- The Senate should reclaim the taxpayer-funded NCInnovation endowment and transfer the money to the Savings Reserve
- Taxpayer dollars should fund core public responsibilities, provide tax relief, or remain in taxpayer-controlled savings — not sit in a private nonprofit venture-capital-style fund
- Moving the money back to the Savings Reserve would correct a prior budget mistake without turning the clawback into new spending
This letter was sent to members of the North Carolina Senate on April 30, 2026.
Dear Senator,
On behalf of the John Locke Foundation, I urge the Senate to support reclaiming the taxpayer-funded NCInnovation endowment and transferring those funds to the Savings Reserve.
The House has passed legislation to claw back the endowment. Gov. Josh Stein has also called for reclaiming the funds in his proposed 2026-27 budget. That creates a rare moment of agreement across political lines: North Carolina should not leave half a billion taxpayer dollars parked in a government-created venture-capital nonprofit.
This is, first and foremost, a taxpayer issue.
When a North Carolinian pays taxes, he or she reasonably assumes those dollars fund core public responsibilities: schools, universities, roads, bridges, law enforcement, courts, emergency response, and other basic services. A taxpayer does not expect the state to take hard-earned money from families and businesses and place $500 million into a private nonprofit to support commercialization grants and startup-adjacent activity.
If state government has $500 million available for an experiment like NCInnovation, taxpayers are entitled to draw one of two conclusions. Either their money is not being used for core government services, or taxes are too high. Quite possibly, both are true.
North Carolina does not need a taxpayer-funded venture-capital endowment to prove that it is a national leader in business, innovation, or research. CNBC named North Carolina the Top State for Business in 2025, the third time in four years the state earned that distinction. The state ranked especially well for its economy and business climate, including top-five marks for economy and business friendliness.
That success did not happen because state government placed $500 million in a private nonprofit endowment. It happened because North Carolina has built a competitive tax and regulatory climate, a strong workforce, a growing economy, and an excellent system of public and private higher education.
We should be proud of our university system. Taxpayers have already invested heavily in it, and those institutions will continue to be engines of research, talent, and economic opportunity without asking taxpayers to underwrite a separate venture-capital-style fund.
The state has many priorities. Lawmakers can and should debate what those priorities are. Rebuilding from Hurricane Helene, strengthening emergency response, supporting rural county school construction, maintaining roads, improving public safety, or considering a new children’s hospital are all much closer to the proper scope of constitutional government than taxpayer-funded venture capital.
But reclaiming this endowment should not be treated as an excuse for new spending. The proper course is to move the funds into the Savings Reserve. That would return the money to public control, strengthen the state’s fiscal position, and make clear that this is not a spending increase. It is the correction of a prior budget mistake: moving taxpayer savings out of a private nonprofit endowment and back into a taxpayer-controlled reserve.
This distinction matters. The question before the Senate is not whether lawmakers can identify other programs on which to spend $500 million. In a large and fast-growing state, there will always be more proposed uses for taxpayer dollars than available funds. The question is whether taxpayer savings should remain locked away in a venture-capital-style nonprofit when the state already has a proper vehicle for reserves and future needs.
This is not an argument against innovation. It is not an argument against research, universities, entrepreneurs, or the private sector. North Carolina should be a place where all of those thrive. But innovation does not require state government to act as a venture-capital funder. Private capital, philanthropy, universities, and entrepreneurs are better suited than government or government-appointed boards to decide which early-stage technologies merit investment.
Every dollar locked away in NCInnovation is a dollar unavailable for legitimate public needs, future emergencies, future tax relief, or other priorities directly accountable to voters through the General Assembly. The Senate does not need to settle every budget debate in order to recognize that a $500 million public endowment for a private nonprofit should not outrank taxpayer-controlled savings.
North Carolina taxpayers deserve better than being told state government needs their money, only to learn that government had hundreds of millions of dollars available for a venture-capital-style nonprofit.
For that reason, the John Locke Foundation respectfully urges the Senate to support a full clawback of the NCInnovation endowment and transfer the funds to the Savings Reserve. Taxpayer dollars should be used for core constitutional responsibilities, returned to taxpayers, or held in taxpayer-controlled savings — not locked away in a private nonprofit endowment.
Sincerely,
Donald Bryson
CEO
