Northeast Ohio RegionalSewer DistrictImplementationof a RegionalStormwaterManagementProgramApril 5, 2012
NEORSD: formed by courtorder in 1972 under ORC 6119Key responsibilities:• WWTP Operation• Easterly, Southerly, Westerly• Interceptor Sewers (NOT local sewers)• Combined Sewer Overflow (CSO) Control• Regional Stormwater Management
We serve approximately 1million people in 62communities and 4 counties
• In a 1978 court order revision, JudgeMcMonagle mandated the District to “developa detailed integrated capital improvementplan for regional management of wastewatercollection and storm drainage”• Over the years we did a number of drainagestudies…
138 Problem Locations
248 Problem Locations
513 Problem Locations
In 2006 our consultantsadvised us:Establishing asuccessfulstormwater utilityrequires that youpay attention tofive key areas ofdue diligence:• Governance defined andcordial• Program concept and thecompelling case• Public and political educationand support• Financial policies anddocuments• Database development &accuracy and customerservice
Governance defined:• ORC Chapter 6119 Authority• Court Order: Plan of Operation• Code of Regulations• Titles I – IV deal with sanitary sewage, industrial wasteand combined sewage• Title V: Stormwater Management Code15
Compelling Case:• Flooding, erosion, and waterquality problems areincreasing throughoutNortheast Ohio• Regional stormwatermanagement is needed toaddress problems andminimize new concerns• NEORSD has the mandate,authority, and skills toimplement this regionalprogram
Program concept: what needs tobe done?17
Regional Stormwater System =channels and pipes draining 300acres or more (approximately450 miles)
We will developstormwatermaster plans
We will performinspection andmaintenance
We will build projects
Chevy Branch streamrestorationWe will restorestreams
We will fix problems
We will encourage goodpractices
Fee based on impervioussurface:Residential property:Roof + driveway= 1.0 EquivalentResidential Unit (ERU)= 3,000 square feet ofimpervious surface“The more you pave the more you pay.”
Residential Stormwater Fee (2013):• Small houseThree Tiers‣ Less than 2,000 square feet of impervious surface‣ $2.85/month, $34.20/year $3.03/month, $36.36/year• Medium house‣ 2,000 to 4,000 square feet of impervious surface‣ $4.75/month, $57/year $5.05/month, $60.60 per year• Large house‣ More than 4,000 square feet of impervious surface‣ $8.55/month, $102.60/year $9.09/month, $109.08/year• Homestead rate‣ For those who qualify for water/sewer‣ $1.95/month, $23.40/year $2.03/month, $24.36/year
Non-residential Stormwater Fee:(Residential property: Roof + driveway = 3,000 sq. ft. = 1 ERU)Non-residential property:Roof + parking lot= 120,000 sq. ft.= 40 ERUs= $202/month= $2,424/year(less any credits)
Stormwater Fee Credits• Financial incentive to managestormwater at source:– Reducing regional costs– Encouraging environmentalstewardship31
Individual ResidentialProperty Credit (1): 25%• District-approved StormwaterControl Measures include:• Rain Gardens• On-Site Stormwater Storage (rainbarrels, cisterns, etc.)• Impervious Surface Reduction• Pervious Pavement• Vegetated Filter Strips32
Individual ResidentialProperty CreditRaingardenRain BarrelsVegetatedFilter StripPervious Pavement33
Stormwater QuantityCredit (2): Up to 75%• Reduction of Peak Flow– Up to 25% credit• Reduction of Runoff Volume– 50% credit34
Stormwater QualityCredit (3): up to 25%• Credit for providing water qualitytreatment to runoff35
Stormwater Quantityand Quality CreditsDry Detention BasinRetention Pond36
Stormwater EducationCredit: 25%• Credit for providing education toK-12 students about water qualityand stormwater problems37
Other financial policies:• Exemptions: public roads,runways, railroad rights-of-way,and municipal properties.• Community Cost Share of 7.5%
Database development &accuracy and customer service:• We’ll knowwhen thefirst bills rollout!39
Who did our consultants (in 2006)warn us will not like the concept?• tax exempt properties• people with largepaved areas withcheap buildings• fixed income• sometimes developersdon’t like itMaybe everybody !!
Who opposed us?• tax exempt properties: Cleveland CatholicDioceses and Cleveland Metropolitan SchoolDistrict• people with large paved areas with cheapbuildings: commercial group including BOMA,auto dealers, apartment owners, NAIOP, realestate people, etc.• member communities: 11 of 49 CuyahogaCounty communities, and 11 Summit Countycommunities
What did our consultants (in 2006)warn us about legal challenges?• Fair and reasonable• Not illegally discriminatory orconfiscatory• Total costs substantiallyrelated to provision offacilities and services• Individual rates basedloosely on demand or “use”of system• Legal by charter orlegislation• Proper procedures followed25% Challenged in the courts
What were the main issues incourt?• Fair and reasonable• Not illegally discriminatory orconfiscatory• Total costs substantiallyrelated to provision offacilities and services• Individual rates basedloosely on demand or “use”of system• Legal by charter orlegislation• Proper procedures followed
First trial in March 2011:• Does the District have theauthority under ORC 6119 toimplement Title V?
Court Decision April 2011• Court finds that ORC Chapter 6119 authorizesthe District to address intercommunity flooding,erosion and stormwater-related water qualityissues. The term “wastewater” as used in 6119includes stormwater.• Court strikes down a few things in Title V• Court rules that some Summit Countycommunities are not “members” of the District,and cannot be subjected to the District’sauthority without written consent.
Second trial in December 2011:• Does the District have theauthority to charge a fee forstormwater management?• Is the fee fair andreasonable?
Opposition arguments:• Cuyahoga Communities:– District does not own or control any part of proposed RegionalStormwater System, and will interfere with communities’ rightsto operate and fund their own local systems.– No proof that proposed projects are needed, or will beconstructed.• Summit Communities:– Fee based only on impervious surface is not fair.– Fee bears no relationship to any benefit to those paying it.
Opposition arguments:• Commercial group:– The exemptions and credits are not fair.– It’s a tax because property owners will receive no specificbenefit or service, and District’s service area does not include allof the watershed.– Charge will produce funds far in excess of foreseeable cost ofservice.– Charge is not fair because there’s no cap on non-residential fees.• Diocese and CMSD:– Schools and churches can not afford the fee.
District’s arguments:• Property owners will be provided a service or benefit.• Fee is not a tax because it will:– Be imposed in return for services provided to property owners,– Not exceed the cost of providing those services,– Be used only for projects relating to stormwater,– Not be diverted for general District expenses.• Using impervious surface to calculate the fee is mostwidely used method, and is appropriate.• Exemptions are rational.• Credits are rational.• Regional system definition is rational.
Court Findings February 2012• Title 6119: the Court finds the District isauthorized by 6119, and not restricted by itscharter, to charge a stormwater fee.• Tax/Fee: the Court finds that the chargesproposed in Title V are not an unlawfulimposition of a tax
Court Findings February 2012• Constitutional Issues: the Court finds the fee isnot arbitrary, capricious or unreasonable.However, the District must re-work the nonresidentialproperty portion of the fee scheduleproviding either a cap or a reasonable decliningblock scale.
Court Findings February 2012• Credits & Exemptions: the fee credit system is arational way to advance a legitimategovernmental interest and is not otherwisearbitrary, capricious or unreasonable. However,the District shall provide the school systems withappropriate curriculum for grades 1-12 toachieve the credit, and shall submit a planproviding for the accrediting of costs of licensedengineer in completing any applications forcredit (not to exceed 10% of annual fee)
Court Findings February 2012• Community Cost Share: Either the meaning of“regional” must be arrived at by consensus ofthe District and member communities, or thecost share must be an amount no less than25%.• Exemptions: the Court finds that the District’sexemptions are reasonable…and that they arenot otherwise arbitrary, capricious orunreasonable.
Where do we stand:• Judge called meeting on March 19 th to discussissues he asked the District to address:– Cap on non-residential fee– Provide workbooks for education credit– Reimburse portion of engineering fees for credit applications– Increase Community Cost Share?• Cuyahoga communities and commercial groupfiled appeals, which have been dismissed.• We are close to settling with Diocese andCMSD.• We are still in settlement discussions withSummit County.
Lessons learned:• Every program and stormwater utility isdifferent, but learn from others.• Hire good consultants and listen to them.• Do your homework.• Never underestimate the resistance to a newtax fee.• If there is a legal challenge, hire good lawyersand listen to them.• However long you think it can possibly take tosettle a legal challenge, it will take longer.