Carolina Journal News Reports
CJ Series

Northeast Partnership

North Carolina's Northeast Partnership, a regional economic development agency established by the General Assembly in 1994, almost immediately afterward declared itself a private nonprofit organization and therefore not subject to public records laws. Funded almost entirely by state government, the partnership's leaders have allegedly sought to boost their own financial stakes in private companies by attempting to obtain state economic incentives for those companies. These efforts have been helped through their ties to State Senate President Pro Tem Marc Basnight.

(8.29.08) AG is AWOL in Corruption Cases
While wasting time on a battle against the Tennessee Valley Authority, Roy Cooper has done little to protect North Carolinians from politicians who break the law.

(8.25.08) Privaris Founder Outlines Watson Conflicts
RALEIGH — A state-funded economic developer gained ownership in a business that he was recruiting and then secured state grants for the same company, according to the business' founder and documents obtained by Carolina Journal.

(4.21.08) Document Shows Conflict in Parton Project
RALEIGH — Former state-funded economic developer Rick Watson was the business manager for Randy Parton’s company at the same time he was recruiting Parton on behalf of North Carolina, according to documents obtained by Carolina Journal.

(3.27.08) Panel Begins Work Amid Records Flap
RALEIGH — As Gov. Mike Easley’s special panel on email records retention has its first meeting today, its leader is the object of a Carolina Journal email and records request that has gone unfulfilled since it was made more than two weeks go.

(2.18.08) Parton Also Had Eyes on Missouri
RALEIGH — Randy Parton says that for three years he dedicated his life to making the Roanoke Rapids theater a success, but after he signed the deal with the city Parton also tried to launch a clothing line and build a similar theater in Missouri.

(1.16.08) Parton Funds Bought $600 Custom Pants
RALEIGH — The Partons stretched the adage “wearing out your welcome” to new limits when ordering wardrobes with public money, according to Randy Parton Theatre documents obtained from North Carolina’s Northeast Commission.

(1.15.08) Leaders Teamed Up on Parton Deal
RALEIGH — State Senate leader Marc Basnight, House Speaker Jim Black, and DOT Transportation Secretary Lyndo Tippett helped state economic developer Rick Watson launch the Randy Parton Theatre in Roanoke Rapids, according to documents obtained by Carolina Journal.

(12.20.07) Parton Project Attracts Political Firepower
ROANOKE RAPIDS — The Sanford Holshouser law firm, founded by two former governors, is emerging as a key player in developments surrounding the Randy Parton Theatre in Roanoke Rapids. Adding to the political firepower attracted by the troubled project, the two leading Democratic candidates for governor have made the theater’s problems a campaign issue.

(12.11.07) Official Owned Part of Theater Co.
ROANOKE RAPIDS — A state-funded economic developer who recruited Randy Parton to headline a theater in northeast North Carolina owned a one-third interest in the company that managed the theater, documents show.

(4.26.07) A Theater of the Absurd
What the voters were told about Amendment One in 2004 was garbage. The only use of TIF bonds to date shows clearly that there are neither sufficient safeguards nor guarantees that they will be used for viable enterprises.

(4.25.07) Parton to Get $1.5 Million Per Year
RALEIGH — Roanoke Rapids will pay a $1.5 million per year “artist fee” to entertainer Randy Parton, brother of Dolly Parton, for managing a new theater bearing his name, according to a contract obtained by Carolina Journal. In addition, the city is required to provide Randy Parton an “acceptable” fully furnished home and an “acceptable” vehicle.

(4.23.07) Parton Theater Contract Under Wraps
RALEIGH — Roanoke Rapids will pay entertainer Randy Parton, brother of Dolly Parton, at least $750,000 per year for managing a new theater bearing his name, according to informed sources, who requested anonymity.

(8.03.06) Bill Ups Scrutiny of Agencies
RALEIGH — The General Assembly in the waning days of the short session last week passed legislation that purports to hold the state's seven regional economic development agencies more accountable.

(5.15.06) NE Partnership Conflicts Continue
RALEIGH — Longtime consultants for the state-funded Northeastern North Carolina Regional Economic Development Commission, and the associated agency North Carolina's Northeast Partnership, continue to work for both entities despite an apparent conflict of interest similar to one that helped cost former president and CEO Rick Watson his job.

Related Northeast Partnership Articles:
Panel: Disable, don't dissolve, Partnership
CJ: Groups circumvented records law
Partnership puts brakes on CEO search
CJ: Organizations defy records request
CJ: Audit critical of NE Partnership

(4.20.06) Groups Circumvented Records Law
RALEIGH — North Carolina's Northeast Partnership was formally separated from the state-created Northeastern North Carolina Economic Development Commission in 2003 in order to evade state Public Records Act requirements, according to documents obtained by Carolina Journal and confirmed by a Commission director.

Related Northeast Partnership Articles:
Partnership puts brakes on CEO search
CJ: Organizations defy records request
CJ: Audit critical of NE Partnership

(4.13.06) Audit Critical of NE Partnership
RALEIGH — State Auditor Les Merritt yesterday released a scathing report on the activities of the North Carolina's Northeast Partnership, and the closely associated Northeastern North Carolina Regional Economic Development Commission, alleging that both organizations' directors "relinquished too much authority" and insufficiently exercised "their fiduciary responsibilities."

Related Northeast Partnership Articles:
NE Partnership paid big bonuses; Why?
'Looks like the whole damned crowd needs to be replaced'
Partnership board failed to exercise oversight
Report: Norris had vague contract with Partnership
Norris's P.R. job puzzles some
Partnership ends contract with Watson
Norris called legislator a 'nutcase'
Partnership says it's not subject to records law
Organizations defy records request
Commerce payments to Partnership unauthorized

(4.07.06) Organizations Defy Records Requests
RALEIGH — Despite the removal of its president and CEO, as well as its legal counsel, the Northeastern North Carolina Economic Development Commission and North Carolina's Northeast Partnership are withholding documents requested by Carolina Journal pursuant to the state's Public Records Act.

Related Northeast Partnership Articles:
Report: Norris had vague contract with Partnership
Norris's P.R. job puzzles some
Partnership ends contract with Watson
Norris called legislator a 'nutcase'
Partnership says it's not subject to records law
Commerce payments to Partnership unauthorized

(3.24.06) Partnership Ends Watson's Contract
RALEIGH — The board of the North Carolina's Northeast Partnership terminated the contract of its president and CEO, Rick Watson, on Monday, after a longtime disagreement among the partnership's county members about his contract and his personal business dealings.

Related Northeast Partnership Articles:
Report: Norris had vague contract with NE Partnership

(2.09.06) Commissioner Wants Watson Gone
RALEIGH — Mort Hurst, chairman of the Martin County Board of Commissioners, says he will spearhead an effort among the 16 counties represented by the North Carolina's Northeast Partnership to remove Rick Watson as the nonprofit's president and chief executive officer.

Related Northeast Partnership Articles:
Pasquotank: Watson should resign

Today: Mitch Kokai live in The Locker Room on the State Board of Elections hearings.
Read Mitch's blog posts on the hearings from Wednesday.
Thursday's blog posts.

New Feature! Who's Who at the Board of Elections Hearings

(2.02.06) Watson Conflicted as Officer, Director
RALEIGH — Both Ernie Pearson and Rick Watson, respectively the lawyer and the executive director for North Carolina's Northeast Partnership, say Watson is not subject to the nonprofit's conflict of interest policy because he is a contractor and not an employee. But Watson is on the board of directors and as president is an officer, and the Partnership's ethics policy treats employees, officers and directors the same.

Related Northeast Partnership Articles:
Most partnerships avoid conflicts

(1.27.06) AG Announces Corruption Fight
RALEIGH — N.C. Attorney General Roy Cooper on Thursday appealed to state legislators to provide more tools for state investigators and prosecutors to ferret out public corruption.

Board of Elections to Investigate Black
By Mitch Kokai

RALEIGH — The N.C. Board of Elections decided Thursday that it will conduct a three-day hearing in February on House Speaker Jim Black’s campaign finances. Board Chairman Larry Leake says the hearing will help the board address some “information that causes us some concern.”

Related NC Ethics & Corruption Articles:
Black 'glad…attorney general agrees with me'
Blust: '(Cooper's) saying things I've been saying for 10 years'

(1.10.06) Most Partnerships Avoid Conflicts
RALEIGH — Unlike Rick Watson of North Carolina’s Northeast Partnership, some leaders of the state’s other regional economic development groups say they cannot imagine situations in which they would seek public money for businesses that they are trying to recruit and/or work for. Some of them say they have explicit policies against such conflicts of interest.

(1.10.06) Not Music to Taxpayers’ Ears
If state government can legitimately be in the business of staging country-music shows, what business can it not be in? Consider cases in northeastern and western NC.

(1.09.06) Public Funds Key Private Projects
ROANOKE RAPIDS — Economic development officials in northeast North Carolina put a pretty face on the groundbreaking in mid-November of one of three projects planned around Roanoke Rapids. Dolly Parton was there. So was brother Randy. But the stark reality of the projects is that so far, taxpayers appear to be the only ones paying a pretty penny for the projects, and conflicts of interest abound.

(11.22.05) Another Reason to Limit Government
Smaller government is to be preferred not just to maximize freedom and encourage economic growth, but also to minimize corruption. The case of the Northeast Partnership offers a cautionary tale.

(11.21.05) Parton Project Off to Shaky Start
RALEIGH — A legal opinion permitting state-funded economic developer Rick Watson to simultaneously work for Randy Parton's entertainment company, which he recruited for a Roanoke Rapids project, appears to be based on the faulty assumption that Parton's company would receive no funds from Watson's state-funded organizations.

(11.10.05) Partnership Head Helps Himself
RALEIGH — A deal arranged by North Carolina's Northeast Partnership president Rick Watson to work with country musician Randy Parton is not the first case in which Watson has tried to become involved with a company that his public agency is trying to help. Watson, who leads many variations of the partnership, has in the past sought either a personal investment stake or other benefits from the businesses he has tried to help locate in northeastern North Carolina.

(6.16.05) Conflicts Surround Auto Center
RALEIGH — Rep. Michael Wray, a Northampton County Democrat, has been a strong supporter of state funding for an automotive research center to be located on land in close proximity to a tract he owns in Northampton County. Access to the 610-acre tract under option by Northampton County for the proposed Advanced Vehicle Research Center would be via a road that goes through Wray’s tract. Wray and a partner bought the property in 2001, just prior to Lowe’s Home Improvement Company purchasing a nearby tract for a distribution center.

(6.13.05) Privaris Head Helped Other Project
RALEIGH — The president of a fingerprint technology company, which received more than $300,000 from the state Tobacco Trust Fund despite creating no new permanent jobs, helped the state-funded North Carolina's Northeast Partnership with another project just as he launched his own business. Barry Johnson, chairman, president, and chief executive officer of Privaris, Inc., compiled an evaluation report in August 2001 on now-defunct biotechnology company CropTech Corporation, at the request of the Northeast Partnership's executive director, Rick Watson. Like Privaris, CropTech sought millions of dollars in financial incentives from North Carolina.

(6.02.05) Final Report Lacks New Details
RALEIGH — The state’s Tobacco Trust Fund Commission closed its file last week on a fingerprint security business that it funded, even though little or no new information was provided in a revised final report about a project the company conducted for the N.C. Division of Motor Vehicles. Privaris, Inc. received $307,575 from the commission through a grant to the Martin County Economic Development Corporation, ostensibly in exchange for starting business in Williamston with 10 to 15 employees. Privaris was to be paid for determining whether its technology could help DMV enhance the security of drivers' licensing for transporters of hazardous cargo.

(5.23.05) Auto Research Center in Jeopardy
RALEIGH — Boosters of an automotive research center planned for Northampton County, who were hoping for $30 million in taxpayer funding over the next two years, are trying to get their pet project back on track after it was left out of the budget recently approved by the state Senate. Named the Advanced Vehicle Research Center, the project would be located off I-95 north of Roanoke Rapids and would provide automotive testing services at a facility that would include a 2.5-mile closed loop test track, laboratories, garages, and office space.

(5.03.05) Pay To Non-Profit Unauthorized
RALEIGH — The state Department of Commerce, apparently for several years, paid a private nonprofit organization for economic development funds that by law should have been paid to a state-established regional commission. Until June 2003, Commerce's fiscal department issued checks that, by statute and under the biennial state budget laws, should have gone to the Northeastern North Carolina Regional Economic Development Commission. Instead the "pass-through" payments were made to North Carolina's Northeast Partnership, a non-profit organization established by some of the same board members as the Commission.

(4.14.05) Firm Paid Despite Producing No Jobs
RALEIGH — A fingerprint technology company promoted by State Senate President Pro Tem Marc Basnight received $307,575 from the state’s Tobacco Trust Fund, ostensibly in exchange for relocating significant operations to North Carolina, which the company never fulfilled. After Privaris, Inc. completed a pilot project for the state Division of Motor Vehicles in 2003, company workers vacated their office space at a publicly funded business incubator in Williamston. Despite its failure to create 10 to 15 new jobs as promised in its contract with the Tobacco Trust, Privaris was paid $132,575 in April 2004.

(6.24.04) Lobbyist Calls Legislator “Nutcase”
RALEIGH — An administrator for a taxpayer-supported association characterized Rep. John Rhodes, who has asked State Auditor Ralph Campbell to investigate a state-funded economic development agency, as a “true nutcase” whose only allies “are the very religious right folks.” Meredith Norris, a former aide to House Speaker Jim Black, now is a registered lobbyist for the NC Partnership for Economic Development, an association for the state’s seven regional economic development partnerships. Norris made her “nutcase” comment in an e-mail exchange with an official and a consultant with North Carolina’s Northeast Partnership. She later expressed regret about the statement.

(2.02.04) Biotech Failure Blamed on State
RALEIGH — State officials botched the recruitment of a biotechnology company because of a power struggle between the Department of Commerce and an economic development agency in northeast North Carolina, officials of the company say. Documents also show that rather than helping the company in negotiations, North Carolina’s Northeast Partnership continued a practice of seeking equity in the companies it recruits. Senate President Pro Tem Marc Basnight appears to wield strong influence over the Partnership, sometimes determining whether and how businesses get state incentives.

(2.02.04) Role of Regional Partnerships, Basnight Questioned
RALEIGH — Fragmentation of leadership and responsibilities has diminished the effectiveness of North Carolina’s publicly funded economic development agencies, says a private developer who once had dealings in the northeast area of the state. The developer said "that region is controlled by [Senate President Pro Tem Marc] Basnight and by R.V. Owens (III)." Owens is Basnight’s nephew, chief fund-raiser, and a powerful influence in the Northeast. "Everybody has to stay in line and stay in step," the developer said, "or there are negative ramifications held over their heads."

(2.02.04) Partnership Seeks Grant for CropTech Costs
RALEIGH -- In early May 2002 Ernie Pearson, the N.C. Northeast Partnership lawyer, informed Rick Watson about legal expenses from the CropTech deal, including costs "to assist in overcoming concerns raised by Commerce Secretary Jim Fain and to finalize the [agreement]." Watson also requested that Pearson bill the Northeast Partnership for future services related to the deal, though it never went through. Watson sought Tobacco Trust Fund funds to cover these tens of thousands of dollars in cost.

(2.02.04) Executive: Basnight Had "Key" To Tobacco Funds
RALEIGH — CropTech Corporation, which negotiated with NC for more than a year in an effort to relocate to the state, instead decided to move to South Carolina in May 2002. A company official blames the time spent dealing with NC for draining its finances, leading to bankruptcy. "We were told there was no one more powerful in the state of North Carolina than Senator Basnight," he said. "It was understood that this was an exceptional situation because of the involvement of the Tobacco Trust, and Senator Basnight had the key to that resource. His key to opening that door was accommodating his interests — that’s what we were led to believe."

(4.28.03) Group Won't Release DFI-Related Info
RALEIGH — In an apparent violation of North Carolina Public Records Law, an economic development agency refuses to release information on some of its operations. The Northeastern NC Regional Economic Development Partnership claims it is not a public agency and is not subject to the public records law.The group is at the center of allegations made by Raleigh businessman William Horton of The DFI Group, who said partnership President Rick Watson conspired to thwart his ethanol projects in eastern North Carolina.

(3.07.03) Horton Drops Litigation Without Explanation
A Raleigh businessman withdrew a preliminary motion for a lawsuit he had filed against a group of businessmen in which he alleged they had interfered with his plans to build a fuel ethanol plant in Beaufort County. William Horton, in his initial filing in Wake County Superior Court on Feb. 10, said his complaint involved “a complex and intricate conspiracy involving extortion, corruption and racketeering by public and private individuals reaching the highest levels of state government.” “There is a definite reason why he did that,” said Horton’s lawyer, Scott Wilkinson. “We just can’t say why.”

(2.27.03) ABC Commissioner Fails to Disclose Related Business Interest
RALEIGH — A member of the state Alcoholic Beverage Control Commission failed to disclose his interests in a fuel ethanol plant when he filed his 2003 Statement of Economic Interest with the State Board of Ethics on Feb. 25. A Feb. 18 Carolina Journal Online story reported that the commissioner, Thomas “Ricky” Wright, Jr., a Wake Forest businessman, apparently violated the state Board of Ethics conflict-of-interest code by pursuing plans to build an ethanol plant in eastern North Carolina.

(2.24.03) Businessman Sues, Alleges Conspiracy in N.C. Government
RALEIGH — A Raleigh businessman is suing a consortium of interests, one of them linked to publicly funded Golden LEAF for allegedly conspiring to keep him from building an ethanol plant in Beaufort County. His accusations include racketeering, extortion, corruption, and conspiracy, which reach “the highest levels of state government.” The action was filed Feb. 10 in Wake County Superior Court by William Horton, president of The DFI Group, who alleges that a coalition of eastern North Carolina farmers and economic development officials used their political connections to state Senate President Pro Tempore Marc Basnight to pressure Horton to give up his business plans and site options for building the plant.

(2.18.03) ABC Commissioner Apparently Violated Ethics Guidelines
Don Carrington reports that a member of the state ABC Commission apparently violated the state Board of Ethics conflict-of-interest code by pursuing plans to build an ethanol plant in eastern North Carolina.

(2.07.03) Co-op Transfers Ethanol Plant to Private Group
A farmers’ grain cooperative heavily subsidized by Golden LEAF has transferred its interest in building an ethanol plant in Beaufort County to a newly formed group of private investors, whose experience in alternative fuels is unclear.