In mid-November, Governing magazine named Virginia Gov. Terry McAuliffe (D) one of its "public officials of the year." Among the reasons cited by the well-respected publication: "Virginia has created more than 200,000 jobs on his watch, with unemployment well below 4 percent — and with the rate down in every county in the commonwealth."
The award was sweet affirmation for the outgoing governor, who has boasted that his hard work, foreign trade expeditions and natural salesmanship have made him a remarkable “jobs” governor.
From January 2014, when McAuliffe took office, to November, Virginia saw a net increase of 207,000 jobs, according to Bureau of Labor Statistics figures. The state had an unemployment rate of just 3.6 percent in October. Officials also hope to add more than 84,000 jobs from economic development plans that have been announced but not completed, said Meghan Welch, a spokeswoman for the Office of the Secretary of Commerce and Trade.
One reason McAuliffe is so proud of his jobs record is that he has been stymied repeatedly by Republicans in the General Assembly on other policies, including expanding Medicaid to 400,000 low-income Virginians. He had to do end runs with his executive power to expand rights to 156,000 former felons. He has worked hard to lure job-creating companies.
Virginia's economic growth rate lags behind the rates in the rest of the country and is hampered by the commonwealth's reliance on federal jobs, experts say. And, the Virginia Economic Development Partnership, the state's lead company-hunter, went through an embarrassing scandal and reorganization that predated McAuliffe but came to a head on his watch.
Compared with that of the previous seven governors, McAuliffe's jobs achievements would be in the middle of the pack. George Allen (R) ended his term with 313,300 net new jobs. James S. Gilmore III (R) had 221,000. Mark R. Warner (D) had 207,300. The past seven governors saw new net jobs, except Tim Kaine (D), who oversaw a loss of 89,000, thanks to the Great Recession.
And Virginia’s economic growth is not as rosy as in the rest of the country.
"In terms of [gross domestic product] growth, [Virginia] has lagged that of the United States as a whole," says Robert M. McNab, a professor of economics at Old Dominion University and co-author of an annual report on the state's economy.
One problem is that when a company moves to Virginia with a large investment these days, it might not mean all that many jobs. McNab noted a recent announcement that Facebook would build a $1 billion facility in Henrico County — creating only about 100 new, permanent jobs because of technology and automation.
As for the anticipated 84,000-plus additional jobs, it’s always dangerous to overemphasize them.
In 2014, McAuliffe was pleased to announce a $2 billion paper-mill project in Chesterfield County with Tranlin, a China-based company. The project had been hatched by Robert F. McDonnell, McAuliffe's Republican predecessor, and was slated to create 2,000 jobs. Repeated delays forced Tranlin to give back some of the state incentives it received, and the project's future remains cloudy.
At least Tranlin was required to sign a performance agreement with the Virginia Economic Development Partnership. That wasn't the case with Chinese firm Lindenburg, which, in 2014, promised to build a $113 million ceramics plant in Appomattox County, creating 349 jobs.
Lindenburg received $1.4 million in state incentives. At a ceremony, McAuliffe was photographed with local, state and company officials celebrating the deal.
But Lindenburg vanished. Incredibly, according to the Roanoke Times, the same firm had approached North Carolina officials in 2013 with a similar project idea, but the Tar Heel State found that Lindenburg's credentials were phony.
The scandal became a centerpiece of a reorganization of the Virginia Economic Development Partnership.
Last year, the Joint Legislative Audit and Review Commission issued a 132-page report stating that the VEDP was shoveling money out the door to lure firms without checks and balances. Prospects were not vetted. The VEDP's controls were tightened, and Stephen Moret, a state economic development official in Louisiana, was named to lead the agency.
To be sure, the VEDP’s problems predated McAuliffe, and he was a strong driver in its reform.
Questions about McAuliffe’s economic tenure in the commonwealth are sure to arise if he runs for president in 2020. He should be prepared.
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