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N.C. State Rep. Donny Lambeth, R-Forsyth, speaks as a panelist at a town hall about the future of Medicaid expansion in North Carolina in 2016.

Forsyth and Guilford counties are under consideration for the relocated headquarters of the state Department of Health and Human Services and potentially 2,300 jobs, state legislators confirmed Wednesday.

A potential move to the Triad appears to depend on another layer of the political hardball surrounding Democratic Gov. Roy Cooper’s veto of the state budget.

The relocation project, inserted into the state budget, mentions only Granville County. It could take up to five years to complete the project.

Rep. Donny Lambeth, R-Forsyth, and the lead House budget writer, and House Democratic leader Darren Jackson, D-Wake, said Forsyth is among six counties being discussed as a potential re-location site.

Sen. Paul Lowe, D-Forsyth, said he has been approached about the DHHS headquarters relocation by a lobbyist.

“We have a good employment base and well-educated work force and good access as a central location in the state,” Lambeth said. “Our area would be the perfect location for a major move like this.”

Rep. Pricey Harrison, D-Guilford, confirmed the consideration of Guilford.

Forsyth and Guilford have Democratic legislators being pursued by GOP leadership with special project funding in the budget in exchange for agreeing to support an override vote.

The other counties mentioned — Cumberland, Harnett and Wayne — also have Democratic legislators being enticed with special project funding or, in the case of Wayne, have Majority House leader John Bell as a county delegation member.

Landing the DHHS headquarters would trump all of those special project offers.

Rep. Darren Jackson, D-Wake, said Tuesday to The Insider media publication that “I certainly think we should put divisions of state government where they need to be, where it’s most efficient for taxpayers, where the work is, things of that nature.”

Jackson said during Wednesday’s floor session that Cooper’s willingness to agree to a study on moving the DHHS headquarters is “a sign of compromise” and a “good idea” when considering the budget would affect 2,300 jobs.

“I suspect that Speaker Tim Moore is considering many ways to round up Democratic votes to override the governor’s budget veto,” said Mitch Kokai, senior policy analyst for Libertarian think tank John Locke Foundation.

“It would not surprise me to learn that those discussions include the future site of the Department of Health and Human Services.”

Jobs for rural areas

An agreement reached in July 2015 between former Republican Gov. Pat McCrory and Raleigh Mayor Nancy McFarlane allowed the city to buy the Dorothea Dix property for $52 million. The goal is to eventually convert the 307-acre campus into a community park.

McCrory and state Senate Republican leaders had wanted to put the property up for auction. The agreement allowed DHHS to remain on the Dorothea Dix property through 2040.

Senate leader Phil Berger, R-Rockingham, said in June during the unveiling of the Senate budget proposal that legislative leaders wanted to act on the DHHS headquarters move.

“It’s important for the more rural areas to reap the benefit of state jobs,” Berger said.

The proposal is similar to legislative plans to move the state Division of Motor Vehicles headquarters from Raleigh to Rocky Mount.

House speaker Tim Moore, R-Cleveland, said that, with the DMV relocation proposal, “we need to make sure that rural North Carolina is not left behind.”

Ardis Watkins, government relations director for State Employees Association of N.C., said in a statement that “much like the DMV move, this would cause the state to lose many well-trained career employees.”

“But unlike the DMV move, this would add significant traffic to already congested roads. And we cannot imagine that citizens traveling those roads on a daily basis now would appreciate this.”

Republican legislative leaders acknowledge the potential of losing DHHS and DMV employees with the potential moves.

‘Shopping the move’

An override vote was placed on the House floor agenda, but not acted upon, for a third consecutive session.

Action on Medicaid expansion legislation House Bill 655 was held off for a second consecutive session after it was fast-tracked to the House floor Tuesday. The House is scheduled to meet at 10:30 a.m. today.

The Senate has allotted $240 million for the headquarters move, which would likely represent a longer commute for many DHHS employees.

Sen. Ralph Hise, R-McDowell, told The News & Observer that legislative leaders are looking at state-owned land in Butner, as well as 527 acres that Granville officials propose to donate in a business park.

Cooper’s initial budget proposal would move the headquarters to state-owned property on Blue Ridge Road in Raleigh.

His updated budget priority, submitted Tuesday, calls for a legislative study on a relocation site.

Berger told The Insider that he has not specifically lobbied for any relocation site.

Cooper said at his budget press conference Tuesday that “it’s hard to know how serious that proposal is, even though it’s in their budget.”

“But we know for a fact that they are shopping the move of DHHS to various counties in order to get votes to override the veto.

“So, to me, that shows that they’re willing to make a significant change and move in state government in order just to get a vote to override this veto instead of negotiating,” he said.

Local sites?

It is not clear where DHHS could move to in Forsyth or Guilford, whether state-owned or leased properties or properties the state would have to purchase or lease.

Mayor Allen Joines said recently that every area within downtown Winston-Salem is a hot spot for future growth and development, whether commercial or residential.

“The core area along Fourth, Main, Trade and Liberty (streets) has seen intensive development, and there remains opportunity for additional spot development in these areas,” Joines said.

New areas that will offer increased opportunities for growth are north of Martin Luther King Jr. Drive in the Industry Hill area, around the BB&T Ballpark, west Fourth Street near Broad Street, the area around the former GMAC building, the South Marshall Street area, and along Main Street south of Third Street, the mayor said.

In addition, Wake Forest Innovation Quarter officials say they believe it will continue to have strong development from Third Street south to Salem Parkway, including the Bailey Park South project.

The site, which is a place for research, business and education in biomedical science, information technology, digital media, clinical services and advanced materials, has 1.9-million square feet of office, laboratory and educational space on more than 330 acres.

The research park has received nearly $367 million in local, state and federal money, as well as private investments since its beginning in 1994. Much of its attraction has been federal and state historic-rehabilitation tax credits tied to buildings donated by Reynolds American inc.

Innovation Quarter officials said there is the potential for an additional 2.5 million square feet of space, mostly on undeveloped land.

Economists have said it will be more challenging for the Innovation Quarter to attract significant capital investment for start-from-scratch projects.

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rcraver@wsjournal.com 336-727-7376 @rcraverWSJ

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