Legislature sets aside $500 million for innovation in state budget
As the legislature fought over whether to include casinos and Medicaid expansion in the budget, a debate surfaced among some business leaders over a half-billion dollar fund for a public-private partnership designed to promote startups that spring from academic research in North Carolina.
NC Innovation began in 2018 and was created to bring “C-suite leadership to impact North Carolina’s innovation future.” The organization specifically focuses on universities outside of the Triangle to create more business and jobs in rural areas.
House Speaker Tim Moore cited venture capital funds in other states, such as California, Texas and Connecticut, that were used to incubate startups that started in North Carolina.
“If these companies choose to locate in some of these other states, they have the financing available,” Moore said. “[NC Innovation] is to try to keep those technologies that are developed right here in North Carolina in our state, to translate for the number of jobs.”
NC Innovation’s board includes UNC System President Peter Hans, various university chancellors and numerous business executives.
The group has already received $23 million from private businesses and philanthropies, but the Senate’s proposed budget would have increased that figure dramatically, by $1.4 billion.
In the end, the final state budget included $250 million this year for NC Innovation, and another $250 next year.
Five business leaders, including influential GOP donors Art Pope and Bob Luddy, sent a letter on Monday to Republicans in the North Carolina House of Representatives arguing against NC Innovation, as well as Medicaid reform and casinos. Pope also served as budget director for former North Carolina Gov. Pat McCrory.
“Government intervention and support in the technology sector can create market distortions and stifle true innovation,” the letter read. “We believe that fostering innovation should be the role of the private sector, and state resources would be better spent on initiatives that promote competition and minimal government involvement in the economy.”
Moore said Tuesday that the NC Innovation funding will stay in the final budget.
“We all realize that this is an opportunity for a great project with great business leaders to try to recruit and keep the intellectual property that is developed in North Carolina,” Moore said. “We have amazing research universities in the state that bring about incredible patents.”
The House and Senate plan to vote on the budget Thursday and Friday.
WUNC's Colin Campbell contributed to this report.