North Carolina Department of Justice
North Carolina Department of Justice
North Carolina Department of Justice
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August 2, 1978

Subject:

Municipalities; Powell Bill Fund; Village of Pinehurst

Requested By:

Joseph R. Monroe, Jr. Attorney for Village of Pinehurst

Question:

Is Pinehurst, Inc., a private real estate and development corporation which renders fire and police protection and maintains streets for the Village of Pinehurst, eligible to receive Powell Bill Funds (gasoline tax funds) under Section 5 of the provisions of Chapter 993 of the 1949 Session Laws?

Conclusion:

No. The Village of Pinehurst is constituted a municipal corporation only for such purposes as are listed in Chapter 993 of the 1949 Session Laws and it cannot comply with the conditions of eligibility to receive Powell Bill Funds as it is not a municipal corporation for those purposes.

The gasoline tax funds appropriated to municipalities for use in the construction and maintenance of municipal streets are referred to as Powell Bill Funds. G.S. 1360-41.1. The question is presented as to the right of Pinehurst, Inc. to receive Powell Bill Funds under the provisions of Section 5 of Chapter 993 of the 1949 Session Laws. Section 1 of the Act provides that "For all purposes of this Act, but only for such purposes" the area described constitutes "the municipal corporation to be known and hereafter referred to as Pinehurst".

Section 5 of the Act provides that "the municipality of Pinehurst as herein defined shall be entitled to all such refunds and moneys as are allowed or conferred upon towns and cities of the State" and "shall be likewise to all such gasoline taxes on account of roads . . . that other cities and towns may be entitled to and to the same extent as if the said Pinehurst was a regularly incorporated town or city." A private corporation, Pinehurst, Inc., developed the Village of Pinehurst and performs services such as the maintenance of roads and sidewalks, fire protection and police protection for some of its residents. The Act provides that inasmuch as "Pinehurst, Incorporated, . . . maintains and operates at its own expense all public streets and sidewalks in Pinehurst and furnishes at its own expense all the public facilities and utilities enjoyed by the public within said territory of Pinehurst, all such refunds, moneys or property as would be payable or belong to Pinehurst as a regular municipality under the provisions of this Act shall be paid and delivered to Pinehurst, Inc. to reimburse it for such expenditures in behalf of Pinehurst in its capacity as a municipal corporation."

G.S. 136-41.1 provides for the distribution of "Powell Bill Funds" "among the several eligible municipalities of the State." G.S. 136-41.2 contains the provisions for eligibility for receiving the funds. It provides that (a) no municipality shall be eligible to receive funds under G.S. 136-41.1 unless it has conducted the most recent election required by its Charter or general law, whichever is applicable, for the purpose of electing the municipal officials. Subsection (b) provides that no municipality shall be eligible to receive funds under G.S. 136-41.1 unless it is levied an ad valorem tax for the current fiscal year of at least five-cents on the $100 valuation upon all taxable property within the corporate limits, and unless it has actually collected at least 50% of the total ad valorem taxes levied for the preceding fiscal year. Subsection (c) provides that no municipality shall be eligible to receive funds under 136-41.1 unless it has formally adopted a budget ordinance and appropriated funds for at least two municipal services.

Chapter 993 of the 1949 Session Laws constitutes the Village of Pinehurst as a municipal corporation only for the purposes listed in that Act. The purposes listed do not include any of the acts listed which are conditions for eligibility for receipt of Powell Bill Funds. It is not a municipal corporation for the purpose of (a) electing municipal officials; (b) the levying of an ad valorem tax; nor (c) the adoption of a budget ordinance. Therefore, this Office is of the opinion that Pinehurst, Inc. is not entitled to receive distribution of Powell Bill Funds.

Rufus L. Edmisten Attorney General

Eugene A. Smith Special Deputy Attorney General