Taking the Field: On the Struggles of Rural Towns

Paul Meyer, NCLM Executive Director

It is no secret that rural North Carolina, and rural areas of the United States generally, have struggled over the last few decades with trends that have imperiled the economic future of towns, surrounding unincorporated areas and the residents living in both.

The loss of manufacturing and agricultural jobs, population loss and urbanization, and a lack of infrastructure investment have all combined to put rural North Carolina and rural America in a challenging place.

That change has been relatively swift.

As late as the 1970s, textile, furniture tobacco accounted for more than 20 percent of the economic output and jobs in North Carolina. In the early 1990s, manufacturing employed more than 800,000 people in the state; today those jobs number fewer than 475,000. Tobacco-related jobs are roughly half of what they were in the mid-1990s.

Obviously, manufacturing and agriculture remain incredibly important to the state’s economy, but the job losses and their effects cannot be ignored.

That is not to suggest that all is doom and gloom in rural North Carolina. Local municipal and community leaders in a number of towns have been working to leverage resources—whether natural, historical, recreational, or business-related—to help reinvent local economies and make their communities vibrant.

But increasing public and media attention has focused on struggling rural towns and, particularly, those with financially troubled water and sewer systems.

The failure of the Town of Eureka’s utility system and the takeover of those operations by the Local Government Commission brought the issue into sharp focus. In response, the N.C. General Assembly last year approved the creation of a Viable Utility Fund, creating a structure to begin addressing these troubled utility systems but without the level of funding that will eventually be required. The LGC is now overseeing the finances of four local units of government, with more potentially on the horizon.

As troubling as all these issues are, none of this has come as a surprise to League leadership.

The reason that NCLM established our Municipal Operations Consultants program more than two years ago was to begin to help struggling towns address their financial operations. With annual audit assistance identified as another key need, we are working to put together potential solutions there as well.

Our Advancing Municipal Leaders educational program was also established to try to better inform local elected leaders about the range of challenges that they face, and the potential solutions that they might use in meeting those challenges.

We have also been meeting with State Treasurer Dale Folwell, who oversees the Local Government Commission, and State Auditor Beth Wood to discuss ideas related to these challenges, as well as establish a working dialogue so that we might all better understand the points of view from all directions.

Finally, our government affairs staff has been meeting for months with both the staff of the governor’s Hometown Strong program and a working group formed by the state Division of Water Infrastructure to flesh out how the Viable Utility Fund can most effectively work.

These issues are incredibly complex. They have only been exacerbated by the pandemic and recent hurricanes.

At its core, this is about how to continue to provide services to people, services that in many cases they require and have come to expect. No single answer is going to work. Instead, it will be some combination of regional approaches, realistic examinations of what is viable and can succeed for the future, and figuring out how to help communities maintain their sense of identity even when services must be unwound.

Answers will only work if towns themselves embrace them and see them as in their self-interest.

It won’t be cheap. It will require a statewide effort.

And lest we forget, many of these towns were once the ones doing more than their part for the larger state economy.