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HB 801

RELATING TO TAXATION.

2025 Regular Session Introduced by Kyle Yamashita

HB 801 requires study of all towns since 1995 to see if they provide promised services and if charter suspension or changes to incorporation rules are needed.

Carried over to 2026 Regular Session.
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Bill Summary · HB 801

Summary — HB 801: Legislative Research Commission Study — "Paper Towns" (NC, 2025)

Status: Introduced / LRC study bill
Introduced: 2025 (filed Apr 7, 2025 as H.B. 801, Sponsors: Reps. Stevens, Ross)
Effective: When enacted
Reporting deadline: Final report (with any proposed legislation) due to the 2026 Regular Session of the 2025 General Assembly

Purpose / Intent

HB 801 directs the North Carolina Legislative Research Commission (LRC) to conduct a focused study of so‑called “paper towns” — municipalities that legally exist but do not provide legally required or adequate services to their residents — and to recommend any legislative responses. The study aims to determine whether recently incorporated towns are meeting the commitments made at incorporation and whether statutory incorporation standards should be revised.

Key provisions

  • Directs the LRC to study the current status of "paper towns." The bill defines a “paper town” as a town that exists in fact but does not provide adequate services, as required by law, to its residents.
  • Scope of review: towns incorporated by the General Assembly since 1995.
  • Specific tasks for the LRC:
    1. Determine whether each such town is providing the services proposed in the original petition to incorporate (as submitted to the Joint Legislative Commission on Municipal Incorporation).
    2. Evaluate whether the services being provided are sufficient to justify continued municipal authority over taxation, zoning, and other regulation of private property.
    3. Consider whether the General Assembly should take action (including suspension or revocation of a municipal charter) for towns that fail to provide critical services.
    4. Review the statutory incorporation criteria (Part 2 of Article 20 of Chapter 120 of the General Statutes) and recommend changes, if any, to ensure incorporated towns continue to provide sufficient services after incorporation.
  • Deliverables: a final report, including any draft legislation, to the 2026 Regular Session of the General Assembly.

Scope and timeline

  • Geographic/scope limitation: applies to towns incorporated by the General Assembly since 1995.
  • Deadline: LRC must report upon convening of the 2026 Regular Session (i.e., report due for that session).
  • Effective immediately upon enactment (no delayed effective date specified).

Who would be affected

  • Municipalities incorporated since 1995 (subject towns).
  • Residents and property owners in those towns (taxation, zoning, services).
  • County governments and adjacent municipalities (service provision, intergovernmental relations).
  • General Assembly (may be asked to enact charter suspensions/revocations or revise incorporation statutes).
  • State agencies that support municipal operations or incorporation processes.

Potential impacts

  • Could identify towns inadequately providing municipal services and trigger legislative action (including charter suspension or revocation).
  • May lead to statutory reforms tightening incorporation criteria or post‑incorporation oversight to ensure towns deliver promised services.
  • Possible downstream effects on local taxation, zoning authority, municipal liabilities, and service delivery arrangements.

Notes

  • The bill does not itself suspend or revoke any charter; it is an investigatory measure that may produce legislative recommendations.
  • The bill references Part 2 of Article 20, Chapter 120 (NC incorporation statutes) as the locus for potential statutory changes.

Compiled from official sources — confirm details with the bill’s official record.

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