System Development Fee Study

Purpose and Statement

The North Carolina General Assembly passed House Bill 436 in July 2017, amending Chapter 162A of the General Statutes by adding “Article 8, System Development Fees.” This amendment was enacted as “An Act to Provide for Uniform Authority to Implement System Development Fees for Public Water and Sewer Systems in North Carolina and to clarify the Applicable Statute of Limitations” which requires compliance with designated calculation methodology. 

Through House Bill 436 (HB 436), the General Assembly of North Carolina established a uniform approach and associated methodology required for local governmental units to calculate and implement System Development Fees (SDF) for public water and sewer systems. The City of Marion implemented SDFs in July 2018 and is required to re-evaluate the fees every five years.   

What are System Development Fees?

System Development Fees are defined as a charge imposed on each new customer or development that generally offsets the incremental cost of replacing existing and/or constructing new capital assets to provide capacity that will continue to meet the demands placed on the system by each new customer or development. Since water system capacity must, without exception, exceed customer demands, the major infrastructure components providing this capacity, such as water treatment plants, reservoirs, wells, pump stations, etc., must be planned and constructed well in advance and in large enough increments to keep pace with anticipated demand on the available system capacity.

More Information

The City of Marion retained McGill Associates (McGill) to perform the mandatory five-year evaluation of its system development fees effective July 1, 2023 to conform with HB436. McGill Associates is a qualified in engineering disciplines and financial analysis and has the expertise and experience to determine system development fees. McGill has prepared a report of their findings which may be downloaded below. 

2023 System Development Fee Analysis - Public Presentation, Hearing Notice, and Public Comment

McGill Associates will present the System Development Fee Study Findings to the Marion City Council and Citizens during a Public Hearing at the regularly scheduled Council meeting on Tuesday, May 16, 2023 at 6:00 p.m. at the Community Building located at 191 North Main Street, Marion, NC 28752.  Prior to that, the community has 45 days to review and provide comments for consideration of possible modifications or revisions. Those comments can be made using the online form below.

Please leave your comments using the online form below.