News: CJ Exclusives

Jobs Announcement Draws Scrutiny

New Currituck company chose NC after extortion scheme in VA failed

Gov. Mike Easley announced at a Currituck County groundbreaking ceremony Friday that an automobile auction will expand its Virginia-based auto wholesale operation into North Carolina. The governor’s comments at the event and in a press release are inconsistent with other information uncovered by Carolina Journal. The discrepancies include the reason the company chose North Carolina, the influence of financial incentives, and the number of jobs for North Carolinians.

The “groundbreaking” ceremony for Tidewater Automobile Auction was conducted at the Currituck County airport, 15 miles from the actual site. The company has acquired a 100-acre site on Highway 168 about five miles from the Virginia state line, where auction officials plan to build a 45,000-square-foot building.

According to information on its web site, the company claims it will bring up to 300 new jobs, making it the largest employer in the county. The employees and operations are being relocated from the company’s existing location in Chesapeake, Va. One of seven major vehicle auctions in the mid-Atlantic, the company attracts about 600 dealers from several Eastern states who bid for up to 2,000 cars and trucks per week.

“Our top-ranked business climate and low business tax burden are helping us attract new and expanding companies from across the country. This announcement is further proof our targeted investments in education and infrastructure are paying off,” a press release from the governor’s office said.

The company, however, pursued the North Carolina site only after a 2001 extortion scheme to secure a site in Suffolk, Va. had failed.

The company’s general manager, Michael D. Hockett , is a convicted felon. In 2001 Hockett, who at the time was the company’s owner, pleaded guilty in federal court to one count of conspiracy to obstruct and affect commerce and movement of articles or commodities by extortion.

According to news reports and court documents in April 2001, Hockett, who was then the company owner, allegedly hired two men to gather information on Suffolk City Councilman Dana Dickens in order to sway his vote to approve rezoning of a 120-acre site sought by the company. When the men failed to turn up any information that could be used to threaten Dickens, they hired an exotic dancer to go to his office, where the men would attempt to photograph Dickens and the dancer in a compromising position. Dickens asked the dancer to leave before any photos were taken, so the men took pictures of the woman outside his office door. When the men later approached Dickens with the photos they were arrested by the police and charged with attempted bribery. The police brought in the FBI because extortion of a public official is a federal crime.

Hockett received a five-month prison sentence, three years of supervised release, and a $20,000 fine. Dickens is now the mayor of Suffolk. He preferred not to comment on details of the incident.

After the federal charges were filed Hockett turned over ownership of the company to his wife, Kelli, and he became general manager. He is listed as such on the company’s web site. Easley’s press release cited Kelli Hockett as the company’s owner and president. Michael Hockett was at the ceremony, but played no visible role. Kelli Hockett joined Easley at the podium.

The governor’s speechwriters also implied that two incentive programs were a factor in the decision. “According to Easley, North Carolina is able to attract business such as the TAA because of state incentives such as the One North Carolina Fund and the Job Development Investment Grant,” the Daily Advance of Elizabeth City reported.

But TAA did not get incentives from either of the programs.

“The company has been granted $250,000 by the N.C. Department of Transportation, from a discretionary fund for economic development, to make improvements to the access road to their facility. Tidewater Auto Auction is also a type of business eligible for Bill Lee Tax Credits,” Easley Communications Director Cari Boyce said.

On Tuesday, The News & Observer of Raleigh reported that Michael Hockett said he did not ask for incentives and was “surprised when the road improvement money was offered.”

“Tidewater Auto Auction is bringing 250 good-paying jobs to 250 hard-working North Carolina families right here in Currituck County,” Easley was quoted as saying by the Daily Advance. In his press release he said that the “company will initially need 250 people to fill a variety of positions.” But the auction’s current facility is only 20 miles away, and the number of existing employees who will transfer is actually unknown, according to Dean Vasser, who told CJ that he was TAA’s general manager. Vasser also said that the company is planning a job fair later this year and it will consider employees from any state.

The company turned its attention to Currituck County after plans for the Suffolk site failed. In January 2002 the Currituck County Board of Commissioners cleared the way for the project by rezoning the land from agricultural to commercial, and also by amending the county development ordinance to allow wholesale auto facilities in a commercial zone.

Since the rezoning, the project has drawn significant local opposition. Opponents organized a group called Save Moyock Committee, Inc.

Concerns expressed on the group’s web site are that the project will cause an increase in criminal activity, pollute a nearby creek, and overburden local law enforcement and fire departments. The group also complained that the nature of the project is not in harmony with the adjoining residential uses, agricultural uses, and a new middle school.

A lawsuit the group filed to halt the project was unsuccessful.

Don Carrington is associate publisher of Carolina Journal.