AN ACT to provide additional flexibility for certain regional water and sewer infrastructure Funding.

The General Assembly of North Carolina enacts:

SECTION 1.  Section 14.20A of S.L. 2016‑94 reads as rewritten:
"Regional Water and Sewer Funding
"SECTION 14.20A.(a)  Of the funds appropriated to the Department of Environmental Quality, Division of Water Infrastructure, by this act, the sum of fourteen million five hundred forty‑eight thousand nine hundred eighty‑one dollars ($14,548,981) shall be used to fund interconnection, extension of water lines, and related water system modification and expansion involving the Counties of Rockingham and Guilford and the municipalities of Oak Ridge, Stokesdale, Summerfield, Reidsville, Madison, and Mayodan. Of the funds allocated by this section, no more than twenty‑five percent (25%) of the funds shall be used for Guilford County and may include one or more of the municipalities listed in this section located in Guilford County, and no more than seventy‑five percent (75%) shall be used for Rockingham County and may include one or more of the municipalities listed in this section located in Rockingham County. The funds allocated by this section may be spent for planning, design, survey, real property acquisition, construction, repair, and any other activities necessary to improve the performance and reliability and expand the capacity and service footprint of participating water systems in Rockingham and Guilford Counties. The Counties of Rockingham and Guilford and the municipalities participating in the interconnection and extension of water lines within each county funded by this section shall agree on the use of the funds allocated by this section through any combination of (i) interlocal agreements under Article 20 of Chapter 160A of the General Statutes that specify, at a minimum, the ownership of the water lines and infrastructure funded by this section and long‑term maintenance, repair, and replacement responsibility or (ii) one or more regional water and sewer authorities under Article 1 of Chapter 162A of the General Statutes.
"SECTION 14.20A.(b)   Notwithstanding G.S. 143C‑6‑23(f1)(1) and G.S. 143C‑1‑2, funds allocated by this section shall be held in reserve by the Office of State Budget and Management and the allocations to each County shall be released when the County and one or more of the municipalities specified in subsection (a) of this section reach agreement on the funds allocated to that County by this section through interlocal agreements or the formation of regional water and sewer authorities or a combination of interlocal agreements and regional water and sewer authorities. Funds not spent or encumbered by June 30, 2020, shall be returned by the local governments or regional water and sewer authority to the Office of State Budget and Management and revert to the General Fund."
SECTION 2.  This act is effective when it becomes law.
In the General Assembly read three times and ratified this the 16th day of May, 2017.

	s/	 Philip E. Berger
	 President Pro Tempore of the Senate

	s/	 Sarah Stevens
	 Speaker Pro Tempore of the House of Representatives

	s/	 Roy Cooper
	 Governor

Approved 8:30 a.m. this 23rd day of May, 2017