North Carolina HB 376: Little Federal Model NC Edition.

Bill Text

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025

SESSION LAW 2026-32
HOUSE BILL 376

*H376-v-7*
AN ACT TO ADDRESS WATER AND WASTEWATER AFFORDABILITY AND
CAPACITY AND TO MAKE VARIOUS CHANGES TO THE STATUTES GOVERNING
ON-SITE WASTEWATER SYSTEMS AND PRIVATE WELLS.

The General Assembly of North Carolina enacts:

AMEND PROCEDURES REGARDING THE SALE OF A PUBLIC WATER SYSTEM
SECTION 1. G.S. 62-133.1B(e) reads as rewritten:
"(e) The Commission shall, after notice and an opportunity for interested parties to be
heard, issue an order ruling on the water or sewer utility's request to adjust base rates under
G.S. 62-133, denying or approving, with or without modifications, a water or sewer utility's
proposed Water and Sewer Investment Plan. The Commission may suspend the effect of the
proposed base rates and the Water and Sewer Investment Plan implementation pending
investigation in the same manner as provided in G.S. 62-134(b), provided that the Commission
may suspend the implementation of the proposed base rates for no longer than 300 days. An
approved plan shall be effective no later than the end of the maximum suspension period pursuant
to G.S. 62-134(b).period."
SECTION 2. Article 1 of Chapter 162A of the General Statutes is amended by
adding a new section to read:
"§ 162A-19.1. Sale of a public water or sewer system.
(a) For purposes of this section, "local government service provider" means any of the
following:
(1) A county.
(2) A city.
(3) A water and sewer authority created under Article 1 of Chapter 162A of the
General Statutes.
(4) A metropolitan sewerage district created under Article 5 of Chapter 162A of
the General Statutes.
(5) A sanitary district created under Part 2 of Article 2 of Chapter 130A of the
General Statutes.
(6) A county water and sewer district created under Article 6 of Chapter 162A of
the General Statutes.
(7) A metropolitan water district created under Article 4 of Chapter 162A of the
General Statutes.
(8) A metropolitan water and sewerage district created under Article 5A of
Chapter 162A of the General Statutes.
(b) No local government service provider may sell to a private company a water or sewer
system that provides service to the public until the governing body of the local government
service provider has held a public hearing on the sale and made a determination that the sale is
in the public interest. In determining if the sale is in the public interest, the local government
service provider shall consider, at a minimum, all of the following:
(1) The physical condition of the water or sewer system being sold.

Page 2 Session Law 2026-32 House Bill 376
(2) The capital replacements, additions, expansions, and repairs needed to provide
reliable service and meet all applicable federal standards.
(3) The availability of federal and State grants and loans for system upgrades and
repairs.
(4) The willingness and the ability of the purchaser to make system upgrades and
repairs and provide high-quality and cost-effective service.
(5) The reasonableness of the contract sale price and terms.
(6) The most recent income and expense statement and asset and liabilities
balance sheet of the purchaser.
(7) The purchaser's existing rate base and projected rates over the next three years.
(8) The affordability of the projected rates for the next three years for customers
serviced by the system, based on the income levels of the customer base.
(9) The alternatives to the sale and the potential impact on utility customers if the
sale is not made.
(c) The local government service provider shall prepare a statement showing that the sale
is in the public interest, including a summary of the purchaser's experience in water or sewer
utility operation and a showing of financial ability to provide the service.
(d) All moneys paid by a private company to a local government service provider for the
purchase of a water system or sewer system shall be used for the purpose of debt reduction for
the system, if applicable, and repayment of federal grant awards associated with the system as
may be required by federal law or regulation. Any unspent funds remaining after debts and
federal grant awards have been repaid shall be deposited in the general fund of the local
government service provider."
SECTION 3. Article 1 of Chapter 162A of the General Statutes is amended by
adding a new section to read:
"§ 162A-19.2. Limitation on water and sewer rates charged to customers outside the
jurisdictional boundaries of the provider.
(a) For purposes of this section, "local government service provider" means any of the
following:
(1) A county.
(2) A city.
(3) A water and sewer authority created under Article 1 of Chapter 162A of the
General Statutes.
(4) A metropolitan sewerage district created under Article 5 of Chapter 162A of
the General Statutes.
(5) A sanitary district created under Part 2 of Article 2 of Chapter 130A of the
General Statutes.
(6) A county water and sewer district created under Article 6 of Chapter 162A