Ford announced plans to open a plant near a Tenn. Black town. Then the state took over the town.

When Mason, Tennessee, faced losing its ability to govern its own finances in a fight with white state officials earlier this year, doing so brought a spotlight to the majority Black community of fewer than 1,600 people for a situation that town advocates called discriminatory.

For months, Mason battled for its own financial control after the town refused to give up its charter, prompting the state to formally take over its finances shortly after carmaker Ford announced a major project nearby. But in May, Mason officials dropped a lawsuit they brought to Tennessee’s Chancery Court against state officials, after agreeing to more favorable terms, signaling the lengthy feud between the town and the state over racial discrimination and autonomy is coming to an end.

The majority Black town, represented in court by the NAACP, announced during a press conference last month that it would regain its independence, while also reaping the benefits of the nearby economic development opportunity coming to the region.

A replica of the Statue of Liberty in Mason.  (Andrea Morales for NBC News)
A replica of the Statue of Liberty in Mason. (Andrea Morales for NBC News)
Older storefronts along Main Street in Mason.  (Andrea Morales for NBC NEWS)
Older storefronts along Main Street in Mason. (Andrea Morales for NBC NEWS)

The conflict started in February when Mason faced a stark choice: forfeit its right to self-governance in exchange for debt forgiveness, or retain control and have to immediately start paying off almost $600,000 in debt it couldn’t afford.

The decision, forced on the town by Jason Mumpower, the state’s comptroller, came soon after the announcement that the Ford plant would be built nearby, slated to open in 2025. The project is expected to bring $1.8 billion to the state and create 18,000 jobs. Mason, the town closest to the plant with a sewer and wastewater system that the plant would use, will be one of its biggest beneficiaries financially. This is one reason why, according to Mason Vice Mayor Virginia Rivers, the town chose to take on the debt in March.

As a result, Mason was subjected to pay almost $600,000 of debt through monthly payment plans of approximately $22,000, owed to its water, sewer and gas funds that had accrued since at least 2007, according to Mason’s financial fact sheet. In addition to paying off the debt, the town could not apply for grants or pay bills over $100 unless they were approved by Mumpower, who began financial oversight in March.

“We were being set up to fail,” Rivers told NBC News in March about the original repayment plan required by the comptroller.

Image: (Andrea Morales for NBC News)
Image: (Andrea Morales for NBC News)

The lawsuit the mayor and Board of Aldermen of Mason filed against Tennesee’s comptroller of the treasury accused Mumpower of racial discrimination and misuse of financial power. The lawsuit also stated that the comptroller’s financial oversight plan violated the Tennessee Constitution, according to the Tennessee Observer.

“This was a power grab, not a path to support the citizens,” NAACP President Derrick Johnson said. “They were seeking to dissolve the town,” he said, as the result of Mason being put under the financial control of majority white Tipton County

Johnson said the comptroller’s actions had racist undertones, since majority-white municipalities that were in debt, like Jellico County, were not forced to face the same ultimatum, reflecting the state’s history of targeting Black leadership.

For Mason, prior to the lawsuit, Johnson said, “democracy was not working.”

Following the settlement, now the town is required to pay back approximately $5,000 per month, which Anthony Ashton, senior associate general counsel of the NAACP, said is a more manageable payment plan compared to the $22,000 the comptroller previously required. And instead of needing approval for every expense over $100 each time it takes place, the spending threshold increased to $1,000 and is approved monthly.

The town also managed to pay off a portion of its almost $600,000 debt, lowering it to approximately $248,000, which will be paid off over four years.

“The debt was incurred with a previous administration,” Ashton said. “This administration was actively paying it down and rapidly paying it down, and yet it was this administration that received a target from the comptroller of ‘give up your charter.” The corrective action plan was “so strict and overwhelming” that it would “ruin the town financially,” he added.

Andrea Morales for NBC News
Andrea Morales for NBC News

In a statement in March, Ford acknowledged the tensions but said that the situation was between the state and Mason and denied any involvement. Rivers said representatives from Ford met with her administration in April to hear Mason’s side of the story, but did not offer any assistance to help.

“We’ve had several conversations with Mason officials to ensure they are positioned to benefit from the economic growth we are bringing to the area, and we’ll continue to engage with Mason and other West Tennessee communities to help them prepare for potential jobs and investments for their residents,” Ford said in a statement shared with NBC News in June. “Ford is committed to being a good neighbor and providing equitable opportunities.”

During the conflict, many people on social media also called for action, including one Virginia resident, identified as KD, who started a series of hashtags, petitions and fundraisers on behalf of Mason.

“They need a lot of economic substance down there — where the money would directly benefit the residents of Mason because they’re the people that are suffering the most,” said KD, who requested to remain anonymous due to safety concerns. “So we were able to put that GoFundMe page together strictly for that purpose.”

Since then, KD’s efforts have garnered almost $18,000 in donations from more than 325 supporters around the nation. KD is currently in the process of withdrawing the funds and plans to give Mason the money in the form of a cashier’s check, they said.

While this new deal may seem like a win for the town, not everyone is rejoicing. Rivers said that if Mason Mayor Emmit Gooden had not signed off on dropping the lawsuit against the comptroller, the town’s repayment terms would have not changed. She also said that the comptroller’s financial oversight will cease if the town’s budget for 2023 is approved by August.

“I am not totally satisfied but it’s better than what we had,” she said.

Mumpower released an updated corrective action plan in May with terms of agreement, one requiring the town to maintain regular contact with the comptroller’s office or it will be considered in violation of the plan.

“Mason’s agreement to a new corrective action plan is a significant step in restoring the town’s financial health,” Mumpower said in a statement released in May. “By agreeing to change its practices and work with our Office, Mason will operate on a balanced budget, work toward correcting its audit findings, and eliminate improper borrowing. Most importantly, if Mason follows this plan, taxpayers can know their leaders are being good stewards of their money.”

A man walks along Finde Naifeh Drive in Mason.  (Andrea Morales for NBC News)
A man walks along Finde Naifeh Drive in Mason. (Andrea Morales for NBC News)

When asked about Mason’s accusations of discrimination from Mumpower, the comptroller’s office said that it “proceeded diligently and in good faith to improve the financial condition of the Town of Mason so that its citizens can benefit from the services they receive from the Town,” according to a statement given to NBC News in June. The statement also said that the comptroller’s office “has a responsibility to ensure that Tennessee local governments do not fail without regard to the local government’s demographics.”

Now that the lawsuit has been dropped, the town will work to meet its financial obligations and continue paying off the debt. Mason will also move forward with investing in its infrastructure and economic development to bring business into the town for “Mason to be a beautiful place,” Rivers said.

“Hopefully, it doesn’t happen again,” she said. Because of the state’s correction action plan, the comptroller can exercise his financial authority if Mason gets “out of line at all in any way,” she said.

“But hopefully we don’t have to get to that point,” she added.

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CORRECTION (June 22, 2022, 5:30 p.m. ET): A previous version of this article mischaracterized where Jellico County is in relation to Mason. It is not a "neighboring" area; the county is about 350 miles northeast of the city.