North Carolina commission strips town of its incorporated status for first time
(The Center Square) – The North Carolina Local Government Commission (LGC) has voted to dissolve the town of East Laurinburg, stripping the town of its incorporated municipality status as of June 30, 2022.
The LGC assumed control of the Scotland County town last month after a state audit found its former finance officer misused funds. The commission passed a resolution in April to repeal the town’s charter for failing to submit annual financial audit reports for four years.
Tuesday’s dissolution vote was the first time the LGC used its recently enacted authority to revoke local government charters. The North Carolina General Assembly passed legislation last summer giving the LGC the power to do so, and Gov. Roy Cooper signed the bill into law in August. The General Assembly could veto the LGC’s action.
“It is with deep regret that we must take this action, which we tried to avoid for many years by offering every assistance possible to East Laurinburg to correct numerous financial, budgetary and operational deficiencies,” said North Carolina Treasurer Dale Folwell, who chairs the LGC. “In the end, they did not fully avail themselves of our staff’s expertise or demonstrate the resolve to make the tough choices that were necessary to be a viable municipal government.”
October’s state audit report found the former finance officer, who was not named in the report, wrote a series of checks to pay for utilities at her residence and spent more than $8,000 on miscellaneous undocumented expenses, causing the town’s bank account to overdraft. East Laurinburg did not have funds available for operations as a result.
The audit said the finance officer misused more than $11,000 of the town’s $75,000 operational budget. The audit found from May 2017 through January 2018, the finance officer wrote 13 checks from the town’s bank account totaling $2,674 to pay utilities at her home. She signed the checks herself, and her mother, a commissioner, signed 11 of the checks.
The finance officer also spent $8,542 from the town’s bank account without providing supporting documentation, including four checks to herself, totaling $585 for additional time worked and $880 for supplies.
“I’ve been a motorcycle mechanic figuring out repair solutions for most of my life,” Folwell said. “But I have no tools in my tool kit to fix the problems in East Laurinburg.”
The LGC said East Laurinburg does not provide essential services to its residents, but it does operate streetlights and administers a contract for trash pickup. The commission said it is talking with Scotland County about assuming control of those services.
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