stormwater financing mechanisms- charlotte katzenmoyer

Stormwater User Fee

Implementation

in the City of Lancaster

June 5, 2012

Courtesy:

Criteria For Evaluating Policy Issues

Equity/Fairness Clarity (Simplicity, ease of understanding)

Transparency (clear link of program needs and fees)

Efficiency/Ease of Implementation Efficacy (e.g., are more precise breakdowns of property categories likely to result in noticeable differences in charges?)

Legal considerations Consistency with other goals/objectives of the City

Charging based on Impervious Area is Equitable

75%

14%

11%

Number of Parcels

Residential Non-ResidentialMulti-family NO CODE

20%

76%

4%

Impervious Area

Residential Non-ResidentialMulti-family NO CODE

Preliminary Program Costs for Three Level-of-Service Scenarios (updated for May 31 meeting)

  Estimated Annual Costs Low Medium High

Operating and MaintenanceGreen Infrastructure* n/a $162,000  $202,500 Dry and Wet Ponds (inspection) $2,300  $2,300  $2,300 Street Sweeping $168,800  $168,800  $234,100 Catch Basin $201,000  $201,000  $402,000 Storm Drainage n/a n/a n/aMS4 Implementation  $449,762  $449,762  $449,762 Program Administration $149,000  $226,000  $303,000 

Capital CostsGreen Infrastructure $730,600  $1,909,100  $3,652,400 Storm Drainage n/a $1,444,000  $1,926,000 Catch Basin $164,000  $164,000  $164,000 

Total $1,865,462 $4,726,962 $7,336,062      

Note: rate model factors in grants and loans that the City is projecting will reduce these costs early, and increase debt service later

6

Number of properties by tier: Option with 4 tiers, applied to all property types

238

4,259

6,358

2,591

1,273 643 573 210 128 97 79 76 78

750

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

Cum

ulati

ve P

erce

nt

Num

ber o

f Par

cels

Impervious Area (square feet)

Frequency Distribution: All Properties

Number Parcels Cumulative Percent

Tier 1 Tier 2 Tier 3 Tier 4

7

Rates for 3 Tiering Options, with Medium Level of Service, Pay-as-you-Go

Not including grants/loans, Penn Vest debt service, or Bond Financing

$0 

$20 

$40 

$60 

$80 

$100 

$120 

$140 

$160 

$180 

$200 

<=500 sf >500 sf and <=1,000 sf

>1,000 sf and <=1,500 sf

>1,500 sf and <=2,000 sf

>2,000 sf and <=2,500 sf

>2,500 sf and <=3,000 sf

>3,000 ($/3000 sf, charge based on total impervious 

area)

Impe

rvio

us A

rea

Fee

(Ann

ual,

per ti

er

Impervious Area (square feet)

Annual (7 tiers)

Annual (4 tiers)

Annual (no tiers)

8

Rates for 3 Level of Service Scenarios, Pay-as-you-Go ($/1000 sf, actual rates vary by size tier)

with grants/loans, Penn Vest debt service, Pay/Go

$20 $20 $20 $20 $20 $20 $20 $20 $20 $20

$30 $30 $30

$52

$74 $74 $74 $74 $74 $74

$53 $53 $53

$103$108 $108 $108 $108 $108 $108

$-

$20 

$40 

$60 

$80 

$100 

$120 

1 2 3 4 5 6 7 8 9 10

SWU

Fee

($/1

,000

sf)

Year

Low

Medium

High

Reliance on grants and

loans assumed to end after

Year 3

9

Typical Annual Stormwater Bill

$26.36

$45.00

$48.00

$53.40

$55.20

$62.48

$62.88

$65.40

$70.00

$70.00

$73.44

$84.00

$96.00

$99.96

$115.34

$161.76

$237.00

$0 $50 $100 $150 $200 $250

Prince William County, VA

Richmond, VA

Takoma Park, MD

Chesapeake, VA

Hampton, VA

Rockville, MD

Suffolk, VA

Newport News, VA

Montgomery County, MD

Gaithersburg, MD

Washington, DC

Portsmouth, VA

Mt. Lebanon, PA

Norfolk, VA

Virginia Beach, VA

Philadelphia, PA

Portland, OR

Typical Residential Annual Stormwater Charge

10

Single Family Residential Case Studies Comparing IA Fee ($/1000 sf), Dedicated Property Tax ($/mil), and Sewer Fee ($/1000 gal)

186 

4,068 

5,624 

1,884 

861 384  173  99  32  96 

0 

1,000 

2,000 

3,000 

4,000 

5,000 

6,000 N

umbe

r of P

arce

ls

Impervious Area (square feet)

Frequency Distribution: Residential

11

$15.25

$7.13

$10.69

$33.93

$45.39

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50

SWU Charge(no tiers,

$15.25/qtr/property)

SWU Charge (4 tiers Option,

$7.13/qtr/property for Tier 1)

SWU Charge (7 tiers option,

$10.69/qtr/property for Tier 2)

Dedicated Tax ($2.459 per mil)

Additional Component to Sewer Charge

($3.13/Kgal)

Qua

rter

ly C

harg

e

Small Single Family

Case Study – Single Family #1 - Attached Rowhouse600 block Ocean Ave

Typical Small Residential Property

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumptio

n(1000 gal)

$55,200 668 58

Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

12

$15.25

$21.38 $17.81

$36.58

$66.51

$0

$10

$20

$30

$40

$50

$60

$70

SWU Charge(no tiers,

$15.25/qtr/property)

SWU Charge (4 tiers Option,

$21.38/qtr/property for Tier 2)

SWU Charge (7 tiers option,

$17.81/qtr/property for Tier 3)

Dedicated Tax ($2.459 per mil)

Additional Component to Sewer Charge ($3.13/Kgal)

Qua

rter

ly C

harg

e

Medium Single Family

Case Study – Single Family #2 – Detached Residential @ 500 Poplar St

Medium Sized Residential Property

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumption (1000 gal)

$59,500 1,155 85

Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

13

$15.25

$48.07 $48.07

$100.14

$20.35

$0

$20

$40

$60

$80

$100

$120

SWU Charge(no tiers,

$15.25/qtr/property)

SWU Charge (4 tiers Option,

$14.25/qtr/1000sf for Tier 4)

SWU Charge (7 tiers option,

$14.25/qtr/1000sf for Tier 7)

Dedicated Tax ($2.459 per mil)

Additional Component to Sewer Charge

($3.13/Kgal)Q

uart

erly

Cha

rge

Large Single Family

Case Study – Single Family #3 – Single Family Residential @ 900 Block Lehigh Ave

Large sized Residential Property

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumption (1000 gal)

$162,900 3,373 26Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

14

Multi-Family Case Studies Comparing IA Fee ($/1000 sf), Dedicated Property Tax ($/mil), and Sewer Fee ($/1000 gal)

0 

76 

550  547 

278 

166 

96 62 

25 

176 

0 

100 

200 

300 

400 

500 

600 

Num

ber o

f Par

cels

Impervious Area (square feet)

Frequency Distribution: MULTIFAM

15

$651.27 $608.56 $608.56

$202.87

$58.69

$0

$100

$200

$300

$400

$500

$600

$700

SWU Charge(no tiers, $15.25 per Qtr

per 1000 sf)

SWU Charge (4 tiers option,

$14.25/qtr/1,000sf for Tier 4)

SWU Charge (7 tiers option,

$14.25/qtr/1,000sf for Tier 7)

Dedicated Tax ($2.459 per mil)

Additional Component to Sewer Charge ($3.13/Kgal)

Qua

rter

ly C

harg

e

Apts at Mulberry Ct

Case Study – Multi-family Residential / P-84 Apartments at Mulberry Court

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumption (1000 gal)

$330,000 28,578 819 Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

16

Commercial Case Studies Comparing IA Fee ($/1000 sf), Dedicated Property Tax ($/mil), and Sewer Fee ($/1000 gal)

49 112 

178  156 121 

82  71  61  54 

742 

0 

100 

200 

300 

400 

500 

600 

700 

800 N

umbe

r of P

arce

ls

Impervious Area (square feet)

Frequency Distribution: COMM

17

$295.68 $276.29 $276.29

$148.59

$21.13

$0

$50

$100

$150

$200

$250

$300

$350

SWU Charge(no tiers, $15.25 per Qtr

per 1000 sf)

SWU Charge (4 tiers option,

$14.25/qtr/1,000sf for Tier 4)

SWU Charge (7 tiers option,

$14.25/qtr/1,000sf for Tier 7)

Dedicated Tax ($2.459 per mil)

Additional Component to Sewer Charge ($3.13/Kgal)

Qua

rter

ly C

harg

e

Two Dudes Painting

Case Study - Commercial Two Dudes Painting

Commercial

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumption (1000 gal)

$241,700 19,389 27Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

18

$897.60 $838.74 $838.74

$176.68

$0.00 $0

$100

$200

$300

$400

$500

$600

$700

$800

$900

$1,000

SWU Charge(no tiers, $15.25 per Qtr

per 1000 sf)

SWU Charge (4 tiers option,

$14.25/qtr/1,000sf for Tier 4)

SWU Charge (7 tiers option,

$14.25/qtr/1,000sf for Tier 7)

Dedicated Tax ($2.459 per mil)

Additional Component to Sewer Charge ($3.13/Kgal)

Qua

rter

ly C

harg

e

Private Parking Lot

Case Study – Parking Lot (Public) P-51 Water St

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumption (1000 gal)

$287,400 58,859 0

Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

19

Industrial Case Studies Comparing IA Fee ($/1000 sf), Dedicated Property Tax ($/mil), and Sewer Fee ($/1000 gal)

0  1  0  0  3  2  1  3  1 

100 

0 

20 

40 

60 

80 

100 

120 N

umbe

r of P

arce

ls

Impervious Area (square feet)

Frequency Distribution: INDUS

20

$5,223 $4,880 $4,880

$1,289

$231

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$6,000

SWU Charge(no tiers, $15.25 per Qtr per

1000 sf)

SWU Charge (4 tiers option,

$14.25/qtr/1,000sf for Tier 4)

SWU Charge (7 tiers option,

$14.25/qtr/1,000sf for Tier 7)

Dedicated Tax ($2.459 per mil) Additional Component to Sewer Charge ($3.13/Kgal)

Qua

rter

ly C

harg

e

Ace Rents

Case Study – Industrial (Ace Rents)

Assessed Value

Estimated Impervious

Area (sf)

Estimated 2011 Water Consumption (1000 gal)

$20,96,900 342,482 295

Rates and charges assume medium LOS ($4,800,000 annual program)

Impervious area fee options

21

Debt Financing

GO Bonds– full faith and credit of the City– pledge stormwater utility revenues

Debt assumed to not count against debt cap

5.5% interest rate (subject to change based on market conditions)

20 year term (subject to change based on average useful life of projects)

next likely bond issue is 2015/16