Commerce Secretary John Skvarla told a legislative panel Thursday that North Carolina needs to help small businesses find investment capital so they can grow, and one way to do that is to legalize crowdfunding.
“If we’re not going to help our small businesses, we can talk around these issues all day long,” Skvarla told members of an oversight committee that was examining the economic struggles of rural counties.
Since the 2008 recession, business investment capital has been hard to come by, especially in rural areas.
At least 29 other states have already approved crowd-funding as a way for start-up businesses to raise money, and Skvarla and the rest of Gov. Pat McCrory’s administration have been pushing for crowd-funding for several years.
The idea has never made it through the General Assembly, however. While the House has strongly supported the idea, the Senate has been more skeptical.
Senate Majority Leader Harry Brown said House and Senate leaders don’t see eye to eye on how to regulate crowd-funding.
“I think everybody understands the need. It’s just how do you provide it?” Brown said. “There’s some argument, but I think it’s starting to take shape a little bit. I think it’s going to get more conversation.”
The state pension fund is another source of investment money for businesses, Skvarla said, and he plans to talk with the State Treasurer’s Office next week about tapping the venture capital fund in the pension system.
“Everybody thinks in terms of venture capital as biotech or pharma, but what about the HVAC company in Anson County?” he said. “We can create a mechanism in North Carolina that will be unsurpassed in the United States.”
Skvarla also told lawmakers that rural counties won’t grow unless they have access to high-speed Internet.
“Without high-speed Internet connectivity in all of our counties, Murphy to Manteo, we are not going to create jobs. It’s a must,” he said.
The Commerce Department is working to find ways to use federal grant money to help expand broadband infrastructure into unserved areas, he said.
Such moves could trigger yet another skirmish among state lawmakers over government’s role in Internet access, however.
Critics of the idea, including cable companies and Internet providers, as well as free-market advocacy groups, say local and state governments should not compete with businesses that build and provide high-speed Internet access. But supporters of state involvement say providers aren’t likely to build high-speed networks in rural or low-income areas where they may not make a profit from their investment. Internet access is more of a utility than a service, they argue, and the state should make sure all communities have equal access to it.
Reporter: Laura Leslie
Photographer: Bill Herrero
Web Editor: Matthew Burns