PayPal cancels North Carolina expansion plans after passing of HB2

Just two weeks ago, PayPal CEO Dan Schulman stood next to North Carolina Governor Pat McCrory to announce plans for a new $3.6 million global operations center in Charlotte that would employ nearly 400 people and pump some $20 million worth of annual payroll taxes into the state system.

And then came the controversial passing of House Bill 2. Now, PayPal has officially backed out of all expansion plans within the state.

"The new law perpetuates discrimination and it violates the values and principles that are at the core of PayPal's mission and culture," Schulman wrote in a statement. "As a result, PayPal will not move forward with our planned expansion into Charlotte."

HB2 is widely criticized for its impact on the LGBT community. The law eliminated an ordinance passed in Charlotte which protected transgender people who use public restrooms based on their gender identity. The new law also nullified local ordinances around the state that were designed to protect members of the LGBT community from being fired for their sexual orientation or identity.

PayPal's CEO had previously joined a bevy of CEOs from Silicon Valley and across the country calling for the repeal of HB2 in a signed joint letter from the Human Rights Council and Equality North Carolina.

Many executives threatened to shutter operations in the state if HB2 was not repealed. PayPal has now set that ball in motion.

"As a company that is committed to the principle that everyone deserves to live without fear of discrimination simply for being who they are, becoming an employer in North Carolina, where members of our teams will not have equal rights under the law, is simply untenable," Schulman said.

Schulman plans to seek an alternative location for PayPal's new operations center. Meanwhile, he said the the company will continue to work with the LGBT community in North Carolina in an effort to overturn the legislation.