WILMINGTON — Water used by hundreds of thousands of residents in southeastern North Carolina could soon be affected by a decision made far upstream, as state regulators consider a request to divert millions of gallons a day from the Cape Fear River.
The Town of Fuquay-Varina, a rapidly growing municipality 150 miles upstream of Wilmington, is seeking state permission to permanently remove 6.17 million gallons of water from the Cape Fear River every day. The town’s request was the focal point of a Jan. 3 seminar led by Cape Fear Public Utilities Authority at Cape Fear River Watch headquarters, where executive director Kenneth Waldroup warned the move could jeopardize the water security of the entire Lower Cape Fear region.
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Fuquay-Varina is currently one of the fastest-growing towns in North Carolina. Between 2010 and 2020, the town grew by 90%, and current forecasts estimate the population will exceed 65,000 by 2030. To meet demands, the town currently relies on water purchased through contracts with Raleigh, Johnston County, and Harnett County, though more is needed.
According to the town’s draft environmental impact statement for the request, Raleigh’s current water allocation to Fuquay-Varina is expected to reach its ceiling by 2030, and town projections show a shortfall of nearly 2 million gallons per day beginning in 2030. To sustain growth through 2055, the town’s solution is to source its entire supply from the Tri-Rivers Water Treatment Plant in Sanford, meaning Fuquay-Varina would stop buying water from neighbors and instead take its water exclusively from the Cape Fear River.
An interbasin transfer occurs when water is withdrawn from one river, but discharged as treated wastewater into a different one. For this request, water would be taken from the Cape Fear River at the Tri-Rivers intake in Lee County. It would then be transported to and used by Fuquay-Varina, after which it would be treated and discharged into the Neuse River Basin via the Terrible Creek Wastewater Treatment Plant. In North Carolina, any transfer over 2 million gallons a day requires North Carolina Environmental Management Commission certification because of potential to harm the source river.
Estimated to cost Fuquay-Varina more than $120 million, the project is already being funded by state grants and a 20% local water and sewer rate hike, which took effect in July 2023. It involves expanding the Tri-Rivers Plant to 30 million gallons per day and laying a 14-mile transmission pipeline from the Sanford intake in Lee County directly to Fuquay-Varina’s distribution system in Wake County.
For Fuquay-Varina, the transfer would provide enough raw water to support an additional 27,000 homes and businesses until 2055, according to the draft environmental impact statement. Unlike local users like CFPUA and Brunswick and Pender counties utilities who borrow and return treated water to the river, Fuquay-Varina’s request means water would be gone forever.
Fuquay-Varina leaders evaluated several other options before settling on the current plan. One alternative was taking no action, which would likely have forced a moratorium on new development in the town due to the 2030 water shortfall. Another explored possibility was seeking a larger allocation from Raleigh or Johnston County, though both neighbors indicated they need water for their own growth.
Instead of the current request, Waldroup has proposed a compromise: Fuquay-Varina can have the water, provided they return it back to the Cape Fear River instead of putting treated wastewater into the Neuse. This would require the town to build a return pipe or pay for capacity at a plant, such as the one in Harnett County, which discharges into the Cape Fear.
Fuquay-Varina’s draft environmental impact statement notes infrastructure to return water to the Cape Fear would cost the town at least $200 million, though Waldroup explained Harnett County already has the capacity to help. Fuquay-Varina is a current partner in the North Harnett Regional Wastewater Treatment Plant, having purchased 3.4 million gallons per day of capacity from the plant’s 9 MGD expansion project in 2023. To Waldroup’s point, the facility already discharges treated water directly back into the Cape Fear River and Fuquay-Varina sends a portion of its sewage there.
Historically, most IBTs in North Carolina have taken water and not returned it to the source because it is cheaper, but Waldroup believes this case must be different.
“Water is one of those few things that you can borrow and return and that’s what we really want all of our neighbors upstream to think about,” he said at the seminar. “If you are going to use the water, return it to us so we can use it ourselves downstream.”
Waldroup described the Cape Fear River as “already stressed,” citing nine approved interbasin transfer certificates statewide, including two which draw water from the Cape Fear basin. The largest, held by Cary, Apex, and Morrisville, permits up to 33 million gallons per day. Altogether, Waldroup estimated existing transfers are already diverting roughly 40 million gallons of water from the river each day.
Worried about the health of the river, CFPUA has been joined by more than 20 municipalities, businesses, and utilities in opposition to Fuquay-Varina’s request. For the Cape Fear region, commissioners in Brunswick, Pender, and New Hanover counties, and Wilmington City Council have all approved resolutions against the ITB transfer request in late 2025. The resolutions state permanently diverting millions of gallons from the river — with no plan to return it — threatens the safety, reliability, and future of downstream communities.
Local leaders are assessing the long-term threat, as 16 other Triangle-area utilities have projected a future need for an additional 50 MGD by 2031 and up to 150 MGD by 2055. If Fuquay-Varina’s request is approved allowing the town to take water without returning it, Waldroup is worried it sets precedent for other municipalities to request Cape Fear water.
“Our biggest concern is, this is the camel’s nose under the tent. They want six [gallons] then somebody else would come right behind them and ask for 10 or 20, or 150,” he said.
During extreme low-flow periods, flow levels at the Kings Bluff intake — primary supply for 500,000 residents — have dropped as low as 170 MGD. During normal conditions, flow is roughly 2 to 4 billion gallons per day. Below 170 MGD, the river’s ecosystem starts to fail as saltwater begins to creep upstream, threatening drinking water supplies and damaging freshwater habitat. As Waldroup explained, removing the requested 6 MGD permanently increases the risk of mandatory water restrictions. Recently, Brunswick County entered a Stage 1 water conservation alert in June of 2025 amid strained water supplies.
Additionally, less water in the river means a higher concentration of contaminants like PFAS and 1,4-dioxane. Put simply, if the volume of water in the river drops while the amount of chemical discharge from upstream stays the same, those chemicals become more concentrated. New Hanover County Commissioner Rob Zapple brought up contamination during the seminar, noting the water quality implications of the ITB request.
“We know that the Cape Fear River currently has PFAS or forever chemicals that are in it. So when you have less water, you have less dilution. We have fortunately been forward-thinking enough to put in a GAC system, so we clean that water. But what is the financial impact if we have greater concentration in the water?”
If pollutant concentrations rise, Waldroup explained, CFPUA must run its $43 million granular activated carbon filtration system more aggressively. The system filters PFAS out of raw water to non-detectable levels, though filters must be replaced once full. CFPUA currently spends about $5 million annually on the GAC system for new filters, which typically last about seven months.
“More pollution in, means the filter has to be changed more often,” Waldroup stated. “It’s a negative impact, we’ll spend more money.”
Waldroup did not address whether additional treatment costs from the proposed transfer could be passed on to customers, but noted CFPUA is seeking to recover PFAS-related damages through ongoing litigation against Chemours, which could help offset the costs of its GAC filtration system if successful.
Part of the local government’s resolutions is for the EMC to hold a public hearing in the Cape Fear region. Three public hearings were held in December in Fayetteville, Raleigh, and Pittsboro, though none are planned for the lower Cape Fear.
Waldroup noted he has been in contact with NCDEQ officials to see about holding a meeting locally while the public comment period is still open. Waldroup urged residents to send NCDEQ letters of opposition to the transfer request, suggesting the utility could pursue legal action if necessary.
“Hopefully we’ll get a chance to have a public hearing, but if not, then I guess we’ll see it in court,” Waldroup said. “I’d rather not solve the problem in court, we’d rather solve it in the process by borrowing and returning the water.”
The public has until April 1 to submit comments to the North Carolina Department of Environmental Quality regarding the ITB request. After public comment ends, the EMC will review comments and hold a final hearing on whether to approve or deny Fuquay-Varina’s request.
For an approval to be granted, the commission must find the benefits of the transfer outweigh the risks to downstream water security and that the town has no better way to meet its needs.
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