North Carolina Offered Defense Contractor Pratt & Whitney a Contract Loophole After Job Shortfall
ASHEVILLE, N.C. – North Carolina officials quietly inserted a provision into a contract with aerospace manufacturer Pratt & Whitney allowing the company to avoid repaying state incentives after initially falling short of promised job creation numbers, Carolina Public Press has learned. The arrangement raises questions about transparency and accountability in the state’s economic advancement practices, even as local officials maintain they were unaware of the specific contractual maneuver.
The deal centers around Pratt & Whitney’s $650 million facility in Asheville, which received $14.5 million in state Job Development Investment Grants (JDIG) contingent on creating 800 jobs by the end of 2026. When the company announced in late 2023 it would only create 550 jobs, triggering a potential clawback of the funds, a loophole within the contract-its origins currently unknown to key local legislators-prevented the state from demanding repayment. The plant is now projected to reach 1,200 positions by 2027.
“It’s not uncommon for these contracts to have clauses that address unforeseen circumstances,” said Chris Skaggs, director of the economic development group Mountain West Partnership.”It is likely that in drawing up the contract, North Carolina officials foresaw this possibility and wrote in the loophole to avoid having to revoke the money.”
Pratt & Whitney maintains a strong commitment to Asheville. “Our arrival in Asheville has been met with strong support from Buncombe County, the state and the local community,” pratt & Whitney Asheville general manager Dan Field told CPP. “by partnering with nonprofits, the Chamber of Commerce, and local community colleges, we have demonstrated that Pratt & Whitney is a committed partner that delivers on its investments, creates jobs, prioritizes employees and gives back to the community.”
The incident underscores the complexities of incentive-based economic development and the potential for negotiated outcomes that deviate from publicly stated criteria. While the state ultimately avoided a financial loss, the lack of clarity surrounding the contract modification has prompted calls for greater oversight and transparency in future deals.
