‘Bathroom bill’ to cost North Carolina $3.76B
Financial hits range from scuttled plans for a PayPal facility to canceled Ringo Starr concert
DRALEIGH, N.C. espite Republican assurances that North Carolina’s “bathroom bill” isn’t hurting the economy, the law limiting LGBT protections will cost the state more than $3.76 billion in lost business over a dozen years, according to an Associated Press analysis.
Over the past year, North Carolina has suffered financial hits ranging from scuttled plans for a PayPal facility that would have added an estimated $2.66 billion to the state’s economy to a canceled Ringo Starr concert that deprived a town’s amphitheater of about $33,000 in revenue. The blows have landed in the state’s biggest cities as well as towns surrounding its flagship university, and from the mountains to the coast.
The AP analysis — compiled through interviews and public records requests — represents the largest reckoning yet of how much the law, passed one year ago, could cost the state.
The law excludes gender identity and sexual orientation from statewide antidiscrimination protections, and requires transgender people to use restrooms corresponding to the sex on their birth certificates in many public buildings.
Still, AP’s tally is likely an underestimation of the law’s true costs. The count includes only data obtained from businesses and government officials regarding projects that canceled or relocated because of HB2.
A business project was counted only if AP determined through public records or interviews that HB2 was why it pulled out.
The AP also tallied the losses of dozens of conventions, sporting events and concerts through figures from local officials. The AP didn’t attempt to quantify anecdotal reports that lacked hard numbers.
Bank of America CEO Brian Moynihan — who leads the largest company based in North Carolina — said he’s spoken privately to business leaders who took projects elsewhere because of the controversy, and he fears more decisions like that are being made quietly.
Other measures show North Carolina has a healthy economy. By quarterly gross domestic product, the federal government said, North Carolina had the nation’s 10th fastest-growing economy six months after the law passed. The vast majority of large companies with existing North Carolina operations have made no public moves to financially penalize the state.
HB2 supporters say its costs are tiny compared with an economy estimated at more than $500 billion per year, roughly the size of Sweden’s. They say they’re willing to absorb those costs if the law prevents predators from posing as transgender people to commit assaults in restrooms — acts the law’s detractors say are entirely imagined. Republican Lt. Gov. Dan Forest issued a statement Monday accusing the AP of “another attempt to mislead and confuse the public through a bogus headline.” Forest questioned the tally and said that even if true, it would represent only a sliver of the state’s economy.
Forest, who declined an interview request to discuss AP’s analysis before its publication, recently told Texas legislators considering a similar law: “Our economy is doing well. Don’t be fooled by the media.”
But the state governor — Democrat Roy Cooper, who’s long opposed HB2 — responded to AP’s story by saying: “We now know that, based on conservative estimates, North Carolina’s economy stands to lose nearly $4 billion because of House Bill 2. That means fewer jobs and less money in the pockets of middle class families. We need to fix this now.”
And AP’s analysis shows the economy could be growing faster if not for projects that have canceled. Those include PayPal canceling a 400-job project in Charlotte, CoStar backing out of negotiations to bring 700-plus jobs to the same area, and Deutsche Bank scuttling a plan for 250 jobs in the Raleigh area.
Other companies that backed out include Adidas, which is building its first U.S. sports shoe factory employing 160 near Atlanta rather than a High Point site, and Voxpro, which opted to hire hundreds of customer support workers in Georgia, rather than North Carolina.
“We couldn’t set up operations in a state that was discriminating against LGBT” people, Dan Kiely, Voxpro founder and CEO, said in an interview.
An analysis by the state Commerce Department shows that state officials expected the PayPal expansion to contribute more than $200 million annually to North Carolina’s economy. By the end of 2028, the state expected PayPal to have added $2.66 billion.
Meanwhile, canceled conventions, concerts and sporting events have deprived the state of more than $196 million, according to tourism officials around the state.
All told, the state will have missed out on more than $3.76 billion by the end of 2028. The losses are based on projects that already went elsewhere — so the money won’t be recouped even if the law is struck down in court or repealed.