Recent Blog Posts

  • Combining Multiple Property Tax Exclusions

    Authored by: on Friday, May 18th, 2018

    In a North Carolina town, a long-vacant historic mill with environmental contamination has sat empty on the edge of downtown for years. The Town has taken action to see the property transformed. Town staff worked through a brownfields process to clear the major environmental problems associated with the property, and the Town engaged the UNC Development Finance Initiative (DFI) to evaluate the financial feasibility of private development on the site and to attract a developer. Now a developer has proposed an adaptive reuse of the historic building that aligns with the Town’s interests. The developer hopes to take advantage of property tax exemptions to make the project work financially and asks whether the property can benefit from both the brownfields exclusion in G.S. 105-277.13 and the historic property exclusion in G.S. 105-278.

    In other words, can a single property and a single owner benefit from more than one property tax exclusion at a time?

    Read more »

  • The State of the Dark Store Theory

    Authored by: on Tuesday, May 8th, 2018

    Consider the following scenario: Target is challenging a city’s property tax valuation. The city has assessed the store at $16.7 million, while Target contends the tax value is closer to $8.1 million. In reaching this valuation, Target used sales comps from eight vacant big box retail establishments, and it wants the city to reduce its assessed value to reflect the market price of these unoccupied buildings. The city will lose a substantial amount of tax revenue if it accepts Target’s valuation. It must choose one of two options: settle with Target or endure costly litigation.

    This scenario, known as the “dark store theory,” has taken center stage in numerous legal battles across the country. The key question: should fully operational big box retail stores be taxed in the same way as closed ones?

    Read more »

  • Tips for Tax Foreclosure Sales

    Authored by: on Tuesday, April 24th, 2018

    Carolina County is selling Parcel A at a tax foreclosure sale.  The county enters an opening bid of $4,500, the total taxes and costs owed on the property.  Happily for the county, two other bidders, Billy Blue Devil and Wanda Wolfpack, get into a heated competition for the property.  Billy Blue Devil is the eventual high bidder at $25,000.

    What happens next? How much money does Billy need to pay at the auction? What if Billy fails to produce the full bid amount? What deposits are required of upset bidders?  What happens if an upset bidder defaults on the winning bid? Do the answers change if the foreclosure is “mortgage style” or in rem?

    The relevant statutes don’t provide clear answers to all of these important questions. Read on for my suggested approaches and advice about best practices from tax foreclosure veterans . . . Read more »

  • GiveUNC: A message from the Dean

    Authored by: on Tuesday, April 10th, 2018

    Whether you attend classes at the UNC School of Government, consult with our faculty, or use our books and blogs—we exist because of you.

    Today is a special day because we’re spending 24 hours celebrating the University, the School, and all of the individuals and institutions we reach across the state. And we hope we can count on you to help us reach even farther.

    If 150 people can step up and donate today, we have an opportunity to earn an additional $7,500 in matching funds, thanks to generous anonymous donors.

    We know that you have many demands on your time, talent, and resources and we appreciate all that you do for the people of North Carolina. If you can give today, you’re equipping us to train more public leaders and helping strengthen our state.

    Learn more about GiveUNC and how the School is celebrating at

    We are grateful for your support.

    Michael R. Smith, Dean, UNC School of Government


  • Formulating Plans for Responding to School Violence in Closed Session: Who Can Attend?

    Authored by: on Friday, April 6th, 2018

    In response to the latest school shooting, local school boards are reviewing and revising their policies and procedures for responding to incidents of school violence. Responses to these incidents increasingly require coordination among multiple jurisdictions. Discussions about these issues may require input from representatives from cities, counties, state law enforcement, and other resources outside of the school administration. Some of the information exchanged during these discussions must be kept confidential for security reasons.  The open meetings law provides authority for closed sessions “[t]o formulate plans by a local board of education relating to emergency response to incidents of school violence or to formulate and adopt the school safety components of school improvement plans by a local board of education or a school improvement team.” G.S. 143-318.11(a)(8) (I’ll call this the “school violence provision”). Does this provision only apply to public bodies that are part of the local school unit? I think not. Does that mean the school board could meet in closed session with the board of county commissioners, the town council, the police chief, sheriff, or representatives from the SBI? I think so. And what if the school board created a working group that includes representatives from multiple jurisdictions. Would that public body be able to meet in closed session? I think so. Read on to learn why. Read more »

  • Social Services Working Group

    Authored by: on Thursday, March 29th, 2018

    [This post is co-authored with my colleague, Margaret Henderson]

    In 2017, the North Carolina General Assembly established the Social Services Regional Supervision and Collaboration Working Group (SSWG) and directed it to develop recommendations related to the social services system (see legislative summary here). The legislation directed the UNC School of Government to convene the group, facilitate the meetings, and provide staff support to the project.

    The SSWG’s work is divided into two stages. The group just released the final report for Stage One and is scheduled to present its recommendations to the legislature on April 10, 2018. Stage Two will get underway in May. All of the meeting materials, minutes, and recordings are available online.

    There have been quite a few different conversations about social services system reform over the last year or so. As a result, there has been some confusion about the role of the SSWG. This blog post is intended to shed some light on the group’s charge and connect some dots between the work of the SSWG and other elements of system reform that are underway.

    Read more »

  • Preauditing Electronic Transactions Just Got (A Little) Easier

    Authored by: on Friday, March 23rd, 2018

    The preaudit is a statutory internal control process to ensure that public funds are spent appropriately. If implemented properly the preaudit can be an effective tool in preventing and/or mitigating employee mistake, misappropriation, and even fraud. The problem with the preaudit process is that it is difficult to follow the strictures of the statute, particularly when conducting electronic transactions. New rules, promulgated by the State’s Local Government Commission (LGC), will now make that process easier, or at least make it possible for local government entities to comply with the law. (The rules are part of the North Carolina Administrative Code (20 NCAC 03.0409 and 20 NCAC 03.0410).

    This blog post reviews the requirements of the preaudit process and identifies when the process is triggered. It then discusses how the process can be carried out for certain electronic transactions, specifically purchase card (p-card), credit card, and fuel card transactions, under the new rules. Read more »