County and Municipal Government in North Carolina, Second Edition, 2014 (eBook)
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Preview Chapter One: An Overview of Local Government
This reference book on North Carolina county and municipal government provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This book describes the legal framework and common administrative practices that are currently in use and explains what counties and cities in North Carolina do, and how they do it.
County and Municipal Government in North Carolina is designed to meet the needs of elected and appointed county and city board members and the employees who, on a day-to-day basis, carry out the functions mandated and authorized for North Carolina local governments. It will also appeal to citizens, civic leaders, high school and college students, state employees, legislators, members of the media, and any others who need basic information about the legal authority and responsibilities of North Carolina counties and cities.
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County and Municipal Government in North Carolina
The Primacy of State Government / 4
The Current System of Local Government / 5
County and City Governments / 5
Geographic Extent / 6
Authorized Activities / 7
Mandated Activities / 7
Governmental Structure / 7
Partisan versus Nonpartisan / 8
Other Types of Local Governments / 8
School Administrative Units / 8
Special Districts and Authorities / 8
Townships / 8
A Brief History of Local Government in North Carolina / 9
Colonial Times through the Civil War / 9
Counties / 9
Cities / 9
Local Government from 1868 until 1900 / 9
Cities and Counties in the Twentieth and
Early Twenty-First Centuries / 10
From 1900 through World War II / 10
1945 to the Present / 10
North Carolina Local Government in the National Context / 11
Summary / 13
Additional Resources / 13
About the Author / 14
County and Municipal Government in North Carolina
Municipal Incorporation / 15
Repealing City Charters and Dissolving Counties / 17
Annexation / 17
Overview of Current Annexation Methods / 18
Voluntary Annexation of Contiguous Areas / 18
Voluntary Annexation of Noncontiguous (Satellite) Areas / 19
Voluntary Annexation of High Poverty
and Distressed Areas / 20
Involuntary Annexation / 20
Annexation by Legislative Act / 22
The Effect of Annexation on Existing Public Services / 23
Contracts with Fire Departments / 23
Fire Department Debt / 23
Contracts with Solid Waste Collectors / 23
Taxation of Newly Annexed Property / 24
Annexation Disputes between Cities / 24
De-annexation / 24
City–County Consolidation / 25
The History of City–County Consolidation / 25
Advantages and Disadvantages of City–
County Consolidation / 25
Additional Resources / 26
About the Author / 26
County and Municipal Government in North Carolina
Background / 28
Introduction / 28
Units of Government in North Carolina / 28
Counties / 28
Cities / 28
Generally / 28
Means of Organizing / 29
Organizing North Carolina Cities—By the Numbers / 29
County and City Governing Boards in North Carolina / 29
Generally / 29
Size of Board / 30
Length of Members’ Terms / 30
Election at Large or by District / 30
Election on a Partisan or Nonpartisan Basis / 30
Designation and Composition / 30
Presiding Officers on Governing Boards / 31
The Chair of the Board of Commissioners / 31
The Mayor / 31
Common Expectations of Board Chairs and Mayors / 32
Responsibilities of the Governing Board / 33
Statutory Duties—County Board of Commissioners / 33
Statutory Duties—City Council / 35
Vacancies on Governing Boards / 37
Counties / 37
Cities / 38
Organizing the Supervision of Officers and
Employees in Mayor–Council Cities / 38
Best Practices for County and City Governing Boards / 39
Exercising Caution in Speaking for the Governing Board / 42
Role of the Manager in North Carolina Local Governments / 42
Use of an Administrator in Mayor–Council Cities / 42
Procedures for Adopting a County–Manager
or Council–Manager Plan / 42
Adopting the County–Manager Form of Government / 43
Adopting the Council–Manager Form of Government / 43
Advantages and Disadvantages of the Board of Commissioner
and Mayor–Council Forms of Government / 45
Procedures for Changing the Governing
Board’s Structure / 45
County Board / 45
City Board / 45
Additional Resources / 46
About the Author / 46
Appendix 3.1A Summary Figures on the Structures, Forms
of Governing Boards of North Carolina Cities / 47
Appendix 3.1B Summary Figures on The Mode, Type of
Election of Governing Boards of North Carolina Cities / 48
Appendix 3.2A Numbers, Terms of North Carolina
Boards of County Commissioners / 49
Appendix 3.2B Distribution of North Carolina County
Commissioners by Mode of Election / 50
Appendix 3.3 2014 Municipal Forms of
Government in North Carolina / 51
County and Municipal Government in North Carolina
Council–Manager Form of Government
under North Carolina Law / 54
The County Manager / 54
Hiring, Firing, and Disciplinary Powers / 54
Administrative Authority / 54
Duties Related to Governing Body Meetings / 55
Oversight Regarding Proper Execution of
Orders, Ordinances, etc. / 55
Financial Duties / 55
Reports and Miscellaneous Duties / 55
The City Manager / 56
Hiring and Firing Powers / 56
Administrative Authority / 56
Miscellaneous Duties / 57
Origins and Reasons for the Growth of the
Council–Manager Form / 57
History—North Carolina / 57
History—Generally / 58
ICMA Recognition / 59
Roles and Responsibilities of the Manager / 59
Basics of the Council–Manager Plan / 59
Realities of the Council–Manager Plan’s Implementation / 59
Concept of Governance / 61
ICMA Code of Ethics / 62
Roles and Relationships in Policy and Administration / 63
Dichotomy Theory / 63
Dichotomy-Duality Model / 63
Common Expectations among the Governing Body,
the Chair or Mayor, and the Manager / 65
Expectation 1: The Manager Is an
Organization Capacity-Builder / 66
Expectation 2: The Manager Is a Valued
Advisor to the Governing Body / 66
Expectation 3: The Governing Body and the Manager
Jointly Strive for Good Service to Citizens / 67
Expectation 4: Elected Officials’ Relationships with
Employees Are Carefully Managed / 67
Expectation 5: The Governing Body Acts as a
Body and Is Dealt with as a Body / 68
Expectation 6: The Manager and Members of the Governing
Body Give One Another a Chance to Prove Themselves / 69
Expectation 7: The Manager and the Governing
Body Freely Give and Seek Feedback / 69
Expectation 8: The Manager and the Governing Body Work
Together to Develop a Highly Effective Governing Body / 70
Tips for Ensuring Peak Performance of Governing Bodies / 70
Searching for an Effective Manager / 71
Evaluating the Manager—And the Governing Body / 73
Generally / 73
Clearly Set Expectations / 73
Evaluation Process for Managers / 74
Evaluating the Governing Body / 75
Conclusion / 75
Additional Resources / 75
Publications / 75
Organizations / 75
About the Author / 76
County and Municipal Government in North Carolina
Defining the General Ordinance Authority of
Counties and Cities in North Carolina / 78
Sources of the General Ordinance Authority / 78
Scope of the General Ordinance Authority / 79
Judicial Approaches to Local Government Power / 79
Impact of King v. Town of Chapel Hill on the
General Ordinance Authority / 81
Other Provisions in the Police Power Statutes / 82
Exercising General Ordinance Authority / 83
Territorial Limits of General Ordinance Authority / 84
Preemption of Local Ordinances / 84
Ordinance Enforcement / 85
Criminal Actions / 86
Civil Actions / 86
Civil Penalties / 86
Equitable Remedies / 87
Public Nuisance Abatement / 87
Adoption and Filing of Local Ordinances / 88
Adoption of Ordinances / 88
Filing of Ordinances / 88
About the Author / 90
County and Municipal Government in North Carolina
Civil Procedure / 94
Tort Liability under North Carolina Law / 95
Intentional Torts / 95
Battery / 95
Assault / 96
False Imprisonment / 96
Defamation / 97
Negligence / 97
Nuisance and Inverse Condemnation / 98
Scope of Employment / 99
Liability of the Local Government / 100
Governmental Immunity / 100
Governmental versus Proprietary Activities / 100
Operations with Both Proprietary and
Governmental Elements / 102
Waiver of Governmental Immunity by the
Purchase of Insurance / 103
The Doctrine of Discretionary Immunity / 104
The Public Duty Doctrine / 104
Liability of Public Servants / 106
Absolute Immunities / 107
Legislative Immunity / 107
Judicial Immunity / 107
Qualified Immunities / 107
Public Official Immunity / 107
Public Officers / 107
Public Employees / 108
Liability under Federal Law / 109
Violation of Constitutional Rights / 110
First Amendment Rights of Free Speech
and Political Affiliation / 110
Fourth Amendment Rights of Freedom from
Unreasonable Searches and Seizures / 110
Fourteenth Amendment Right of Due Process / 110
Violation of Statutory Rights / 111
Liability of the Local Government / 111
Liability of Public Servants / 112
Liability of Governing Board Members / 112
Liability of Other Public Servants / 113
Insurance against Civil Liability / 113
Defense of Employees, Payment of
Judgments, and Settlements / 113
Provision of Defense / 113
Payment of Judgments / 114
Settlements / 114
About the Author / 114
County and Municipal Government in North Carolina
Ethics in Government: Why It’s Important / 115
I. Requirements for Local Elected Officials / 116
Ethics Education Requirement / 116
Local Codes of Ethics / 116
Censuring Board Members / 117
II. Conflicts of Interest in Voting / 117
The Duty to Vote / 117
What Constitutes Financial Interest / 118
Number of People Affected / 119
Extent of the Financial Interest (Benefit or Detriment) / 119
Likelihood That the Financial Impact Will Actually Occur / 119
III. Conflicts of Interest in Contracting / 119
Contracts for Personal Benefit / 119
Gifts and Favors / 121
Misuse of Confidential Information / 122
IV. Conflicts of Interest for Specific Categories
of Officials and Public Employees / 122
Building Inspectors / 122
Project Designers / 122
Public Hospital Officials and Employees / 123
Local Management Entity (LME) Board Members / 123
Housing Authorities / 123
V. Conflicts of Interest Applicable to
Federal Grant Funds / 123
Additional Resources / 124
About the Authors / 124
County and Municipal Government in North Carolina
Public Records Law Overview / 127
Scope of the Public Records Law / 128
Personal Records Distinguished / 129
Records versus Information / 129
The Right of Access / 130
Form of the Request / 130
Form in Which Records Are Provided / 130
Time for Response / 130
Electronic Records and Metadata / 131
Custodians of Records / 131
Fees for Providing Copies / 131
Categories of Records Not Subject to the Right of Access / 132
Personnel Records / 132
Criminal Investigation Records / 132
Legal Materials / 133
Trade Secrets / 133
Local Tax Records / 133
Medical and Patient Records / 133
Closed-Session Minutes and General Accounts / 133
Social Security Account Numbers and Other
Personal Identifying and Personal
Financial Information / 133
Records Involving Public Security / 134
Contract Bid Documents and Construction Diaries / 134
Economic Development Records / 134
Social Services Records / 134
Library Records / 134
Telephone Numbers Held by 911 Systems / 134
Framework for Responding to Public Records Requests / 134
Framework Questions / 134
Framework Answers / 135
Remedies for Denial of Access / 136
Records Retention and Disposition / 136
Additional Resources / 136
About the Author / 136
County and Municipal Government in North Carolina
Open Meetings Law Requirements for All Public Bodies / 138
Overview / 138
Public Right of Access to Open Meetings / 138
Official Meetings of Public Bodies / 138
Notice Requirements / 139
Regular Meetings / 139
Special Meetings / 139
Emergency Meetings / 139
Recessed Meetings / 140
Closed Sessions / 140
Procedures for Closed Sessions / 140
Confidential Records / 140
Attorney Consultations / 140
Economic Development / 141
Purchase of Real Property / 141
Employment Contracts / 141
Public Employees / 141
Criminal Investigations / 141
Minutes and General Accounts / 141
Remedies / 142
Additional Meeting Requirements for County
and City Governing Boards / 142
Governing Board Meetings / 142
Organizational Meetings / 143
Counties / 143
Cities / 143
Regular Meetings / 143
Counties / 143
Cities / 143
Special Meetings / 143
Counties / 144
Cities / 144
Emergency Meetings / 144
Counties / 144
Cities / 144
Meeting Location / 144
Rules of Procedure / 145
Quorum / 145
Counties / 145
Cities / 145
Governing Board Action / 145
Voting Rules / 145
Counties / 146
City Ordinances / 146
Excusing Members from Voting / 147
Public Hearings and Public Comment / 147
Rules for Quasi-Judicial Proceedings / 148
Remote Participation in Meetings / 148
Meeting Requirements for Appointed Boards / 148
Additional Resources / 149
About the Author / 149
County and Municipal Government in North Carolina
Citizen Involvement: Interest, Low Voter Turnout, and
Common Reasons for Lack of Engagement / 152
Legal Requirements / 156
Public Comment Periods / 156
Public Hearings / 156
Ways to Involve Citizens / 157
Public Hearings and Appointed Citizen Boards / 157
Public Hearings / 158
Appointed Citizen Boards / 158
Community Visioning / 162
Surveys / 163
Information and Outreach via Television,
Radio, and Print Media / 165
Email and the Internet / 165
Formal Civic Education about Local
Government Operations / 166
Local Government Employee Responsibilities
for Citizen Involvement / 167
Conclusion / 168
Additional Resources / 168
General Resources / 168
Local Government Citizen Surveys / 169
School of Government Publications and Resources / 169
About the Authors / 169
County and Municipal Government in North Carolina
Interlocal Cooperation and Shared Services / 171
Types of Interlocal Cooperation and Shared Services / 173
Grants or Contributions / 173
Resource Sharing / 173
Cooperative Purchasing / 173
Interlocal Service Contracts / 174
Joint Operations / 174
Joint Facilities/Assets / 174
Transfer of Functions / 174
Merged Departments / 174
New Joint Entities / 174
Authority for Cooperation / 175
Barriers to Cooperation / 175
Overcoming Barriers When Cooperation Is Warranted / 176
Provisions of Interlocal Agreements / 176
Regional Organizations / 177
Impetus for Regional Organization / 179
Regional Councils in North Carolina / 179
Planning and Implementing Interlocal
Cooperation and Shared Services / 180
About the Author / 180
Appendix 11.1 N.C. General Statutes Authorizing Cities
to Cooperate with Other Local Governments / 181
County and Municipal Government in North Carolina
Introduction / 183
What Are Nonprofit Organizations and How Are
They Different from Local Government? / 184
Legal Characteristics / 184
Nonprofit Definition / 185
Governance Documents / 185
Tax Status / 185
Limits on Liability / 186
Legal Rules Applicable to Nonprofits / 187
Lobbying / 188
Opportunities and Challenges Presented by Differing
Characteristics of Nonprofits and Local Governments / 190
Individual Missions—Narrower, More of a
Driving Force for Nonprofits / 190
Attracting Volunteers, Donations—Key for Nonprofits / 190
Connection to Communities Served—
Strong for Nonprofits / 190
Procedural Restrictions—Generally Fewer
in Number for Nonprofits / 190
Effect of Variation in Size, Sophistication of Nonprofits / 191
How Nonprofits and Local Governments Work Together / 191
Why Fund Nonprofits? / 191
Ways to Fund or Support Nonprofits / 192
Purchase of Services / 192
Grants / 192
Appropriations / 193
Other Kinds of Support / 193
Designing a Process for Funding Nonprofits / 193
Accountability / 196
Strengthening Relationships between Local
Governments and Nonprofits / 199
Conclusion / 200
Additional Resources / 202
About the Authors / 203
County and Municipal Government in North Carolina
The Employment-At-Will Rule / 208
Hiring and Firing Authority in North Carolina Cities / 210
Mayor–Council Form of Government / 210
Council–Manager Form of Government / 210
Hiring and Firing Authority in North Carolina Counties / 211
Officers Elected by the People / 211
Employees Whose Appointments Are Made
through or Are Subject to Boards / 212
Requirements of Boards / 212
Employees Subject to the State Human Resources Act / 212
“Substantially Equivalent” Personnel Systems / 213
Consolidated Human Services Agencies / 213
Organization of the Human Resources Function / 214
Personnel Officers in Cities / 214
Position Classification / 214
Compensation: Wages / 215
Restrictions on a County Board’s
Compensation Authority / 215
Salary Increases and Longevity Pay / 216
Minimum Wage and Overtime Requirements / 216
Equal Pay / 217
Compensation: Benefits / 217
Local Governmental Employees’ Retirement System / 217
Social Security / 218
Personnel Rules and Conditions of Employment / 218
Policies / 218
Vacation and Other Leave / 219
Recruitment and Selection / 219
Federal Statutes and the Local Government
Employment Relationship / 220
Title VII of the Civil Rights Act of 1964 / 220
Affirmative Action and Use of Race as a Criterion in
Government Employment Decisions / 220
Other Federal Antidiscrimination Acts / 222
The Age Discrimination in Employment Act / 222
Statutes Prohibiting Discrimination on
the Basis of Disability / 222
The Genetic Information Nondiscrimination Act / 223
Defense of Employees / 223
Workers’ Compensation / 223
Unemployment Compensation / 224
Unionization and Employee Relations / 225
Restrictions on Political Activity / 225
Discipline, Dismissal, and Grievances / 226
Personnel Records / 227
Information Permitted to Be Released / 227
Exceptions to the Rule of Confidentiality / 228
Conclusion / 229
Additional Resources / 229
About the Author / 229
County and Municipal Government in North Carolina
The Attorney / 231
Typical Arrangements / 232
Considerations in Providing Legal Services / 233
Retained or Full-Time Attorney / 234
General Factors / 234
Cost Concerns / 235
Options for Full-Time Representation / 235
The Clerk / 236
Appointment / 237
Record Keeping / 237
Minutes / 237
Ordinance Book and Code of Ordinances / 239
Other Records / 239
Notice Giving / 240
Oaths of Office / 240
Closing-Out Sales (City Clerks) / 240
General Assistance to the Governing Board / 241
Research and General Assistance / 241
Agendas and Preparations for Meetings / 241
Information Source / 241
Combination of the Clerk’s Position with
Other Responsibilities / 242
Professionalism and Continuing Education / 242
Additional Resources / 243
About the Author / 243
County and Municipal Government in North Carolina
Overview of Trends / 246
Chief Information Officers and Professional Staff / 246
Enterprise IT Investments and Performance Metrics / 248
Performance Measurement and Management / 249
Enterprise Approaches to IT Investments / 249
Traditional Business Case Metrics / 250
Additional Value-Based Performance Metrics / 250
Social Media Usage in Government: The
New E-Government Frontier / 252
Conclusion / 253
Additional Resources / 254
About the Author / 254
County and Municipal Government in North Carolina
Uses of Performance Measures: Accountability
and Performance Improvement / 257
The Importance of Performance Measurement
for Management / 258
The Value of Performance Measurement
to Governing Boards / 259
Types of Performance Measures / 260
Output (Workload) Measures / 260
Efficiency Measures / 260
Outcome (Effectiveness) Measures / 260
Productivity Measures / 261
Developing a Good Set of Performance Measures / 261
Use of Performance Measures in Budgeting / 261
Performance Measurement as a Tool for
Productivity Improvement / 264
Identifying Strengths and Weaknesses / 265
Benchmarking / 266
Managing for Results / 267
Keys to the Successful Use of Performance Measures / 268
Additional Resources / 268
About the Author / 269
County and Municipal Government in North Carolina
Introduction / 273
Local Taxes / 274
The Property Tax / 274
Tax Base / 274
Tax Rate Limitations and Voter Approval / 274
Uniformity of Taxation and Service Districts / 275
Tax-Levy Formula / 276
The Local Sales and Use Tax / 276
Local Sales and Use Tax Authorizations / 277
Distribution of Local Sales and Use Tax Proceeds / 277
Transportation Sales and Use Tax / 278
Other Local Taxes / 278
Rental Car Gross Receipts Tax / 279
Animal Tax / 279
Short-Term Heavy Equipment Rentals Tax / 279
Motor Vehicle License Taxes / 279
Privilege License Tax / 279
Taxes Permitted by Local Act—Occupancy
and Meals Taxes / 280
Local Fees, Charges, and Assessments / 280
General User Fees and Charges / 280
Regulatory Fees / 281
Public Enterprise Fees and Charges / 281
Franchise Fees / 281
Special Assessments / 281
Statutory Fees / 282
Fees of Public Officers / 282
Court Facilities and Related Fees / 283
State-Shared Revenue / 283
Video Programming Services Taxes / 283
Beer and Wine Taxes / 284
Solid Waste Tipping Tax / 285
Real Estate Transfer Taxes / 285
Disposal Taxes / 285
911 Charge / 285
Electric Taxes / 286
The Telecommunications Tax / 287
Piped Natural Gas Taxes / 287
The Motor Fuels Tax (Powell Bill Funds) / 287
Other Local Revenues / 288
Alcohol Beverage Control Store Profits / 288
Investment Earnings / 288
Grants / 289
Fines and Penalties / 289
Minor Revenue Sources / 290
About the Author / 290
Appendix 17.1 Local Revenue Authority
and Limitations / 291
County and Municipal Government in North Carolina
Introduction / 293
Reasons for Revenue Forecasting / 294
Improved Financial Management / 294
Strategic Thinking / 294
Types of Revenue Forecasts / 295
Recommended Process for Revenue Forecasting / 295
Step 1: Create a Revenue Manual / 295
Step 2: Estimate Major Revenue Sources / 296
Step 3: Departmental Revenue Forecasts / 296
Step 4: Update Estimates / 297
Forecasting Methods / 297
Qualitative Methods / 298
Judgmental Forecasting / 298
Consensus Forecasting / 298
Strengths of Qualitative Forecasting / 298
Weaknesses of Qualitative Forecasting / 298
Quantitative Methods / 299
Formula-Based Projections / 299
Strengths and Weaknesses of Formula-
Based Projections / 299
Trend Analysis / 299
Strengths and Weaknesses of Trend Analysis / 300
Causal Modeling / 300
Strengths and Weaknesses of Causal Modeling / 301
Overall Assessment of Quantitative Methods / 301
Considerations in Choosing the Right Method / 301
Best Practices in Forecasting Revenues / 302
Forecasting Is Not Perfect / 303
Conclusion / 304
About the Author / 304
County and Municipal Government in North Carolina
I. Overview / 306
Constitutional Provisions Governing Taxation / 306
For Public Purposes Only / 306
The Power to Exempt and Classify Property / 307
Statewide Application of Exemptions and Classifications / 307
The Uniform Rule Requirement and Service Districts / 308
II. The Machinery Act / 308
Statutes Governing the Administration
of Property Taxes / 308
Steps in the Taxation of Property / 309
The Administrative Structure / 309
Terms and Qualifications of the County Assessor / 310
The Property Tax Calendar / 310
Real Estate Transfers, Prorations, and Annexation / 314
III. Listing and Appraisal of Property / 314
The Listing Process / 314
Role of the City in the Listing Process / 315
Property Not Subject to Taxation: Requests for Tax Relief / 316
Appraisal / 316
Statutory Elements of Value / 316
Market-Value Standard / 316
Taxability of All Rights in Land / 316
Use-Value Appraisal of Farmlands / 317
Personal Property / 317
Real Property / 317
Appraisal Techniques / 317
Mass Appraisal of Real Property / 318
Development of an Appraisal Manual for
Establishing Market Value / 318
Development of a Present-Use Value Schedule / 318
Approval of the Manuals / 319
Preparation of Record Cards / 319
Appraisal of Property / 319
Notice to Property Owners / 319
Formal Appraisal and Assessment / 320
Appeal and Review / 320
Valuation Appeals / 320
Adjustment of Real Property Values in
Nonreappraisal Years / 320
Discovered Property / 321
IV. Special Classes of Property / 321
Registered Motor Vehicles / 321
The “Old” Process / 322
The “New” Process / 322
Public Service Company Property / 323
V. The Collection of Property Taxes / 323
Office of Tax Collector / 323
Qualification as Tax Collector / 324
Removal of the Tax Collector / 324
Deputy Tax Collectors / 324
Necessary Collection Records / 325
Reports of Progress in Collection / 325
Tax Due Dates: Periods Covered / 325
Order of Collection / 325
The Property Tax Lien / 326
Payment of Taxes / 327
Discounts / 327
Interest for Late Payment of Taxes / 328
Report of Delinquent Taxes and Lien Advertisements / 328
Report of Delinquent Taxes Constituting Liens on Realty / 328
Time and Place of Lien Advertisement / 328
Enforced Collection of Property Taxes / 328
Foreclosure / 328
Enforcement against Personal Property: Levy and Sale / 329
Enforcement against Personal Property:
Attachment and Garnishment / 329
Reduction, Release, and Refund of Property Taxes / 329
Clerical Error Defined / 330
What Is an Illegal Tax? / 330
When Is a Tax Imposed for an Illegal Purpose? / 330
Time Limitation on Refunds and Releases / 330
Settlements / 331
Insolvents / 331
Form of Settlement / 332
Charges / 332
Credits / 332
Additional Resources / 332
About the Author / 332
County and Municipal Government in North Carolina
Introduction / 334
I. Annual Budget Ordinance / 334
Substantive Budget Ordinance Requirements
and Restrictions / 335
Balanced Budget / 335
Required Budget Ordinance Appropriations / 336
Debt Service / 336
Continuing Contracts / 336
Fund Deficits / 337
Property Taxes / 337
Limits on Appropriations / 337
Contingency Appropriations / 337
Tax Levy Limits / 337
Limits on Interfund Transfers / 337
Voted Property Tax Funds / 338
Agency Funds for Special Districts / 338
Enterprise Funds / 338
Service District Funds / 338
Reappraisal Reserve Fund / 338
Optional Budget Ordinance Provisions / 338
Adoption of Budget Ordinance / 339
Role of Budget Officer / 339
Budgeting Process / 339
Budget Calendar / 340
By April 30: Departmental Requests Must Be
Submitted to the Budget Officer / 340
By June 1: Proposed Budget Must Be Presented
to the Governing Board / 340
After Proposed Budget Presented to Governing Board but
before Its Adoption: Notice and Public Hearing / 340
By July 1: Governing Board Must Adopt
Budget Ordinance / 341
Interim Appropriations / 341
LGC Action for Failure to Adopt a Budget Ordinance / 341
Budgetary Accounting / 342
Amending the Budget Ordinance / 342
Changing the Property Tax Levy / 342
Common Budgeting Tools and Techniques / 343
Line-Item Budgeting / 343
Strategic Budgeting / 343
Performance Budgeting / 343
Zero-Based Budgeting / 343
Balanced Scorecard / 344
II. Capital Budgeting / 344
Capital Projects / 344
Grant Projects / 344
Creating a Project Ordinance / 345
Balanced Project Ordinance Requirement / 345
Amending a Project Ordinance / 345
Closing Out a Project Ordinance / 346
Justification for Capital Budget / 346
Capitalization and Capital Budget Thresholds / 347
Common Capital Budgeting Tools and Techniques / 347
Capital Improvement Program / 347
Financial Condition and Forecasting / 348
Financial Condition Analysis / 348
Financial Forecasting / 349
III. Financial Plans for Internal Service Funds / 350
Adopting a Financial Plan / 350
Balanced Financial Plan Requirement / 351
Amending a Financial Plan / 352
Summary / 352
About the Authors / 352
County and Municipal Government in North Carolina
Introduction / 353
Current Revenues / 354
Savings / 354
Fund Balance / 354
Capital Reserve Funds / 355
Special Levies / 356
Special Assessments / 357
Traditional Special Assessment Method / 357
Newer Assessment Method / 358
Special Taxing Districts / 359
County and Municipal Service Districts / 359
Additional Special Taxing Districts / 360
Impact Fees / 360
Borrowing Money / 360
Security / 361
Entities Involved / 361
Bond Counsel / 361
Financial Advisor / 362
Underwriter / 362
Rating Agencies / 362
Local Government Commission / 362
Joint Legislative Committee on Local Government / 363
Types of Authorized Debt / 363
General Obligation Bonds / 363
Revenue Bonds / 365
Special Obligation Bonds / 366
Project Development Financings / 366
Bond Anticipation Notes / 368
Installment Financings / 368
Conclusion / 371
About the Author / 371
County and Municipal Government in North Carolina
The Finance Officer / 374
Official Bonds / 374
The Accounting System / 375
Statutory Requirements / 375
Generally Accepted Accounting Principles
for Governments / 376
Counties’ and Cities’ Own Needs and Capabilities / 377
Control of Expenditures / 377
Preauditing Obligations / 377
The Meaning of Appropriation / 378
Encumbrances / 378
The Preaudit Certificate / 378
Disbursements / 379
Two Stages of Review / 379
The Finance Officer’s Certificate / 379
Governing Board Approval of Bills, Invoices, or Claims / 379
Form of Payment / 379
Cash Management / 380
Daily Deposits / 380
Official Depository / 381
Insurance and Collateralization of Deposits / 381
Investments / 382
Custody of Investment Securities / 382
Authorized Investments / 383
Guidelines for Investing Public Funds / 386
The Annual Audit / 387
Contents of the Comprehensive Annual Financial Report / 387
Introductory Section / 387
Financial Section / 388
Statistical Section / 389
The Auditor’s Opinion / 389
Selection of an Independent Auditor / 390
Audits of Federal and State Grants / 390
Additional Resources / 391
About the Author / 391
County and Municipal Government in North Carolina
Chapter 23 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government.
You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government Netsuite page.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
County and Municipal Government in North Carolina
Chapter 24 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 25 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government website.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 26 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format, the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government website.
PDF Instructions: You will be allowed to download and save/view a PDF four separate times; after the fourth time the PDF will no longer be available in your personal downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 27 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 28 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 29 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government.
You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 30 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 31 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 32 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 33 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format, the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government website.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
What Is Emergency Management? / 577
Sources of Authority / 578
What Is the Difference Between a “Disaster”
and an “Emergency”? / 579
Roles and Responsibilities—Federal and State / 579
Federal Government / 579
State Government / 580
Roles and Responsibilities—Local Government / 581
Legal Authority / 581
Organizational Structure / 581
Planning / 582
Intergovernmental Cooperation / 583
Disaster and Emergency Declarations—
Federal and State / 583
Federal Declarations / 583
State Declarations / 584
State of Emergency Declarations—Local / 584
Who Can Issue a Declaration? / 585
Where Do Local Declarations Apply? / 585
What Restrictions Can Be Imposed? / 586
Other Restrictions and Prohibitions / 586
Paying for Disasters—Who Bears the Costs? / 587
Local Funding / 587
Federal Assistance Programs / 587
State Assistance Programs / 589
Contracting and Other Requirements
for Reimbursement / 589
Infrastructure / 590
Continuity of Government in the Event of Enemy Attack / 591
Immunity and Liability / 592
About the Author / 592
County and Municipal Government in North Carolina
Chapter 35 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 36 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 37 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 38 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government website.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 39 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government website.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 40 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and administration of the state’s counties and cities.
This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government website.
PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing.
PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 41 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 42 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 43 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 44 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 45 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
County and Municipal Government in North Carolina
Chapter 46 of County and Municipal Government in North Carolina, Second Edition, 2014, the complete reference book on North Carolina county and municipal government that provides a comprehensive treatment of the legal foundations, organization, and the administration of the state’s counties and cities. This article may be downloaded for personal use by an individual but may not be reproduced or redistributed in quantities greater than “fair use” permits under copyright law without the express written permission of the School of Government. You may order other individual articles in PDF format; the complete book in hard copy format, or the complete book in PDF format by going to the County and Municipal Government web site. PDF Instructions: You will be allowed to download and save/view a PDF 4 separate times; after the 4th time the PDF will no longer be available in your personal Downloads folder in the School of Government Web Store. Please SAVE your PDF to your local/personal hard drive or a disk for continuous viewing. PDF Accessibility: To learn how to save your PDFs, click here.
