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Stephen LaRoque, the former state representative from Kinston facing charges of stealing from a federally-funded non-profit, warned that he would seek revenge shortly after his 2012 indictment, according to recently filed court documents.

LaRoque

LaRoque

LaRoque, a Republican from Kinston, is facing a dozen charges related to $300,000 that federal prosecutors contend he took from an economic development group funded through a rural lending project in the U.S. Department of Agriculture in order to buy things like replica Faberge eggs, cars and a Greenville ice skating rink.

The federal probe into LaRoque began after a 2011 N.C. Policy Watch report about LaRoque’s non-profit, that found he received generous salaries from the federally-funded non-profit from a board of directors that for several years consisted of LaRoque, his wife and brother.

He has denied any wrongdoing, and has previously said the $300,000 in question was owed to him.

George Vital, a USDA program official that oversaw parts of the rural lending program spoke with LaRoque shortly after the July 2012 indictment. LaRoque, according to Vital, wanted to have top officials at North Carolina Rural Development office fired and thought he could do that if his preferred 2012 presidential candidate Newt Gingrich was elected.

LaRoque’s threats were detailed in a motion filed by federal prosecutors Friday, and included in a summary federal agents wrote up about a July 2012 interview with Vital.

Vital had been upset that he was bypassed for a promotion at USDA, and called LaRoque the day after the indictment to talk about Bruce Pleasant, who oversaw the rural lending program in the state, and Randall Gore, the appointed head of the USDA’s Rural Development office for North Carolina.

From court documents:

VITAL explained that he told LAROQUE about his [Mr. Vital’s] administrative complaint against GORE [the presidentially appointed North Carolina RD Director] and PLEASANT. VITAL was upset that he [rather than Pleasant] did not get promoted into the position being occupied by PLEASANT.

LAROQUE complained about PLEASANT and wanted to know how to get PLEASANT and GORE fired from their respective jobs. LAROQUE asked VITAL to pull any records on bad loans that PLEASANT may have been involved with. VITAL said LAROQUE was talking about becoming the RD State Director if Newt Gingrich was to win the nomination and get elected as president. LAROQUE was working to get Gingrich elected and this would help LAROQUE get the people at RD fired. LAROQUE would make heads roll at RD if things worked out for him and the election.

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News

North Carolina’s privatized economic development group already has a new leader, less than two months after the group officially launched in October.

Christopher Chung,  38, an experienced economic developer from Missouri, will begin Jan. 12 leading North Carolina’s job recruitment efforts.

Christopher Chung

Christopher Chung

He will replace Richard “Dick” Lindenmuth, 62, a business executive hired last January to help shift North Carolina’s job recruitment efforts from the state Commerce Department to the new privatized set-up.

Chung, who has led Missouri’s version of the privatized economic development efforts since 2007, was announced Monday through a press release from the economic development group, and came as a bit of a surprise.

An Ohio native, Chung holds a bachelor’s degree in economics and Japanese from Ohio State University and oversaw $80 million in financial incentives when leading Missouri’s public-private partnership.

UPDATE: Details were released Monday evening about Chung’s compensation. He will make an annual salary of $225,000, and can earn additional bonuses of up to 25 percent of his salary if he meets benchmarks that the economic development partnership board will make in January. Public money will be used for $120,000 of his salary, in line with the legislation that created the partnership. Chung’s moving expenses will also be covered, and he’ll be given a car once he arrives in North Carolina.

The new 17-member board for North Carolina’s economic development partnership held its first meeting on Nov. 15 at its Cary headquarters and made no mention about the potential hire during the open session of the public meeting.

Lindenmuth, who made $120,000 a year as the CEO of the partnership, will continue working with the group on a contract basis working on projects that will include expansion of high-speed internet services to rural parts of the state, data analysis and recruitment of veterans to the state, according to Monday’s press release from the economic development partnership.

Richard Lindenmuth

Richard Lindenmuth

With most of his career spent managing or consulting for troubled companies, Lindenmuth came to the job with no economic development or public sector experience. An N.C Policy Watch investigation published earlier this year found that he’d been scrutinized by a federal bankruptcy judge for padding his expenses to a company in bankruptcy proceedings.

N.C. Commerce Secretary Sharon Decker applauded Chung’s hire.

“The Partnership is off to a strong start and is working closely with us to bring in new jobs,” Decker said, according to a news release from the partnership. “They have enjoyed strong leadership from day one, and now have in place a CEO and Board of Directors that will help ensure an excellent first year of economic growth in 2015.”

N.C. Policy Watch requested, but was not immediately provided, information about Chung’s salary , as well as details about Lindenmuth’s proposed contract work and his pay. (See update above for details about Chung’s salary)

North Carolina, through legislation passed this summer, shifted its tourism, marketing and business recruitment divisions in October to a the newly-created Economic Development Partnership of North Carolina. A central piece of Gov. Pat McCrory’s jobs plan, the public-private partnership is funded with $16 million in public funds and less than $500,000 in private donations. The quasi-public method of economic development has had mixed results in other states. Supporters say moving economic development efforts outside of state government allows for more effective recruitment of new employers while detractors point out that other states have seen conflicts of interest and a pay-to-play culture emerge.

News

N.C. Commerce Secretary Sharon Decker says the $22.5 million fund to recruit business to the state is nearly empty, with enough money left to cover one additional jobs project, according to the Triangle Business Journal.

Decker was speaking to a group of commercial real estate developers at the Umstead Hotel in Cary when she made her comments about the state’s Job Development Investments Grants (JDIG) program.

Lawmakers did not fund the incentive program at levels desired by state commerce leaders, and Gov. Pat McCrory has said he is considering calling lawmakers back to Raleigh before their scheduled start in January for the long session.

From the TBJ article:

“And without JDIG, we will not be competitive,” N.C. Commerce Secretary Sharon Decker told members of Research Triangle chapter of NAIOP at its meeting Nov. 7 at the Umstead in Cary.

The JDIG program, since its inception in 2002, has been used by state economic development recruiters to sweeten the pot for companies that are considering a major investment in North Carolina that would lead to the creation of net new jobs in the state.

JDIG has typically been reserved for the largest new jobs deals, and pay-outs are only made after the company reaches a minimum job creation goal. Local companies that have been awarded JDIG grants include MetLife, Ipreo, Sygenta Biotechnology, Allscripts Healthcare and HCL Technologies.

Decker warns that the state is dangerously close to losing its chance to even negotiate on potentially large job-producing deals, including three big economic development prospects that are considering expansion and relocation options in the Triangle that could add another 4,100 jobs in region

You can read the entire article here.

Commentary

MDCRecently, the good people at Durham-based nonprofit known as MDC, released the group’s most recent “State of the South” report. For those interested in looking behind the headlines to get a feel for exactly what’s going on in the region, it’s an important “must read.”

This year’s report, which carries the impressive title “Building an infrastructure of opportunity for the next generation,” looks closely at the issue of youth mobility in the South. Recently, one of the report’s authors, Alyson Zandt, submitted this very useful summary:

A young person born at the bottom of the income ladder in the South is less likely to move up it as an adult than in any other region in the nation. Some of the region’s cities may be thriving, but even our most economically vibrant places do not propel enough of their youth and young people up the ladder of economic and social mobility.

The State of the South 2014 report, “Building an Infrastructure of Opportunity for the Next Generation,” takes a deep look at youth mobility in the South. The report, released by Durham-based nonprofit MDC, finds, for instance, that in the Forbes magazine rating of “Best Places for Business and Careers,’’ six Southern metros placed in the top 10 among the 100 largest metropolitan areas in the nation, but eight Southern metros rank in the worst 10 metropolitan areas on a measure of mobility. Of Southern metros in the top 50 for business, only one is also in the top 50 for mobility: Houston, Texas.

The gap between business vitality and youth mobility is especially pronounced in North Carolina’s largest cities. Read More

Commentary

It’s probably just a coincidence that the biggest donor to the state’s new sketchy economic development nonprofit is Duke Energy that ponied up $200,000 to help the nonprofit meet its first year goal of $250,000 in private contributions.

That donation surely has nothing to do with the state’s ongoing battle over regulation of the company’s leaking coal ash ponds across the state. There’s no chance that Duke officials were trying to keep Gov. Pat McCrory and his administration happy with the donation to the nonprofit that is so important to the governor.

It’s all probably above board. Nothing nefarious here. No expectations, just $200,000 out of the goodness of Duke Energy’s heart.