Funding Program Spotlight: North Carolina Regionalization Feasibility Grant

Written by: Claudia Flores

Calling all North Carolina water and wastewater systems who are considering merging/regionalization or other state funding agencies that want to promote regionalization. The North Carolina Merger/Regionalization Feasibility Grant offers water and wastewater systems an opportunity to conduct a study to evaluate the merging of two or more systems. This program emerged from Session Law 2015-241 to help water and wastewater utilities explore pathways that can improve their finances and overall operating efficiency.

While many communities have become interested in looking at regionalization as a way to improve service to their customers, mobilizing resources to evaluate options can be a challenge. The North Carolina Merger/Regionalization Feasibility Grant (MRF) is a unique opportunity for water and wastewater utilities to get planning and evaluation assistance before committing to a comprehensive and expensive merger effort. It is also envisioned that these grants will help prepare communities for additional public funding programs to carry out the infrastructure projects needed for the regionalization.

The funding for the MRF program has come from state appropriation funds. All past rounds have had consistent funding and each applicant is eligible to receive up to 50,000 dollars. Since the establishment of the MRF, a total of 15 utilities have received awards. The most recent pool of applicants that will be awarded funds will be announced in March 2019.

Map produced by The Environmental Finance Center at the University of North Carolina at Chapel Hill. Data Source: North Carolina Department of Environmental Quality: Division of Water Infrastructure

Applications for this program are typically due early fall―in September. In order to be eligible to apply, applicants must get a resolution from their board and have one additional utility willing to participate in the study. The application process involves a rating system, where points are allocated to different categories that are based on technical status, organizational status, and affordability. The rating system was designed to give priority to applicants that are out of compliance, have fewer connections, and/or less staffed. Thus, smaller water and wastewater utilities are encouraged to apply. If a utility desires to do a study on both their water and sewer system, then they must complete two separate applications.

Because the MRF is a relatively new program, it is too early to assess the ultimate impact of this program in terms of completed regionalization and mergers. Several of the communities that completed studies have entered into negotiations and discussions that may lead new regionalized utility systems. For more information on what documents are required to submit a MRF application, please see the Merger/Regionalization Feasibility Grant Priory Rating System Guidance.

More Resources

Interested in the Environmental Finance Center’s past involvement in conducting a study under the MRF? See Partnerships and Regionalization—A Real Life Situation.

 

Special thanks to Amy Simes and Jeff Hughes for contributing to this post.