By Jeff Day
Nutrient and sediment pollution carried by urban and suburban stormwater into the Chesapeake Bay and its tributaries must be reduced significantly if the bay's ecosystem is to be restored, but state and local officials say paying for controls poses a major challenge.
One approach that has been widely used elsewhere in the United States is the imposition of stormwater fees on residents and businesses, usually attached to water and sewer bills or property tax bills. Officials in the bay area largely have resisted those fees, but that may be changing as large urban areas grapple with the question of how to find the vast sums of money needed in a way that is politically acceptable.
There are no official estimates of the amount of money required to manage urban and suburban stormwater pollution in the six states sharing the 64,000-square-mile watershed. However, a top environmental official in one jurisdiction, Prince George's County, Md., estimated that it will need $1 billion just for that county alone.
In Virginia, Del. Lynwood Lewis (D), a member of the House of Delegates' Agriculture, Conservation, and Chesapeake Committee, acknowledged that funding is a big problem.
“The missing piece is how we get the money to do this,” Lewis told BNA. “It's difficult to find the money to do the things that need to be done, especially at the local level, where stormwater issues meet the road.”
Some bay watershed jurisdictions are beginning to look at stormwater fees.
The District of Columbia has had fees for several years, in part to pay for projects to reduce its combined sewer overflows as required under a federal consent decree, and Maryland as of July 1 requires stormwater fees for the city of Baltimore and the nine largest counties in the state. Sixteen municipalities in Virginia have stormwater fees, most located in coastal areas subject to flooding.
Yet the region still lags behind the rest of the country.
Between 1,400 and 2,000 localities in the nation imposed stormwater fees in 2012, according to C. Warren Campbell, an associate professor of civil engineering at Western Kentucky University. Campbell, assisted by student researchers, has produced annual stormwater fee survey reports since 2007. The latest report includes detailed fee information on 1,314 stormwater fee programs in 39 states and the District of Columbia.
The fees on single-family residences varied widely, from under $1 to as high of $27 a month, averaging $4.20, according to Campbell's latest annual census.
Stormwater fees are usually included in water and sewer service bills. Some jurisdictions add the fee to annual real estate tax bills.
The latest Western Kentucky University Stormwater Utility Survey, covering 2012, shows that the fees are common in the Midwest, the southern states bordering the Atlantic Ocean, and the Pacific Northwest.
Clusters exist in most other regions. The fees are rare in the northeastern quadrant, including most of the Chesapeake Bay watershed. Campbell said the reasons for the regional disparities are not clear.
Municipalities with stormwater fees use them with varying and sometimes multiple goals, said Josh Ellis, stormwater control policy analyst at the Metropolitan Planning Council, a think tank focused on Chicago and its suburbs.
Ellis and Seth Brown, stormwater program and policy manager at the Water Environment Federation, said the goals include:
• expanding or improving municipal separate storm sewer systems;
• installing rain gardens and other green infrastructure on public property to capture stormwater and slow run off;
• funding sewer and structural improvements to reduce basement flooding and sewage backups in vulnerable neighborhoods;
• inducing property developers to use advanced stormwater management techniques in both construction and the finished project, by offering stormwater fee discounts; and
• inducing owners of developed property to replace impervious surfaces, such as asphalt parking lots, with surfaces that allow water to infiltrate into the soil, such as pervious concrete, by offering stormwater fee discounts.
Stormwater fees and the discounts available for existing property retrofits must be high to make the property changes a compelling business proposition, Brown and other analysts said.
One of the first municipalities to impose a stormwater fee program offering discounts for reductions in impervious surfaces was Ann Arbor, Mich., Ellis said (see related story).
Some municipal stormwater fee programs have been established as a result of expected or actual consent decrees with the Environmental Protection Agency or state environmental agencies that require the construction of large tunnels to store excess stormwater and sanitary sewer flows until they can be sent for treatment, Ellis and Brown said. These storage tunnels are intended to reduce or eliminate combined sewer overflows.
The capital and operating costs of such tunnels can dramatically increase sewer bills.
In 2004, an EPA-District of Columbia consent decree required the city to install three large tunnels to capture the combined flows for post-storm treatment at a cost of about $2.6 billion.
Construction of large tunnels also was required under a 2004 EPA-Philadelphia consent decree. The billions of dollars required to construct such tunnels prompted both cities to find alternatives.
In 2006, Philadelphia, which is not in the bay watershed, began installing green infrastructure. In 2009, the city imposed an ambitious stormwater fee program (see related story).
By 2012, EPA and Philadelphia signed a joint agreement fully embracing the concept of eliminating sewer-stormwater system overflows primarily with green infrastructure.
Public resistance is widespread to paying fees to reduce stormwater flows with green infrastructure, according to utility officials and policy analysts.
However, in jurisdictions facing vast increases in water and sewer fees to pay for major gray infrastructure projects, such as tunnels, the public has, in some cases, accepted fees for green infrastructure, touted as producing the desired results at a much lower cost.
Some of those stormwater fee programs offer significant incentives for property owners to replace impervious surfaces with pervious ones, by basing the fees in part on the amount of impervious surface on their properties.
Public tolerance of fees that are high enough to induce many property owners to alter their property might well be contingent on the prospect of skyrocketing water and sewer bills necessary to pay for CSO overflow tunnels or other costly “gray infrastructure'' solutions, Brown and Ellis said.
Virginia Del. Lewis expressed doubts that green infrastructure will suffice in many situations. Localities face differing stormwater challenges, and many will likely need a combination of gray and green infrastructure, Lewis said. “There is no silver bullet,” he said.
The Chesapeake Bay total maximum daily load program requires large reductions in the amount of pollution carried into the watershed by urban and suburban stormwater runoff.
On a jurisdiction-by-jurisidiction basis, the Chesapeake Bay Program Office within EPA Region 3 estimated in February the pollution loading reductions from urban and suburban stormwater needed by 2025. Estimates for the four jurisdictions that account for 80 percent of the land area of the watershed are as follows:
• District of Columbia: cut nitrogen loading by 13 percent, phosphorus loading by 22 percent, and sediment loading by 16 percent;
• Maryland: cut nitrogen by 24 percent, phosphorus by 28 percent, and sediment by 29 percent;
• Pennsylvania: cut nitrogen by 41 percent, phosphorus by 45 percent, and sediment by 50 percent;
• Virginia: cut nitrogen by 3 percent, phosphorus by 21 percent, and sediment by 30 percent.
As of July 1, fewer than 30 of the 18,000 localities in the bay watershed had or were expected soon to have stormwater fees, according to Campbell's data and bay state environmental agencies.
Most fee programs in the Chesapeake Bay are designed to raise funds for stormwater management. Some programs offer discounts to property owners who modify their properties to reduce stormwater runoff, although none compare to Philadelphia's high levy on business property, which is designed in part to make replacement of impervious surfaces a compelling business proposition.
Pollutant Reduction Targets By 2025
• District of Columbia: nitrogen (13 percent), phosphorus (22 percent) sediment (16 percent)
• Maryland: nitrogen (24 percent), phosphorus (28 percent), sediment (29 percent)
• Pennsylvania: nitrogen (41 percent), phosphorus (45 percent), sediment (50 percent)
• Virginia: nitrogen (3 percent), phosphorus (21 percent), sediment (30 percent)
Asked if any of the fees and discounts in bay jurisdictions are high enough to make runoff-reducing property changes financially advantageous, Lee Epstein, land programs director at the Chesapeake Bay Foundation, said no.
However, Epstein said the fees are not meant to induce landowners to modify their property to reduce runoff. He said they are meant to raise money for each jurisdiction's stormwater control programs.
In Prince George's County, Md., authorities will need $1 billion between now and 2025 to adequately control the runoff, according to Larry S. Coffman, deputy director of the county's Department of Environmental Resources.
On May 9, Coffman told the Chesapeake Bay Commission, a body made up of state legislators and regulators, that the county has decided to create a public-private partnership funded with roughly $10 million of county money and $80 million from a private partner. The partnership will leverage the $90 million into $1 billion in long-term bonds.
“The capital markets like this because we have a guaranteed revenue source--water and sewer fees,” Coffman said.
The partnership, a limited liability corporation, will manage construction and long-term operating and maintenance costs, Coffman explained. The green infrastructure urban retrofit program will be marketed “not as a water quality/environmental program but as a business and community development program,” he added.
Coffman predicted that it will create 5,000 jobs, revitalize neighborhoods, and lead to much private investment and the launching of local green businesses. The county's economy will grow by $1.2 billion by 2025 because of the green infrastructure development, Coffman predicted.
County legislation to establish the public-private partnership was introduced June 18. The county issued a request for proposals from prospective private partners May 18, with responses required by July 1.
The public-private partnership model can be used by individual or multiple local jurisdictions, Coffman said.
Brown, with the Water Environment Federation, said Coffman's idea has enormous potential.
Maryland in 2012 enacted legislation requiring that the 10 municipalities with the most municipal separate stormwater systems establish “watershed protection fees.” Maryland appears to be the first state in the nation to require fees, Western Kentucky University's Campbell said.
Maryland committed to imposing the fee in its Phase 1 watershed implementation plan for the bay TMDL and was the only state to do so, EPA Region 3 TMDL implementation team leader Katherine Antos told BNA.
The 10 jurisdictions--the city of Baltimore and the state's nine most populous counties--had to establish their fee programs by July 1. The jurisdictions are at liberty to design their programs as they wish, with fees at any level, and the Maryland Department of the Environment has no authority to require modifications, MDE spokesman Jay Apperson said.
The stormwater fee requirement has come under heavy fire from conservatives, who have labeled the fees “rain taxes.” Many local residents have questioned the fees, prompting some counties to issue detailed program defenses on their websites.
The EPA manager directing the Chesapeake Bay Program, Nick DiPasquale, defended the fees in an April 30 blog post. The fees “generate critical funding for green practices that mitigate the effects that roads, parking lots and rooftops have on our environment,” he wrote.
One county official in Maryland who declined to be identified told BNA that the backlash stems from the fact that the fees represent the first time most homeowners and business property owners have become aware that stormwater control is costly. Most residents appear to have had no awareness that stormwater could cause environmental harm or that rainfall on their property flows into waterways, the official said.
The jurisdictions' fee programs vary considerably.
Howard County, a generally prosperous suburb located between Baltimore and Washington, D.C., established its annual watershed protection fee of $15 for each 500 square feet of impervious surface, or roughly $90 for a typical residential property, according to the county. It suggests ways that property owners can reduce impervious surface coverage.
How will the amount of impervious surface be determined on every property?
“A computer program will analyze existing infrared aerial photography already used by the county and the state, to distinguish impervious surfaces in contrast to areas that can absorb stormwater, such as lawns and gardens,” according to Howard County's Frequently Asked Questions document.
Anne Arundel County, a suburb of Baltimore and Washington, D.C., that borders the Chesapeake Bay, has taken another approach. The county declared that the average single family property has 2,800 square feet of impervious surface and a flat $85 annual fee will be assessed on such properties. Any single family home that has more than twice as much impervious surface will pay a flat $175 fee.
Commercial property owners will be charged $85 for every 2,800 square feet of impervious surface. The watershed protection fee for commercial property with 28,000 square feet of impervious surface will be $850.
In Frederick County, a developing rural jurisdiction, the Board of County Commissioners approved legislation that will assess a watershed protection fee of 1 cent per property per year.
Shannon Moore, manager of Frederick County's Office of Sustainability and Environmental Resources, told BNA that the Board of County Commissioners plans to spend $3.6 million in fiscal year 2014 and $4.7 million in fiscal year 2015 to fund its municipal separate storm sewer system (MS4) permit obligations, through the county general fund.
Prince George's County, an older suburb of Washington, D.C., will have a three-tier residential stormwater fee based on the size of the lot, ranging from $33.12 to $62.38 per year. Commercial, instructional, and industrial properties will be assessed $372 per acre of impervious surface.
With stormwater-driven overflows from the District of Columbia's combined sewer/stormwater system sending several billion gallons of untreated wastewater into the Potomac and Anacostia rivers each year, the city has two stormwater fees to raise money for gray and green infrastructure improvements to slash the overflows.
Under the 2004 EPA consent decree, the district is required to construct three enormous tunnels to hold the overflow for post-storm treatment.
In 2010, DC Water, which operates the city's water and sewer agency, estimated that tunnel construction would cost $2.6 billion. It proposed a large demonstration project to determine whether extensive use of green infrastructure could manage stormwater to the extent that one or two of three tunnels would not need to be built.
EPA Region 3 approved the demonstration project but said it would open up the consent decree only if it was satisfied that the green infrastructure would suffice.
DC Water's stormwater fee program, begun in 2009, classifies residential properties into six categories, based on the amount of impervious surface on each parcel.
The fee has been rising sharply. A property with 700 to 2,099 square feet of impervious surface currently pays stormwater fees of $113.64 per year, up from $14.88 in 2009. They are forecast to hit $142.20 in 2014 and to continue increasing until 2021.
DC Water is in the process of designing a green credit program for customers who have containment areas and/or retention ponds, spokeswoman Pamela Mooring told BNA.
Meanwhile, the District Department of the Environment has a similar but separate stormwater fee program. For a residential property with between 700 and 2,000 square feet of impervious surface, the DDOE fees total $32.04 per year. Commercial properties are charged $2.67 per month for each 1,000 square feet of impervious area on their lot.
Like DC Water, DDOE is establishing a discount program for green infrastructure improvements to properties.
In 2011, EPA approved a new municipal separate stormwater permit for the city that requires stormwater management techniques such as green roofs that retain rainwater on properties for at least 24 hours.
According to the Virginia Department of Environmental Quality, 16 Virginia localities impose stormwater fees, 11 of which were established before the Chesapeake Bay TMDL. A 17th, Charlottesville, will impose a stormwater fee effective Jan. 1, 2014.
In a report prepared for the Chesapeake Bay Commission, DEQ estimated that in 2012, the 16 individual jurisdictions' annual per-capita stormwater fee costs ranged from $12.14 to $73.52. Collectively, the fees generated $153 million in 2012, according to DEQ data.
That is a fraction of the amount Virginia will need to reduce urban and suburban stormwater pollution as required by the Chesapeake Bay TMDL, the Water Environment Federation's Brown said, echoing the assessment of Lewis, the Virginia delegate.
The level of fees--or fees plus state taxes--that could generate necessary funding would be politically impossible in Virginia, Brown said. He recalled that when the board of supervisors of wealthy Fairfax County imposed a significant stormwater fee in the 1990s, supervisors who supported the fee lost their re-election campaigns. Their successors repealed the fee.
The mandatory Chesapeake Bay TMDL program did not exist at the time, but Brown expressed doubt that the TMDL will adequately alter the political calculus.
Lewis said the state's Republican-dominated House of Delegates will not raise state taxes to fund urban and suburban stormwater controls. However, Lewis said the chamber has budgeted one-time allotments for stormwater control and would do so again in the event of large state budget surpluses.
The chamber might be willing to approve legislation granting all Virginia localities authority to impose local stormwater fees, Lewis said, adding that he will push for it. To date, the Legislature has provided that authority only via jursidiction-specific legislation.
Another potential source of funds is the EPA/state revolving fund. States can use the program to fund stormwater controls, but Virginia to date has not done so, DEQ Chesapeake Bay Coordinator Russ Baxter told BNA.
Lewis noted Virginia has and continues to provide hundreds of millions of dollars annually for sewage treatment plant upgrades, adding that it has slashed the plants' releases of nitrogen and phosphorus.
Two jurisdictions in Pennsylvania impose stormwater fees, but neither is located in the central portion of the state that is part of the Chesapeake Bay watershed, according to the Western Kentucky University study.
However, one jurisdiction in Pennsylvania's portion of the watershed, the city of Lancaster, has implemented a showcase green infrastructure program on city property and plans to implement a fee program, according to the Chesapeake Bay Program and the city's mayor, J. Richard Gray. He chairs the Chesapeake Bay Program's local government advisory board.
Gray told BNA that a stormwater fee program is essential to finance the necessary city investments and to induce property owners to reduce the amount of impervious surface in the jurisdiction. Gray said he hopes to have a fee program in place later this year.
The city of 60,000 has a combined sewer-stormwater system that each year sends between 750 million and 1 billion gallons of overflow into the watershed, Gray told BNA.
Gray said the city faced mandates by EPA and the state Department of Environmental Protection to install massive tanks to hold the polluted mixture for post-storm treatment. The gray infrastructure capital costs were estimated at $300 million, with between $750,000 and $1 million in annual operating costs, the mayor said. The city's entire 2013 annual budget is $49 million.
Gray said he wondered if green infrastructure could dramatically reduce the overflows as well as reduce the amount of nutrient and sediment-laden stormwater flowing directly into the watershed.
The city commissioned a study by CH2M Hill. Gray said it found that green infrastructure would work and do so at half the cost of using gray infrastructure, the mayor said.
By installing permeable paving, expanding the tree canopy, installing rain gardens, and replacing concrete-channeled creeks with natural and meandering creeks, the city has made and continues to achieve significant reductions in stormwater runoff from city property, Gray said.
He added that green infrastructure is expected to reduce CSO overflows as effectively as the tunnel solution--at less than half the cost. The greening of the city also will enhance the quality of life, Gray said.
Asked if public support for stormwater fees hinges on the incentive created by the cost of alternatives, Gray said, “We're looking at a $37,500-a-day fine going back to 2008. That get's your attention.”
The city invited the public to discuss the concept of stormwater fees at a meeting on April 25. Gray said there was little dissent.
However, he added the details have yet to be determined. The city council must pass legislation for the fees to be imposed. Gray forecast that the city council will act this fall.
Pennsylvania's Senate has passed a bill (S.B. 351) that would authorize localities to impose stormwater fees. It awaits action in the House.
Gray said that in his estimation, state authorization is not necessary, but he added that the bill would address doubts expressed by some other mayors.
Officials in the District of Columbia and the six states sharing the watershed agree that nutrient and sediment pollution in stormwater must be reduced. Each of the jurisdictions' latest strategies for meeting the TMDL requirements, their Phase 2 watershed implementation plans, includes commitments to reduce urban and suburban stormwater runoff.
The Phase 2 plans from the five jurisdictions without mandatory stormwater fees--Delaware, New York, Pennsylvania, Virginia, and West Virginia--all say that additional funding is vital and promise to identify funding mechanisms during the next few years.
All five states suggested state and/or federal grants to construct urban and suburban stormwater best management practices, but West Virginia added that “fees would ensure their long term viability.” None of the five plans commits to implementing specific, dedicated funding mechanisms, a BNA review of the implementation plans determined.
As Lewis said, “The missing piece is how we get the money to do this.”
To view additional stories from Water Law & Policy Monitor register for a free trial now