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Nags Head staff outline $500,000 zero-interest pilot to help failing septic systems
Summary
Town planning staff proposed using a $500,000 Division of Water Infrastructure zero-interest loan to prioritize repairs or replacements for high‑risk conventional septic systems, with a recommended $20,000 cap for high‑risk properties and continued access to the $12,000 low‑interest program for others.
Town planning staff on May 7 presented a detailed plan for a pilot zero‑interest loan program intended to help property owners with failing or vulnerable conventional on‑site wastewater systems.
Kelly Wyatt, director of planning and development, said the town expects to submit a scope to the North Carolina Division of Water Infrastructure by late June or early July and emphasized that local approvals and state requirements will both apply. "We do have to submit a scope of the program to the Division of Water Infrastructure. We're hoping to have that completed by the end of June, early July," Wyatt said.
Staff recommended focusing the $500,000 pilot on properties identified as high risk — defined initially by proximity to water bodies such as canals, stormwater ditches and marshes, lack of septic maintenance in the past five years, and conventional system type. Property owners who do not meet the high‑risk criteria would still be able to apply for the town’s existing low‑interest septic loan, which Wyatt said remains capped at $12,000.
For properties the town designates high risk, staff recommended a maximum zero‑interest loan of $20,000 to cover upgrades that may be substantially more expensive, including alternate systems or importation of fill. Wyatt said town environmental planner Connor Twitty and deputy planning staff are building GIS layers and maintenance records to identify qualifying parcels.
Wyatt flagged additional compliance items: the town must obtain Local Government Commission approval before using the funds; contractors would need to be pre‑qualified for Davis‑Bacon prevailing wage requirements; and American Iron and Steel provisions must be observed in procurement. Finance manager Amy Miller was cited in the presentation as responsible for details of fund disbursement.
The advisory committee also recommended prioritizing elderly, disabled and low‑income residents within the high‑risk pool regardless of technical risk scores. Staff recommended a five‑year repayment schedule consistent with existing loan terms and said the town has budgeted $30,000 to assist applicants who fall outside the high‑risk designation but still need support.
Next steps outlined by staff included finalizing the high‑risk criteria, completing mapping and data checks, and drafting the formal scope for DWI review. Wyatt said the advisory committee will meet again later in May to refine criteria before submitting the scope to the Division of Water Infrastructure.
