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An economist once said that every economic expansion and contraction, or what we call a business cycle, has a unique personality.

Well, this one surely does.

Welcome again to the most widely watched and the longest running dialog on line of business and policy seen across the Carolinas for 35 years now.

In a moment.

This economy is unique.

It also has this persistent political unease around it and increasing job cuts, but also some slowing job growth.

But the forward momentum is still fairly strong in growth.

So as we do each and every week, we will unpack what it looks like this week and what issues are worth talking about with our expert panel.

And later on, North Carolina State Auditor Dave Boliek Stay with us.

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On this edition of Carolina Business Review, Vicki Lee Parker High, from the North Carolina Sustainable Business Council.

Suzy Shannon of the South Carolina Council on Competitiveness, and special guest Dave Boliek, Auditor for the State of North Carolina.

(upbeat rock music) Welcome to our program.

Happy Summer.

Again, thank you both for traveling to the program because I know it's a commitment.

It's a day's worth out of your time.

And you and you do it and so grateful for you doing it all these years.

And you've been here a bunch.

Vicki Lee, let me let me start with you in North Carolina.

This is not new news or, you know, it's almost becoming commonplace.

I don't want to jinx that.

But for the third year over four years, North Carolina has been named as number one business state by CNBC.

It's not a small thing.

Now, I don't want to be dark about it, but as North Carolina racks up these kind of accolades, the other side of this is expensive growth.

Yes, transportation, housing services, etc., etc.

has the new South that we know North and South Carolina has that New South become not as affordable to live in?

Yes.

Well, one way I kind of put it is it's almost looking like gentrification or on steroids, you know, because communities that were there almost like yesterday and you drive by and they're they're gone.

They're gone.

And you see them replaced by these, you know, new stores, the high rises and the, you know, new development.

And so they are families who, you know, like myself, you know, I have, a child is going to be coming out of, you know, school soon is going to be graduating from college, and you want them to stay close.

You want them to be able to to live nearby and start as we did.

Our generation was able to go out and get that first apartment.

So that's a real concern.

Is it?

Will she be able to do that?

You know, will our, students who come out of our universities be able to stay close and they able to live where they want to live and be able to afford it?

And again, those older communities, as I drive through neighborhoods where I, you know, you will see people sitting on the porch, you know, is sad.

But those days have come and seemingly gone.

And you have to wonder, where are those?

Where are those communities where the people who live there, you know, the whole idea of sense of place is changing.

There's no doubt there are town centers and there are great communities to live in, for sure.

But the same thing is, is do you think that folks are connecting the dots that we love seeing these economic development wins and all this growth and development, but also it comes at a cost?

I think, yes.

To that we're going to see demands on infrastructure.

And not just physical infrastructure, but also digital infrastructure, for instance.

Right.

So you're going to see you're going to need more investment into broadband or satellite communications technology, right?

As you have more people come in more businesses that sprout up.

And certainly with AI and data center usage and energy usage, we're going to see a lot more, you know, demand on the grid for instance.

And then certainly within the housing realm as well.

And it's going to it's changing the flavor of communities.

But I think you're also going to see communities to adapt.

And we may actually get where we see more of that kind of mixed use assimilation, going to the grocery store and going to your faith based institution and going to your job and more close in where you live.

If we don't have more of that exurban and and sprawl.

But let me stay with you for just a second, because you live in the Midlands, which is for many people that don't know it's Columbia, it's the center of the states kind of is is included in there to some degree, sometimes a little bit, sometimes.

Okay.

But Midlands has been kind of, shoehorned between these two bookends of the Lowcountry or Charleston and the upstate Greenville, Spartanburg and all the exciting growth that's gone on in both of those bookends.

Is the Midlands starting to catch up?

I would say yes.

I would also say this too.

So I grew up along the coast of South Carolina, and certainly the flavor of the coast has changed over the last few decades.

And the Midlands has always been sort of part of this holy trinity of Lowcountry, the Midlands and the upstate area.

And less don't talk about sort of the sister sibling relationship of Greenville and Spartanburg in the upstate, you know, but now we're seeing a lot of these build out of corridors like into Aiken, into the PD, Rockhill, into the Grand Strand.

But, for the Midlands, it's it's historically had a number of traditional assets because it's the seat of state capital government, multiple two and four year colleges and universities.

But that also meant that it had a lower tax base, right?

The denominator was smaller, numerator was smaller because of these tax exempt buildings.

And structures and entities.

But now what we're beginning to see, and some of this may be because of the compression from the low country and the upstate.

And how do we find the big the next big mega site, for instance?

And of course, scout Motors found a perfect one, right there within the Midlands.

And so we're, we're starting to see a bit more of a reorientation even in how we approach economic development within the Midlands.

So for instance, recently the Richland County Economic Development re morphed itself, to be more of a public private partnership.

And so I think that's really going to change.

But the Midlands has always had, you know, the three interstate corridors running through it, the three rivers.

And so now I think you're seeing more of a spotlight shown on those assets as a result of like a Scout motors recruitment.

No, I'm glad for you.

That's always been one of those things about Columbia in the Midlands that, gosh, you know, they watch their sisters do that.

Vicky, let me come to you, change gears.

Just a little bit.

So given what's gone on with Dodge, with the new administration in Washington, with what's gone on in philanthropy and and nonprofits, do you find that a lot of the services, a lot of the growth, a lot of the things that everyday people have needs are trying are being offloaded now more squarely on the nonprofits and philanthropy where it yes, the short answer is yes.

They're even without organization with small businesses.

They're, you know, they're more people now who are coming to us and wanting to know, well, what what do you have for us?

What you know, what can you do to kind of help us?

As they see that there was so much potential with, with previous federal, bills that were coming through and funding that they had had anticipated, that now a lot of them worry is gone or may not, you know, be there.

So yeah, they are scrambling to see are there other places that they can land to launch these projects?

There were a lot of things that were in motion, you know, major projects, major investments that businesses were making in anticipation of where the where they felt the economy was headed.

And now you have, you know, again, a new a change in guard.

And so they're having to pivot.

And so yeah, they're coming to nonprofit organizations more to see what do we have to offer.

How can we be you know, where before they might have bypasses they're stopping now.

Are you encouraged in in just less than a minute at the home to get we're going to bring our guests.

Are you encouraged that nonprofits, community foundations, endowments, etc., etc.

will will rise to it.

Will will adapt, will will end up is it's a large gap to feel.

I know that they're going to do their very best.

I've seen them already starting to make adjustments for organizations like myself.

This is, you know, going to be more competition more.

We call it friendly competition, but there's still competition where they're going to be more groups now coming to, the wells that we've been dipping in.

So, they're definitely going to, you know, rise to the occasion, to the absolute best of their ability.

But it is a lot.

It is going to be a lot to, to cover for lot to make up for, Thank you.

Stay with us, ladies.

We're going to bring our guest on in just a moment.

But before that, coming up on this program, he is the president of the Federal Reserve Bank of Richmond.

His name is Tom Barkin.

Tom will be our.

I'm sorry, president Barkin will once again be our guest on this program, as well as the College of Charleston.

President Andrew Sue will also be joining us.

This may be a short lesson in civics, but both North and South Carolina, as well as other states, of course, in the Union, have a state auditor.

According to Wikipedia, their job description includes responsibility for overseeing and reviewing the financial accounts of all state government agencies, specifically in North Carolina.

That is an elected position and a constitutional officer.

So besides financial oversight and accounting, what kind of leverage would that would this office have?

Well, joining us now is the fairly newly elected Tar Heel State Auditor, Dave Boliek.

Your honor, welcome to the program.

Oh, Chris, thanks for having me.

It doesn't happen very much that a newly elected state constitutional officer has an act named after him in the General Assembly, the Dave Act.

Place it.

And I'm being a little bit flippant, Your Honor, but what does the acronym mean, and what's the use of that?

Yeah.

So the Dave Act is, establishes the division of accountability, value and efficiency within our office.

And it was a budget mechanism to, enhance the resources that we have in the office.

And the goal is really to take a look at efficiency across state government, agency by agency, institution by institution, with a data driven approach.

Mr.

Auditor you came out swinging, and and I say that I say that in a forward looking way.

And I'm going to pick on Charlotte for a second.

Charlotte had, a headline and an event where the chief of police, Johnny Jennings, had did not sue, but was threatening some legal action to settle what he felt like was unfair, treatment by city government, city council, and it was to the tune of six figures.

And you can look it up.

Anyone can look it up, but the.

But the point was this the state auditor, you came out and said, we are going to audit that transaction.

What?

Why did you pick that one and what does that represent?

Yeah.

Well first of all, the goal is to make the state auditor.

And that was one of my goal.

And our team's goal is to make the state auditor's office here in North Carolina relevant to everyday North Carolinians.

And one of the ways we can do that is to be what I call proactively reactive.

Right?

And so when when things come up in the news that the average citizen would expect the state auditor to have some influence over, we want to be able to engage.

And at the time the city had City of Charlotte had settled with the chief of police.

The amount of money that they had settled with was not public.

It was only 3 or 4 days after we initiated our investigation, that the $305,000 settlement was actually made public.

So by taking that action, it helps to add to the transparency and shed light on, spending of public money.

And that was the reason for the investigation.

And what were the what was the outcome of the investigation?

Well, the investigation is still pending the full outcome, but clearly the city announced that they had actually settled with the with the chief for $305,000.

We've expanded that to take a little bit deeper, look into exactly where the money came from and how the city of Charlotte settles.

Proposed lawsuits.

When will the results be in?

I'd say, at the hearing of this.

It will be within weeks.

Okay.

All right.

Thank you.

Nikki Lee, it's good to meet you in person.

Great to be here, Vicky.

Absolutely.

So I have to ask, so we have the Dave, we have the dote.

And and, you know, there's the perception with the doze where people came in the federal government and kind of, you know, they think about job loss and, and, you know, the immediate, attack on, you know, positions.

How will the Dave, you know, be different if it is different?

And how will you know, you approach it as you try to go through and look for efficiencies?

You know, as opposed to just going out and finding jobs to eliminate.

Right.

Well, it's a good question.

I appreciate the question.

Our approach will be data driven, and that's really important from the, point of view of being the state auditor.

We've got to be right.

Right.

And and any recommendation that we make out of the state auditor's office, I believe, and our team believes has to be based on data.

And we're going to use the most modern computer, software packages available.

We're going to use a, and we're going to sift through, agency by agency, institution by institution to take a look at where North Carolina can be more efficient.

And I'll say this, making North Carolina efficient doesn't necessarily mean just eliminating positions or jobs.

Sometimes it might mean taking a look and saying, well, the taxpayers may get a better return on investment if we add positions to a certain agency or to a certain program.

So our approach won't be singular in the sense of looking to cut.

Our approach is going to be making North Carolina more efficient and making sure that taxpayers get a full return on their investment of tax dollars.

And it's just a quick follow up on that.

Do you feel like the General Assembly in North Carolina is is going it is going to be sympathetic to your recommendations?

I do, for example, we one of the first projects that we've taken on on a larger scale is auditing the DMV.

And our audit of the DMV has shown, not that the DMV is not working really well.

I mean, an audit of - an audit of the North Carolina DMV that says the DMV doesn't work well, is not telling the citizens anything.

Our audit of the DMV took a look at how we can make immediate improvements.

Mid-term improvements and long term improvements.

There is an example where we actually recommended additional, staff at the DMV and the legislature taking us up on that and added already 40 additional, full time employees to the Division of Motor Vehicles.

So, thank you, Mr.

Auditor.

This is very enlightening.

You mentioned data driven.

You mentioned I, of course, as like the super trendy topic of the moment, even though it's sort have been around since the 1950s.

But, in South Carolina, we're seeing the utilization deployment of AI to maybe burrow into statutes and regs to kind of, you know, scour for obsolete, duplicative, overly burdensome regulations or laws.

How would you say specifically I as sort of a cog in the North Carolina government scheme, really helping to move those transition, you know, those efficiencies into real impacts.

I Susie, I appreciate the question.

And, you know, generative AI is new to state government.

It may not be new to business and industry, but it is new to state government.

And our office is one of the leaders on the AI front.

Stated from the very beginning, once I took office that we've got to pour jet fuel on AI, we got to do it responsibly, but we've got to move forward with the use of AI.

And one of the ways we're already using it is in the area of regulations and, in statutory language, so that for example, as you're planning an audit, our team is using the AI, to accumulate those statutes and regs and line those up with the, topic of individual audits as we move forward.

Our hope is to meet with business people across the state of North Carolina in Charlotte, in Raleigh, Greensboro, Wilmington, all across the state of North Carolina.

To ask the question of businesspeople, what types of hurdles are you facing that you, as a business person may believe are unnecessary?

And then we want to take that back, sift it through what business regulations are available, what statutes are already on the books, and see where we can find some efficiencies without giving up the necessary regulations.

But but try to find some efficiencies because, after all, and you've already mentioned it here once today on the program, we've got to keep North Carolina number one in business, because when you keep North Carolina, number one in business, it's great for all North Carolina.

This is going to sound sensational, Mr. Boliek, but are you afraid of what you're going to find in some of these on.

It's.

I mean, are you afraid to look under the cover or under the the hood of some of the cities that may not be solvent?

Well, I'm not afraid, because I ran for the office knowing that we might find some things.

We have already found instances where smaller municipalities, because they had received large amounts of Covid money, for example, and had budgeted forward as if that Covid money was going to be recurring in nature, where they have, you know, sort of run the run, run the town up on the beach and, so to speak, because, they had expanded and hired employees with temporary money.

And that is a consistent problem, not just at some small municipalities, but some at larger, school school systems, for example, where, where that, problem exists.

So we're already finding that across the state of North Carolina.

So I'm not really afraid of it.

You know, we can't be afraid to pick up the rock and look, look at the worms.

Like, my my book.

Good, great.

Good book.

Good.

The great says you pick up the rock and look at the worms.

And we're not afraid to do that because somebody's got to do it.

I have always viewed the state auditor's office as the the office that is in charge of doing just that.

Yeah.

Okay.

Thank you.

Ma'am.

You mentioned Charlotte, and I think I heard you mentioned that you would, that the auditor's office will be expanding and opening an office in Charlotte.

So I'd like to hear a little bit about that.

And, and and why now and what what will that office do in terms of efficiency?

Well, I appreciate that question as well, because yes, we're opening an office here in Charlotte.

And, years and years ago there was a Charlotte office of the state auditors, the state auditor had, we're going to open up a new office.

We're going to have 10 to 12, team members here in Charlotte.

And the idea is Multi-fold one is to be able to recruit professionals from the Charlotte Metro area who may want to serve, in the state auditor's office and bring their expertise, both, both young folks and gray hairs like me, who may want to get off the hamster wheel and come to serve the people of North Carolina.

We want to welcome them and have a place where they can work here in Charlotte.

And and we want to also show a commitment to the taxpayers of North Carolina and to the people of North Carolina who live in the Charlotte metro area, who sometimes feel disconnected with Raleigh and the governmental, complex in Raleigh.

We want to show that commitment to them by being here in the community and working on their behalf.

What's the timeline?

But timeline will be by September of this year.

Hope you can find one with a decent lease rate.

God bless you.

Thank you.

But that would be the case in any urban core right now.

Suzy, I'm sorry I jumped in.

Yeah.

No, no, no.

So how do you.

I obviously particularly with data driven methods and approaches and I, and we actually have one South Carolina maker that is, has sponsored a bill that would set up a kind of a doe like arm of state government as well.

And by the way, the first thing you said was, let's go get all the lawyer jobs.

And I, I'm no your lawyer.

I'm worried about trade as well.

But how do you, particularly in the rural areas and kind of some of those peripheral areas, how do you craft the message?

This is good.

This is a good approach that we're taking with these data driven methods to kind of overcome some of those, that anxiety of all this is going to put me out of a job.

Yeah.

Susie, I mean, I think if if approached the right way and I feel like our team has the right approach, if you take a data driven approach and ask the question, not what we can cut, but ask the question of how can we assure that we're getting a solid return on investment of taxpayer dollars?

It's that approach I think can be really productive because, again, like I said earlier, the key to your question, just because we're doing a look at efficiency does not necessarily mean, wholesale cuts in some programs.

It could mean we're lacking.

Right.

And we need to enhance a particular program or area.

I felt like the auditor's office needed to be enhanced.

We've added 45 new positions with the, latest mini budget from the General Assembly.

And that doesn't even get us up to par with the state of Georgia in terms of the resources that are used in Georgia, which the state of Georgia is a similarly sized state, in terms of population as North Carolina.

So our approach is to ask that question, what is the return on investment?

Not what can we cut?

I think if we take that approach, I think we'll get buy in from stakeholders across the state.

I want to take that just a little bit further, Your Honor.

And the idea that there seems to be an expansion of powers and leverage going on now, as you describe it, and I'm going to discount part of that is you're a prosecutor, you're a JD, you've got this going on kind of in your head.

But but I know it's not necessarily a power grab or is it?

Or and I mean, so what do you think your end game by getting more I'm going to say not even assertive but aggressive with what the auditor's job should be.

Yeah, I think the end game is to become a more outwardly facing office.

When I first took office, I actually testified in the General Assembly and on their board they were getting an orientation program.

My testimony in the state auditor's office was illustrated as an agency or office that is inward facing, and our goal is to continue to the approach of inward work with agencies to help them be better.

But we want to be outward facing, and we're doing that by, for example, creating dashboards.

We have a dashboard on Helene Recovery, for example.

So you can go to the state auditor's website and you can see how tax dollars are being spent in the Western North Carolina recovery.

Now, that's not a traditional auditor function, but it is truly aligned with the idea of being a watchdog of taxpayer dollars.

And so to your question that the simple answer is we want to approach it from the, from the view of being more transparent and more accountable with taxpayer dollars.

Okay.

You know, I wish we had more time.

We are out of time to unpack part of that.

I hope you'll come back.

Would you come back?

Glad to come back.

Okay.

Thank you for being in public service.

I know that's you're not doing it because of the stock options, but we appreciate it.

It's nice to see it.

I think it's important work, and I'm glad to do it.

Yes, sir.

Thank you.

Susie, nice to see you again.

Thanks for making it up from the capital city, Vicky Lee.

Always nice to have you on.

Always great to be here.

Thank you, thank you.

And thank you for watching and supporting this program.

I'm Chris William.

Hope you have a good weekend.

Good night.

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