Market funds restored
Larry Thomas -- Furniture Today, April 8, 2013
RALEIGH, N.C. - North Carolina Gov. Pat McCrory has reversed course and restored funding for the High Point Market Authority in his proposed state budget for the next two years.
The governor had proposed cutting the state funds in half for the fiscal year beginning July 1, 2014, but changed his mind after learning private funding would not be available to make up the difference, Kim Genardo, McCrory's communications director, said last week.
"The governor directed the Department of Commerce and Department of Transportation Secretaries to continue to fund the High Point furniture market at the current level," said Genardo. "We anticipated there would be local contributions available for the market by the second year, but we've since learned that's not the case. Due to this new information we're restoring full funding."
The decision means the Market Authority would receive $1 million from the state Transportation Department and about $655,000 from the state Commerce Department in each of the next two fiscal years under the governor's proposal. It's essentially the same amount the group received for the current fiscal year, which ends June 30.
Genardo said the governor issued the directive a day before 42 furniture company presidents and CEOs sent a letter to North Carolina legislative leaders urging them to reject the proposal to slash market funding.
Doug Bassett, president of manufacturer Vaughan-Bassett Furniture and chairman of the Market Authority's board of directors, was one of those who signed the letter.
"We greatly appreciate the fact that the governor and his staff looked into the facts surrounding High Point Market funding and have changed course. The state needs to be a full partner in the High Point Market and we're delighted that this relationship is going to continue," Bassett said.
The transportation money runs the market's massive shuttle system, and the commerce department funds are used for marketing the promotion of the event.
The letter asked the governor to include $2 million for the Market Authority, the amount the state gave the group in fiscal 2010.
Bassett noted that the market has made do with the lower funding level in recent years despite an increase in operating costs, such as rising diesel and gas prices to fuel the shuttle buses and vans.
He also said that while the state funding is significant, the city of High Point and market participants also are vital in supporting the market's infrastructure.
Even at $2 million, the state portion of market funding would be a tiny part of North Carolina's $26 billion plus budget and would represent about 15 cents per state resident, Bassett said.
In contrast, the city of High Point kicks in about $1 million a year to support the market, or about $10 per city resident. Through showroom taxes, the market's 2,200 exhibitors contribute about $1.6 million a year or $750 apiece, with the largest exhibitors paying far more since the tax is based on square footage, Bassett said.
"The various buildings also have skin in the game," he added. "They cannot collect showroom tax on temporary space, so many buildings are writing five or six figure checks to support the market."
McCrory's budget proposal will be debated in the state legislature in the coming weeks.