Doffing the mill houses: doing that, Pharr Yarns begins to relinquish its role as laird of what could be America's last mill village.

• Author: Hains, David
• Position: Feature

Sixty-two residents--about 10% of McAdenville's population--sit on metal folding chairs in the town's 55-year-old community center. A mirrored disco ball hangs above them, motionless and ignored on a rusted hook among the rafters of the large room, which likely has seen livelier times. Up front, the Town Council begins a meeting beneath a portrait of William Pharr, former mayor, textile magnate and landlord. He smiles benevolently, as if he were confident that this council, like others before it, will make decisions he would favor.

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At the rear of the room, observing but not participating, sits his son-in-law and successor as CEO of Pharr Yarns Inc. J.M. "Bip" Carstarphen, 71, has shaped the town's past and will have plenty to say about its future: His family owns the company, and the company owns 75% of the land in McAdenville. It pays to treat the water and sewage, clean the streets and burn the streetlights.

There used to be lots of places like this in North Carolina. But most companies long ago loosened their grip, selling or leveling the mill houses where their employees lived. McAdenville might be the last mill village in the state--may be the last in America. "It's hard to prove if something is the last, but McAdenville is definitely among the last," says David Carlton, an associate professor of history at Vanderbilt University whose specialty is the industrialization of the South. He spent the first five years of his life in a mill village. He recently asked his colleagues in an Internet work group on textile history if anyone knew of any other places where a mill, in effect, still owns the town. None did.

The issue before the council is momentous. Pharr Yarns has requested a zoning variance that will allow it to build 200 homes, which could double the town's population by the next census and reverse a three-decade population decline. Forty-four mill houses, about half of the homes Pharr Yarns owns in McAdenville, are to be demolished to make way for the project. "It's a big-picture thing, and we're just a little town," Mayor Jerry Helton says at his car-repair shop a few days before the vote. After much deliberation, the council unanimously approves the request, setting the stage for the next step in the town's evolution.

Starting this fall, if all goes as planned, residents will pay municipal property taxes for the first time. The town will take on more responsibilities. "It's going to be a big challenge," Helton...