What the Heck is Sewer Lateral Compliance?

What You Need to Know About Sewer Lateral Compliance: 

A guide for East Bay Home Buyers

If you are planning to buy a house in the East Bay, you may have heard people talk about sewer lateral compliance. It seems like it must be important, but what exactly is it?

You’ve come to the right place!  We’re here to fill you in on everything you need to know about Sewer Lateral Compliance in the East Bay.  A quick word of warning, we will be discussing sewage and plumbing. We’ll keep it as clean as possible, but waste management can be...a messy topic.

Plumbing System Basics

Every home has a plumbing system. Water comes into the home, and waste goes out of the home. It is that simple. In some parts of the country, water might come in via a well, and waste might go out to a septic tank. However, in more urban environments, such as the East Bay, a City utilities system is fairly common.  Water will come into the home from the local City water department, and waste will return to the City for treatment.

In the East Bay, these City utilities are administered by the East Bay Municipal Utility District, or EBMUD. They are the water department.  It’s their job to make sure we all have clean water for our homes, and for removing and treating wastewater.

Each home’s internal plumbing system connects to the City via a Main pipe.  The pipe that connects your home’s waste system to the City Main waste pipe is called the sewer lateral.  It runs from your house out to meet the City Main, wherever it may be. In most cases, the City Main is buried underground in the street in front of your house.

The homeowner is fully responsible for the sewer lateral until the point it hits the City Main.  While the pipe itself may go under sidewalks, streets, and even a neighbor’s property on its journey to the Main, the care and maintenance always falls back on the homeowner. 

Why do we need to replace sewer laterals?

Ok, now we know what a sewer lateral is, but what is this compliance you keep hearing about?  A large number of homes in the East Bay were built in the 1920s-1940s and are getting up there in age. The original sewer lateral pipes were made out of cast iron in smaller pieces that were joined together to create the full length needed. Nearly a century later, they aren’t holding up very well.  They’ve been especially susceptible to rusting and root intrusion. The joins have separated and shifted over time and most of the systems had lots of leaks. Environmental studies were basically showing that a lot of waste was seeping into the groundwater and getting into the Bay. Not an ideal situation.

The local governments needed to come up with a way to fix the leaking waste water issue, but mandating that everyone fix their pipes all at once could become really burdensome on their residents, and could be really difficult to oversee. They decided that the best way to ensure proper repairs were done would be by instituting a Point of Sale Ordinance. A Point of Sale Ordinance is a law that gets triggered when a home sells.  In this case, when a home is sold in the East Bay, it needs to have a Sewer Lateral Certificate from EBMUD in order to close.

How to get a compliance certificate?  

In order to obtain a compliance certificate, EBMUD will schedule a pressure test of your sewer lateral.  They will come out to the property, hook up to the sewer lateral and inject water under high pressure through the pipe.

If you don’t have any leaks, congratulations! They’ll issue a compliance certificate. 

If a leak is found, you’ll need to either repair the leaking portion, or replace the entire pipe. Since most pipes don’t have just one weak point that leaked, a full replacement is usually necessary.

 How much does sewer lateral replacement cost? 

The cost of replacing sewer lateral depends upon various aspects. On an average sized lot that is 5000 square feet on relatively flat land, you can expect the cost of replacement to range between seven and eight thousand dollars. If your home is on a larger than average lot, or if it is on a difficult to access hilly slope, you may have increased costs.

If you’re at the top of a slope, the City Main may not actually be out in front of your home. Your sewer lateral might run behind your house, under your backyard, under your neighbor’s backyard, under their house and out to the street in front of them to join the City Main downhill from you.  In that case, your sewer lateral is incredibly long and replacing it can cost twice as much.

Who pays for Sewer Lateral Replacement? 

EBMUD has no preference for who pays to get a Sewer Lateral Compliance Certificate. They just want a certificate to be in place before a home closes. It is a fully negotiable item between buyers and sellers.  That said, we have been in a sellers’ market for a number of years in the East Bay. Multiple offers are the norm, and most homes end up selling well above the asking price.  Given these circumstances, the seller is not particularly incentivized to spend any money they don’t have to.  

Now buyers may be willing to take on the responsibility and costs of obtaining Sewer Lateral Compliance, but from a practical standpoint, a buyer shouldn’t really perform work on a property that they don't yet own. What happens if the buyer pays $8000, gets the job done, and for some reason, at the last minute, the sale falls apart? They have just paid to improve someone else’s home, and there’s little chance that money will be coming back to them.

Time Extensions

The local governments recognized that the timing around this whole process could lead to some awkward situations, so decided to allow an extension.  For buyers that want to take on the responsibility and cost of the sewer lateral compliance, they can apply for a time extension certificate that allows them up to six months after the closing to get the work done and bring the sewer lateral into compliance. The catch is that they require a $4,500 refundable deposit in order to get this extension.

So if you are the buyer of the house, you not only have to cover the cost of the actual repair work, but you will also need to have $4,500 set aside at the close of escrow that you're going to give to EBMUD. Once the work is complete and EMBUD has issued a compliance certificate, they will refund that $4500 deposit.  But for home buyers that may not have been expecting all of these additional costs, the additional thousands of dollars needed at the time of closing could be a nasty surprise.

Berkeley Exception

The City of Berkeley has actually made it easier on home buyers and has created an exception that will allow them to receive a time exception without an additional deposit. If a buyer has already enlisted a contractor to perform the necessary replacement work, and can provide a signed contract with said contractor, Berkeley will waive the $4,500 deposit requirement.

Now your specific contractor may have deposit requirements before they will issue a contract and this may be a few thousand dollars to 50% of the total cost of the repair work.  This would just be a part of the cost of repair though, and not an additional cost, meaning you don’t need to have quite as much at the closing table.

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Did you know that a Sewer Later Compliance Certificate is necessary when buying a house in East Bay? Learn all about what a sewer lateral is, and how you can get compliant.