GA Out Big Bucks on Business Subsidies After Failing To Do Due Diligence
Missed lots of red flags
George Thorogood's "Bad to the Bone" pumped through loudspeakers at Fort Benning's Redcloud Range in 2004 as a nine-man squad leaped from an armed personnel carrier and blasted away with sleek new XM-8 assault rifles at targets on a nearby hillside.
The state was on board; it chipped in a $300,000 grant to entice the rifle's maker, the German company Heckler & Koch, to build a new gun factory in Columbus. H&K promised at least 200 jobs.
There was just one catch, which neither H&K nor county officials apparently told the state: No $1 billion federal contract for the XM-8, no plant. When the Pentagon cancelled the weapons program, the promised plant was downsized to a distribution center that employed 15 people, according to state records.
As the H&K saga suggests, state officials who awarded hundreds of millions of dollars to lure jobs here sometimes missed critical red flags in vetting the grant recipients. A review by The Atlanta Journal-Constitution of more than 150 economic development incentive files found that some companies omitted critical information. Other times, state officials noted a troubling trail of financial clues and awarded the money anyway.