Jeff Moore
Carolina Journal
NC House Oversight Committee co-chairs Reps. Harry Warren, R-Rowan, and Jake Johnson, R-Polk, are among the primary sponsors of a bill to clawback half a billion dollars in state taxpayer funds from NCInnovation (NCI), a private nonprofit founded to help commercialize more public university research in the state.
Citing the pressing disaster relief needs of western North Carolina as lawmakers gear up for budget discussions, the sponsors of House Bill 154 — including Reps. Julia Howard, R-Davie, and John Blunt, R-Guilford — aim to dissolve the relationship between the state, reclaim the $500 million the state gave the entity in 2023, and subsequently redirect those funds toward more pressing budgetary needs
“North Carolina is confronted with challenges that were unforeseen when the arrangement with NC Innovation was made,” Warren told Carolina Journal in an email. “Considering the devastation created by hurricane Helene in our western counties and the mismanagement of the eastern coastal recoveries by NCORR under the Cooper administration, it is prudent to reconsider the relationship and recall the funding to be applied to the priorities of the citizens in the affected areas.”
Outlays for Helene recovery in western North Carolina have already stretched into the billions as state lawmakers plan for yet another round of relief during the long budget session.
Since being awarded the sizable haul of taxpayer funds for an endowment to support grant-making to public university researchers aiming to commercialize their projects, NCI has been under scrutiny for a lack of transparency and tensions with House Oversight Committee staff.
The NCI board of directors, a portion of which were appointed by the state legislature, have labored over early accounting woes, and shaking off the appearance of conflicts of interest.
The John Locke Foundation, the publishing organization of the Carolina Journal, has panned NCI’s use of taxpayer money since inception and deemed the legislation a prudent step in the right direction.
“The 2023 allocation of $500 million in taxpayer funds to NCInnovation, which has fought public oversight at every turn, has raised serious concerns about transparency and fiscal responsibility,” reads the statement. “House Bill 154 seeks to address these concerns by ensuring that state funds are properly accounted for and returned to the General Fund. At the John Locke Foundation, we believe taxpayers deserve clear and accountable stewardship of public resources, for constitutional core government services – venture capital is not among them. With North Carolina facing pressing needs—including recovery efforts from Hurricane Helene—reclaiming these funds is a prudent step toward responsible governance and ensuring taxpayer dollars are directed where they are needed most.”
Under the proposal, any interest or investment returns earned on the $500 million endowment shall remain with NCI. Feasibly, those returns already reach into the tens of millions of dollars. NCI was also required, as a condition of receiving taxpayer funds, to raise $25 million in private capital to fund overhead and executive pay.
NCI awarded $5.2 million grants in May of 2024, and is in the process of accepting applications for more grant awards later this spring.
While legislative sessions and committee meetings have been canceled for the rest of this week due to winter weather in the capital area, lawmakers will return to Raleigh next week to continue work on disaster recovery and other biennial budget items.
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