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Some Ideas about FundingSome Ideas about Funding

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1. How much will it cost?

2. How will we pay for it?

3. Will the public be willing to pay?

Three Big QuestionsThree Big Questions

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What will it cover? Possibilities include:• Operations and management,• Planning,• Capital improvements,• Public education,• Mapping,• Street sweeping,• Household toxin collection,• Illegal discharge detection,• Storm drain marking,• Commercial/industrial regulation.

Estimating Program CostsEstimating Program Costs

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Montgomery County, MD

• Many of the county’s facilities have not been adequately maintained.

• The average age of the stormwater management facilities is 15-20 years old and the average age of the enclosed system is 40 years old.

• The system has deteriorated and will require significant and costly reconstruction.

What is the state of your system?What is the state of your system?

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1. The general fund

2. Ad-valorum tax

3. Stormwater utility

How Will You Pay for It?How Will You Pay for It?

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The General FundThe General Fund

Problem:

There will be wide swings in available revenue. After a major flood, public interest is high and public officials are responsive. But that drops off considerably when the flood goes away.

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Ad Valorum TaxAd Valorum Tax

Problem:

A property’s contribution to the stormwater problem does not necessarily correspond to its value.

vs.

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Pros:• It’s a steady funding mechanism• Equitable because based on “contribution to

the problem”• Provides an incentive for businesses to reduce

impervious surface

Cons:• Can be hard to get community acceptance• Have to develop a rate structure and a

database of customers and impervious area.

Pros and Cons of a Stormwater Pros and Cons of a Stormwater Utility Utility

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Most state and federal agencies require local governments to provide some percentage of matching funds they will make an “investment.”

The utility fee provides a stable funding source that can make your municipality a contender for various outside financial opportunities.

Another Benefit of Stormwater Another Benefit of Stormwater UtilitiesUtilities

AshevilleCharlotteDurhamGastoniaGreensboroLowellRaleighWilmingtonWinston-Salem

Stormwater Utilities: Catching on in Stormwater Utilities: Catching on in NCNC

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Stormwater utilities are different from other utilities:

• Customers want services such as power and water and are willing to pay to receive them on demand.

• On the other hand, stormwater ratepayers are being asked to pay to prevent things they don’t want, such as

water pollution and flooding.

Stormwater Utility: An Interesting Stormwater Utility: An Interesting BeastBeast

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There is likely to be opposition to establishing a stormwater utility. Principal objectors are tax-exempt organizations, which would not be exempt from paying a utility fee.

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Few residents are aware that storm drains empty directly into creeks or that stormwater management facilities require maintenance.

Without a common understanding of stormwater management, cooperation is unlikely.

Spend time gaining an understanding of what the programs need to be in your community and then communicate them to the public.

Stormwater Awareness: LowStormwater Awareness: Low

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If meaningful public involvement is provided, there is much less chance that the community will feel that a “rain tax” has been imposed on them (and less chance of a lawsuit).

In general, legal challenges are rare (16% have faced legal challenges and most challenges were not sustained).

Marketing is Crucial!Marketing is Crucial!

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Town of Griffin: Top 50 utility customers received one-on-one visits.

Sales pitch:

• Hospital director: A speeding ambulance could skid out of control during frequent street flooding.

• Business owner: It is inconvenient for employees when 6 inches of stormwater runoff surrounds the firm.

Marketing Tips from Griffin, GAMarketing Tips from Griffin, GA

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• Insert a citizen’s group between yourself and every hard decision you must make.

• Show photos of flood-prone spots – they speak volumes about the need for a stormwater utility.

• Create a logo for the utility and put it on everything – vehicles, stationery, offices, watershed signs.

• If you are not marketing the program every day and showing people where the money is going, you’re setting yourself up for failure.

More Marketing AdviceMore Marketing Advice

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• Rates depend on revenue requirements and the number of customers.

• The average monthly residential charge in 1999 was $2.50.

• A majority of the rates fall between $1.00 and $5.00 per month, with 50% of respondents setting their monthly fees between $2.00 and $4.00.

Setting the RatesSetting the Rates

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You cannot exempt anyone. But you can allow partial credits against the fees for items such as:

• Residents of neighborhoods that maintain drainage ponds

• A commercial property with storm-runoff mitigation features.

• Schools that teach water conservation.

Rates “Exemptions”Rates “Exemptions”

Enact two ordinances to create a stormwater utility:

• The first one establishes the components of the utility.

• The second one sets the rate structure.

Forming the utility through two ordinances allows the flexibility to alter the rate structure at a later date without having to revise the first ordinance.

Stormwater Utility OrdinancesStormwater Utility Ordinances

Check the website for example ordinances.

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“Certainly we’ve got to explain regulations. However, the real strength of the story is that the program and projects are needed to protect our drinking water, take care of public drainage problems, mitigate flood hazards and generally make our community a better place to live and work.”

More Advice from Scott BryantMore Advice from Scott Bryant

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Greensboro’s three-tier fee structure:• $2.70 / month for the average homeowner

• $1.50 / month for lower levels of impervious surface

• $3.90 / month for large footprints

The “Big Mac” analogy

Greensboro Fee StructureGreensboro Fee Structure

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• Citywide inventory of stormwater system.

• More than 50 capital improvement projects since 1996.

• Local erosion and sediment-control program.

• Local watershed program.

• Extensive stream-corridor reforestation program.

What has Greensboro done with its utility What has Greensboro done with its utility money?money?