In a first, this small NC community might lose its right to be a town

The N.C. Local Government Commission recently recommended that the tiny Scotland County town of East Laurinburg cease to be a town, but the change could have only minimal effect for its roughly 300 residents.

That’s because the community that grew up around a now-defunct mill is considered a “paper town” — a local government that exists primarily on paper, according to Scotland County Manager Kevin Patterson. “They don’t provide significant amounts of services,” he said.

East Laurinburg got the attention of the Local Government Commission, which regulates financial matters, because it failed to submit an audit of the town’s finances for multiple years. The commission voted unanimously earlier this month to recommend legislation to revoke the town’s charter — eliminating the local property tax and putting the community into unincorporated Scotland County.

“It marks the first time the LGC has taken such action against a local government unit, and follows nearly 10 years of efforts to work with the Scotland County town of 281 residents to correct the problems,” the commission said in a news release announcing the move.

East Laurinburg is one of an increasing number of small towns that are facing punitive measures from the commission, due to missing audits and other financial mismanagement. At the same meeting, it voted to take over the finances of the Wayne County town of Pikeville.

East Laurinburg, however, faces a more drastic solution in part because there are fewer services to sort out. The town already gets water and sewer service from the much larger city of Laurinburg next door, and county sheriff’s deputies handle law enforcement instead of having a separate municipal police department.

According to Patterson, the town has only one employee, and the services funded by the property tax are limited to street lights, yard waste pick-up and maintenance of the town’s community center, which also serves as town hall.

If lawmakers vote to revoke East Laurinburg’s charter, “trash service will be the only real issue that will need to be significantly handled,” Patterson said. That’s currently done through a private contractor, with billing handled by Laurinburg as part of utility services.

The town’s House legislator, Rep. Garland Pierce, D-Scotland, says he’s not yet sure if he’ll file the de-chartering legislation the commission recommended. He says he was surprised by the move and had hoped the commission would be able to work through the financial problems with town leaders.

“I’m kind of taken aback that we find ourselves in this place,” he said. “I probably need to talk to the town one more time. Do they have a plan? Do they want to save the town? I haven’t heard any voices from the community about it.”

Sen. Tom McInnis, R-Richmond, also said he hadn’t yet had time to review the commission’s recommendation.

The NC Insider reached Mayor Marshall Stevens, who said he’s planning to resign due to health problems. He referred questions to Town Commissioner Gail Chavis, who he said will likely replace him. She did not respond to multiple voicemail messages.

Revoking a town’s charter isn’t a new concept. Centerville in Franklin County ceased to be a town in 2017, under legislation backed by its leaders who no longer wanted a property tax. The key question in Centerville was who would pay to keep the streetlights on — a question that East Laurinburg will also have to deal with.

Legislation to remove town charters was more common in the 1970s and ‘80s. Some were merged into a neighboring city: Guilford College, for example, became part of Greensboro.

Other de-chartering legislation gave residents a choice. In 1973, the town of Enochville in Rowan County voted to stop being a town after holding that status since 1877. Decades later though, the name “Enochville” still appears on schools, churches, businesses and roads in the community.

Maintaining a community’s identity is a key concern for struggling municipalities. That’s prompted State Treasurer Dale Folwell, who oversees the Local Government Commission, to propose that the legislature create a “historical charter” status in which a town continues to exist but without the power to levy property taxes or spend money.

So far that idea hasn’t become law, but it could be a consideration for East Laurinburg.

A decade or so ago, East Laurinburg considered whether to merge with its larger neighbor, Laurinburg, but residents opposed the idea because they didn’t want to be just another neighborhood in the county seat, according to Patterson.

A merger could still be an option to deal with the current problems, but Laurinburg leaders aren’t eager to make that happen. That’s because it would mean a net loss for Laurinburg’s budget; additional property tax revenue from East Laurinburg wouldn’t be enough to offset the cost of extra policing and other services, Patterson said.

On a map, East Laurinburg almost looks like a neighborhood within Laurinburg. It was incorporated as a mill town more than a century ago when Waverly Mills opened a large textile mill there.

The textile company sought that status to avoid getting annexed by Laurinburg (and its property taxes), while it paid the costs of government services. Residents of East Laurinburg only started paying property taxes once the mill shut down. The mill has since been demolished, and today the town consists mostly of two churches, a convenience store and modest homes.

Interest in serving on the town commission — and tackling its financial issues — seems to be waning: One of the current commissioners won her seat in 2019 with just five write-in votes. It’s a big shift from 2009, when five candidates filed for seats on the board and the town had a competitive race for mayor.

Since the Local Government Commission’s recommendation, Patterson said he hasn’t heard of any local leaders who oppose ending East Laurinburg’s status as a town.