Outside City Water/Sewer Rates
Customers who live inside the Fayetteville City limits and the Hope Mills Town limits pay a lower Inside City rate. Most municipal water systems that serve customers outside the boundaries of the city/county that owns them charge a higher rate for those customers outside those boundaries because the municipality owns and bears added risk because of that ownership.
Cities in North Carolina, including Fayetteville, own the assets of their utility, which includes the water plants, sewage treatment plants, and all the pipes in the ground. Additionally, they issue the Bonds that are used to finance those assets. Even though PWC is a separate component unit of government from the City of Fayetteville, the City stills issues the bonds that PWC uses. As such, the City, and through the City its citizens/taxpayers, ultimately bears the obligations and risks of those bonds. Customers outside the City do not bear this additional risk or obligation.
Other reasons utilities may charge more for outside customers:
- In the case of municipalities, higher outside charges might be part of managing growth and annexation, or to make contributions alongside the property tax base that secures certain types of bonds and loans serving the entire water or wastewater system.
- For all utilities, outside customers are often more expensive to serve because of lower densities and the fact they reside farther, on average, from the water or wastewater treatment plant than inside customers, increasing costs for distribution and collection.
- PWC’s outside city rates are lower than the inside rates of most NC municipalities that charge outside rates.
- According to the N.C. School of Government who has an online comparison of North Carolina water & sewer rates, differentials range from a low of around 100% to a high of 300%. Average is 167% statewide.
- PWC’s current differential is 175%. According to the N.C. School of Government of those with a differential, 50% have a differential higher than PWC’s and over 135 municipalities have a differential that is 200% or greater.
