Raleigh, N.C. — The 50-member board of the embattled North Carolina Rural Economic Development Center voted Monday to freeze the $242,000 severance package of former director Billy Ray Hall.
Hall's $220,000 annual salary and the severance package were cited in a state audit released two weeks ago that unleashed a firestorm of criticism at the center by Republican state leaders.
Gov. Pat McCrory called for changes at the center, and his budget chief froze the spending of state money by the center and even suggested the state might try to recoup some of the money in the center's accounts.
Senate President Pro Tem Phil Berger pushed for eliminating state funding of the center, and a budget compromise lawmakers approved last week called for creating and funding a Rural Infrastructure Authority within the Department of Commerce instead of the public-private Rural Center.
Commerce Secretary Sharon Decker told the Rural Center board Monday that the mission of helping the economies of rural communities will continue with or without the center.
"What you're not going to see is less support for rural North Carolina," Decker said. "I think what you will see is more support for rural North Carolina. How that looks and how that is executed I can't tell you right now."
The nonprofit Rural Center uses state and federal money to provide grants to support business and infrastructure development in 85 North Carolina counties. State auditors also criticized the center for a lack of oversight of its grants, charging that the organization doesn't verify that grant recipients are using their money for the intended purpose.
The center board voted to create a five-person committee to help shift more than $100 million in state tax money and development grant commitments to the Department of Commerce and determine the future of the center and its 50 employees.
"It was really obvious to those of us on the board that the state wants to go in a different direction in rural economic development, and we're going to accommodate that directive," board member Larry Wooten said.
Some board members want to keep interest earned off the public funds to continue limited Rural Center operations. The new committee will determine within the next month whether to dissolve the center or continue some functions.
Board member Kim Griffin, who was appointed by McCrory, pushed for newer members on the transition committee.
"Why not have some fresh, fresh ideas and some new thoughts on how to correct the ship?" Griffin asked.
Chairwoman Valeria Lee defended the Rural Center's history of helping struggling communities, and she remained defiant toward McCrory's call for her resignation.
"What can I say other than I think the Rural Center has done a very good job over the years," she said.
Lee said Hall deserves to receive his severance package, but board members said they first want to gather more information about the package and any potential tax implications before deciding whether to give him the money.