Is Golden LEAF Necessary?

Executive Summary

Why does Golden LEAF exist? This question is not poised in a legal context. Rather it is meant to discern whether the organization offers any unique benefits to the State of North Carolina.

Indeed, an examination of Golden LEAF’s grant making priorities and history suggests that the organization is not needed to effectively disburse its $732 million in assets (as of June 30, 2008) along with the $70 million in annual revenue it receives as part of the Master Settlement Agreement (MSA) resulting from a lawsuit filed against the major tobacco manufacturers.

In short, the tobacco settlement money could still be spent on the exact same programs as are currently funded by Golden LEAF, even if Golden LEAF didn’t exist.

It makes little sense for millions of the state’s dollars to be annually spent on operational costs for an organization headed by political cronies with no accountability to citizens. For the two fiscal years 2007 and 2008 alone, Golden LEAF spent a combined $9.3 million on administrative costs and capital outlays. That’s a sizeable amount for an organization that mostly duplicates efforts already addressed by numerous other means.

The chart below details three of Golden LEAF’s grant making “impact areas,” along with a list of other government funding efforts dedicated to those very same areas. And for more examples of Golden LEAF’s redundancy, click here for a spreadsheet showing how a majority of Golden LEAF’s 2008 grants were also funded by other entities.

The case for allowing Golden LEAF to continue to manage and disburse millions of the state’s dollars is not compelling. Dissolving Golden LEAF will enhance transparency, provide greater accountability over the state’s master settlement agreement funds and streamline government operations while eliminating an unnecessary and redundant organization. Doing so would demonstrate to North Carolina citizens that our state legislators are committed to becoming more responsible stewards of the state’s – and taxpayers – money.

Golden LEAF “Impact Areas”

Job Creation/Retention

N.C. Dep’t of Commerce partners with 7 economic development regional partners
Article 3J tax credits, film incentives offered to help create jobs
Five economic incentive grant/funding programs via Commerce
Appalachian Regional Commission offers grants to “increase job opportunities”
Two categories of Community Development Block Grants (CDBG) (disbursed by state commerce dep’t) are devoted to “job creation”
N.C. Rural Economic Development Center has three grant programs designed to help job creation

Infrastructure Improvements

Six different state funding entities active in funding water and wastewater infrastructure – plus five federal entities
Four grants/funding programs dedicated to improving public infrastructure via Dep’t of Commerce and Department of Transportation
Appalachian Regional Commission also offers grants to “develop and improve Appalachia’s infrastructure”
Three categories of CDBG are devoted to public infrastructure projects
e-NC Authority is a program funded by the state budget that expands “internet connectivity in underserved areas of the state”
N.C. Rural Economic Development Center features a grant program labeled the “Economic Infrastructure Program”

Workforce Preparedness

N.C. Department of Commerce (DOC) has 24 local area Workforce Development Boards serving all 100 counties
DOC has a Commission on Workforce Development whose purpose is to “oversee a comprehensive …system of approximately 49 workforce development programs in 8 state agencies.”
DOC also has a Division of Workforce Development
DOC also facilitates the Incumbent Workforce program that provides workforce training
The NC Dep’t of Labor’s Apprentice and Training Bureau offers a workforce training program
The N.C. Biotechnology Center features a number of “workforce development activities” – one of which was funded in part by Golden LEAF
The N.C. Community College system has at least three major workforce training programs as well as the Small Business Center Network that offers “specific training for individual business needs”

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