North Carolina Supreme Court Weighs Constitutional Challenges to Sewer Impact Fees

May 11, 2022

The North Carolina Supreme Court this week listened to oral argument in a challenge to the legality of water and sewer impact fees brought by real estate developers against a North Carolina county.

At issue in the case, Anderson Creek Partners, et al. v. Harnett Co., is whether such generally applicable fees should be subject to an analysis under the Fifth Amendment of the U.S. Constitution to determine whether they amount to unlawful “takings.” 

Many NACWA public utility members, like Harnett County in the present case, charge modest impact fees to developers to recover the costs of the water and sewer infrastructure required for the new development.  Subjecting such fees to an onerous Constitutional analysis could place significant burdens on municipalities.

NACWA joined with the North Carolina Water Quality Association on an amicus brief authored by NACWA Legal Affiliate AquaLaw to combat claims made in the case by both the developers and national litigious property rights group the Pacific Legal Foundation (PLF).  NACWA’s brief argued that impact fees are necessary to fairly apportion the cost of wastewater services, and are reviewed for reasonableness under various applicable laws and as such do not warrant a Constitutional inquiry.

The seven Justices on the State’s high court asked both sides multiple questions throughout the hour-long argument.  While some of the Justices questioned how legislatively imposed routine fees could constitute “takings” under Fifth Amendment jurisprudence, others inquired about why fees required for land development should not be subject to an unlawful takings test.

The Court is expected to issue a decision on the matter in the coming months.  In the interim, please contact Amanda Aspatore with any questions.  

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