Provo to absorb private HOA water infrastructure, sparking debate over multi-million dollar legacy liability

Provo to absorb private HOA water infrastructure, sparking debate over multi-million dollar legacy liabilityProvo's Water Resources Division will use internal crews to relocate meters and assume partial ownership of a leaking private water system, setting a potential precedent for 30 to 40 similar aging HOA networks across the city.

Provo City will assume ownership of water infrastructure up to newly installed meters in the public right-of-way for the Taylor Terrace HOA to mitigate unmetered leaks.

The city's portion of the work is valued at approximately $60,000 and will be completed by internal crews, while the HOA will cover an estimated $75,000 to connect homes to the new meters.

City officials estimate there are 30 to 40 similar private water systems in Provo, representing a potential $3 million to $4 million liability if all request municipal absorption.

Because the city is utilizing existing workforce capacity without requiring a new budget appropriation, the takeover will proceed administratively subject to a hold-harmless agreement.

The City of Provo's Water Resources Division will administratively take over a portion of a failing private water system belonging to the Taylor Terrace Homeowners Association (HOA), a move designed to halt unmetered water loss but one that highlights a looming multi-million dollar liability for the municipality. During an August 25 work meeting, Lane Pearce, a water resources engineer for the city, outlined a plan to resolve legacy infrastructure failures at the Taylor Terrace development. Currently, leaks in the HOA's private lines occur before the water reaches the meters, resulting in non-revenue water loss for the utility. To rectify this, city crews will install new meter cans in the public park strip, bringing the infrastructure up to municipal standards. The city will take ownership of the system up to the new meters, while the HOA will remain responsible for the lines running from the meters to individual residences. The city's portion of the project, which will be completed using internal labor, is estimated at $60,000. The HOA will bear an estimated $74,000 to $75,000 in costs to connect to the new meters and repair associated asphalt and sidewalks. While the Taylor Terrace project resolves an immediate leak, the intervention prompted council members to question the city's broader policy for aging private systems. Pearce noted that Provo has between 30 and 40 unique privately owned water systems. Representatives from other developments, including Grandview Manor and Three Fountains, have already approached the city requesting similar municipal takeovers due to failing pipes. Council members expressed concern over the financial precedent, noting that if the city assumes $100,000 in infrastructure work for each of the estimated 30 to 40 systems, it could face a $3 million to $4 million liability. City staff acknowledged the growing scale of the issue, pointing out that one local mobile home park alone would require over $1 million to bring its leaking system up to standard. Despite these long-term concerns, the Taylor Terrace project will advance without a formal council vote. City attorneys confirmed that because Public Works is utilizing existing staff capacity and not requesting a new budget appropriation exceeding the $50,000 threshold, the department can execute the takeover administratively. To protect the municipality from liability for pre-existing damages caused by the legacy leaks, the city will require the HOA to sign a hold-harmless agreement before the infrastructure transfer is finalized.