Nc Osbm Arp Business Innovation 2021
Summary
A section of an American Rescue Plan Budget Recommendation for North Carolina setting out proposed business and innovation investments, each with a statement of need, recommendation detail and expected impact. The hospitality recommendation invests $350 million, including $300,000,000 for the NC Hospitality Economic Loss Program (NC HELP) and $50,000,000 in Small Business Recovery Grants. The Small Business and HUB Resiliency recommendation provides $50 million for grants, second-stage growth assistance and business recovery counseling. The Sites Development recommendation provides $50 million for megasites, certified sites in distressed communities and green infrastructure sites. The section closes with health research items, including $15 million to the North Carolina Policy Collaboratory for research grants at Historically Minority-Serving Institutions.
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Hospitality Industry Business Assistance and Recovery Grants
Recommendation
Invests $350 million to promote economic recovery in the hardest-hit industries across the state
through two programs that target food services, accommodation, recreation and leisure, and personal
services businesses. These funds will help these vital small businesses survive the COVID-19 pandemic
and accelerate economic recovery in communities across the state.
Table 1: Allocation of Funds to Support Small Hospitality and Related Businesses
NC Hospitality Economic Loss Program (NC HELP) $ 300,000,000
Small Business Recovery Grants $ 50,000,000
Grand Total $ 350,000,000
Statement of Need
Small businesses in the leisure, hospitality, and personal services industries were among the hardest hit
by the COVID-19 pandemic. Many of these businesses shut down entirely during the early months of the
pandemic and faced limits on capacity and constrained consumer demand into early 2021.
• Consumers cut taxable spending at North Carolina restaurants, bars, and hotels/motels by an
estimated $5.05 billion between March 2020 and January 2021 compared to the same period
one year prior. 1
• Jobs at leisure and hospitality businesses fell by almost half between February and April 2020.
Even in March 2021, there were more than 80,000 fewer leisure and hospitality jobs than in
February 2020, accounting for more than half of net statewide job losses across all industries.
• Between 20% and 45% of North Carolina small businesses in food services, drinking places,
accommodation, leisure, and entertainment were closed or operating at severely reduced
capacity as of March 2021. 2
• A nationwide Yelp report from September 2020 showed more than 38,500 closures among
restaurants, bars, and nightlife businesses, more than half of which were permanent. There
were an additional 22,500 closures among beauty salons, spas, and fitness centers, of which
more than two in five were permanent. More than 3,500 YELP-listed businesses in North
Carolina were closed as of August 31, 2020. 3
Recommendation Detail
NC Hospitality Economic Loss Program (NC HELP)
• Provides $300 million in grants through the Department of Revenue (DOR) to help replace
taxable sales revenue at eligible businesses, including restaurants, bars, and hotels. The
application-based program would provide a grant equal to a specified percentage of the decline
in taxable sales. The specified percentage would be equal to $295 million divided by the total
reduction in taxable sales 4 among the pool of all eligible applicants. DOR will calculate the
1
OSBM analysis of NC Department of Revenue data.
2
Homebase and Opportunity Insights (Womply).
3
Yelp: Local Economic Impact Report. September 2020. https://www.yelpeconomicaverage.com/business-
closures-update-sep-2020
4
With an adjustment to account for applicants who receive the maximum allowable grant amount.
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specified percentage after receiving all grant applications. For example, if the total decline in
qualifying taxable sales among the grant applicants is $2.95 billion, the specified percentage
would equal 10%. This method ensures that all $295 million will be spent to help those in need.
o To qualify, restaurants and bars must have experienced at least a 15% reduction in
taxable sales from April to December 2020, and hotels must have experienced at least a
25% reduction in taxable sales in the same time period.
o DOR may use up to $5 million to administer the program.
Small Business Recovery Grants
• Provides $50 million for grants of up to $50,000 through the Department of Commerce to help
businesses that have fully or partially closed and to help new businesses start in business
locations that permanently closed during the pandemic.
o The first round of applications will target businesses seeking to open in existing or
former business locations. Eligible businesses include restaurants, bars, and other eating
and drinking establishments; traveler accommodations (hotels/motels); recreation
establishments (such as arcades, fitness centers, and bowling centers); personal services
businesses (such as salons, spas, and dry cleaners); and entertainment businesses and
attractions not eligible for the federal Shuttered Venue Operators Grant.
o The second round of applications, if funds remain after the close of the first round, will
target new businesses seeking to open in eligible business locations that closed
permanently during the COVID-19 pandemic.
Expected Impact
Accelerating economic recovery in eligible industries will provide employment opportunities for out-of-
work North Carolinians, avert small-business failures, and prevent blight caused by vacant business
locations. Expected impacts include:
• Distribute $295 million in financial support to more than 10,000 qualifying restaurants and bars
and more than 1,500 hotels and motels across North Carolina.
• Provide support to between 1,000 and 2,000 small businesses across the state, helping to retain
and create thousands of jobs.
• Prevent negative economic and social consequences associated with vacant storefronts, such as
reduced property values, elevated crime rates, and adverse health outcomes. 5
• Support job creation among hospitality, recreation, and personal services businesses.
5
Jorge Gonzalez-Hermoso and Jein Park. “Local Policies Can Protect Commercial Corridors as the Pandemic
Continues,” Urban Wire, Urban Institute, November 19, 2020. https://www.urban.org/urban-wire/local-policies-
can-protect-commercial-corridors-pandemic-continues
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Small Business and HUB Resiliency
Recommendation
Provides $50 million to sustain small businesses and Historically Underutilized Businesses (HUBs) that
were adversely impacted by COVID-19. Of these funds, $40 million will be provided to the Department
of Commerce (DOC) to administer a grant program in partnership with The Institute, the Carolina Small
Business Development Fund (CSBDF), and the Economic Development Partnership of North Carolina
(EDPNC) Small Business Advisors, to help businesses with fewer than 50 employees and less than $5
million in annual revenue; $4 million to EDPNC to develop an initiative that fosters businesses in their
second stage of growth; and $6 million between the Small Business and Technology Development
Center (SBTDC) and the Small Business Center Network (SBCN) for business recovery counseling.
Table 1: Allocation of Funds to Ensure Small Business and HUB Resiliency
Small Business and HUB Resiliency Grants $ 40,000,000
Small Business and HUB Resiliency Grants $ 30,000,000
Resiliency Grants Management $ 3,200,000
The Institute and CSBF Program Costs $ 6,800,000
Second-Stage Growth Assistance $ 4,000,000
EDPNC Small Business Advisors $ 3,000,000
EDPNC Staff Capacity and Marketing $1,000,000
Business Recovery Counseling $ 6,000,000
Small Business and Technology Development Center $ 3,000,000
Small Business Center Network $ 3,000,000
Grand Total $ 50,000,000
Statement of Need
Supporting small business and HUB growth is important to North Carolina’s economic and social
pandemic recovery.
• North Carolina’s small business revenue decreased by 26.7% from January 2020 to March 2021. 1
• While assistance was available, many small businesses did not receive it. Of small businesses
surveyed in September 2020, 70% of those who applied for grant relief funds received no
assistance. 2
• National pandemic recovery efforts so far have provided less assistance to women-owned and
minority-owned businesses across the country. From April 2020 to January 2021, women-owned
businesses received lower average Paycheck Protection Program (PPP) loans than male-owned
businesses. 3 During the initial loan period, minority-owned businesses received only 17% of
loans, even though they made up 31% of total businesses. 4
1
Opportunity Insights. “Percent Change in Small Business Revenue.”
2
The Institute. “Impact of COVID-19 on NC Small Businesses, September 2020.”
3
The Institute. “Disparities in PPP Lending by Gender.”
4
The Institute. “Disparities in PPP Lending by Race.”
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Recommendation Detail
Small Business and HUB Resiliency Grants
• Provides $40 million for Small Business and HUB resiliency grants. DOC, in partnership with The
Institute, CSBDF, and EDPNC Small Business Advisors, will build on the successful RETOOLNC
program and provide approved applicants with resources, training, and grants to cover
operating expenses incurred due to COVID-19. The program’s efforts will be coordinated by
DOC, and funds will be distributed by the department on a semi-annual basis, based on need.
The program’s key components are as follows:
• DOC will fund grants and marketing to promote Small Business and HUB Resiliency Grants.
• EDPNC Small Business Advisors will proactively reach out to rural, hospitality, and HUBs to
promote the grants and technical assistance services that CSBDF and The Institute will provide.
• CSBDF and The Institute will oversee grant administration and provide technical support
services. Technical support services will include an assessment tool for participating businesses
to identify needed training and support to help those businesses meet short- and long-term
goals for success. CSBDF and The Institute will provide business training, match-make
entrepreneurs and small businesses with business mentors, and offer incubation space, as well
as provide other support services.
The $40 million funding will be allocated as follows:
• $30 million for grants of up to $50,000 to support working capital to address capacity building
and sustainability. Allowable expenses may include collateral enhancements, specialized training
or certification expenses, technology and equipment purchases, plant investments, and funds to
establish business incubators at nonprofits, such as the National Institute for Economic
Development.
• $3.2 million to cover the programmatic expenses to CSBDF and The Institute for operating the
grant program.
• $6.8 million split evenly between The Institute and CSBDF to develop a holistic small business
support program, which will include:
o Gathering baseline assessments data to better understand small business preparedness
and recovery and resilience needs, which may include the need for financial infusions;
o Launching the Small Business Resilience University to provide a holistic suite of training,
technical assistance, capital, networks to brands and consumers, and supply chain
connectivity;
o Creating a dashboard to track positive movement on key baseline assessment indicators
that measure both recovery and resilience, such as jobs created or sustained, new
contracts and financing secured, revenue generation, and investments in plant and
equipment;
o Connecting to regional planning efforts of councils of government, local development
districts, HMSIs and community colleges, and corporate supplier diversity efforts; and
o Recruiting HUBs and rural small businesses to participate in the program through EDPNC
Small Business Advisors.
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Second-Stage Growth Assistance
• Provides $4 million to EDPNC to focus on growing “second-stage growth firms” that have
demonstrated proof of concept, revenues, and management ability but lack certain in-house
expertise, which limits their growth trajectory. EDPNC’s Small Business Advisors will identify
second-stage firms and resources that will help them grow.
• Provides $1 million to EDPNC for staff capacity and marketing needs, including $200,000 for
three Small Business Advisors to conduct proactive campaigns for Second-Stage Growth
Assistance and $800,000 for a marketing campaign to promote small business resources.
Business Recovery Counseling
Funds $6 million for services critical to sustaining and growing a business, including business planning,
strategy development and implementation, financing and financial understanding, marketing, and
performance improvement.
• Provides $3 million to go to the Business Resiliency and Recovery Program at the SBTDC to
advise small to mid-sized businesses, focusing on those with at least 10 or more employees.
North Carolina State University would receive the grant funds on behalf of the SBTDC, with a
limit of up to 3% facilities and administrative costs for the university.
• Provides $3 million in counseling support at SBCN for small businesses with less than 100
employees in both rural and urban communities. The SBCN also works with many underserved
populations and is positioned to help businesses with fewer than 10 employees.
Expected Impact
This proposal will support small business growth. Expected impacts include:
• Grants to small businesses and HUBs will serve about 750 businesses in building capacity for
sustainable operations.
• The small business support program will engage at least 1,000 small businesses with fewer than
50 employees.
• The RETOOLNC program, which is similar to the program recommended, highlighted the need
for this support, disbursing $13 million in grant funds to more than 350 applicants across 48
counties. 5 More funds would provide assistance to new applicants and for the more than 1,300
applicants who did not get funded.
• Second-stage Growth Assistance is expected to support the growth of 200 small businesses.
• Small Business and HUB Resiliency Grants will help underserved business communities in all 100
counties.
5
The Institute. “RETOOLNC.” https://theinstitutenc.org/retoolnc/.
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Sites Development
Recommendation
Provides $50 million to cultivate sites and related infrastructure to attract businesses to North Carolina.
Of these funds, $20 million will support the development of megasites in communities
disproportionately impacted by the COVID-19 pandemic, $10 million will be directed to certify and
market sites in distressed communities, and $20 million will strengthen green infrastructure sites
available statewide.
Table 1: Allocation of Funds to Site Development
Megasite Development Grants $ 20,000,000
Certified Sites in Distressed Communities $ 10,000,000
Competitive Grants for Local Government $ 8,000,000
Marketing for Certified Sites $ 2,000,000
Green Infrastructure Site Certification $ 20,000,000
Competitive Grants for Local Government $ 5,000,000
NC Ports – Green Infrastructure $ 15,000,000
Grand Total $ 50,000,000
Statement of Need
Communities across our state, particularly rural and distressed communities, must have competitive,
high-potential properties with desired infrastructure to attract companies. Competitive properties
create significant economic opportunities to help local, regional, and state economies thrive.
• Businesses seek out prepared sites for an expedited process to opening new facilities. 1
• The COVID-19 crisis has exacerbated rural communities’ existing challenges with significant
impacts on local government revenues and businesses. For example, Tier 1 and 2 counties
suffered a larger share of the state’s job losses (60%) between February 2020 and March 2021
than their pre-pandemic share of jobs (56%). 2
• Currently there are at least 10 megasites and 11 certified sites in Tier 1 or 2 counties. Sheetz
cited the excellent location when selecting a certified site in Alamance County for its distribution
and production center in 2012. 3
• None of the currently certified sites are used to meet green economy needs. However, two
tenants at Ferncliff in Henderson County, Sierra Nevada Brewing Company and GF Linamar,
pursued LEED certification for their facilities. 4 Businesses interested in sustainability and
environmental stewardship would be more likely to select locations that provide the necessary
infrastructure and align with their vision for preserving the environment.
• North Carolina can build upon the strong green energy sector already in place. The state has the
highest concentration of smart grid companies in the world and ranks third nationally for
1
Area Development. “How Certified Sites Can Expedite the Site Selection Process for Expanding Companies.”
2
Department of Commerce. “Current Employment Statistics (CES).”
3
Triad Business Journal. “Sheetz Chooses Burlington for Distribution Center, Creating 254 Jobs.”
4
Henderson County Partnership for Economic Development. “America’s Most Beautiful Industrial Park: Ferncliff.”
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installed solar capacity. Almost 1,000 green energy companies currently generate over $6.4
billion in annual revenue within the state. 5
Recommendation Detail
Megasite Development Grants: $20M
• Funds a $20 million competitive grant program for local governments to develop megasites,
defined as sites that are 1,000 contiguous acres or larger, in communities disproportionately
impacted by the COVID-19 pandemic. These sites must have the potential to attract major
employers that can bolster local, regional, and state economies through new jobs and capital
investment.
o Examples of currently available sites eligible for the program include, but are not limited
to, the Greensboro-Randolph Megasite, Person County Mega Park, Chatham-Siler City
Advanced Manufacturing Site, International Logistics Park of North Carolina between
Brunswick and Columbus counties, and Kingsboro Business Park in Edgecombe County.
o Grant funds may also support improvements to public infrastructure for, and on-site
preparation of, the megasite, including clearing, grading, or other related expenses.
Certified Sites in Distressed Communities: $10M
• Provides $7 million for competitive grants to local governments to identify, evaluate, and
complete the certification process for competitive sites in distressed communities. Priority will
be given to sites that have already completed an initial evaluation process with a utility or site
selection consultant. The program will also assist local government units in funding
improvements to public infrastructure, such as publicly-owned water, gas, and sewer systems,
transportation infrastructure, electrical utility lines, or installation of green infrastructure that
improves resilience to the effects of climate change.
• Utilizes $3 million to develop a statewide program to improve the competitiveness and
marketability of all certified sites. These marketing funds may also be used to demonstrate an
individual property’s promise to prospective employers and to match local government funds to
market certified sites.
Green Infrastructure Site Certification: $20M
• Provides $5 million for competitive grants to local governments to support green infrastructure
in site development and to increase certified sites available for prospective green infrastructure
investment.
• Supports the NC Ports with $15 million for green infrastructure development to help attract
businesses considering locating at, or needing access to, the state’s ports.
• Provides 3% of funds for each grant program for administration.
Expected Impact
Sites Development will lead to increased economic activity in distressed and struggling communities and
help grow the green economy in North Carolina.
5
NC Department of Environmental Quality. “North Carolina Clean Energy Plan: Transitioning to a 21st Century
Electricity System.”
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• Megasite development grants will support improvements at least five current megasites and
help create up to five more megasites to attract major employers to distressed communities.
• The grants for certified sites in distressed communities are expected to help 10 new sites
become certified, making them more attractive to prospective businesses and/or fit local
community economic development strategies.
• Marketing funds for megasites and certified sites will successfully attract more than 10
employers to these locations.
• At least five major employers will locate at the state’s certified green infrastructure sites and
ports.
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Strategic Industry Development
Recommendation
Provides $50 million to develop and prepare North Carolinian communities for potential employers in
industries that serve a public health need, suffered during the COVID-19 pandemic, or are green
economy businesses. Grants will enable local governments to invest in public infrastructure, particularly
green infrastructure, and workforce pipeline programs for specific economic development projects.
Statement of Need
• Businesses interested in locating in North Carolina seek both the physical resources to build and
maintain a profitable facility and the talent pipelines to maintain long-term success. Locations
lacking these crucial components garner less interest.
• Investments in public infrastructure have helped North Carolina attract and support businesses.
Since 2006, the One North Carolina Small Business Program (OneNC), has helped 275 small
businesses in 25 counties create and maintain more than 900 jobs and leverage more than $500
million in funding from other sources. The program has also enabled more than 120
collaborations between small businesses and universities. 1
• Discretionary cash-grant programs like OneNC allow the state to respond quickly to the needs of
competitive job-creation projects.
• North Carolina had 194,000 fewer jobs in January 2021 than in February 2020, and some
industries have been disproportionately affected. 2 For example, the manufacturing sector lost
48,000 jobs between March and April 2020. 3
Recommendation Detail
• Provides $50 million to assist local governments and their partners attract potential employers
through grants for public infrastructure and targeted workforce development programming.
• A commitment of resources will enhance the recruitment of potential employers to relocate or
expand their facilities in North Carolina, which include but are not limited to:
o Structural repairs, improvements, or renovations of existing buildings;
o Installation or purchase of equipment;
o Construction of or improvements to water, sewer, gas or electric utility distribution
lines, or associated equipment for new and existing buildings;
o Funds may also support targeted programming with community colleges, local
workforce development boards, and public and private universities that are central to
providing the talent pipeline that targeted businesses need.
• The program will accept applications from local governments in discussions with businesses
involved in industries that address a public health need, industries that have incurred negative
impacts due to COVID-19, and clean economy businesses that address climate change.
• Uses 3% of funds for administration.
1
NC Department of Commerce, “One North Carolina Small Business Program.”
2
US Bureau of Labor Statistics, NC Department of Commerce (Current Employment Statistics)
3
NC Department of Commerce. “A Closer Look at NC’s Pandemic Job Losses.”
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Expected Impact
These investments will build capacity and infrastructure for businesses in targeted industries to locate in
North Carolina and to develop the talent pipeline necessary to retain them.
• Similar to OneNC, this program will support at least five local governments, improving both
infrastructure and workforce readiness in North Carolina communities.
• Businesses in eligible industries will have more incentives to locate their facilities in the state.
• Health supplies, jobs, and capital investment that these employers provide will help the state
recover from the COVID-19 pandemic.
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Motorsports and Outdoor Event Opportunities
Recommendation
Provides $45 million to expand motorsports and outdoor event opportunities across the state. Of these
funds, $30 million will be allocated for infrastructure and repairs needed for The Rock Speedway and
Entertainment Complex, the North Wilkesboro Speedway, and the Charlotte Motor Speedway. The
Department of Commerce (DOC) will receive $10 million for a grant program for other motorsport
facilities. The Department of Natural and Cultural Resources (DNCR) will receive $5 million to develop,
connect, and market new and existing natural and cultural tourism trails, including a Motorsports and
Moonshine Heritage Trail.
Table 1: Allocation of Funds to Motorsports and Outdoor Event Opportunities
Improvements to the State’s Motor Speedways $ 30,000,000
The Rock Speedway and Entertainment Complex $ 10,000,000
North Wilkesboro Speedway $ 10,000,000
Charlotte Motor Speedway $ 10,000,000
Motorsports and Outdoor Event Opportunities Grants $ 10,000,000
Natural and Cultural Tourism Trails $ 5,000,000
Grand Total $ 45,000,000
Statement of Need
North Carolina has been a motorsport industry and tourism destination, but the COVID-19 pandemic has
hampered motorsports and the communities that host them.
• North Carolina is the birthplace of motorsports and NASCAR, which hosted the first NASCAR Cup
Series race at the Charlotte fairgrounds in 1949. 1 North Carolina is home to NASCAR’s
headquarters and Hall of Fame, and 90% of teams are based in North Carolina.
• Motorsports is a leading tourism generator in the state, representing a $5 billion industry. 2
• The Charlotte Motor Speedway alone brought 1.1 million visitors to its events in 2019, and pre-
pandemic, the Speedway generated more than $25 million in state and local tax revenue
annually. 3 However, between March and September 2020, Cabarrus County, home of the
Charlotte Motor Speedway, lost over $24 million in hotel revenue, equating to a loss of
$540,000 in local taxes. 4
1
NASCAR. “NASCAR History.”
2
Belk College of Business Administration, University of North Carolina at Charlotte. “The Economic Impacts of the
Motorsports Industry on the North Carolina Economy.”
3
Charlotte Motor Speedway proposal to NC Office of State Budget and Management.
4
Cabarrus County Convention and Visitors Bureau. “County Spending by Domestic Visitors Increases to More than
$478 Million.”
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• Hospitality executives nationwide expect leisure travel to occur closer to home because of the
COVID-19 pandemic, which aligns with surveys of North Carolinians that indicate a desire to
travel in-state and attend outdoor events. 5,6
• North Carolina has nearly 40 active tracks, such as drag strips, kart tracks, oval tracks, and road
courses, that could benefit from refurbishment and be used for tourism and events.
Recommendation Detail
Improvements to the State’s Motor Speedways
• Invests $10 million in each of the home counties of The Rock Speedway and Entertainment
Complex, the North Wilkesboro Speedway, and the Charlotte Motor Speedway: Richmond
County, Wilkes County, and Cabarrus County, respectively. A non-state match of at least $1 for
every $4 from the state is required to receive funding. County governments will partner with
venues to fund needed infrastructure, including, but not limited to, the following:
o Water and wastewater extensions
o Pedestrian walkway enhancements
o Speedway repaving
o Upgrades to facilities and dragways (if applicable)
o Bathroom fixtures and maintenance
o Grandstand repair
o Erosion control
Motorsports and Outdoor Event Opportunities Grants
• Provides $10 million to DOC to partner with the North Carolina Motorsports Association to
administer a grant program that provides flexible grants of up to $500,000 for local
governments to work with racing venues to enhance amenities and increase opportunities for
events. Motorsport venues can provide ideal venues for outdoor events as they are often
considered “complete sites,” meaning venues with parking, fencing, power, and water. Venue
renovation funding will benefit not only the racetrack and festival grounds but major area
employers as well. DOC may use up to 3% of funds for program and grant administration.
Natural and Cultural Tourism Trails
• Funds $5 million to DNCR to develop, connect, and market new and existing natural and cultural
tourism trails across the state, including a Motorsports and Moonshine Heritage Trail. This trail
will highlight the founding and history of both motorsports racing and moonshine production in
North Carolina. Past experience suggests that even a small state investment in these trails would
have a substantial impact on tourism.
Expected Impact
These investments in motorsports and natural and cultural tourism trails are expected to have the
following impacts:
• The Rock Speedway and Entertainment Complex, the North Wilkesboro Speedway, and the
Charlotte Motor Speedway will host at least five new outdoor events in the next three years.
5
Amadeus. “Hospitality Recovery by the Numbers.”
6
MMGY Global Travel Intelligence. “North Carolina Resident Sentiment: Impact of COVID-19.”
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• Local hotels and hospitality businesses surrounding the supported tracks are expected to
directly benefit from event tourism.
• The program can provide a minimum of 20 grants to transform underutilized racing assets.
• Marketing the state’s natural and cultural tourism trails is expected to drive in- and out-of-state
tourism across North Carolina.
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Recovery Grants for Arts, History, Libraries, Science, and Film
Recommendation
Provides $60 million to ensure the continuation of arts, history, and science organizations, support
libraries, and invest in the state’s burgeoning film industry. Of these funds, $50 million will be provided
to the Department of Natural and Cultural Resources (DNCR) to support arts, cultural and scientific
organizations and $10 million to the Department of Commerce to bolster the film industry through
investment in the state’s film infrastructure.
Table 1: Allocation of Funds to Support Arts, History, Libraries, Science,
and Film
Supporting Arts, Culture, and Science $ 50,000,000
Arts $ 20,000,000
History $ 8,500,000
Science $ 8,500,000
Libraries $ 8,500,000
NC Symphony Society $ 2,250,000
Museum of Art $ 2,250,000
Bolstering the Film Industry $10,000,000
Grand Total $ 60,000,000
Statement of Need
The creative economy is important to the economic and social recovery of North Carolina.
• The creative economy generates over $2.1 billion in economic activity, employs over 72,000 full-
time equivalent jobs, and generates $201.5 million in local and state government revenue. 1
• Due to the pandemic, North Carolina’s creative industries lost over 81,000 jobs and
approximately $3.4 billion in sales between April and July 2020. 2
• Many, if not all, cultural organizations, including arts, science, and history organizations as well
as libraries, have been shuttered or operated at a limited capacity since March 2020.
• The Arts, Entertainment, and Recreation nonprofit sector is expected to take nearly 2.5 years to
recover from the pandemic. 3
• The estimated number of US films that entered production in 2020 was a mere 447, a 45%
decrease relative to 2019. Of these films, 101 had an estimated budget over $15 million, a 43%
decline compared to 2019. 4 For scripted series, production completely shut down in March 2020
and did not resume for several months. 5 Despite the decline in production, the pipeline and
1
Americans for the Arts. “Arts & Economic Prosperity 5”
2
Brookings Institution. “Lost Arts: Measuring COVID-19’s devastating impact on America’s creative economy.”
3
Center for Civil Society Studies. “COVID-19 JOBS UPDATE, JANUARY 2021: Nonprofit Jobs Still Down by Nearly
960,000 as of January, Time to Full Recovery Increases to 2 Years”
4
Motion Picture Association. “2020 THEME Report.”
5
Shaw, Lucas, Smith, Gerry, and Gilblom, Kelly. Bloomberg News. “Networks Are Prepping for the Craziest Fall
Season in the History of Broadcast TV.”
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potential for the film industry in North Carolina is strong, with more direct in-state spending by
productions though February 2021 than any annual spend since 2014.
Recommendation Detail
Supporting Arts, Culture, and Science Organizations
• Provides $45.5 million to DNCR for “Recovery Grants” grants to revive arts, science, history, and
library resources adversely affected by the pandemic. The grants will help address financial
hardships, jump start programing, ensure events and facilities are safe for the public, and
guarantee access to the resources with public Wi-Fi and enhanced educational content.
o DNCR estimates that there are over 696 arts organizations, 216 science organizations,
306 history organizations, and 84 public library systems adversely impacted by the
pandemic that would be eligible for Restart grants.
o While federal Shuttered Venue grant funds might be available to some of these
organizations, many will not qualify for that assistance.
o DNCR will administer the grants on a competitive basis while ensuring funds reach all
parts of the state. Grants would not require a match. Up to 2% of these funds may be
used for administration, including temporary positions.
• Provides $2.25 million for the North Carolina Symphony Society for its educational programs and
a concert series in the western part of the state that builds on existing partnerships with
Appalachian State and Western Carolina universities and the Eastern Band of the Cherokee
Nation. The Symphony Society saw significant revenue decline due to the pandemic.
• Provides $2.25 million in the Museum of Art Foundation to support programming such as
concerts and community art fairs featuring local artisans and to ensure financial sustainability of
the Foundation, which experienced substantial revenue loss due to the pandemic.
Bolstering the Film Industry
• Invests $10 million to support the state’s film industry, including investments in film
infrastructure and Film Office operations. Investing in the state’s film infrastructure includes
both physical infrastructure (sound stages, studios) and workforce programs, leveraging
programs at community colleges and universities across the state. The Film Office notes
shortages of both available space and workforce as significant barriers to industry growth.
Expected Impact
This proposal will support the state’s creative economy, which, in turn, supports thriving communities.
Expected impacts include:
• Positively impacting over 1,000 organizations, supporting entities in all 100 counties.
• Ensuring all North Carolinians have access to the important resources and experiences that
libraries and scientific, historical, and arts organizations provide and that this important sector
of the state’s economy survives the COVID-19 pandemic.
• Addressing infrastructure and workforce shortages in the film industry through programs with at
least three community colleges and universities.
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UNC System Health Research Innovation
Recommendation
Provides a significant investment in advancing innovative research in health sciences across the UNC
system. Includes $50 million for the Rapidly Emerging Antiviral Drug Development Initiative (READDI) at
the University of North Carolina at Chapel Hill (UNC-CH) to advance development of therapeutics for
COVID-19 and other viruses that pose a pandemic threat. Another $10 million is provided to Winston-
Salem State University’s Center for Excellence for Elimination of Health Disparities for research and
infrastructure. Also includes $15 million for the NC Policy Collaboratory to establish a research grant
program for Historically Minority-Serving Institutions (HMSIs).
Statement of Need
The pandemic has highlighted limitations of the existing research system to adequately prepare and
respond to emerging viral threats.
• Novel viruses are emerging more frequently and the response to COVID-19 has demonstrated
multiple system weaknesses that hindered the country’s ability to rapidly respond.
• University research is critical due to a lack of incentive for the pharmaceutical industry and
others to invest in products with no obvious market. University-based research and
development is uniquely able to assist with its project-based research and point solutions.
Pandemic preparedness requires re-engineering antiviral therapeutic development and delivery
by working across sectors.
• Multiple new viruses have emerged in the 21st century to cause widespread viral outbreaks,
epidemics, and pandemics, posing a serious threat to human health, the economy, and our
national security. No treatments or vaccines exist for the majority of these viruses, leaving the
state and nation unprepared for when a virus emerges. 1
• The COVID-19 pandemic has highlighted disparities in health equity as COVID-19 has unequally
affected racial and ethnic groups, putting them more at risk of getting sick and becoming
seriously ill or dying from COVID-19. 2
Recommendation Detail
Rapidly Emerging Antiviral Drug Development Initiative (READDI)
• Provides $50 million for READDI, a nonprofit public-private partnership based at UNC-CH.
READDI scientists are world leaders in COVID-19 research and have played critical roles in the
development of existing therapeutics and vaccines, leading to UNC-CH’s recognition as the
highest ranked COVID-19 research university in the nation.
• Funds will enable READDI to accelerate new antiviral drug development, advance existing assets,
and expedite availability of treatment for COVID-19, as well as other viruses that pose future
pandemic threats.
1
Nature Medicine. “Developing therapeutic approaches for twenty-first-century emerging infectious viral
diseases.”
2
Centers for Disease Control (CDC). “COVID-19 Racial and Ethnic Disparities.”
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• The READDI Workforce Development Initiative will support the development of a diverse
workforce trained in drug discovery and development in partnership with North Carolina
community colleges and other UNC-system schools.
• As a highly visible start-up headquartered in North Carolina, READDI will stimulate economic
development and provide global recognition for excellence in pandemic preparedness. A
substantial state investment is critical to securing federal research investments that could be in
the hundreds of millions of dollars.
Center of Excellence for Elimination of Health Disparities (CEEHD)
• Provides $10 million for the CEEHD at Winston-Salem State University. CEEHD’s mission is to
promote equity and social justice in health care delivery, treatment, and outcomes by leading
collaborative efforts to generate and disseminate evidence-based solutions, and to educate
future leaders who incorporate equity and social justice in their professional practice.
• Funds will enable CEEHD to provide additional services to underserved communities, including
enhanced learning opportunities for health sciences students, and collaborative research
opportunities aimed at improving minority health and reducing health disparities.
• Expanded services will include telehealth, behavioral health, and a new child wellness program.
The primary goals of the child wellness program are to improve the quality of life for children in
underserved minority communities and to expand experiential learning opportunities related to
child health and wellness for nursing and allied health students.
• In addition to health equity research initiatives, a portion of funds may be used for renovation
and infrastructure to establish a physical location for the Center.
Expand Research Capacity at Historically Minority Serving Institutions
• Provides $15 million to the North Carolina Policy Collaboratory to expand research capabilities
in health-related areas through a research grant program for each of the following constituent
institutions identified as Historically Minority-Serving Institutions (HMSIs): Elizabeth City State
University, Fayetteville State University, North Carolina Agricultural and Technical State
University, North Carolina Central University, the University of North Carolina at Pembroke, and
Winston-Salem State University.
• Each institution will receive one or more research grants in an amount of at least one million
dollars. Funds may be used to purchase needed equipment, upgrade classroom and laboratory
space, and for items that will enhance their research and innovation efforts.
Expected Impact
These investments in innovative health sciences research are expected to have the following impacts:
• Ensure the United States is better prepared when the next virus emerges by developing
effective antiviral therapies, designing clinical trials, and establishing manufacturing and
distribution plans.
• Support READDI’s goal to develop five new broad spectrum antiviral drugs effective against
entire families of pandemic viruses in the next five years.
• Advance evidence-based solutions for eliminating health disparities through health equity
research and community engagement and outreach.
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• Provide additional access to health services for underserved populations and expand
opportunity for experiential learning for health science students.
• Increase research activity based in North Carolina, encouraging the development of a diverse
STEM-focused workforce and bringing high-paying research jobs.
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