is located in a known flood or other hazard area (for example, there are no provisions to prohibit designation of a Development Zone in a mapped floodplain). However, as good stewards of state assistance, communities are responsible to make use of their own overlay of hazard issues to aid in the decision of where to build or develop property within a Development Zone.



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