FOR IMMEDIATE RELEASE:
December 30, 2004
Transcript of James B. Hyler Jr.'s Remarks on the Economy and the U.S. Open
SECOND ANNUAL MEETING, MOORE COUNTY PARTNERS IN PROGRESS, OCT. 27, 2004
NOTE: Hyler is vice chairman of First Citizens Bank, former chairman of the Research Triangle Regional Partnership and a member of the U.S. Golf Association, which hosts the tournament
It's always a pleasure to be in Moore County. I'm fortunate in that I'll get to spend even more time in this great community over the next year as we prepare for another U.S. Open Championship. The Open tees off with practice rounds on June 13, 2005 - just 228 days away.
Tonight, I'll discuss preparations for the Open and what the Championship means to our state and this region.
But before I do, I want to provide an overview of the national and state economies to set the stage.
Overall, I believe our nation's economy is on a solid path:
- Interest rates and inflation remain low.
- The housing market shows no sign of slowing.
- Preliminary indications are that retail sales jumped 1.5 percent in September - the best showing since March and a turnaround from a slight drop in August.
- However, there are some areas of concern -
- Lower consumer confidence - some analysts say the election itself might be undermining the confidence of consumers - with all the debate by the candidates about the health of the economy. You'll have to admit there's certainly differing opinions about where we are on the economic front.
- Modest job creation. Only 96,000 jobs were created last month, much less than forecast.
- And lastly, record-high oil prices are starting to weigh down our economic growth as well as growth in other parts of the world.
Fed Chairman Alan Greenspan has said that we'll be able to weather the high oil prices, although it could be a bumpy ride. Officials with the Fed also said recently that despite the disappointing job data, they haven't changed their outlook for solid economic growth - and I tend to agree.
The number of people signing up for jobless benefits fell sharply last week - another bit of encouraging news for recovery in the labor market. I think nationally we'll see employment revive and pick up to the pace needed to keep up with population growth and further reduce the unemployment rate.
With this expectation, I think the Fed will continue to raise rates at a "measured" pace. I fully expect another quarter-percentage point increase at its next meeting on November 10. This will make the federal funds rate 2.0 %, still very low by historical standards. After this move, I believe the Fed will take a wait and see approach before raising rates further in 2005.
The economy grew at a 3.3 percent rate in the second quarter and appears to have picked up some momentum in the third. We should see the national economy grow 3.5 to 4 percent this year and next.
Here in North Carolina, we're also beginning to see glimmers of progress:
- Corporate profits are up 16.5 percent in the past year.
- More people own their own homes.
- Employment is gradually getting stronger:
Data released Friday show the state's unemployment rate in September was 4.8 percent - more than half of a percentage point lower than the U.S. rate.
September was the seventh consecutive month that the state's unemployment rate was below the national average.
Prior to that, North Carolina's unemployment rate was higher than the national average for approximately three years. This reflected the fact that the recession was deeper and broader in North Carolina as compared to the rest of the county.
In Moore County, the data show similar progress: The unemployment rate dipped from 5.3 percent in July to 5.1 percent in August. These unemployment numbers - along with the tobacco buyout and a potential new economic development tool - should give North Carolinians additional reasons for optimism.
Having grown up on a family tobacco farm in Southside Virginia, the long-awaited buyout comes with mixed emotions: It's the end of a unique way of life.
But the buyout also represents a new day for agriculture.
The buyout will likely increase economic activity and business opportunities in many of our state's already fragile rural communities - giving our farmers new options and new hope for the future.
While the tobacco legislation is positive news for our state, I want to remind you about an economic development issue that has the potential to give local governments and communities greater ability to attract jobs and investment for many years to come.
North Carolina is currently one of only two states in the nation without a powerful economic development tool called self-financing bonds. Next Tuesday, we'll have the opportunity to vote for Amendment One to authorize the use of these bonds.
Both Partners in Progress and the Moore County Chamber have gone on record in support of this measure. If you're not familiar with how self-financing bonds work, they do just what they say they do - pay for themselves. They finance public improvements such as streets, water and sewer service and sidewalks in special development districts.
They allow property values in a district to increase, which generates additional tax revenues to pay off the bonds.
And self-financing bonds support affordable housing, industrial parks, re-use of abandoned manufacturing plants and redevelopment of areas damaged by environmental pollution or natural disasters.
Because the bonds don't pledge the community's full taxing power, no local referendum is required. That flexibility makes North Carolina communities much more competitive for projects that can't wait months for a referendum.
Amendment One has received a wide-range of bipartisan support from the business community and the General Assembly as well as from former Governors Hunt, Martin and Holshouser. I encourage you to support this important measure. Let's join the other 48 states that see this as a good thing.
For 2004 and 2005, I see some improvement for our state's economy over last year's modest 1.4 percent growth rate. Overall our state's economy is fundamentally sound, and Moore County will continue to be a contributor to our economic progress. I want to congratulate you for your commitment to making this area a vibrant, thriving community.
Moore County enjoys a quality of life and rural charm that can't be beat. It's a regional shopping, golf and retirement Mecca that features a growing healthcare sector.
On the heels of these advantages, let me mention two challenges.
As more people, businesses and retailers discover what you have to offer, dealing with growth and all its issues - traffic, education, the effect on water and sewer, to name a few - will be a major challenge. It's especially important to make sure that future growth comes about in way that complements your unique quality of life.
A second challenge is managing the transition to a more diversified economy. Since the beginning of the year, there have been 11 company relocation and expansion announcements that will bring an estimated $15 million in investment and at least 270 jobs to the county.
The Partners in Progress 2005 plan of action targets smart, diversified companies and encourages entrepreneurism - while not compromising the quality of life that drives the tourism and retirement industries.
I also congratulate Partners, the Chamber and the Convention and Visitors Bureau for pooling their distinct efforts and working side-by-side.
There's much to build on:
- Because of your proximity to Fort Bragg and Pope Air Force Base, there's tremendous potential for recruiting defense suppliers, contractors and retired military officers, who are now finding this area to be an ideal location for business. The Chamber's newly formed military affairs council is a great start.
- Your first-rate healthcare facilities enhance the region's appeal to business and industry.
- And leveraging your tourism and resort industries to recruit new business is another great opportunity.
Golf and tourism give you an advantage over other communities in North Carolina. CEOs and other decision-makers regularly visit Moore County, and they can see firsthand what you have to offer. The U.S. Open represents another major opportunity to get them to think about the area as a potential location.
What does the future hold for Moore County? The overall forecast for this area is for steady economic improvement through next year and into 2006. The return of the U.S. Open next year should provide an additional boost to the local economy and your industrial recruitment efforts.
North Carolina is proud to have the privilege of hosting the U.S. Open for the second time in six years. It's hard to believe that we're less than eight months away from its return to Pinehurst No. 2.
On behalf of the President's Council, I want to thank you again for the outstanding hospitality you provided during the 1999 Championship.
The entire world was our guest, and you made everyone feel right at home.
I remember all the anxiety and hard work. And I'm proud to say that this great community came through with flying colors!
Thanks to the team at Pinehurst Championship Management - headed by Beth Kocher - and everyone else at the Resort and to those in the community who were involved.
- Everything was well organized - from transportation and housing to the countless logistics required in putting together an event of this magnitude. This is a big event.
- The golf course was in perfect shape.
- And perhaps most important, we showed how a state and a community can come together. We rolled up our sleeves and worked hard to get the job done.
- After years of planning and anticipation, we succeeded in making the event one of the best, if not the best, U.S. Open ever.
- The '99 Open at Pinehurst will certainly rank as one of the most memorable: We'll never forget how the late Payne Stewart sunk that dramatic 15-foot putt on the final hole to win by one stroke.
- The impact of hosting the Championship was also dramatic in its own way:
- We had near record attendance for any U.S. Open.
- The '99 Open added an estimated $135 million to $150 million to the statewide economy.
- We broke records for merchandise sales and corporate hospitality sales.
- Millions of people discovered what a wonderful place this is by watching the Open on TV. Some 30 hours broadcast to 100-plus countries.
One interesting aspect of the media coverage was how many of the state's larger metropolitan areas - Charlotte-Mecklenburg, the Triangle, the Triad - adopted this community as their own. TV reporters from these areas took great pride in Moore County for hosting the Championship in what they considered their own backyard.
Another legacy from 1999 was the great impression you made on our guests. One spectator from Florida found everyone remarkably hospitable and courteous. He said that he "took it for granted that everybody's just really friendly … from the waitresses to the people in the shops to the people on the golf course." And I can tell you that we have customers today who still talk about their great experience in 1999.
But as successful as the '99 Open was, the 2005 Championship will be just as great an experience, with its own identity and its own story to tell. This time, the team has the advantage of knowing what to expect so a few minor adjustments will be made.
The most obvious change will be the site of the corporate hospitality village, which will be located on the current practice range beside the 18th green of Course No. 2.
Corporate hospitality sales have already surpassed 1999:
- The clubhouse is sold out with 11 packages.
- The village is also sold out with 67 marquees.
- And more than 100 table packages have been sold. There are only a few tables left, and we expect to be totally sold out by year's end.
The transportation set-up worked so well in 1999 that no changes to the plan will be made. Patrons will park at satellite lots and then ride a modern, air-conditioned bus to the main entrance. During the week of the Open, more than 385,000 guests are expected to be moved to and from the event. More than 40,000 spectators are expected each day.
For housing, more than 4,000 rooms - totaling 25,000 room nights - (half in Moore County) have been secured for corporate clients, USGA, media, contestants and vendors.
Other logistics of note include:
- Installing more than 25,000 bleacher seats on the course.
- Setting up 300,000 square feet of canvas tents - enough material to cover 10 football fields.
- Bringing in 500 portable restrooms.
- Providing enough temporary electricity to power 840 homes.
- Grilling 75,000 hot dogs, hauling in 240,000 pounds of ice for beverages and, my favorite, serving 37,000 Krispy Kreme doughnuts.
Next year's Open will be an extra special time for me. As John mentioned, I was recently elected to the Executive Committee of the USGA. This is an incredible honor for me and has been a fantastic experience.
I've been exposed to many different aspects of the game, traveled a lot and met many wonderful people. It takes a lot of time, but for a golf junkie who deeply respects the game and its traditions and history, it's quite a thrill. I've learned a lot but continue to be on a steep learning curve.
The USGA's two core functions are to govern the game and conduct championships. We govern by making the Rules of Golf, the Rules of Amateur Status and setting equipment standards. Annually, we conduct 13 National Championships - three Open and 10 Amateur. Of course, the USGA is involved in lots of other things, but these are our true core functions.
With next year's Open in my backyard, I'll have the opportunity to play host to the Executive Committee and other USGA officials. I'll consider it an honor and will be proud to do so. Following the 2005 Open, we won't have much time to catch our breath. The Women's Open returns to Pine Needles in 2007. And the U.S. Amateur Championship will be held on Pinehurst No. 2 and No. 4 in 2008. Hosting these major Championships are further tributes to this community!
High-profile events like these add so much to our state's quality of life. They assist with our economic recruitment efforts and give us state, national and worldwide exposure.
In closing, the next year should bring renewed opportunities as our economy continues to grow and as we host another successful U.S. Open Championship. As a business that has enjoyed building relationships with the people and businesses of Moore County for the last 29 years, First Citizens Bank takes great pride in being a part of this community.
We're certainly looking to the future with great anticipation. Thank you.
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