|Final stormwater fee vote looming
After passing two rounds of voting, Lenoir City Council is poised to make a final decision Monday on implementation of a stormwater utility fee.
The fee, which is set at $3 per month for residential property and a more expensive sliding scale for non-residential, has been hit with criticism and labeled a “rain tax” by some in the community.
Lenoir City is classified as a Phase II municipal separate storm sewer system (MS4) by the Tennessee Department of Environment and Conservation.
That designation requires Lenoir City “to obtain coverage under a stormwater discharge permit and implement a set of programs to manage the quality of stormwater runoff from the storm sewer systems,” Kim Schofinski, deputy communications director for TDEC, said in an email correspondence.
In order to be compliant with those requirements, municipalities with the Phase II MS4 designation must meet six “minimal control measures.”
Schofinski said those measures include:
Conduct public education and outreach to inform residents about the impact polluted stormwater runoff can have on water quality.
Provide opportunities for residents to participate in program development and implementation, including effectively publicizing public hearings and/or encourage resident representation on a management panel.
Develop and implement a plan to detect and eliminate illicit discharges to the storm sewer system.
Develop, implement and enforce an erosion and sediment control program for construction activities that disturb one or more acres.
Develop, implement and enforce a program to address discharges of post-construction stormwater runoff from new development and redevelopment areas.
Develop and implement a program with the goal of preventing or reducing pollutant runoff from municipal operations, which must include municipal staff training on pollution prevention measures and techniques.
Amber Scott, city administrator, estimated the cost of implementing those six measures from the 2016-17 budget at $300,000-450,000.
“That’s including the money that we spend to TDR industrial services every year to come and vacuum the system, also the money we spend to camera the system and record it and also the money that we spend sweeping our streets, cleaning them,” Scott said. “The work of the street department basically.
Anything that we do to keep foreign materials from our storm system.”
If the proposed stormwater fee is passed, it would bring in about $500,000 in revenues, which Scott previously said would help with a backlog of projects related to stormwater costs.
“Some of the backlog is simply planning for infrastructure upgrades,” she said. “We have infrastructure in the center of town that is over 100 years old. The back log would be us planning for that. With that extra money, which you — because it’s going to be earmarked. When you make a stormwater fee budget it’s earmarked for that purpose. It doesn’t go back into the general fund. So we’re going to be able to do a capital improvements plan to upgrade that infrastructure that’s in the ground to meet the needs of the future.”
But the majority of the money linked to stormwater management in Lenoir City is related to wages and salary. The $350,000-$400,000 estimate from Scott includes money spent from “the Codes Enforcement/Building Office and Street Department” budgets.
The only line item in the budget specifically for stormwater is $35,000 for the codes enforcement office.
Making up the majority of the $350,000-$400,000 estimated cost is stormwater manager Greg Buckner’s full salary, 50 percent of the salary for both the city planner and codes enforcement officer and 50 percent of the wages for the street department.
Wages for the street department totaled more than $540,000 in the 2016-17 budget, with about $270,000 falling under stormwater costs.
“The law provides that fees can be utilized in that way, as well, for positions that are related to this effort,” Scott said.
Fee or a tax?
The state does require Lenoir City to cover the costs associated with meeting the six measures related to stormwater, but it does not dictate how.
“Of course certain people can twist it and say it however they want to say it, but at this time we’re choosing to implement a fee to fund it,” Scott said.
“That’s how we’re choosing to do it. We could do a tax increase, we could fund it with a fee or we could just continue to fund it the way we have been. These are the choices. Or don’t do it and get fined $25,000 a day.”
Scott provided a list of 16 Tennessee cities that implement a stormwater utility fee of some kind that were looked into by Lenoir City when considering a possible fee, the closest being Maryville and Alcoa.
“City of Knoxville did a tax increase in lieu of doing a fee,” Scott said, adding that Lenoir City chose to pursue a fee because it was “more equitable.”
“If you look at the comparison between the tax increase and the fee, a fee is a more equitable way of doing things,” she said. “If it’s a tax you’re really only getting your business owners and your residents. You can’t get your schools and you can’t get your churches because they’re exempt from property taxes. So even though they’re putting into the system, they’re not having to contribute anything toward it.
“The other item would be that when you have a tax increase, all of that is going to be lumped into the general fund,” Scott added. “When you have a fee set aside, a special fee like this, it’s earmarked just for that purpose. … It’s not redistributed out.”
While the money brought in from the fee will be earmarked, the fee does free up at least the previously estimated $350,000-$400,000, in essence providing the city the same benefits as a tax increase. Scott did not provide specific details about how that money would be used but did point to some possible departments that could see a boost.
“A budget is just a piece of paper,” she said. “When you look at that $350,000, it’s going to be funding other projects in the city. It’s going to be freed up to go to the police department, to go to the fire department, to go to all the various departments in the city that’s been feeding this other one. We haven’t had a tax increase in years, so we’ve been having to spread our money really thin to make it go farther.
“So it frees that money up to other departments,” Scott added. “We’ve had shortages in the police department. We haven’t bought vehicles since 2011. Our vehicles are starting to break down, so we’re going to be using money for that. We had about a seven-person shortage in the roster. There’s a fire department roster shortage. So we’re trying to fill in some of those gaps where we’ve been holding back the past few years.”
The cost of the proposed fee is significantly higher for non-residential property than for residential, with the lowest cost for a commercial property starting at $25 per month, or about eight times that of a residential property.
Cost for non-residential property is based on “impervious square footage,” or the square footage of the roof and paved or gravel areas of a property. Grass is not included in the measurement.
Scott does not believe the fee would deter any future businesses from entering Lenoir City.
“A lot of business, a lot of your big box businesses that move in that are your franchises and chains, they expect it,” Scott said. “That’s one of their first questions is do you have a stormwater utility fee? How much is it if you do? They’re used to paying it in other places. We’re probably one of the last cities that are under this mandate that have implemented a fee of some sort. Ours is quite a bit lower when you look at the comparison of some other cities.
“... Your downtown businesses, 95 percent of them will be $25 a month,” she added. “I would even go so far as to say 98 percent of them will be $25 a month. Think about how small those stores all. It’s your roof plus your impervious pavement.”
Some non-residential property representatives have expressed concern. Lenoir City Schools Superintendent Jeanne Barker attended city council’s special called meeting June 5 to voice concerns, as did several church representatives.
Barker estimated the cost for Lenoir City Schools at about $14,000 during the Lenoir City Board of Education’s June meeting.
Jason Vance, Loudon County director of schools, said he also plans to send a letter in opposition of the fee, calling it a “burden” on the school system.
The Rev. Ernie Varner of Sixth Avenue Church of God called the fee “unfair” during council’s June 5 meeting.
Varner referenced a $400-$500 monthly charge for the church but was later informed that Sixth Avenue COG would pay around $100 per month. Even so, he is standing by his previous stance.
“I think churches should be exempt and other non-profits,” Varner said. “I think it’s a slippery slope when you start adding fees to them. They say it’s not a tax, but it feels like a tax. … I just think the status of non-profits should be respected.”
Varner believes the city has not communicated effectively with the public the need for the fee.
“I don’t think they’ve communicated with everyone enough,” he said. “I also really don’t think any of the meetings should have been during the day. I think they should be at a time when everybody could be there. I still don’t understand why one of the meetings (June 5) was at 1 o’clock during the day.