HOW NORTH CAROLINA IS EFFECTED ECONOMICALLY BY WATER POLLUTIONAbout 80% of the State’s surveyed freshwater rivers and streams have good water quality that fully supports aquatic life uses, 17% have fair water quality that partially supports aquatic life uses, and 3% have poor water quality that does not support aquatic life uses. Ten percent of the surveyed rivers do not fully support swimming. The major sources of impairment are agriculture (responsible for 53% of the impaired river miles), urban runoff (responsible for 16%), and construction (responsible for 13%). These sources generate siltation, bacteria, and organic wastes that deplete disssolved opxygen. Only 17% of the surveyed lakes in North CCarolina are impaired for swimming and 6% are impaired for aquatic life uses. A few lakes are impacted by dioxin, metals, and excessive nutrient enrichment. The Champion Paper mill on the Pigeon River is the source of dioxin contamination in Waterville Lake. The State and the mill implemented a dioxin minimization program in the mid-1980s and completed a modernization program in 1993 that will reduce water usage and discharges. About 94% of the estuaries and sounds in North Carolina fgully support designated uses. Agriculture, urban runoff, septic tanks, and point source discharges are the leading sources of nutrients, bacteria, and low dissolved oxygen that degrade estuaries. About half of the people in North Carolina use ground water as their primary supply of drinking water. Ground water quality is generally good. The leading source of ground water contamination is leaking underground storage tanks, which contaminate ground water with gasoline, diesel fuel, and heating oil. Comprehensive programs are under way to assess potential contamination sites and develop a ground water protection strategy for the State. In 1993-1995, North Carolina continued its aggressive program to control nonpoint source pollution. North Carolina established the NPS Workgroup, implemented NPS Teams for each of the 17 river basins, published a guide for establishing a point/nonpoint source pollution reduction trading system, and introduced the Draft Interim Plan of the Neuse River Nutrient Sensitive Waters (NSW) Management Strategy. Surface water quality in North Carolina was primarily evaluated using physical and chemical data collected by the Division of Environmental Management (DEM) from a statewide fixed-station network and biological assessments. These include macroinvertebrate (aquatic insect) community surveys, fish community structure analyses, phytoplankton analyses, bioassays, and limnological review of lakes and watersheds. Other sources of information were point source monitoring data, shellfish closure reports, lake trophic state studies, and reports prepared by other local, State, and Federal agencies.