Wastewater Merger & Regionalization Feasibility Awarded to Eastern Johnston County Communities

Durham, NC, April 2019 - On March 13, 2019, the State Water Infrastructure Authority awarded $50,000 of Merger/Regionalization Feasibility Grant Funding to the town of Kenly to study potential collaboration opportunities among the utility systems of the towns of Kenly, Micro, Pine Level, Princeton, Selma, and Smithfield, and Johnston County. The grant application was submitted by Triangle J Council of Governments (TJCOG) on behalf of the seven communities after the COG identified Eastern Johnston County as an area that could dramatically benefit from regional utility opportunities.
The study aims to identify the practicality of a merger or regionalization of the Town of Kenly’s wastewater treatment and collection system with one or more of the other communities as well as other potential opportunities for all seven local governments, e.g. shared utility staff. In recent years, the Division of Water Infrastructure has focused on utilizing COGs across the state to assist with Merger/Regionalization Feasibility studies to facilitate these tough conversations around utility mergers and to provide staff capacity to administer the grants on behalf of smaller local governments. â€œThe State Water Infrastructure Authority and the Division of Water Infrastructure are very focused on helping utilities across the state become viable and self-supporting", said Kim Colson, Division Director of the NC Division of Water Infrastructure. "We are happy to provide assistance to proactively look at alternatives that lead to long/ term solutions.”
The Economic Instability of Small Utility Systems
The Merger/Regionalization Feasibility Grant was initially created by the state legislature to broaden the use of grant funds to encourage water and wastewater utility success and proactive management of systems. In recent years, it has become apparent that utilities owned and managed by small communities may become liabilities in the face of economic instability or stressors. Recent natural disasters such as Hurricane Florence and Matthew have burdened utility systems and, for smaller systems, can be massively detrimental. According to the NC Department of Water Infrastructure’s 2017 Master Infrastructure Plan, large rain events and flooding have caused nearly half of the state’s wastewater facilities to exceed treatment capacity, resulting in systems that are under moratoria – temporary suspensions of activity – or Special Orders of Consent.
In addition to the statewide challenges of utility management, several of the Johnston County grant communities have experienced periodic or ongoing insolvency as a result of net losses in their utility fund and have lacked the financial capacity to conduct additional maintenance, expansion, or future planning. These issues are compounded by a struggle to attract and retain experienced utility employees. "Regional planning between all the towns and county will give synergy to each community", remarked Princeton Mayor Don Rains. "By reviewing our water and sewer inventory and potential expansion of services, we can bring economic growth and a better purchasing value to consumers.  Planning is the tool of this grant that will offer better opportunities for each community."