CLARION, Pa. (EYT) — Property owners, including non profits such as churches and Clarion University, could see new fees or taxes trickle down as Clarion Borough Council investigates the establishment of a new Stormwater Authority.
Faced with the possibility of Department of Environmental Protection legislation mandating better control of stormwater following directions from the federal government, some Pennsylvania communities are investigating the establishment of separate authorities that could establish taxes or fees apart from the municipality.
Assessment of the fee would be based on the amount of stormwater generated by the property or the amount of impervious covering such as roofs and parking lots.
Adoption of stormwater authorities in Pennsylvania has been slow up to this point. In 2014, there were six authorities, and it was expected to double this year.
All property owners would be liable for the fee, including individuals, businesses, and non-profits, such as churches and state-owned property. Clarion University via the state is the largest holder of tax-exempt property in Clarion Borough.
Lee Stinnett of Salzmann Hughes, P.C. Attorneys at Law of Harrisburg, and Adrienne Vicari, P.E. from HRG Engineering and Related Services of Harrisburg, presented a program on stormwater authorities. Borough Secretary Mark Hall invited the two after seeing them make a presentation at a conference.
“It is a fee and not a tax,” said Vicari. “An average monthly fee nationally for residential building is $3.00 to $8.00, but that does vary.”
Stinnett said it is probably a matter of time before DEP officially requires it as part of the MS4 Permits that cover lines other than water and sanitary sewers as the agency expands its environmental reach.
One of the primary reasons municipalities are looking at separate authority is the aging infrastructure of storm sewers with collapsing pipes. Clarion Borough spent $92,190.12 in 2015 on stormwater sewer replacements and faces a growing amount each year, and all of that comes from the general budget.
“The challenges facing municipalities include aging infrastructure, tightening regulations, increased development equals more stormwater, and a lack of level funding,” said Stinnett. “There are three reasons for creating authorities, and they are financial, administrative, and jurisdictional.”
Stinnett explained that financial reasons include providing a steady dedicated revenue stream and allows tax revenues to be directed to fund other necessary functions of the municipality. Property owners would still pay the new fee, but non-profits would also be required in the new mix, perhaps making it more equitable than a property tax. A technical point with a new autonomous authority may improve a municipality’s finances because new debt associated with the stormwater system is not recognized a direct municipal debt. Again, the same cast of characters would still be paying the fees.
Council member Rachel Roberts questioned the length of time required to establish a new authority, and Vicari recommended a yearlong process. Costs of a start up could range between $55,000.00 and $80,000.00 estimated Vicari, but acknowledging that costs may go higher.
Start up costs could include mapping impervious area coverage, quantifying program costs, developing rates, a credit policy, a customer database, developing and approving necessary ordinances, and public education. Borough resident Bob Balough said public education would be crucial.
Clarion County GIS may be able to provide the necessary mapping required to help establish individual rates or certain zones in town.
One of the considerations in establishing a new authority is what model to adopt.
Stinnett outline three basic types of authorities, although further variations are possible. The options include an operating authority, leaseback authority, and reverse leaseback authority. Variations of these three are possible, but Stinnett said it is his opinion that the leaseback authority arrangement is illegal in Pennsylvania because the authority owns the system and issues debt to finance the system, but the municipality operates the system and sets all rates and charges and has control.
The two other authority arrangements permit the municipality to appoint members to the authority, but the authority is independent from the municipality.
It was also noted that one of the challenges in establishing a new authority is that elected officials lose control.
Clarion Borough Council President Carol Lapinto said cost estimates for stormwater expenditures over the next ten years are between $5 million and $10 million. Lapinto also said she would not vote for an authority where the Borough relinquishes its control.
