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WWW.UPANDCOMINGWEEKLY.COM JULY 26 - AUGUST 1, 2023 UCW 5 JOHN HOOD, Board Member, John Locke Foundation. COMMENTS? Editor@upandcomingweekly.com. 910-484-6200 North Carolina has enjoyed more than a decade of conservative governance. It's brought our state impressive growth and widespread acclaim. e General Assem- bly has reformed and reduced state taxes, lightened the regulatory burden, invested in infrastructure, and promoted choice and competition in public services, among other accomplishments. is year, lawmakers have an excel- lent opportunity to build on this record of success by enacting a 2023-25 state budget with a prudent mix of strategic investments and pro-growth tax reforms. Unfortunately, the Senate version of the budget contains a non-conservative — indeed, a decidedly anti-conservative — provision to transfer $1.4 billion in taxpayer money to a private entity, NCIn- novation. Its stated intention is to bridge the gap between academic research and successful commercialization. Most new businesses fail. Indeed, many seemingly innovative ideas never become businesses in the first place. ey fail to attract enough human and financial capital to sustain them as they move from the research-and-develop- ment phase to the revenue-producing phase. e business executives, consul- tants and activists who created NCIn- novation propose to solve the problem by making grants to university research- ers and other interested parties to carry them across this gap, often described as the "valley of death." ere may well be university research- ers and other North Carolinians with promising ideas who just need some bridge funding to launch trailblazing new businesses. Sounds like a fascinating op- portunity for private investors to pursue, with the promise of significant returns as well as the risk of significant losses. It is not, however, the proper role of state government. As NCInnovation itself recognizes, "North Carolina is a powerhouse when it comes to research and development funding." Our colleges and universities attract a great deal of private and federal research funding. State taxpayers add to that with one of the highest levels of university subsidy in the nation. While opinions may differ, my view as a conservative is that it is appropriate to use state dollars to subsidize research on state campuses, and to fund extension services to transfer research findings to private individuals and enterprises to implement. As for the other cliff of the so-called valley of death, it's clearly not appropri- ate to force state taxpayers to become venture capitalists for private startups. Although the initial budget language for the NCInnovation transfer appeared to allow for equity stakes in recipient firms, that idea is no longer on the table as far as I know. Rather, the proposal is to transfer $1.4 billion from the state treasury to NCInno- vation, a private entity with a board com- posed primarily of legislative appointees. Notice I didn't say "appropriate" I said transfer. e $1.4 billion is not technically an expenditure, which means it doesn't count against the General Assembly's annual spending cap of inflation plus population growth. For conservatives, that should already be a big red flag. Exactly what range of grants NCInno- vation might make from the proceeds of its $1.4 billion corpus is not spelled out in any of the documents I've seen. Nor would its activities be subject to open meetings and public records laws. And why should we expect the board and staff of NCInnovation to make better decisions about which potential ventures to fund than private investors would make with their own money? is is the crux of the matter. e organization has attracted an impressive array of directors and well-wishers, many of whom are ac- complished executives. I don't question their business savvy. I question why they deem it appropriate to risk just not their own money, or their friends' money, or their clients' money, but my money — and yours. Conservatives believe that govern- ment's role is clearly defined and limited. We pay taxes to fund public services such as law enforcement, courts, education and transportation assets that cannot or should not be funded through receipts or voluntary contributions. When the line between the public sector and the private sector gets blurry, we get concerned. When it disappears entirely, we get angry. NCInnovation is a bridge too far by JOHN HOOD OPINION Insurance products are underwritten by Colonial Life & Accident Insurance Company, Columbia, SC. Ⓒ2020 Colonial Life & Accident Insurance Company. All rights reserved. Colonial Life is a registered trademark and marketing brand of Colonial life & Accident Insurance Company. 8-20 | NS-369880 steven.grimes@coloniallifesales.com 910-916-7191 Injury | Illness | Dental | Vision | Life Steven Grimes coloniallife.com Your Local Colonial Life Family. We provide benets that your employees want for those unexpected moments in life, whether that's an accident, illness or injury. Colonial Life. Keep it Local. Keep Unexpecting.® SELLING A BUSINESS? BUYING A BUSINESS? Business Sales • Mergers & Acquisitions • Franchises akelsey@tworld.com Ashley Kelsey (910) 302-6447 www.transworldeast.com