What is the Maryland Stormwater Fee?
On May 2, 2012, Maryland Governor Martin O’Malley signed into law House Bill 987, which requires 10 Maryland counties, including Harford, to collect a Stormwater Remediation Fee from taxpayers to fund the implementation of local stormwater management practices and stream and wetland restoration projects. This bill passed the House of Delegates by a 91-45 vote, and passed the State Senate by a 33-14 vote. To see the bill text and to get more information on how it moved through the legislature visit http://mgaleg.maryland.gov/2012rs/billfile/hb0987.htm
Why do we have to pay it?
Harford County is required under the federal Clean Water Act to apply for a Municipal Separate Storm Sewer System (MS4) permit. One part of the permit requires Harford County to now treat 20% of our impervious surfaces by 2017. In addition, Harford County is required to comply with the Chesapeake Bay Watershed Implementation Plan for reducing nutrient loads originating from stormwater runoff. The total cost of meeting these permit requirements by 2017 is between $70 million and $90 million. To learn more about the MS4 permit, go to http://cfpub.epa.gov/npdes/stormwater/munic.cfm
Where did the idea for a fee come from?
The concept of a Stormwater Fee has been a goal of the environmental community in Maryland for a number of years. Organizations such as the Chesapeake Bay Foundation have felt that counties and municipalities need to do more to prevent harmful runoff from entering local waterways, and that a dedicated funding source for infrastructure upgrades needed to be in place.
What did our local officials do to try to prevent it?
Harford County Government and County Executive Craig worked closely with the Maryland Association of Counties (MACo) to oppose the fee legislation when it was introduced and testify against it in committee. Ten of Harford County’s 11 General Assembly members voted against the bill, and an amendment was introduced in the Senate, with the support of the County Executive, that would have exempted Harford County from the legislation. The amendment failed and the bill passed by a sizeable majority in both houses minutes before the 2012 session ended.
Will residents and businesses in an incorporated town have to pay this fee?
Not initially. Due to the way that the state law was written, Harford County cannot collect a fee on residents and businesses in municipalities without the consent of the municipal governments. This fee will only apply to Harford County residents who do not live within the city/town limits of Aberdeen, Bel Air, or Havre de Grace. Those municipalities operate under a different stormwater permit than does Harford County, and the municipalities are not required by the state to charge a fee at this time. However, they can impose a fee at any time if they so choose, as other municipalities around the state have done.
It is expected that all municipalities and counties in Maryland will have to begin collecting this fee in the near future, and the rates for residents and businesses in municipalities could very well end up being higher than the fee for county residents, due to the fact that they have a greater concentration of impervious surface area.
How could this fee have been structured?
There are a variety of ways in which this fee can be collected, including a flat fee, a fee as a percentage of assessed property value, or a fee based on the total impervious area of a property. The Department of Public Works sought opinions from a variety of stakeholders, including citizens, taxpayer interests, commercial industry representatives, and technical experts, in order to examine all of the possible ways this fee could be collected in an equitable manner.
The Department of Public Works recommended that residential properties (excluding apartments) be charged one flat fee, while commercial properties (including apartments) will be charged a fee based on the impervious area of the property. Farms (Ag-zoned and ag-assessed) would not be charged the commercial fee for buildings and pavement, and will only have to pay the residential rate that other non-farm homes pay.
How much will I have to pay as a homeowner?
The charge for residential properties was set at $125 per year; however, taxpayers will only be required to pay $12.50 for the tax year beginning July 1, 2013. During this initial phase-in, a task force set up by the County Council will determine what the fees will be for subsequent years.
The $125 figure was reached by taking the proportion of residential impervious surface in the county (76%) and applying that to the annual funding required to satisfy a federally determined “best effort” ($10.5 million x .76 = $8 million), then dividing that dollar amount by the total number of residential properties in the county.
How much will this fee cost my business (non-farm)?
Since the purpose of the fee is to treat impervious surfaces, and given the wide range of impervious surface areas on commercial properties, the Department of Public Works recommends that commercial properties (including apartment complexes) be charged the fee based on impervious area.
The charge for commercial properties will be $7 per 500 sq. ft. of impervious area, which equates to roughly 1.4 cents per square foot. However, like the residential fee, commercial property owners will only have to pay 10% (70 cents per 500 sq. ft. of impervious surface) for the tax year beginning July 1, 2013.
Compared to the other counties that have introduced legislation, Harford’s fee (even at the 100% level) would be slightly less than Howard, half of Anne Arundel, and five-times less than Baltimore City.
Why doesn’t Harford County just ignore the fee and permit requirements?
The state requires the county to charge a fee, but the legislation did not specify the amount that needed to be charged. However, the county is also legally required to meet federal EPA stormwater discharge permit requirements, which are requiring us to treat 20% of all impervious surface in the county, which will cost as much as $90 million. The County is subject to heavy fines and our businesses could be denied various state permits (e.g., state highway access) for noncompliance.
Now that the state has mandated this Stormwater Fee, the County will be obligated to collect a level of funding that can support stormwater projects that will be undertaken by the county. The county has aimed to keep the fee as small and as equitably applied as possible.
The fact is that the long term costs of not complying will be much greater than the cost of complying.
A court ruled in Virginia that the EPA can’t regulate rainwater. Does that mean we don’t have to do this?
Unfortunately, the case in Virginia is different than the situation in Maryland. The Virginia case was based on the fact that the EPA was trying to regulate the volume of stormwater runoff, rather than the amount of pollutants in the stormwater itself. The court very rightly found in favor of the Commonwealth and agreed with their stance that while the EPA can regulate water quality, it cannot regulate water quantity.
The EPA can, under the Clean Water Act, regulate pollutants such as nitrogen, phosphorus, and sediment in stormwater, as well as the method by which stormwater becomes polluted (i.e. untreated impervious surfaces). This was the basis for the Maryland law making it mandatory that Harford and nine other jurisdictions to collect a “rain tax.”
What is the Rural Counties Coalition?
The Rural Coalition is a group of counties that has hired an Annapolis lobbyist to represent them legislatively. However, most rural counties are not yet required to charge this fee, as only Harford, Frederick, Carroll, and Charles are. Generally, the coalition is focused on issues currently before the General Assembly, rather than items such as this that have already been passed into law.
Harford County has joined the coalition as an associate member, but not a full dues-paying member. Doing so allows us to remain part of the “Big 7” group of counties and still take advantage of our status as a rural county.
There is a separate coalition called the “Clean Chesapeake Coalition” that has hired a Baltimore law firm to provide legal advice on issues related to the Chesapeake Bay TMDL mandates. However, unlike the other smaller rural counties, Harford County has a number of full-time lawyers on staff that can and do provide legal advice, and therefore, it wouldn’t be a prudent use of public funds to hire outside counsel in this instance.
Projects, Credits, and Exemptions
What will the money collected be spent on?
All of the funds collected by the Stormwater Fee must be placed in a dedicated fund which can only be used to pay for stormwater remediation projects and related expenses. Such projects include stream restorations, stormwater management pond retrofits, educational outreach, and operating funds for the Water Resources Section.
Is there anything I can do to lower my fee?
Homeowners and business owners can get up to a 100% credit for doing remediation projects on their own property. Some of these projects include the use of rain barrels, the installation of rain gardens, retrofitting existing stormwater management facilities, and the planting of trees along waterways.
In addition, newer communities and commercial sites designed within the last decade that incorporate newer stormwater management practices may receive a credit for a percentage of the fee. The specific levels to which these remediation projects will depend on the type and effectiveness of the stormwater management practice employed.
Rules and regulations regarding stormwater remediation fee credits and/or exemptions have not yet been established. Once an advisory board has been selected and rules established, the committee will process the credit and exemption applications. This is expected to occur by late fall of 2013. The only applications that can be processed at this time are the “Hardship Exemption” which will be handled by the Treasury and “Appeal” which will be handled by Department of Public Works.
How do I apply for an exemption from paying the fee based on financial hardship?
Applications for an exemption from paying the fee on grounds of financial hardship can be found here. Instructions for the application can be found here.
How do I appeal my stormwater fee if I think an error has been made in its calculation?
A property owner who wishes to challenge the imposition of a Stormwater Remediation Fee shall appeal to the Director. The Appeal shall be submitted on or before October 1 in order to receive a correction of the Stormwater Fee for the taxable year. The application can be found here.