Tensions are rising in Kinston as the City Council delivered a stark message to Downtown Kinston Revitalization (DKR): Address your issues, or face a funding reckoning.

On October 25, 2023, members of Kinston City Council sent a letter addressed to the Board of Directors of DKR expressing concerns about the stability and effectiveness of DKR, focusing on issues related to board governance, fundraising, financial accountability, results, and impact. Despite the warning from the city to withhold voting on new members or possibly face consequences, and while the City Manager and two councilmembers were present, members of the DKR board voted to move forward with re-appointing a recently resigned board member and appointing a brand new one.

City of Kinston and DKR’s relationship

As part of the 1984 creation of Pride of Kinston, the City levies an additional municipal service district tax (MSD) on all downtown properties and diverts the tax dollars to DKR, amounting to more than $60,000/year. The City provides an additional annual $43,000 grant to DKR and has an approximate $100,000 lien on the Kinston Enterprise Center located at 327 N. Queen St, a building currently for sale. In addition, the City in 2017 made the non-profit’s Executive Director a city employee, thereby saving DKR salaries and benefits each year.

The City is currently studying a downtown Social District ordinance with DKR, indicating a close partnership. Notably, the City of Kinston recently invested over $10 million to redevelop Queen Street, highlighting its commitment to the revitalization of the downtown area.

DKR, formerly known as Pride of Kinston, is a nonprofit organization dedicated to revitalizing and promoting the downtown area of Kinston. Its mission is to enhance the economic and cultural vitality of downtown Kinston by fostering community engagement, supporting local businesses, and preserving the town’s history.

City of Kinston’s October 25th letter

The letter (seen below) recommended steps for addressing challenges, including stabilizing the organization's current board membership and working collaboratively to resolve the issues at hand before introducing new board members. The City Council emphasized its responsibility to ensure proper stewardship of the city's financial resources and raised the possibility of reconsidering the city's funding relationship with DKR if these issues are not addressed in the near future.

DKR’s October 26th Board of Directors meeting

“The city is very proud of our relationship with DKR; we want to see the organization succeed, and we want to see downtown succeed,” said Councilmember Chris Suggs during Thursday’s DKR public board meeting. “There are a number of issues that need to be addressed, to be quite blunt, immediately.”

Suggs and Councilmember Robbie Swinson brought important concerns to the forefront during the DKR meeting. Suggs emphasized the need for immediate action to address governance issues within DKR, given the city's significant financial investment. He urged the board to consider these concerns seriously, stressing the importance of stable leadership and proper management to ensure the city's continued support. Suggs also hinted at the possibility of redirecting funds to alternative economic development avenues if issues persist.

“There are a lot of positive things happening in Kinston,” said Swinson. “We want those things to continue, especially downtown. We need to work together and keep our issues in-house and not put it on public display because that shows there is disorganization in the organization.”

Swinson echoed the call for progress, underlining the significance of resolving internal matters privately to avoid negative perceptions that could deter investment and visitors.

“We can’t tell people what to say, but when you continue to get on the internet or Facebook and bash the city or DK, it's not a good look for the city or DKR,” said Swinson.

Suggs further recommended implementing roll call votes for transparency and maintaining well-documented meeting minutes, aligning with the city's requirements. Both council members emphasized their commitment to seeing positive changes and urged prompt attention to these vital issues.

Robyn Godfrey, DKR executive committee member, said the action item to allow votes on two board members was placed on the agenda the week prior.

“Prior to getting the letter we got in email,” said Godfrey, “the executive committee had approved applications for two new board members to present to the rest of the board for approval. Limiting how many can be on this board, most especially during the busiest time, makes the people even more worn out, so to speak, and makes them quicker to want to say you know what, I didn't volunteer for all this.”

Chairman Mike Chastain then asked the board, considering the letter and concerns of the city, if they’d like to move forward with voting on the two applications. Zac Holcomb, an executive committee member, motioned to proceed with the election process. The motion received a second from Treasurer Lara Tribula. The motion passed 5-2. Holcomb, Tribula, Godfrey, Leigh Turner and Susan Colomaio all voted in favor of the motion. Chastain and Cathy Reese voted in opposition. Members not present were Jeremy Whitfield and Brandon Corey.

Two board members voted on

The DKR board voted to bring on both Owens and Hengst, and appointed Holcomb as the interim Vice Chair. Former board member Chuck Hengst, who resigned a few weeks ago from the board, citing his lack of available time to commit to the board, and Dan Owens were appointed to serve.

“The reason I want to be on this board is several of my friends have made the decision to open businesses here in Kinston,” said Owens. “I want them to succeed. These merchants, these people who have put their lives into this town and put their financial resources into it. We owe them.”

Hengst also made his case for bringing him back on the board. “Nowhere have I made a public statement downing DK. Any of my concerns have been with people that have already been talking to board members.”

What happens next?

While other issues were brought up in the letter from the city council, the board did not create any action plans to address them. Fundraising was brought up, but just to discuss how the board members helped a business outside of downtown sell discount cards. There was a little discussion addressing Christmas sponsorships that must be sold for the upcoming holiday events.

As tensions escalate between Kinston City Council and DKR, the organization has chosen a defiant path. While the city council sent a stern message, demanding action to address pressing issues, DKR's response appears to disregard the city’s concerns, raising questions about the future of this critical revitalization effort and the financial security of DKR.