How New Local Water Distribution Inspections Significantly Impact Housing Affordability

By: Michelle Manns, Greater Charlotte Apartment Association; John Huson, Carocon Corporation; Tom Brasse, Home Builders Association of Greater Charlotte

“Regulation imposed by all levels of government accounts for an average of 32.1 percent of multifamily development costs.  In fact, in a quarter of cases, that number can reach as high as 42.6 percent”,
according to research released in 2018 by the National Association of Home Builders (NAHB) and the National Multifamily Housing Council (NMHC).  

A recent change in the administration and inspection of private water distribution systems in housing developments here locally has led to a substantial increase in the cost of housing with no discernable public benefit.  The purpose of this article is to bring attention to how a local regulatory change has significantly increased the cost of housing construction that ultimately impacts housing affordability and ultimately the renters in our community.

Specifically, this issue involves a regulatory change in the permitting and inspection procedure for site domestic water lines for private water distribution systems.  Previously, the review and inspection of this scope of work was administered by Charlotte Water as a delegated authority by the State Division of Water Quality (DWQ).  All underground domestic water lines, public and private, were permitted and inspected by Charlotte Water and the project civil engineer would observe the installation and pressure test and would certify the private lines.  About a year ago, the administration for the private portion of this work (past the meter and up to the building(s)) was transferred from Charlotte Water to Mecklenburg County Building Standards.  This change was the result of a local legal interpretation by the City Attorney on behalf of Charlotte Water.  The City Attorney rendered that Charlotte Water did not have the authority to review water systems that were not “public”.  Now, all private underground domestic waterlines are to be permitted and inspected by the County Code Enforcement department thereby bringing the review and inspection of these lines under the State Plumbing Code.  Charlotte Water will still inspect the public lines, which do not fall under the jurisdiction of the plumbing code, but not the private lines.  There has been no change in the actual layouts or construction, only the applicable code.

How does this change impact housing affordability?  It is all about the piping.  The previous standard for the pipe used in the vast majority of residential developments for these installations, both private and public, was the PVC C900.  The State Plumbing Code, which addresses the building code and not a utility code does not recognize the C900 standard.  C900 and its associated fittings have met all the numerous American Society for Testing and Materials (ASTM) standards for use as a water distribution system and has been acknowledged by State Plumbing representative as acceptable for use in the distribution systems.  However, representatives are hampered by their own rules and are unwilling to make a blanket permission ruling to use the pipe without requiring the change to go through the formal approval process.  This is despite the fact that the DWQ approves this material for public distribution systems and Charlotte Water installs this pipe within this municipality on a daily basis.  There seems to be a level of contradiction within government.

The likely proposed alternate pipe for private water distribution systems that is recognized in the State Plumbing code is ductile iron which is significantly more expensive than PVC C900.  The additional cost of the change to ductile iron can be as much as $600+/unit and the ongoing maintenance cost for any future replacements or repairs would be more expensive as well.  There is no discernable difference in the delivery or quality of the water between the two types of piping and therefore no benefit to the end users who will ultimately eat the costs associated with the change. 

This administrative change by Charlotte Water was made without any notice or discussion with the apartment or construction industry.  No industry participation was involved.   So, what has resulted is that a generally accepted industry practice has been modified simply because there was a change in the inspecting agency.   It can be argued that the specific change was the result of applying a code applicable for buildings to a code applicable to site utilities. 

This issue has and continues to financially devastate housing projects that are already experiencing rising costs in labor and materials.  Local officials in Charlotte Water claim there is nothing they can do to help, although an interpretation with the assistance of DWQ to give them authority to permit and inspect private systems would fix this.  County Code Enforcement has been sympathetic and helpful, but their hands are tied because of the State Code and they do not have the flexibility to allow anything without an interpretation from the State or a change in code or ordinance.  Developers hands are tied as well. In any case, regulation again is causing a significant increase in the cost to build housing.

Representatives of the Greater Charlotte Apartment Association, REBIC, and The Homebuilders Association (HBA) have joined forces to try to address this issue through an appeal with the North Carolina Building Code Council and with City and County staff and elected officials.  These processes are long and in the meantime the cost for housing continues to escalate. At the end of the day, the end-user, the renter, pays the ultimate price.

For a recent television interview on this topic, click the link below:

https://www.wsoctv.com/news/local/change-inspections-creates-expensive-headache-charlotte-builders/YPFZT4S2ANDCJPILYRPNIXZV4Y/