UPDATE 4-U.S. storm Arthur to pack hurricane winds by July 4 holiday

Wed Jul 2, 2014 8:15pm EDT

(Adds quotes, evacuation ordered on Hatteras Island, updates position)

By Colleen Jenkins and Gene Cherry

July 2 (Reuters) - Tropical Storm Arthur threatened to douse some July 4 holiday plans on the U.S. East Coast as officials ordered evacuations of some low-lying coastal areas, closed beaches and tourist sites and delayed fireworks shows in anticipation of heavy rain and fierce winds.

The first named storm of the Atlantic hurricane season (link.reuters.com/baw32w) was close to reaching hurricane strength, forecasters said on Wednesday, leaving some businesses worried about taking a financial hit.

Authorities began closing campgrounds, lighthouses and beaches at noon (1600 GMT) on Wednesday on the Outer Banks of North Carolina, where up to 200,000 visitors crowd the Hatteras and Ocracoke islands.

A mandatory evacuation order for Hatteras Island forced some to change vacation plans.

Dave Dawson, owner of the Cape Hatteras Motel said he was completely booked for the holiday but planned to close. "We are calling people right now apprising them of the situation so they can make other plans," he said.

Despite the evacuation order, not all residents of the 50-mile-long (80-km) island said they were leaving. The island is served by only one highway, which is prone to flooding and closure because of sand washed in by the ocean.

"It will be impossible for us to return back to our house," said retired teacher Elizabeth Mullen, who plans to ride out the storm with her husband in Salvo, midway on the island.

"We have only left for two storms in the 41 years we have lived here," she added, noting she had stayed through at least a dozen previous storms.

There are currently 35,000 people on Hatteras Island, Dare County spokeswoman Dorothy Killingsworth estimated on Wednesday.

A hurricane warning was in effect along North Carolina's coast, while part of the South Carolina shore was under a tropical storm warning, the National Hurricane Center said.

North Carolina Governor Pat McCrory declared a state of emergency on Wednesday for 25 eastern counties to help prepare for possible damage.

COULD BE HURRICANE SOON

Arthur was expected to become a hurricane on Wednesday night or Thursday as it passes well east of Florida's northeast coast, the NHC said. A tropical storm becomes a hurricane when top sustained winds reach 74 mph (119 kph).

The storm remained out at sea with maximum sustained winds of 70 mph (113 kph) on Wednesday, about 180 miles (290 km) south-southeast of Charleston, South Carolina, the Miami-based weather forecasters said on Wednesday night.

Arthur could be packing Category 1 hurricane-force winds of 85 mph (135 kph) when the outer bands brush the Carolinas on Thursday and Friday before weakening, according to forecasters.

The storm could produce dangerous rip currents along the coasts of several Southern states, forecasters said, dumping up to 2 inches (5 cm) of rain across the Carolinas and causing flooding from storm surge.

Concerns about the storm caused authorities in Boston to move a nationally televised concert by the Boston Pops and a fireworks display, which draw hundreds of thousands of spectators to the city's riverfront, up by a day to Thursday.

Several towns and villages on North Carolina's Outer Banks and coast rescheduled Independence Day festivities and fireworks plans as the storm picked up speed moving north at 7 mph (11 kph).

Farther up the coast, the resort town of Ocean City, Maryland, said it was moving its July 4 fireworks display to Saturday because of the storm. (Reporting by Colleen Jenkins in Winston-Salem, North Carolina, and Gene Cherry in Raleigh, North Carolina; Additional reporting by David Adams in Miami, Harriet McLeod in Charleston and Scott Malone in Boston; Editing by Susan Heavey, Eric Beech and Peter Cooney)

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