Jenna Robinson’s latest Martin Center column explores questions surrounding public universities’ actions in competition with the private sector.

Late last year, NC State University purchased two small office buildings on Oberlin Road, near the university’s East campus, for the price of $3.1 million. Their location, situated between NC State’s historic bell tower and the thriving private, mixed-use community at Cameron Village, has considerable commercial value. If State finds new tenants for the buildings or razes them for commercial redevelopment, it is likely to reanimate a decades-old debate about whether public universities should be allowed to compete with private business.

For there is a law on the books that prohibits just such for-profit activity by North Carolina’s public universities. As originally envisioned, the 1929 Umstead Act would have made the decision an easy one; only activities that were related to the mission of a public university would have been permitted. The Act, which, broadly speaking, regulates “government in business,” is meant to keep the government—whose various entities do not pay state and local taxes—from competing with private individuals or businesses. North Carolina government agencies are specifically prohibited from leasing or subleasing space for the purpose of operating or providing businesses that engage in the sale of goods, the operation of restaurants, the rendering of services to the public, or the provision of transportation services in competition with private enterprise.