Good money can be made if done correctly and for the right clients.
By Mike Price
Customers of new homes are wanting assurance that their well will meet or exceed their needs.
Housing booms and rural migration throughout the United States are leading to a surge of well inspection calls for some water well contractors.
Homeowners want to know the quality of their water well system. Prospective homebuyers, if they’re aware of the well system, also want to naturally know before making an offer.
In today’s real estate transactions, well inspections are becoming required by some lending agencies. While some inspections are basic that check for general functionality of the system, others require in-depth date codes on all equipment, lengthy production tests, and assurance that all parts of the system are up to current codes set forth by their respective private water system rules and regulations.
“We as a company strongly advise buyers to have well inspections done for multiple reasons,” says Rob Watson of Watson Well Drilling Inc. in Bryan, Ohio, and Ohio Water Well Association president.
“Assurance that the well’s production can meet or exceed their needs, mechanically the system is functioning properly without excessive wear and free of any failed components, and checking to confirm water is bacterially safe.
Sebastian & Sons Well Drilling Inc. in Springport, Michigan, has seen an increase in water well inspections and prices them to ensure profitability. Photo courtesy Sebastian & Sons Well Drilling.
“Between lack of system maintenance, poor craftsmanship by unregistered contractors, and general failure of components, we see a high percentage of the systems we inspect in need of updating and repairs. Some of the findings can shock you. Rodents, surface water, foreign objects easily entering systems.”
In Michigan, a state with more than a million well owners, free testing was offered in September 2023 from the Michigan Department of Environment, Great Lakes, and Energy (EGLE) using a special $5 million 2022 appropriation. It took less than three weeks for the money to cover 15,000 owners taking advantage of the free testing. Thousands more well owners were willing to pay for their own test.
“I see from the public’s interest in their own water supply as probably one of the number-one concerns of their home in the next five to seven years,” says National Ground Water Association Board Director Buddy Sebastian, vice president/general manager of Sebastian & Sons Well Drilling Inc. in Springport, Michigan. Sebastian is also president of the Michigan Ground Water Association and chairman of the EGLE Director’s Water Well Advisory Committee.
If true, water well contractors will be positioned to pursue well inspections as a growing revenue stream for the foreseeable future.
Math Equation for Pricing Well Inspections
Sebastian, who has presented at Groundwater Week and state associations on the cost of doing business, simplifies how to price a well inspection by breaking it down this way:
- How much time will be spent talking to the prospective customer?
- How much window time will be spent driving to the job?
- How much time will be spent performing the inspection?
- How much time will be spent giving a summary of the inspection?
“To price it, it’s a math equation. Do you have a baseline?” Sebastian asks. “Start at this much money. I think the more you elevate yourself from the average home inspector who is going to go out and kick the well and take a picture of it and take a picture of the tank and send it to the customer, the better off you’re going to be because you’re the professional. You really are the expert.
“Most groundwater professionals know the history behind the tank that’s in the basement, where it came from, who were they owned by first, because you know the history of the company. We know the history of the pump company of the pump being used. You can really talk more in depth.”
One qualification: In some states, if a contractor performs the inspection, they’re not authorized to complete any subsequent work needed on the well system. They then refer another area contractor for the work.
Tiered Inspection Format
Jeff Canfield, president of Canfield Drilling Co. in Fort Morgan, Colorado, recommends breaking down the level of well inspections offered. His company no longer conducts inspections but followed this format when it did:
- Level one: This involved no entry into the well. Canfield’s company might have test run the pump, checked amps, flow, pressure, and taken a water sample. If it was an older system with a pressure switch, the company would ensure it was cycling normally. All this was done for a minor fee.
- Level two: This might involve pulling the well cap, conducting a sounding of the well, and checking the water level. He wouldn’t put anything down the well for fear of it getting entangled and causing issues. He would investigate the well’s construction history too for anything noteworthy.
- Level three: This involves pulling the pump and conducting a full inspection.“That’s where it gets really dicey because what if you find it’s on old, galvanized drop pipe, it’s rotten, you don’t want to put it back in,” Canfield says. “If he’s a potential buyer, he doesn’t want to pay for anything. The seller needs to pay for it; it gets really weird at that point.“That’s what I did. Each level was a set price, and it was very clearly defined as what would be done at each level.”
In today’s real estate transactions, well inspections are becoming required by some lending agencies.
Canfield, whose company now focuses primarily on high-capacity irrigation, municipal, and industrial wells, suggests contractors be careful with what they say about the condition of the water well system too.
“In today’s market, people want absolute guarantees,” he says, “so, the contractor, if he engages in this kind of work, has to be awful damn careful that he doesn’t put out something that’s going to make him libelous for a comment that might have been made. Don’t answer questions in offhand comments to the customer. Make a comment that means nothing and go back to the office and take the data and write things up.”
Canfield used a template for his well inspection reports. His written comments about the well involved thought and were based on industry best suggested practices.
“You might make a comment or two, but it better not mean much because it’s always going to be misinterpreted and to your disadvantage,” Canfield shares.
With contractors’ busy workloads, it’s important to be mindful of the time investment required for well inspections. Canfield says contractors who have a trained eye can detect if it’ll be worth their time by scanning the owners’ property on such items as:
- Is the property tidy and vehicles/equipment parked?
- Is the house well kept?
- Is the well’s location known? (Some properties have older, out-of-compliance, buried/below-grade discharges not using pitless adapters.)
“You can usually see the signs of a job to avoid that you just want to say we’re so busy we can’t get to you,” he concludes. “That’s important—I can’t overemphasize that. You can’t waste any time these days. You have to be effective. Sometimes, rank-and-file employees who don’t concern themselves with business principles fail to survey the situation and dive in without due consideration.”
NGWA Resources to Help with Well Inspections
NGWA published its best suggested practice, Water Well Systems Inspection, in 2016.
The six-page, downloadable BSP, which is free to NGWA members, covers items a qualified inspector should perform including, but not limited to:
- Determining the water well use parameters such as its purpose, e.g., human consumption, irrigation, industrial; estimated groundwater usage per day; any known water quality issues.
- Visually inspecting the wellhead to ensure proper siting.
- Visually and physically inspecting the water well system components, including testing the pump, checking valves, and conducting electrical testing.
- Visually inspecting any other equipment such as pressure tanks, storage tanks, water heaters, softeners, filtration equipment, etc.
- Documenting for the well owner/manager the system specifications observed, any suggested recommendations for remedial work, and a recommended schedule for future routine inspection, testing, cleaning, and rehabilitation.
NGWA also published in 2016 the resource, General Contract for Residential Water Well Inspection and Maintenance Services.
The 20-page, downloadable item, which is also free to NGWA members, is designed to aid water well contractors who want to increase revenue by locking in residential water well inspection and maintenance work. It covers the terms necessary to create an annual maintenance services contract and provides details on all the necessary parts of such a contract.
NGWA’s Water Well Inspection Resources
Mike Price is the senior editor of Water Well Journal. In addition to his WWJ responsibilities, Price contributes to the Association’s scientific publications. He can be reached at email@example.com, or at (800) 551-7379, ext. 1541.