Tetra Tech, Inc. (Tt) worked with the Upper Neuse River Basin Association to develop locally-driven performance standards for new development in the Upper Neuse Basin, North Carolina. This paper describes the growth and water resource issues faced by the 14 local governments that comprise the Association and the planning process used to develop on-site performance standards to address those issues. In 2002, Tt completed a Draft Watershed Management Plan. It includes a subwatershed plan for each of the nine drinking water supply watersheds and provides three or more options for the local governments to consider in addressing projected impacts from new development. Although developed in partnership with the State of North Carolina, local governments' priorities and adopted water quality targets drove the watershed planning and management objectives. Includes tables, figures.