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Lead pipe mandate could cost NC utility customers

FILE - In this July 20, 2018, file photo, a lead pipe is shown after being replaced by a copper water supply line to a home in Flint, Mich.
Paul Sancya
/
AP
FILE - In this July 20, 2018, file photo, a lead pipe is shown after being replaced by a copper water supply line to a home in Flint, Mich.

The Biden administration’s effort to remove an estimated 9.2 million lead pipes from the nation’s public and private water systems has begun. The first step in that process is a mandated service line inventory due later this year.

But for local governments across North Carolina, it’s unclear where the money to cover the full cost of the inventory will come from. And that will likely place some of the burden on local utility customers.

“It is a big task. I mean it’s doable, we’ll just deal with it, get it done, and move on," said Jeff Stines, public services director for the Haywood County town of Waynesville, population 10,000.

Stines estimates the town has around 8,000 municipal water service connections, the underground lines that connect buried water supplies to buildings and homes.

He’s in charge of complying with the recent federal mandate to conduct an inventory of the lines, the first phase of a 10-year process to rid the nation’s drinking water supply of dangerous lead pipes once and for all.

Municipalities work to identify location of lead lines

Lead pipes were banned in 1987. Municipalities are using predictive data modeling based on property records to identify areas where lead service lines are more likely to be present, but in order to verify the composition of pipes, there’s going to be a whole lot of digging on both sides of the meter.

“One of the issues that I know not only Waynesville, but other municipalities, face is gaining access to private property,” Stines said. “We're going to have to dedicate a crew, or crews, to do this, along with other maintenance. You're talking at least four, maybe even eight people working on this.”

For some water systems, the job will be much bigger.

“We don’t serve just the city of Charlotte,” said Veronica Horvath, senior public information specialist with Charlotte Water. “We do serve the city of Charlotte and Mecklenburg County, so we do serve around 1.1 million people and we have to the tune of about 330,000 service lines and connections around our region. So yes, we are very large utility.”

Horvath said her system is leaning into predictive modeling and is reporting lead service lines as they find them. But that the whole endeavor won’t come cheap.

You could look at $150 to $200 per household. Some of our meters are two to three feet deep, so it's not just a matter of sticking the shovel in the ground and hitting a pipe. They may be digging for a while to get to that pipe.
Waynesville Town Manager Rob Hites

The cost of this initiative is something Waynesville’s Town Manager Rob Hites is also trying to get a handle on. 

“I mean, you could look at $150 to $200 per household,” Hites said. “Some of our meters are two to three feet deep, so it's not just a matter of sticking the shovel in the ground and hitting a pipe. They may be digging for a while to get to that pipe.”

The Biden Infrastructure Law has allocated $15 billion to states specifically for the service line inventory and some replacement work. In 2023, North Carolina received $180 million, but that’s being made available to water system operators through zero-interest loans repayable over decades.

The key word there is repayable.

In North Carolina, municipal enterprise funds like recreation funds or water and sewer funds must be self-sufficient. That means they can only rely on revenue derived from those specific services. So in this case, the loan payments would have to come from utility customers.

The state has granted water system operators principal forgiveness in varying amounts, but that’s awarded after a competitive application process, and it isn’t guaranteed.

During the first round of awards last September, 44 water systems received $16.6 million in loans, but on average, only 60% of the principal was forgiven.

Some towns, like Lenoir, will have to repay their entire $500,000 loan. Other towns, like Pittsboro, won’t have to repay a cent.

In Waynesville, Hites said unless they’re awarded 100% forgiveness, he and other towns, large and small, will almost certainly see some budgetary impact.

“If it looks like we have to spend $150 or $200 per household, we may have to look at a rate increase and then we back it off once the program is over,” he said.

The deadline for the completion of the service line inventory is Oct. 16.

Cory Vaillancourt
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