NC General Statutes

N.C. Gen. Stat. § 136-41.2 (2026)

Eligibility for funds; municipalities incorporated since January 1, 1945

✓ current as of July 2026

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(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 the general law, whichever is applicable, for the purpose of electing municipal officials. The literal requirement that the most recent required election shall have been held may be waived only:

(1) Where the members of the present governing body were appointed by the General Assembly in the act of incorporation and the date for the first election of officials under the terms of that act has not arrived; or,

(2) Where validly appointed or elected officials have advertised notice of election in accordance with law, but have not actually conducted an election for the reason that no candidates offered themselves for office.

(b) No municipality shall be eligible to receive funds under G.S. 136-41.1 unless it has levied an ad valorem tax for the current fiscal year of at least five cents (5¢) on the one hundred dollars ($100.00) valuation upon all taxable property within its corporate limits, and unless it has actually collected at least fifty percent (50%) of the total ad valorem tax levied for the preceding fiscal year; provided, however, that, for failure to have collected the required percentage of its ad valorem tax levy for the preceding fiscal year:

(1) No municipality making in any year application for its first annual allocation shall be declared ineligible to receive such allocation; and

(2) No municipality shall be declared ineligible to receive its share of the annual allocation to be made in the year 1964.

(c) No municipality shall be eligible to receive funds under G.S. 136-41.1 unless it has formally adopted a budget ordinance in substantial compliance with G.S. 159-8 and G.S. 159-13, showing revenue received from all sources, and showing that funds have been appropriated for at least two of the following municipal services if the municipality was incorporated with an effective date prior to January 1, 2000, water distribution; sewage collection or disposal; garbage and refuse collection or disposal; fire protection; police protection; street maintenance, construction, or right-of-way acquisition; or street lighting, or at least four of the following municipal services if the municipality was incorporated with an effective date of on or after January 1, 2000: (i) police protection; (ii) fire protection; (iii) solid waste collection or disposal; (iv) water distribution; (v) street maintenance; (vi) street construction or right-of-way acquisition; (vii) street lighting; and (viii) zoning.

(d) The provisions of this section shall not apply to any municipality incorporated prior to January 1, 1945. (1963, c. 854, ss. 3, 3½; 1985 (Reg. Sess., 1986), c. 934, ss. 5, 6; 1999-458, s. 5; 2017-102, s. 20.)

Notes of Decisions

Cited in 3 cases, 1958–1976 · leading case: Taylor v. City of Raleigh, 227 S.E.2d 576 (N.C. 1976).

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Taylor v. City of Raleigh, 227 S.E.2d 576 (N.C. 1976). “, 1975), the General Assembly empowered all municipalities (except those not qualified to receive gasoline tax allocations under G.S. 136-41.2) to annex satellite areas upon the petition of all the owners in the proposed satellite annexation.”

Great Am. Ins. Co. v. Johnson, 126 S.E.2d 92 (N.C. 1962). “105-213, directing distribution of the intangible taxes collected by the State; G.S. 136-41.2, 41.3, directing distribution of a part of the gasoline tax to cities for the maintenance of their streets not part of the State Highway system; G.”

City of Winston-Salem v. S. Ry. Co., 105 S.E.2d 37 (N.C. 1958). “1951, now codified as G.S. 136-41.2 and 136-41.3), the sum of over $300,000 for the construction and maintenance of public streets in the City of Winston-Salem other than State highways.”

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