Oh, Sweet Relief! Stormwater Utilities as an Equitable Tool to Solve Flooding and Pollution

June 25th, 2021 by Gary Brune

When we discuss the attributes of our favorite communities, chronic flooding or unswimmable lakes and streams do not make the list. However, many municipalities in New Jersey confront those problems and, for at least some of them, the creation of a stormwater utility could be the key to a more sustainable, prosperous future. Similar to traditional water and sewer utilities, stormwater utilities provide a stream of dedicated revenue that is delivered in the most equitable manner, as a user fee. This stable funding ensures a state of good repair across stormwater drainage systems, preventing property damage, protecting public health, and sheltering economies that rely heavily on outdoor recreation.

In this session during the 2021 New Jersey Planning and Redevelopment Conference, co-hosted by New Jersey Future and the New Jersey Chapter of the American Planning Association, four speakers covered the basics of stormwater utilities, including typical program design, fee structures, and credits for stormwater mitigation projects. Bree Callahan, Stormwater Manager at New Jersey Future, recognized the challenges, but noted the rising popularity of such utilities across the country. “In the 10 years from 2009 to 2019, nearly 700 new stormwater utilities were created, an increase of nearly 70 percent. There are over 1,700 such programs in operation today,” she said. (For a comprehensive view, see New Jersey Future’s recently launched resource center at https://stormwaterutilities.njfuture.org/).

Adrienne Vicari, Financial Practice Area Leader with Herbert, Rowland, and Grubic, Inc., and Michael Callahan, Stormwater Program Manager at the Derry Township Municipal Authority (DTMA), jointly reviewed how that Pennsylvania authority established a regional stormwater utility in 2017. Serving 20,000 customers across six municipalities, much of DTMA’s existing stormwater infrastructure (including 31 miles of pipe and 2,500 inlets) dates to the early 1900’s.

Vicari emphasized the importance of public outreach before, during, and after such an initiative. The DTMA first established a Stakeholders Advisory Committee of residents and local officials in 2015 to secure feedback on the community’s vision of the future, the desired level of service, and an equitable fee structure based on “impervious area” (i.e. hard surfaces such as concrete) which prevent rainfall from filtering into the soil, a driving factor for stormwater quantity and quality.) A series of public meetings and a coordinated public education campaign followed.

In outlining the township’s fee approach, Callahan noted how the use of a standard billing unit, the “equivalent residential unit” (ERU), ensured an equitable distribution of the financial burden. This is important because, in many communities, most stormwater runoff is generated by non-residential properties, including parking lots. In DTMA’s service area, one third of the total impervious area is attributable to only 10 parcels. While non-residential properties comprise 11 percent of all water accounts, they represent 73 percent of the billing units based on impervious area.

Account Type Percent of Water Accounts Percent of ERU Billing Units

Non-Residential 11% 73%

Residential 89% 27%

Based on the projected program cost and the number of ERU billing units in the region, the basic fee rate was set at $6.50/month/ERU.The authority employed a tiered fee system: the more impervious area on a property, the higher the monthly cost. (E.g..,The typical residential home is assigned 1 ERU and pays $6.50/month (i.e., $78/annually), while non-residential properties, with higher impervious area, are assigned multiple ERUs and pay a much larger amount.)

Callahan also shared some “lessons learned”

Actual rate appeals/delinquencies were double what was projected, decreasing revenue.
Emergency spending on stormwater dropped precipitously (i.e., 80 percent), from an annual average of $300,000 to $60,000 when the program was fully implemented.
Fee credits were set on a sliding scale, with the highest value (45 percent) provided for green infrastructure projects.

Callahan emphasized, “Project selection should focus not only on the obvious, such as areas of local flooding, but also upstream sources of stormwater, where the problem originates.” (For more information about Derry Township Municipal Utility Authority’s program, see: http://www.dtma.com/our-services/stormwater/stormwater-program-fee/).

Molly Reilly, Water Quality Coordinator for the NJ League of Conservation Voters, rounded out the session by addressing public engagement, including how to manage opposition. Reilly emphasized, “First and foremost, outreach campaigns must be clear on the question, “why is this necessary?” Then, build allies, including trusted community organizations who often carry considerable weight locally. Reilly recommended communication techniques include storytelling (with strong examples drawn from residents’ daily life), powerful photo images (e.g., flooding damage), simplified information (e.g., mapping tools), and the use of a variety of media platforms. Since NJ is the 4th most diverse state in the country, with 45% of its residents identifying as people of color, multi-language materials are vital.