The float, pulled by a local farmer on a tractor flying a confederate flag, was loaded with watermelons, and carried signs that read "White History Month," and urged people to hug white people.
Board members also directed the town manager to come up with a policy regulating parade floats.
A local minister thinks the board's actions are the first steps in the healing process.
"We have never had a policy. We never really talked about these issues, and now they are in the forefront," said Rev. Dennis Sheppard of Hope Mills United Methodist Church. "They are getting addressed, and I think that will let people know the town board is taking it seriously, hearing their concerns, their complaints, and so forth. I think it is a big step. It's a big step."
The town manager says he will present a proposed policy to the town board in September.