For the next six months, no new commercial building activity can start in the tiny village community of Bald Head Island. 

In late June, to confront a supposed “surge” of commercial development and population growth, according to the ordinance language imposed, the village council instituted a 60-day commercial building moratorium. On Sept. 6, council extended the moratorium to last through March 17, as it awaits a commercial master plan from its land-use consultants, ColeJenest & Stone. Consultants estimate they will deliver the report in four to six months.

The moratorium spans the island’s few commercial nodes, including the marina, land surrounding the Old Baldy Lighthouse, the market area and land surrounding the Shoals Club. Roughly 20 undeveloped acres are affected by the freeze in all, according to village maps. 

“We have such limited resources on the island,” Mayor Peter Quinn said. “We’re at this turning point right now.” 

Though populations swell during the summer tourist season, Bald Head Island’s year-round population was 268 as of the 2020 U.S. Census, up from 158 in 2010. The island is home to roughly 1,200 residential units and has seen just a handful of new commercial construction permits annually (or none at all) over the past decade, according to data compiled in 2020 by financial firms for a separate project. 

“You can go a couple of years without something being built, and then you could have three things happen at once,” Quinn said of the pace of commercial building on the island.

From his understanding, Quinn said the moratorium hasn’t negatively affected any developers with plans to construct a commercial project and the village hasn’t received any pushback for its decision. 

“There were conversations with people who, they're getting really close to jumping, but nobody had jumped,” he said. 

No one new development prompted the moratorium, Quinn said, but Bald Head Island Ltd.'s phased exit has prompted officials to assess its few remaining commercial opportunities. "The moratorium gives us a chance to stop for a minute and ... make sure we're not shooting ourselves in the foot," he said.

A village spokesperson said officials were almost positive this is Bald Head Island’s first moratorium. 

Moratoria can be state-imposed, to halt development when infrastructure is strained or maxed-out (like the 2019 sewer line extension halt in northern Brunswick County or Wilmington’s 2008 sewer moratorium that prompted the formation of Cape Fear Public Utility Authority). They can also be voluntary. 

Ed McMahon, a senior fellow with the Urban Land Institute, said voluntary moratoria tend to pop up in quaint, resort or second-home communities when officials seek to pause activity while they get their bearings before introducing new regulations. 

Though the land-use attorney wasn’t directly familiar with the Bald Head Island moratorium, he said the pandemic has accelerated the out-migration of wealthy individuals to high-amenity locations across the U.S. This influx can eventually impact a place’s character, he said.

“People don't like change,” he said. “But there's really only two kinds of change in the world we live in today: There's planned change, and there's unplanned change. And unplanned change will typically, at least in America, wreck eventually, everything that people love about the place they live.

“People hate change when they think it's being done to them. [They prefer it] when they feel like they're controlling the change, or at least can say something about the direction of change or the pace of change.”

North Carolina state law does not impose a specific timeframe for how long a moratorium can last – it states the duration must be “reasonable.” In South Carolina, case law has set the “reasonable” threshold at six months, McMahon said. 

Legal issues can arise, McMahon said, but typically, by the time the litigation makes its way through the court system, the specific moratorium has ended. “So the moratorium becomes moot in the legal sense,” he said.

Quinn said when the village is ready to unveil new commercial guidelines, he anticipates new requirements including stronger tree and landscaping rules and an emphasis on pedestrian accessibility. 

“It's a big step and it's one that's timely,” Quinn said of the moratorium. “I think it was inevitable that it was going to happen sooner or later. So it's good that it's happening now.”