Edenton Chowan Partnership chair defends performance-based structure as commissioners prepare to take public comment

By Miles Layton

EDENTON — A proposed $1 million incentive package aimed at attracting a second grocery store to Chowan County has sparked pointed questions from at least one of the Albemarle Observer’s readers — and detailed answers from a key local economic development official — in the days leading up to a public hearing set for June 15.

So, I reached out to Joe Wach, chairman of the Edenton Chowan Partnership, for answers. Presently, I’m working off-the-grid on an island with no grocery store, although we have good restaurants and secluded shores, so this issue means a little more to me this week.

Per the story’s photo, I’m not in the mood to go hunting for a grocery store picture in my “cloud” any more than I am willing to create a AI generated photo, so that’s a picture of a town without a grocery store — no matter where you are, embrace your blessings.

The Chowan County Board of Commissioners will hold the hearing during its regular meeting, which begins at 6 p.m. at the Chowan County Public Safety Building on West Freemason Street. The session will give residents an opportunity to weigh in before commissioners decide whether to commit up to $500,000 (county’s share) over five years toward luring a full-service grocer into the long-vacant former Food Lion space at the North Broad Street Shopping Center.

The Town of Edenton would contribute an equal amount, bringing the total potential public commitment to $1 million. The Edenton Town Council unanimously voted in support of the proposal at a recent meeting.

But not everyone is ready to sign off without more information.

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There’s subsidies, then there’s subsidies

One of the Albemarle Observer’s readers raised a series of pointed questions about the proposal — questions that many residents may also be asking.

“The details of the proposal need to be made public if ‘they’ want money from the people,” he wrote in an email to this ink stained wretch, me.

He asked why anyone would endorse $500,000 in subsidies from public funds without knowing the details?

He went further, questioning who drafted the proposal, what the cost would ultimately mean for existing taxpayers and for the county’s only current full-service grocery store.

His email offered an alternative funding model: a $2 surcharge added to every customer receipt at the new store, which he calculated would generate $500,000 in roughly five years if 1,000 shoppers visited weekly — effectively having the store’s own customers fund the subsidy rather than the general public.

“The shoppers who benefit will be the ones providing the subsidy,” the reader wrote.

Wach Addresses the Questions Directly

The Edenton Chowan Partnership — the local nonprofit tasked with growing the economy of Edenton and Chowan County — responded to each of the reader’s questions when contacted by the Albemarle Observer.

On the question of who drafted the proposal, Wach said it remains a collaborative, ongoing effort. “The agreement is currently being drafted between the Town, County, and the prospective grocer,” he said, noting it is still a work in progress.

On the broader question of cost to taxpayers, Wach pushed back firmly on the framing that the incentive represents money going out the door with no return — and pushed back equally on the notion that it wants “money from the people” at all. The incentive is not funded by drawing on existing taxpayers, he explained. It is funded by the new tax revenue the grocer generates — revenue that would not exist otherwise — with the remainder of those gains flowing back to the public.

“The incentive isn’t paid first,” Wach said.

He outlined a sequence under which the grocery operator would be required to invest its own money first — renovating the building, purchasing equipment, hiring staff and opening for business — before any public dollars would change hands. The county’s contribution, he explained, would come in annual installments of up to $100,000 over five years, with no payments made during the first year of operation. If the grocer fails to meet agreed-upon performance benchmarks tied to jobs created and sales volume, future payments would not be made.

“The benefits come first,” Wach said. “The investment, the jobs and the revenue all happen before any grant payment would be made.”

The Revenue Math

Wach argued that residents may be focused too heavily on the $500,000 outlay without accounting for the new tax revenue the county would gain in return — and that the core point is this: the incentive pays for itself. Rather than costing current property owners more, it actually reduces the tax pressure on the budget.

Once the grocer opens, he said, the county could reassess the value of the North Broad Street Shopping Center building to reflect the improvements the grocery operator had made — generating new property tax dollars. The grocer’s equipment, shelving, refrigeration cases and other business personal property would also become taxable, representing additional revenue that currently does not exist.

Sales and use tax collections, Wach said, would also increase. Leakage — the spending that leaves the county because residents shop elsewhere — is not limited to any single destination. Some residents prefer the Food Lion in Hertford and make the drive. Others travel to Walmart locations in Williamston and Elizabeth City, or to the Piggly Wiggly in Plymouth. A local grocery option would recapture a portion of that spending.

“The pro forma evaluated by the Edenton Chowan Partnership shows an expected return of over 4 to 1,” Wach said. 

Worth noting, the pro forma reflecting that ratio accounts for two additional retail tenants expected to follow the grocery anchor into the shopping center — and only if the grocery store opens first. The grocery store alone was still projected to be net positive for the county, just not at the 4-to-1 ratio. Those additional tenants would similarly generate new property tax and sales and use tax revenue, compounding the return on the county’s investment.

Under the overall projected numbers, the county could receive more than $400,000 in new tax revenue in a given year while only disbursing $100,000 in grant funds — leaving roughly $300,000 in new money flowing to the general fund.

“That is relief to the current property taxpayers,” he said.

Wach framed the decision in stark terms for those inclined to vote no.

“When people ask ‘what is the cost?’ — the answer is: it will cost us a lot if we don’t do this,” he said.

He added that a competing county has already demonstrated its willingness to use such tools. “If the county chooses not to do this, the people may still end up with another grocery option — it just might be in Perquimans County,” Wach said. Perquimans County has shown a clear appetite for offering economic incentives, and recently did so at Chowan County’s expense — most notably in the case of Mitek. The point is not that Perquimans is pursuing this particular grocer, but that the county has shown it will act when opportunities arise.

Years of Recruitment Efforts

The proposal does not emerge from a vacuum. For years, residents have called for a second grocery store in Chowan County, with the topic surfacing regularly on social media, at public meetings and in everyday conversations. Residents have cited competition, greater product variety and better access to fresh food as reasons for wanting another option.

The Edenton Chowan Partnership has worked alongside local government to attract a second grocer for years, though previous recruitment efforts proved difficult. Grocery chains, Wach explained, evaluate population size, demographics, median household income and shopping patterns before committing to a new location — and Chowan County’s numbers have not always been compelling enough on their own.

The current opportunity centers on the former Food Lion space, which sat empty after that chain relocated. During a recent Edenton Town Council meeting, Main Street Edenton Executive Director Ches Chesson announced that a grocery store anchor had signed a letter of intent for the location.

County Manager Kevin Howard acknowledged both the public appetite and the public obligation to weigh costs carefully.

“We know the public wants it,” Howard said at a recent commissioners meeting. “We need to know whether the public wants us to spend $500,000 to bring it here.”

That framing, while accurate as a quote, warrants some unpacking. The word “spend” implies the money is gone with no return. In reality, the $500,000 is not committed upfront and is not funded by drawing on current revenues. It comes out of the realized gains — the new sales and use tax, property tax, and business personal property tax — that the county would not have at all without the grocer. The incentive does not ask for money from the people. It asks to use a portion of new money that the grocer itself generates, while still leaving the remainder as a net gain for the public.

The June 15 public hearing will give residents the opportunity to answer that question directly. The meeting begins at 6 p.m. at the Chowan County Public Safety Building on West Freemason Street in Edenton. All residents are encouraged to attend and provide input.