PayPal Drops Plan to Build $3.6M Facility in NC Because of Controversial Law

PHOTO: President and CEO of PayPal, Dan Schulman speaks onstage at the Kiva NYC launch event at the IAC Building on Dec. 9, 2015 in New York.PlayLarry Busacca/Getty Images
WATCH Battle Over 'Religious Freedom' Bills Heat Up in the South

PayPal announced today that it's withdrawing plans to build a new facility in North Carolina, the first major corporation to pull out of the state as a result of what some call an "anti-LGBT" law there.

Two weeks ago, California-based PayPal announced plans to open a $3.6 million global operations center in Charlotte that would have created more than 400 jobs. But today, PayPal CEO Dan Schulman said the company is seeking another location.

"The new law perpetuates discrimination and it violates the values and principles that are at the core of PayPal’s mission and culture," Schulman said in a statement today.

Schulman is referring to House Bill 2, formally known as the Public Facilities Privacy and Security Act, which Gov. Pat McCrory signed last month. The law bans people from using bathrooms that don't match the sex indicated on their birth certificates, which opponents argue is discriminatory toward the transgender community.

In response to the bill's passage, dozens of business leaders have signed a letter to McCrory and state lawmakers that seeks a repeal of the law. LGBT advocacy group Human Rights Campaign coordinated the effort.

Organizers of the state's annual furniture show, High Point Market, said backlash to the bill is causing "significant economic damage." Organizers issued a statement last week that dozens of customers contacted the High Point Market Authority and have cancelled plans to attend the show due to the law's passage.

"Based on the reaction in just the last few days, hundreds and perhaps thousands of our customers will not attend Market this April," the market organizers said in a statement last week.

Charlotte’s Mayor Jennifer Roberts said in a statement today, “I am deeply troubled by the loss of PayPal jobs as a result of HB2. I urge our state assembly to find a legislative remedy as soon as possible before more North Carolina families are harmed by this bill.”

Gov. McCrory's office did not respond to a request for comment.

New Jersey-based Braeburn Pharmaceuticals, which had plans to build a $20 million manufacturing and research facility in Durham County, North Carolina, said it's evaluating its options. But the company fell short of saying it was pulling out of the project.

"Building a manufacturing and research facility is a business necessity to ensure we fulfill our commitment to patients; we are reevaluating our options based on the recent, unjust legislation," the company said in a statement last week.

New York's Democratic Gov. Andrew Cuomo banned nonessential, publicly-funded travel to North Carolina last month. McCrory and proponents of the law have described the corporations and politicians who are banning travel to the state as "bullies" and "hypocrites" for not having a law that enforces gender usage in bathrooms.

Proponents, like the North Carolina Family Policy Council, argue that the law "does not impact the ability of businesses to adopt their own internal employment, non-discrimination, or bathroom policies."