The Town of Tamperville, NC disconnects a customer’s water service for nonpayment. Two weeks later, a staff member reviewing usage data notices something unusual. Water is being used at the property, even though service has not been restored. A technician visits the site and finds the meter lock cut and the water illegally turned back on. Consistent with its fee schedule, the town charges the customer a $150 “meter tampering penalty.” It adds this amount to the customer’s account.

That penalty may seem like a reasonable deterrent. But under North Carolina law, it’s likely not enforceable.

Local governments and public authorities that provide utility services have broad statutory authority to assess fees, charges, and penalties related to those services, but they cannot impose penalties for conduct that state law has already made a crime. Because meter tampering is explicitly criminalized under state law, any local penalty addressing the same conduct exceeds the local government’s legal authority.

Local Government Authority to Set Utility Fees

Municipalities have authority under G.S. 160A-314 to set and revise rates, fees, and charges for public enterprise services such as water and sewer. Counties have similar authority under G.S. 153A-277. Public authority utilities, including water and sewer authorities, county water and sewer districts, and metropolitan districts formed under Chapter 162A are similarly authorized to adopt utility rates, charges, and penalties.

This fee-setting authority supports cost recovery, encourages timely payment, and allows for the collection of deposits and service-related fees. But it is not unlimited. When state law has already established criminal or civil penalties for specific conduct, local government utilities cannot impose their own.

Meter Tampering Is a Crime Under G.S. 14-151

Tampering with a water, electric, or gas meter, reconnecting service without permission, or interfering with utility infrastructure is criminalized under G.S. 14-151. The statute prohibits unauthorized reconnections, bypassing or damaging meters, retaining possession of meters, and interfering with pipes, valves, or other equipment. First-time violations are Class 1 misdemeanors. Repeat offenses, or those that cause property damage or pose a public risk, may be charged as felonies. The statute also allows utility providers to sue the violator for triple the actual damages or $5,000, whichever is greater.

Subsection (b) of the statute establishes a prima facie presumption. If a meter or related equipment is altered, bypassed, or tampered with in a way that causes inaccurate readings or diverts service, that fact alone is presumed to show both intent and a violation. This presumption applies to the person in whose name the meter is registered or to anyone receiving the unauthorized service. That evidentiary shortcut reduces the burden on the State or the utility when proving the case.

But because G.S. 14-151 already defines and punishes this conduct, local government utilities cannot create overlapping penalties under their general rate-setting authority. This is where the legal principle of preemption applies.

State Law Preempts Local Penalties

Preemption occurs when state law occupies a particular area so fully that it leaves no room for local governments to legislate or regulate. For municipalities, this is codified in G.S. 160A-174, which states that a municipal ordinance is invalid if it purports to regulate an area where the state has established a complete and integrated scheme, or if it defines an offense with the same elements as one already covered by state or federal law.

Although counties and public authorities don’t have an identical statutory provision, courts apply the same standard through common law. See State v Tenore, 280 NC 238 (1972); State v. Furio, 267 NC 353 (1966). Any local penalty for conduct that is already criminal under state law, like meter tampering, is thus unenforceable, regardless of whether the government is a municipality, county, or public authority.

What Can a Local Government Utility Do Instead?

Although local governments cannot impose their own penalties for meter tampering, they still have several lawful ways to respond. G.S. 14-151 offers two options: criminal prosecution and civil recovery. And local government utilities may also recover the actual cost of repairing or replacing damaged equipment. Reimbursement can be pursued in addition to either enforcement option.

Option 1: Refer the Case for Criminal Prosecution

A utility can document the incident and refer it to law enforcement. The district attorney may charge the violator under G.S. 14-151, and a conviction could result in a misdemeanor or felony penalty depending on the circumstances. The prima facie provision helps prosecutors by allowing them to infer criminal intent based on evidence that the meter was bypassed or tampered with. But as with any criminal charge, the State must still prove its case beyond a reasonable doubt, a high standard, particularly when there is no direct evidence of who committed the act. In some cases, this may limit the practicality of criminal enforcement.

Option 2: File a Civil Lawsuit and Seek Damages

The utility can also sue the violator under G.S. 14-151(e) to recover either triple the actual damages or a minimum of $5,000. The lower burden of proof in civil court—more likely than not—and the prima facie presumption makes this option more accessible in some cases. But pursuing a civil case comes with costs, including legal fees and staff time.

There’s also a constitutional catch. Article IX, Section 7 of the North Carolina Constitution requires that the clear proceeds of all penalties imposed under state law for the purpose of punishing a violator must be distributed to the local public schools. See G.S. 115C-437. In NC School Boards Association v. Moore, 359 N.C. 474 (2005), the North Carolina Supreme Court confirmed that civil judgments awarded under punitive statutes fall under this requirement. Because G.S. 14-151(e) includes treble damages and a statutory minimum, it is almost certainly punitive. That means if a local government collects under this provision, the proceeds likely belong to the local school administrative unit(s) in the county in which the violation occurred. 

Option 3: Recover Actual Costs as Reimbursement

Regardless of whether the utility chooses criminal prosecution or civil enforcement (or neither), it may charge the customer for the actual cost of repairing or replacing damaged infrastructure, such as a broken lock or meter. This is not a penalty. It’s reimbursement for documented damage, and it is not subject to preemption or the constitutional requirement to remit proceeds to the public schools.

To use this option effectively, the utility’s ordinance must clearly authorize these reimbursement charges. Customers should be informed that if damage is discovered and reasonably attributed to them, the actual cost of repair may be added to their account. The utility may also want to consider offering a process for customers to contest responsibility for the damage. Whether a dispute process is necessary (and how it should be structured) should be discussed with legal counsel based on the local unit’s enforcement framework and billing practices.

Conclusion

Meter tampering is a real concern for utility providers, but local governments must respond within the boundaries set by state law. G.S. 14-151 already defines the offense and outlines both criminal and civil enforcement tools. Local governments may not impose additional penalties, even if adopted in a fee schedule by ordinance.

Instead, local government utilities may choose to refer the matter for criminal prosecution or pursue civil damages under G.S. 14-151. And they may recover the actual cost of repairs through reimbursement. Each option has different implications, particularly when it comes to enforcement authority, evidentiary standards, and where the money goes.