1. Consensus-Building and Its Role in Successful Stormwater Utility Implementation Danny Bowden, City of Raleigh Scott McClelland, CDM Presented at: NC APWA Innovations in Water Resources & Stormwater Management September 27, 2004

2. Presentation Agenda u Drivers for the stormwater funding study u Role of the stakeholder group u Establishment of a utility for the City of Raleigh u Lessons learned and ongoing efforts

3. What Drove the Need to Perform a Stormwater Management Funding Study?

4. Consequences of Increased Uncontrolled Urbanization Time Stream Flow Rate With Urbanization Without Urbanization Greater & earlier peak discharge Greater runoff volume Smaller & less rapid peak Reduced baseflow Rapid conveyance of more pollutants

5. Impacts of Increased Runoff u Creates downstream flooding problems u Accelerates erosion and degradation of our streams u Carries pollutants into streams and rivers, impacting water quality

6. Did the City’s Stormwater Program Have Adequate Resources?

7. Previous Stormwater Management Program Budget and Staffing Levels

8. The City’s Existing Level of Service Operation & Maintenance – 5 staff members provided all maintenance for City’s stormwater program (making maintenance solely reactive) Capital Improvements – CIP was funded by a mix of City funds and grants. Program needs were prioritized to try and address the most critical needs Program Administration – City did a good job of planning, but lacked resources to update models for new conditions and to manage new CIP projects

9. Over 3,000 Stormwater Complaints Were Made By City Residents Since 1986 Less than 15% of those complaints had been addressed

10. City Drainage Basin Studies Had Identified Nearly $100 Million of CIP Needs

11. Federal and State Water Quality Regulations u NPDES Phase I & II Regulations u EPA/State 303(d) List u Nutrient sensitive waters (i.e. Neuse Rules) u Wetlands/401 Regulations u Federal Clean Water Act - TMDLs

12. What Questions Does This Raise??? u Are the City’s programs effective in achieving its goals? u Does the City have adequate staff to support its programs? u What role does the current funding play in making these goals more difficult to achieve? u Are the citizens satisfied with the City’s current level of service?

13. What Role Does a Stakeholders Group Play in the Process?

14. Financial, Technical, and Stakeholder Input Is Used to Develop Recommendations RECOMMENDATIONSRECOMMENDATIONS Collect and Evaluate Data Define Billing Methodology Determine Billing Units Establish Administrative Procedures F I N A N C I A L Identify Stormwater Needs Select Funding Methods Develop 5-yr Financial Plan Set User Fee T E C H N I C A L Appoint Citizen Committee Reviews Needs Committee Reviews Funding Methods Committee Reviews User Fee STAKEHOLDER INPUT

15. Project Approach Gave Every Member of the Process An Equal Vote Stakeholders Consensus- Based Results Old Approach Our Approach Stakeholders Project Sponsor

16. Stakeholder Group Workshop Process u Invite representatives with diverse opinions u Facilitate meetings to emphasize “fairness and equity” u Discuss program levels of service u Group/consultant presents results to Council

17. Invite a Diverse Group to Represent the Customers At-Large Stakeholders Group Stakeholders Group State and Local Government Citizen Action Groups Homeowners Associations Homeowners Associations Environmental Interests Commercial Business Interests Homebuilders Association Non-Profit Groups Schools and Universities

18. Case Study: City of Raleigh Stakeholders Group Consisted of 25 Members Office of State Construction Wake Co. Environmental Services North Carolina State University Meredith College Wake County School System Local High Schools (2) Crabtree Valley Mall Practicing Engineer Chamber of Commerce Office of State Construction Wake Co. Environmental Services North Carolina State University Meredith College Wake County School System Local High Schools (2) Crabtree Valley Mall Practicing Engineer Chamber of Commerce Homebuilders Associations Association of Realtors Environmental Group (3) Homeowners Association (2) Citizen Action Groups (2) Church Representative Apartment Management (2) Local Non-Profit Groups (2) Progress Energy Homebuilders Associations Association of Realtors Environmental Group (3) Homeowners Association (2) Citizen Action Groups (2) Church Representative Apartment Management (2) Local Non-Profit Groups (2) Progress Energy

19. Stakeholder Meeting Topics u Meeting #1 – Introduction, Expectations, & Schedule u Meeting #2 – Stormwater 101 & Program Level of Service u Meeting #3 – Existing Program Level of Service & Cost u Meeting #4 – Stakeholder Field Trip u Meeting #5 – Level of Service Improvements and Cost

20. Stakeholder Meeting Topics (con’t) u Meeting #6 – Future Level of Service Selection u Meeting #7 – Existing Funding Sources & Options u Meeting #8 – Program Rate Structures u Meeting #9 – Fee Adjustments & Credits u Meeting #10 – Stakeholder Recommendations

21. Stormwater Management Functional Areas u Stormwater Program Management u The planning and management of assets associated with stormwater u Operations and Maintenance u The management of stormwater assets to assure that the assets continue to operate at peak efficiency u Capital Improvements Project (CIP) u The construction of new assets that upgrade older portions of the stormwater system and that handle growth within the system

22. Stormwater Management Goals u Flood control u Water quality protection u Operation and maintenance u Regulatory compliance u Environmental protection u Long-term financing u Community acceptance Levels of Service

23. Developing a Level of Service

24. Stakeholder Group Field Trip u 15 stakeholders and 2 city council members visited 9 stormwater project sites u Sites were chosen to show examples of “the good, the bad, and the ugly” of stormwater management

25. City of Raleigh Stormwater Program Level of Service Matrix

26. Stormwater Utility Stakeholder Level of Service Voting Results

27. How Should We Pay For Our Stormwater Management Program?

28. Components of General Fund: Traditional Funding Has No Relationship to Stormwater Service

29. Funding Options for Stormwater Management u Taxes u Ad Valorem u Municipal Service Districts u Special Assessments u Sales Taxes (Local Government Sales & Use Taxes) u Utility or Public Service Enterprise Fees (User Fees) u Other Funding u Impact Fees u Grants u Loans/Bonds

30. Funding Capability of Each Funding Option

31. How Do They Compare in Some Key Areas?

32. A Stormwater Utility Charges a User Fee Based on Impacts to the Stormwater System PollutantsPollutants Water Runoff

33. Stormwater Utilities: New Concept? u First utility established in 1976 (Bellevue, WA) u Trend continued in the late 80’s/early 90’s in response to NPDES Phase I u Approximately 400 utilities exist today u Most larger communities in North Carolina are now funded by a stormwater utility Raleigh Charlotte Greensboro Winston-Salem Durham Fayetteville Wilmington Greenville Chapel Hill Washington Wilson High Point Rocky Mount

34. Benefits = Charge u Management of runoff benefits owners and tenants u Benefit relates to property’s contribution to the problem (runoff burden) u Fee relates to runoff u Common proxy for runoff is impervious area Customer receives services from the utility in direct measure to the runoff burden

35. Utility Fees Should Be Fair and Equitable Based on Service Needed u Water utility – volume used u Wastewater utility – volume generated u Solid waste program – volume/weight u Stormwater utility– runoff contribution

36. A Stormwater User Charge Is Typically Based on Impervious Surface

37. Comparison Between Ad Valorem and a Stormwater User Fee u Advantages u In place already u Easy to collect and administer (tax collector) u Can be sufficient for all services u Disadvantages u Not dedicated u Competition u Not equitable u Advantages u Equitable (i.e., fee related to service provided) u Stable & dedicated funding u Encourages good behavior u Sufficient for all services u Disadvantages u Startup costs u Administrative costs Ad Valorem Stormwater User Fee

38. City of Raleigh Stormwater Program Levels of Service & Annual Costs

39. Cost Comparison for the Typical Residential Home Owner u Tax rate needed for LOS B = $0.046 per $100 assessed value u For median home: u User rate needed for LOS B = $4.00 per month per SFU u For median home: $156,000/$100 x 0.046 = $71.76/yr $4.00 x 12 = $48.00/yr Ad Valorem Stormwater User Fee

40. Outcome of City of Raleigh Stormwater Funding Study u Stakeholders broadly supported an increase in the City’s level of service u The group voted almost unanimously to fund the program with a utility u Stakeholders participated in the presentation to Council u Council approved the implementation of the utility in May 2003

41. Continuing Efforts and Lessons Learned

42. Keys To Establishing A Successful Stormwater Utility Program u Review and establish the current level of service of the program u Involve a stakeholders group to determine the desired level of service of the public at-large u Allow the stakeholders to choose the desired funding option u Utilize the stakeholder process to gain the support of the citizens and local government officials

43. Ongoing Efforts…. u Per the stakeholders’ recommendations, the City Council has also approved the following: u Stormwater Utility Fee Credit Manual u Approval of 10 additional stormwater staff u Establishment of a permanent, 10-member Stormwater Management Advisory Commission

44. Role of the Stormwater Management Advisory Commission u Recommends policy changes to council u Reviews and comments to council on the annual capital improvement program u Responds to council and staff for advice on stormwater utility matters u Presents council with an annual report of key actions and issues

45. Lessons Learned u Program and utility recommendations came from the stakeholder group and not city staff or council led to community support u Facilitation by consultant kept the stakeholders on task u Public education is a continual process and you can never do too much public education when implementing a stormwater utility u Coordination between key city departments is crucial to implementation – stormwater services/ billing/ GIS/ budget office

46. Lessons Learned u Look for the unknowns in billing systems and with the impervious data u Address Conflicts in Databases u Homeowners Associations/ Common Open Space Areas u Billing of HOA’s versus Individual Unit Owners u Billing of Tenants versus Owners u Semi-Impervious Surfaces

47. Lessons Learned u Customer Service u Provide it Efficiently and Promptly u Clearly Define Roles of Different Departments u Count on a Ten Fold Increase in Calls During the First Six Months of the Utility and Staff Accordingly Scott McClelland, CDM u Err on the Side of the Customer - Quote from Scott McClelland, CDM

48. Thank You For Your Time! Any Questions??