Earlier this year, there was good news for stormwater programs when the president signed a law requiring federal facilities to pay local stormwater fees. This month, though, brought a reminder that getting funding isn’t always easy and that stormwater utilities and user fees, although they’ve become more common, aren’t always a sure thing.
Once rare, stormwater utilities became a more popular way to fund local programs in the late 1990s. Their numbers grew as hundreds of smaller cities tried to figure out how to pay for the provisions of NPDES Phase II. Many early ones faced lawsuits, which claimed the charges were not a fee for stormwater services but rather a tax that municipalities were not authorized to levy.
This article from 2005 documents Davenport, Iowa’s attempt to establish a user fee, or what became widely known as a “rain tax.” (One angry comment from a citizen during a community meeting to explain the proposed fee: “Rain is from God. How can you tax rain? I’ll bet you don’t even believe in God.”)
Stormwater user fees are now better understood and more widely accepted, but they’re still sometimes struck down. Last July, a Lincoln County (Missouri) Circuit Court judge ruled that the stormwater fee the Metropolitan St. Louis Sewer District (MSD) had been collecting since 2008 was in fact a tax and required voter approval. That would have been bad enough for MSD, but two weeks ago the same judge ruled that the law firm that led the class-action suit against the sewer district could increase its fees from $2.1 million to $4.2 million—plus additional money for expenses—all to be paid by MSD. MSD is appealing that ruling.
The only good outcome for MSD: It won’t have to repay any of the $90 million it collected while the fee was in place.