What is the average household stormwater fee in North Carolina? This is a harder question to answer than you might assume. User fees for stormwater management are influenced by many factors, including a utility’s service population, the importance of managing stormwater runoff to the community, and the amount of impervious surface. The Environmental Finance Center (EFC) recently completed a statewide stormwater fee survey in North Carolina. We collected and analyzed 73 different service area fee structures. These structures paint a picture of North Carolina’s stormwater management across the state.

Most stormwater utilities in NC are managed by municipalities and contain a single fee structure applicable to the entire service area. However, several counties run stormwater utilities that have multiple fee structures depending on where the property is located in the county. For example, Mecklenburg County’s stormwater utility was created to generate revenue to manage stormwater in six different municipalities and the unincorporated area of the county. Each area provides different services and has established its own revenue needs, leading to 7 different fee structures. Person County has a separate fee structure for properties within and outside the Falls Lake Watershed. Additionally, Granville County manages stormwater in three municipalities and has differing rates for inside the Falls Lake Watershed versus outside.

Residential Stormwater Utility Fees in North Carolina

One simple way to compare fees between different municipalities and counties is to examine the representative monthly fee for a typical property. To calculate the monthly equivalent stormwater fee payment for each rate structure we collected, we assumed that the average family has 2,455 square feet of impervious surface on their property. Impervious surface area represents the area of the property that does not allow water to filter through its surface and into the soil. Commonly these are areas such roofs, driveways and walkways.

In the graph below, we show the distribution of these fees for the 73 utility rate structures. The amounts charged for a residential property with 2,455 square feet of impervious area range from $0.75 to as high as $10.18 per month.

stormwater1 

Fee Structures Explained: Residential vs. Non-Residential Structures

The most common residential structure consists of a “flat” fee structure where every property pays the same amount regardless of the amount of impervious surface. Forty utilities (or 54% of the utilities studied) charge a flat fee for residential customers. Some utilities employ a “tiered” structure where residential properties are divided into groups (typically 2 to 5 groups) based on the amount of impervious surface and each group pays a different fee. No utilities in North Carolina calculate the residential fee on a “Per ERU” basis. ERU stands for Equivalent Residential Unit and is a set number of square feet a utility determines from surveying properties in their customer base.

The “per ERU” structure is much more commonly used for their non-residential customers since the size of impervious surface can vary so much among non-residential properties. One ERU is typically set at the estimated impervious lot size for an average residential property. For example, a utility might establish a per ERU structure with an ERU set at a size of 2,000 square feet per month and with an ERU fee of $3 per ERU; under this structure, a property with an impervious area of 4,000 would pay $6.00. A property with an impervious area of 7,000 square feet would pay 3.5 times the ERU rate, or $10.50. The Per Unit structure is also sometimes used for non-residential properties. It is different from the Per ERU structure in that municipalities or counties with this fee structure do not base it on an equivalent residential unit, but rather a standard unit that the utility chooses. In North Carolina, the unit size most commonly chosen for commercial properties is one acre or 43, 560 square feet.

stormwaterNC2

 

Fee Type Non-Residential Residential
Per Unit (Non-ERU) 10 0
Per Unit (ERU) 42 0
Tiered 7 28
Flat 11 44

 

Customer Classes and Fee Structures

Eighty-three percent of the utility fee structures studied have distinct residential and non-residential fee structures. Typically, non-residential properties end up paying more than residential properties, and they tend to be based on the use of per ERU rate structures. Since there is far less variation in property size among residential properties than non-residential properties, it may make sense for residential fees to operate on a tiered or flat fee approach. Non-residential properties vary tremendously in size and diversification of surface area, so flat fee structures are often not appropriate. A large commercial complex may end up paying the same amount as a small residential property despite having much more stormwater runoff.

2017 North Carolina Stormwater Rates Dashboard

To learn more about stormwater rates in North Carolina, please explore our preliminary stormwater fee dashboard which visualizes rates across the state for both residential and non-residential customers.

stormwatertableau

More Information on Stormwater Rates

Tara Nattress is pursuing her Master’s of Public Administration in the School of Government at the University of North Carolina at Chapel Hill and works as a research assistant for the Environmental Finance Center.