Construction fees in North Carolina
No general act. Authority is granted piece by piece. Some jurisdictions or some fee types are authorized by separate legislation. What applies to the next county over may not apply to you.
N.C. Gen. Stat. ch. 162A, art. 8 (water and sewer system development fees, HB 436)
Your fee stack in North Carolina
Answer four things and get the list of every body that can bill this project, what each one is allowed to charge for, and the rights your state's law gives you before you pay.
What North Carolina says about your project
North Carolina is the clearest split in the country. There is no general impact fee act, and general authority for other fee types requires a private act of the legislature. No new grants have been approved in years, and Orange County's authority was repealed outright in 2018.
Water and sewer are the exception. HB 436 (2017) imposed uniform statewide rules on system development fees: a written analysis using an accepted methodology, a planning horizon of 10 to 20 years, full documentation of the calculation, and updates at least every five years.
Unless a buy-in methodology is used, a revenue credit must be calculated and the fee reduced by it, though not below 25%.
The statute tells courts to construe the authority narrowly so the fees do not unduly burden new development.
What the fees may pay for
2 of 10 facility categories are eligible here. A charge for anything not on this list is resting on some other authority, and that is a fair question to ask.
| Facility type | Eligible for impact fees |
|---|---|
| Roads and transportation | Not listed |
| Water facilities | Yes |
| Wastewater and sewer | Yes |
| Stormwater and drainage | Not listed |
| Parks and recreation | Not listed |
| Fire | Not listed |
| Police | Not listed |
| Libraries | Not listed |
| Solid waste | Not listed |
| Schools | Not listed |
What the jurisdiction had to do first
These are the homework requirements in the act. Where one is required and missing, that is a procedural defect you can raise without a lawyer.
| Planning requirement | In the act |
|---|---|
| Written analysis required | Yes |
| Service areas required | Not required |
| List of projects required | Not required |
| Growth projections required | Yes |
| Level of service standards required | Not required |
Timing, credits, refunds and waivers
| Provision | What the act says |
|---|---|
| Recoupment of prior costs allowed | Yes |
| Required update frequency | 5 years |
What to do next in North Carolina
- Confirm whether your parcel is in a city or unincorporated, then pull the taxing district list from the assessor's record. Why that list is the real fee list.
- Request the current adopted fee schedule and a written fee estimate for the address. The six-step sequence.
- Call each utility separately. Tap fees usually sit outside the act, and are often the largest line.
- Pay under protest if you intend to dispute anything at all. What that preserves.