policy
North Carolina Water Infrastructure Funding Bill Directs Grants to Raleigh Utilities While Surrounding Towns Receive None
Raleigh water customers face stable rates through 2028 under the new state allocation while residents in nearby unincorporated areas expect higher connection fees.
How we reported this
North Carolina House Bill 1247, enacted June 28, sets a $180 million state grant program for municipal water and sewer upgrades through fiscal year 2028. Raleigh receives $24 million of that total for treatment plant expansions along the Neuse River. Wake County towns outside the city limits receive zero dollars under the population-based formula in section 4 of the legislation.
Why the bill reached the governor now
The General Assembly passed the measure after the Department of Environmental Quality reported in March that 47 percent of North Carolina public water systems needed immediate repairs exceeding $4.2 billion statewide. The bill directs the first round of grants to systems serving populations above 250,000, which automatically includes Raleigh but excludes Apex, Holly Springs and Garner.
Raleigh Public Utilities Director records show the city will use the grant to replace 12 miles of aging mains in the southeast sector, a project listed in the 2025 capital improvement plan. Homeowners in those neighborhoods can expect fewer boil-water notices once work finishes in late 2027. Residents outside city limits who rely on private wells or small community systems will continue paying full costs for any required upgrades.
Concrete effects on daily costs and services
The legislation states that grant recipients must match 20 percent of project costs from local funds. Raleigh plans to cover its share through existing utility reserves, avoiding any immediate rate increase. The city budget office projects average monthly residential water bills will stay at $48 through 2028. In contrast, the Wake County Health Department estimates that 3,800 households in eastern Wake County may see septic or well upgrade costs rise by an average of $7,200 per household if they connect to municipal service.
Policy analysts at the North Carolina League of Municipalities note that the formula favors larger cities because the bill ties eligibility to the most recent federal census population counts. Raleigh added 48,000 residents between 2020 and 2025, meeting the threshold. Smaller towns did not.
The Department of Environmental Quality will open the next grant round in January 2027. At that time, municipalities below the population cutoff can apply only if they form joint applications with a qualifying city. No additional state dollars have been authorized beyond the current $180 million cap.