To make someone a local moderator, go to the boards section of your Administration Center (Administration Center > Forum > SMF2.0:Boards > Modify Boards) and select the "modify" link next to the board you wish to place the moderator on. Find the field called "Moderators" and place the members username in the box and save your changes.

You can assign more than one person to moderate a specific board by separating the usernames with commas.