For those who think Alabamians’ giddiness over winning the $1.6 billion Toyota-Mazda factory sweepstakes may be a bit overblown, consider these facts:
-- As a state, Alabama and its sluggish economy produced no vehicles in 1995.
-- In 2016, Mercedes-Benz, Hyundai and Honda built more than a million vehicles at their Alabama-based facilities. (Toyota also has an engine factory in Huntsville.)
-- Metro Huntsville already has more than 50,000 automaking-related jobs with Toyota and the more than 100 assorted parts suppliers.
-- In 1993, Mercedes-Benz promised Alabama its plant near Tuscaloosa would employ 1,500 people when it reached full capacity. Today, after expansion, more than 3,500 people work there.
Alabama’s wish list of needed improvements is historically lengthy, including better public schools, repaired roads and bridges and middle-class jobs for impoverished counties stripped of mills and factories. But since the days of Gov. Jim Folsom, Alabama’s economic developers have aggressively recruited international automakers with a series of hefty tax incentives, abatements and workforce training promises. Those decisions have revitalized segments of Alabama’s economy and made our state a leading destination for site-seeking automakers.
For proof, compare the size of the incentives packages of the Toyota-Mazda finalists, Alabama and North Carolina. Our state offered roughly a $380 million deal. North Carolina countered with a record $1.5 billion incentive package and a 1,900-acre megasite near Greensboro, according to newspaper reports. It still wasn’t enough. Alabama, its foot securely in automakers’ door, won again.
That victory, however, begs two questions: Will Gov. Kay Ivey (and whoever is Alabama’s governor following this fall’s election) ensure that Toyota and Mazda uphold their ends of this agreement? And when will Alabama invest this much effort and resources on its most vexing problems?
Alabama’s courtship of these Japanese automakers caused Ivey to sign away millions in tax incentives. That’s the price to play. But political critics and economic analysts have long debated the wisdom of making deep financial concessions on the front end of deals that may take years, or longer, to pay off for state and local governments. Those criticisms aren’t without merit. And that’s why Montgomery must serve as a watchdog and hold Toyota and Mazda to their agreement to, among other things, create 4,000 jobs when the facility opens in 2021.
In winning these automaking games, Montgomery proves it’s not risk-averse or unwilling to go all-in for the right project. Sounds good, right? Yet, governors and legislators continually tell Alabamians that the state’s finances are weak and they can’t summon political courage to go all-in on education or prison reform or infrastructure or poverty reduction. That, of course, is a crock.
Imagine Alabama’s public schools, particularly those in impoverished areas, if economic developers, lawmakers and school officials adopted the state’s approach for recruiting automakers. Imagine if they went full-bore, eschewing excuses, and placed Alabama’s public schools in the nation’s top 10 percent. Imagine what that would do for our state, for all of us.