Sustainable Storm Water Funding Task Force — Portland, ME
Date: 2011-09-20

AGENDA
 Sustainable Storm Water Funding Task Force
 September 20, 2011
 City Hall, Room 209, 12:00 PM – 2:00 PM

1. Introductions of Task Force members and meeting attendees.

2. Review and approval of the SSWFTF minutes from August 16, 2011.

3. Review of roadmap.

4. Review of Rate Methodology: How should the stormwater user fee be measured?
 a. Charge on the basis of impervious area only.
 b. Charge on the basis of impervious area plus total gross area.
 c. Charge on the basis of intensity of development.

5. Review of Rate Structure: How should Portland charge single family residential properties?
 a. Flat rate for all residential properties.
 b. Several tiers (2-3) or more.
 c. Individually measured charges.

6. Review of Exemptions:
 a. Should Portland charge for roads?
 b. Should Portland charge for public property?

7. Presentation and Discussion of Credits
 a. What private actions and investments should qualify for a credit?
 b. How much of the stormwater program should be available for crediting?

8. Discussion of public outreach plan.

9. Confirm Date for Next Meeting: The next meeting is currently scheduled for October 18, 2011

10. Adjourn
 MINUTES
 Sustainable Storm Water Funding Task Force
 August 16, 2011
 City Hall, Room 209, 12:00 PM – 1:30 PM

1. Introductions of Task Force members and meeting attendees.

All members were present except for Todd Dominski, David E. Robinson, Dennis Martin, Curtis Bohlen,
and John Cannell. Also in attendance was Randy Talbot, Matt Arco, Katherine Early, Doug Roncarati,
Zach Henderson, Sadie Lloyd, and Dan Bisson.

2. Review and approval of the SSWFTF minutes from July 19, 2011.

Veroneau said that he was not at the last meeting and the minutes should reflect that. Gellerson made
a motion to accept the minutes with the amendment that Veroneau was not in attendance. Brooks
seconded that motion. The minutes were unanimously accepted.

3. Presentation on roadmap, rate structure, and exemptions.

After review of the last meeting outcomes, the Task Force reviewed the “Roadmap.” Andy Reese stated
that this roadmap was structured to enable the group to get to the finish line: being able to recommend
a coherent and fairly complete framework to City Council by December. With such a framework the
Council can, if they wish, authorize the City to begin the process of establishing a stormwater user fee.

Reese then reminded the Task Force of the general rate levels for both the sewer rate and the
stormwater rate, and that it was a “zero sum game” in that if one rate decreased the other would go up.
He mentioned that near the end of the process the potential allocation of CSO costs to a stormwater fee
would be revisited.

4. Discussion of storm water rate structure and discussion of exemptions.

The three components of a rate structure were reviewed and a standard set of evaluation criteria noted.
Reese also explained the difference between using an overall rate methodology (sort of a shotgun
approach) for the rate structure versus using credits as sort of a rifle shot approach. You use the basic
rate methodology to get things about right and then credits and exemptions to adjust from there for
those who may outliers to the basic rate methodology.

The concept of a basic rate methodology was discussed and the differences between impervious area
(IA) and the use of gross area (GA) discussed. Three basic rate methods were outlined and then
variations on those suggested: IA only, GA+IA, and GA times an intensity factor. Pros and cons were
discussed. It was explained that gross area approaches may better reflect the total runoff from a
property while IA approaches reflected best the changes a property owner has done and benefits from.
The potential impact of the various methodology decisions on the “Dow Jones” properties was
illustrated and reference was made to the table in the handout. The basic difference is how GA is
handled – whether it is seen as a benefit or a liability in the basic rate methodology.

Significant discussion was had about the various options and each member was given a chance to
express their concerns and preferences and what Portland was trying to encourage in terms of
development.

Members were given a chance to vote along a
continuum of choices from GA being seen as
good to GA being penalized. There was a feeling
that Portland was generally a fairly densely
developed city and that recognition of open
space in the rate methodology was not
warranted. The weight of the voting centered on
the use of a simple IA approach to the rate
methodology but with there being an ability to
recognize, probably through crediting, green
space that had superior rainfall infiltration or
treatment capabilities. This might include: urban
forests versus simple turf cover, and the use disconnection of impervious areas versus directly
connected impervious areas.

The above figure was used to tally votes and to frame the discussion. The following voting was tallied:
Option 1 – 0 votes Option 4 – 2 votes
Option 2 – 4 votes Option 5 – 0 votes
Option 3 – 5 votes Option 6 – 0 votes

Preliminary Policy Recommendation #1: Portland should use an impervious area rate methodology as
the basis for its charge.
Preliminary Policy Recommendation #2: Private efforts and investments to reduce the impacts of
development on parcels such as the planned and engineered use of tree cover or disconnection of
impervious area should be recognized and rewarded.

Single family residential (SFR) charges were discussed and various options commonly used elsewhere
were detailed. The key options discussed began with a simple flat rate for all SFRs on one end of the
continuum to individually measured SFRs on the other.

 • Flat Rate – simple, low cost, few errors
 • Two Tiers – more equity, slightly more cost, few errors
 • Multiple tiers – more equity, smaller jump to next tier, more costly, more errors
 • Multiple tiers + treat very large as commercial
 • Individual measurements – most equitable, most costly, depending on unit size may be many
 errors
The median housing IA (rounded) is often used as the unit of measure for billing purposes (the
Equivalent Residential Unit or ERU) and that number in Portland is about 2500 square feet. Such an
approach is common and helps residents understand their property when compared to the “norm”. The
group felt that such an approach was fine though it was discussed the billing “per 500 square feet” or
any other unit was appropriate. The smaller the billing unit the more chances your estimate for a given
property will be incorrect. The smaller the number of tiers the greater is the jump to the next tier – this
is more important as the fee grows in size.

After thorough discussion the group agreed that the use of at least 2 tiers (six votes) was warranted and
would support three tiers (or more) (five votes) if the housing stock or other good reason warranted its
use.

Preliminary Policy Recommendation #3: Portland should use a simplified charge for single family
residential charges consisting of two or three tiers of charges if the housing stock analysis warrants
more than two tiers.
The group discussed how public roads would be treated. Reese presented detailed information on the
rate implications of billing for roads, impacts on state and federal roads, the sources of funds to pay for
roads (general fund), current funding sources (sewer fund), and how others have done it.

Most stormwater user fee programs do not charge for roads, for a variety of reasons. However, it is legal
and can be done. Roads are a shared significant part of the total impervious area of the city (33%) and
the impacts of roads could logically be allocated across the rate base on the basis of impervious area if
the decision is made not to charge for roads explicitly.

One argument made was that, if charges for roads were levied (and paid through the general fund) that
tax exempt properties would then not participate in those charges forcing that 33% of the fee onto
property taxpayers. This was seen as inequitable by most. In addition in Maine there is no ability to levy
sales or other taxes so the thought was to conserve taxes and not spend them on stormwater where
another funding source was available.

The ability to charge for roads but at a reduced rate was mentioned and had some interest. In the end
the group felt that either no charge for roads (5 votes) or a greatly reduced charge (4 votes) was
warranted.

Preliminary Policy Recommendation #4: Portland should not charge itself for its roads or, if further
study warrants it, charge a greatly reduced fee for roadway surfaces.

The group ran out of time and deferred the discussion of exempting public buildings until the next
meeting.

5. Discussion of public outreach plan.

The group ran out of time and deferred this discussion until the next meeting.

6. Confirm Date for Next Meeting: The next meeting is currently scheduled for September 20, 2011
7. Adjourn
Stormwater Credits
 The purpose of this handout is to provide background information to assist the
 Task Force in decision making on the use of credits in a stormwater rate
 structures.



Stormwater Credits - Overview
For the purposes of the Task Force a credit can be defined as an ongoing reduction in a property’s calculated
stormwater fee that is provided for some rational and legal reason typically related to private investment for a
public good.

Basis for Stormwater Credits
Credits are important in several ways:
 • Credits typically do not have significant total stormwater user fee revenue reduction potential (often less
 than two to five percent), but may build support to the stormwater user fee concept from large fee
 payers or others who would qualify for a credit.
 • One way a fee differs from a tax is that the customer must be able to impact the amount of service they
 receive and that the provision of service must be somewhat qualified as voluntary in nature. A credits
 system is essential to satisfying the requirement of a fee versus a tax. 1
 • Credits are also one of only a few ways stormwater user fee systems have to encourage sound
 development using a "carrot" rather than a "stick". As such they carry an importance far beyond their
 actual revenue significance.

Credits Versus Incentives or Exemptions
It is important to note the difference between the term “credit” and the term “offset”, “incentive”, or
“exemption”.
 • A “credit” is a permanent reduction in the user fee as long as the recipient applies for and continues to
 maintain its reduced impact on the system or program.
 • The term “offset” refers to a one-time reduction in an overall fee.
 • An “incentive” is typically a one-time monetary or other inducement to support a community objective.
 • An “exemption” is the waiving of part, or all, of the fee in recognition of some extraordinary circumstance
 peculiar to an individual or parcel for which the local government determines an exemption is warranted.




1
 Most customers pay some sewer or water fee due to the “availability” of the service. Thus a stormwater user fee mimics water and sewer
utilities not because a customer can refuse service and payment of the fee, but that they can do certain things to reduce their demand or
use of the public system and thus reduce their fee as well.


September 20th, 2011 1
Credits Issues
There is a downside to credits too. They can be: (1) complex and costly to initially determine, (2) hard to
administer and police, (3) not large enough to actually encourage good stormwater behavior, and (4) they are
often mismatched in the development process in that it is the developer who most often must make the decision
to build something credit-worthy into the site but it is not the developer who profits from the ongoing credit – it is
the owner.
Recall that the amount of revenue required is almost a fixed number. Except for program cost reduction credits it
is difficult to assign overall program cost reduction to individual private actions. It is a zero sum game – if credits
are generous then the rate for others goes up.



Stormwater Credits – Policy Decisions
The details of such policy decisions are left for later but two key questions should be discussed by the Task Force:
Question #1 –Basis for and Type of Credits
What private actions and investments should qualify for a credit? Why should they qualify?
Question #2 – Extent of Credits
How much of the stormwater program should be available for crediting? Or, stated differently, how generous
should the credit be?



Question #1 – Basis for and Type of Credits
What private actions and investments should qualify for a credit? Why should they qualify?
Prior to discussing these various bases for applying credits lets remind ourselves that any user fee itself must have
some basis for calculation and application. That basis is some measurement of “use” of the public stormwater
system or “use” of the results of actions on the public system being applied upstream of me, around me, or within
Portland. During the last meeting we defined our measure of “use” of the system as the amount of impervious
area on a parcel – that is, how has a property owner made use of his or her parcel in such a way as to impose an
increased demand on the public system?
In a perfect world credits should be derived and applied on the same basis as rates. They are earned. In that
utopian world there are really only two main bases for a stormwater credit that pass this rate-paralleling muster:
 1. I obtain a stormwater credit because I take some (normally privately funded) ongoing action on my
 property that reduces its actual use of, or impact on, the downstream stormwater system to a level below
 that which would be reflected in the physical parcel measurement that determines my user fee.
 2. I do some (normally privately funded) activity, operate some program, or perform some function that, in
 an ongoing way, reduces the overall cost of the stormwater program for the local government, and thus
 obtain some, or all, of my cost of such performance back in the form of a credit.
The typical basic guiding principle in developing and granting stormwater credits based on impact and cost
reduction can be stated as:


September 20th, 2011 2
 Credit should be given for approved private investments or actions commensurate with
 reduced public cost, or which produce a stormwater related public good which is ongoing.
It is the consultant’s recommendation that this guiding principle be used for all considerations for stormwater
credits. Other reductions or exemptions may be provided but should be done outside the formally adopted rate
structure as a separate City program.
Under this guiding principle, there are a number of ways to look at how credits could theoretically be justified and
applied. Table 1 gives some more common examples. As you think about these credits keep in mind that some of
them could equally be applied as part of the rate structure and not as a rate modifier. For example, disconnected
imperviousness or green roof areas could simply be billed at a lower rate.
 Table 1. Examples of Credits on Two Bases
 Credits Based on Private Actions
 Credits Based on Individual Parcel
 Leading to a Potential Reduction of
 Reduction of Use or Impact
 Overall Local Program Cost
 • Peak flow credit for detention
 • Volume reduction credit for infiltration • Stormwater education credit for schools
 • Pollution credit for BMPs designed according to and/or others
 local standards
 • Area maintenance credits for performing
 • Green design credit for the provision of green sheet maintenance on large urban areas or
 flow and infiltration areas with disconnected roadways
 imperviousness
 • Industrial NPDES credit for complying
 • LID or green design credit for designing a with an individual NPDES stormwater
 neighborhood with embedded LID principles and industrial permit
 approaches
 • Oversize credit for provision of additional storage
 volume above design standards




Credit Based on Reduction of Individual Use or Impact
The basis for an individual parcel’s stormwater utility fee is twofold: the total cost of the stormwater program,
and less directly the impact or use of each property on the stormwater and stream systems. This impact is
typically approximated by measuring impervious area because there is a relationship between the three main
increased impacts of development: peak flow, volume of runoff and pollution.
Most cities that have used an impact-based crediting mechanism have assigned credits based on meeting design
standards required at the time of development or redevelopment. For example, if you meet the peak flow
detention requirement than some portion of the total fee is available to you as a credit recognizing that your
property does not generate runoff to the same extent its impervious area would indicate.
In Portland’s case there is an array of requirements that have differed in terms of the cost of implementation over
time. Since 2006 there has been a significant increase in the cost of private development-related stormwater
infrastructure to handle runoff quality and an increase in the peak flow detention demands. Prior to that time
there was only a peak flow requirement.



September 20th, 2011 3
It must be realized at the outset that a credit is not a strict engineering calculation. It does not have to be exactly
predictive of, but only bear a relationship to, reductions in impact. Therefore great simplifications, not acceptable
for engineering applications are quite adequate for crediting mechanisms.
Looking at the array of requirements that reduce a property’s impact on, or use of the stormwater system, the
following simplification is recommended:
 • If a peak flow credit is offered it should reflect the current flood control requirements to be fully realized,
 but that a lesser credit is available for those who constructed and currently maintain flood control
 structures approved and constructed under an older design standard.
 • If a water quality credit is offered it should reflect only major differences in requirements among the six
 categories of stormwater quality control and that staff are directed to determine appropriate
 discrimination tiers.


 Option 1 – Should Portland offer a peak flow credit?
 Option 2 – Should Portland offer a water quality credit?
 Option 3 – Is there another impact reduction credit that Portland should offer?


Credit Based on Reduced Cost of Service
 Option 4 – Should Portland offer a cost reduction credit, and if so, for what
 activities?
Any actual cost reductions from constructing individual stormwater control structures are impossible to calculate.
However, there are individual actions a property owner can take whose positive impact can be estimated.
Maintenance Credit. For example, cities spend a certain number of dollars per acre on major and minor system
maintenance. Larger properties that maintain their own systems and through-flowing public systems to a certain
acceptable standard reduce the city's cost by removing their large area from public responsibility. This can be
recognized through a credit equal to the area they remove from the city's responsibility or the actual cost of
service reduced.
Education Credit. Stormwater quality compliance requires a mandatory education of citizens. In some cases the
public education capability of local schools (and even churches in one case) is recognized and credited if the local
entity meets basic standards in terms of student contact hours and curriculum content.
NPDES Credit. Another example is a provision of credit for those industries, schools, and other facilities that have
and fulfill the conditions of an industrial NPDES permit for stormwater management. It is argued that they must
perform extraordinary activities beyond those of other properties and should thus be credited. What is ignored in
these cases is the basis for such industrial permits – these types of properties have higher rates or more toxic
pollutants than average properties and thus require an individual industrial permit.




September 20th, 2011 4
Question #2 - Extent of Credits
How much of the stormwater program should be available for crediting? Or, stated differently, how generous
should the credit be?
Once a cost reduction or impact reduction crediting mechanism is decided upon the next question to answer is
the amounts of credit offered. By choosing among different basic approaches a local government can either limit
or expand the portion of the fee available for crediting. The generosity of the credit varies along a continuum
from “Scrooge” to “Santa”. Along that continuum there are mile posts. Let’s discuss two extremes and then how
mileposts might be established in the middle to “cap” credits.

Scrooge - Development Bears its Own Burden
This approach recognizes the fact that large concentrated impervious areas (such as shopping malls or industrial
sites) place a tremendous strain on the stormwater system at the point of release and downstream. It is further
assumed in this approach that the stormwater utility fee is set at a low level to provide an average level of
maintenance and capital improvements, but is not designed to be able to mitigate impacts of the type
experienced by the more intense developments. Such concentrated impervious areas would be considered well
over this level. Detention or other controls are then required by the city to bring the impacts of a site to within
some "norm" for development intensity which can then be handled by the utility. It is considered a cost of doing
business and should not be credited. For example, for peak flow control one city requires all developments to
reduce peak flows to a level reflected by single-family half-acre lot development. Any detention structure that
accomplishes only this minimum amount of peak flow reduction is not eligible for credit. The overall cost of the
stormwater program is built on this private level of discharge and such is expected of all property owners. Only
approved reductions beyond this level would be credit-eligible.
This logic fails somewhat when different ages of development had to build to differing standards creating an
ongoing inequity in the cost of new development and in ongoing maintenance cost.
Under this philosophy few, if any, sites would qualify for a credit unless they went beyond some pre-established
minimum set of requirements – though it is unclear at this time what that minimum might be.

Santa - Credits are Provided on the Same Basis as Fees
This approach fully matches the premise used for justification of the user fee: impervious area as a surrogate for
demand placed on the system. The fee charged goes to pay for all parts of the stormwater program, not just
directly applicable capital or maintenance operations. A direct relationship exists between impervious area, total
program costs and the total fee. This approach provides the largest of the credits under the impact-cost crediting
basis (in one case up to 100 percent of the total fee). This approach recognizes that much of the program cost is
not tied to impervious area (administrative, NPDES costs, planning, etc.) but chooses to apply the credit solely on
the impervious basis of the fee. The total fee is based on impervious area, so the credit is too. In this situation,
limits are placed on the amount of credit granted through more stringent technical criteria – that is the way credit
amounts are limited, not through restriction of the fee amount available for crediting. For example, in one city
part of the credit (25%) was applicable to volume of flow increases would only be available for true volume
reductions through infiltration, evaporation, stormwater reuse or diversion or stormwater collected in detention
ponds and then pumped to the wastewater system for treatment and discharge to receiving waters.
Under this philosophy 100% of the user fee would be available for crediting if the property fully met the required
standards for the key impacts: peak flow, water quality, and sometimes volume control.



September 20th, 2011 5
Setting Caps in Stormwater Credits
This approach attempts to reasonably limit the amount of the user fee available for crediting. There are several
ways this is done:
Option 1 – Fixed Costs Should not be Credited
Under this option it is recognized that certain fixed costs (e.g. billing costs) or non-impact-related program costs
(e.g. public education) would never be reduced through the use of peak or water quality improvement structures
and that these fixed costs should be reserved from crediting effectively capping the stormwater credits.
For Portland this amounts to about a 20% reduction in available user fee for credits (i.e. 80% cap):
 • 5% fixed billing and administrative costs
 • 15% program costs not directly attributable to flood control or water quality impacts
Option 2 – Ability to Mitigate Actual Impacts
Under this option it is recognized that simply meeting the standards does not actually mitigate all the impacts of
development. For example, simply limiting the peak flow at the site outlet to a predevelopment peak does not
solve all flooding problems further downstream where the actual increase in volume is the problem not just the
timing of the peak flow. Or treating 90% of the developed property still allows 10% to go untreated, and the
portion treated is never 100% effective.
This is VERY subjective but would probably be in the range of 10-30% reduction in user fee available for credits.
Option 3 – Shared Impervious Area is Not Treated
Under this option it is recognized that the impervious area of roads is not being paid for by anyone (they are
exempted per previous policy recommendation) and the actual cost of the roadway impervious area impact is
being borne by all ratepayers generally in proportion to their site impervious area (i.e. the bigger parking lot you
have generally the more you benefit from roads). Thus, if roads are 33% of the total impervious area then that
percentage of the fee should not be credited – if it was to be credited that would shift the road costs onto other
rate payers.
This amounts to a 33% cap on the user fee available for crediting.




September 20th, 2011 6
Sustainable Stormwater Funding
Task Force
  September 20th, 2011
Presentation
 1. Roadmap Review
 2. Review from Last Meeting
 3. Public Property
 4. Credits
Presentation
 1. Roadmap Review
 2. Review from Last Meeting
 3. Public Property
 4. Credits
Roadmap
• August – Rate Structure • October – Cost/Program
  – Impervious and gross area – CSO cost allocation
 options – Program five-year plan
  – Residential options – Functional organization
  – Handling of roads, public – Appeals process
 property, and undeveloped • November - Billing
 land
 – Billing
• September - Credits – Customer service
  – Basis for and types of credits – Timing and scope
  – Amount of credits – Public Involvement
 • December- Final
 – Final Recommendation and
 – Implementation Steps/Cost
Presentation
 1. Roadmap Review
 2. Review from Last Meeting
 3. Public Property
 4. Credits
Basic Rate Methodology

Preliminary Policy Recommendation #1:
Portland should use an impervious area rate
methodology as the basis for its charge.


Preliminary Policy Recommendation #2:
Private efforts and investments to reduce the
impacts of development on parcels such as the
planned and engineered use of tree cover or
disconnection of impervious area should be
recognized and rewarded.
Residential Charges & Roads
Preliminary Policy Recommendation #3:
Portland should use a simplified charge for single family
residential charges consisting of two or three tiers of
charges if the housing stock analysis warrants more than
two tiers.

Preliminary Policy Recommendation #4:
Portland should not charge itself for its roads or, if
further study warrants it, charge a greatly reduced fee for
roadway surfaces.
Presentation
 1. Roadmap Review
 2. Review from Last Meeting
 3. Public Property
 4. Credits
Facts About Public Buildings
• 7.2% of Impervious • Pros to charge:
  Area (IA) – Consistent with rate
  – $288,000/year structure
• Most do charge – Allows charges for
 state and federal
• Some do not charge buildings
  – City departments are • Cons to charge:
 non-revenue producing
 – Taxpayers must come
  – Say it is a “wash” and
 up with the money
 that budgeting new tax
 increases is a non-
 starter
Your current preference for public
property charges
 Reduced Property Charge




 2 No Property Charge
 Charge

 1 3


 Other or no vote
 4
Presentation
 1. Roadmap Review
 2. Review from Last Meeting
 3. Public Property
 4. Credits

 Policy Question #1: What private action and
 investment should qualify for a credit?

 Policy Question #2: How much of the stormwater
 program should be available for crediting and how
 generous should the credit be?
Stormwater Credits - Overview
• Are a legal “requirement”
• Normally little revenue impact
• Offers a carrot
• Credits are earned, not given, and not an
  “exemption” or “incentive”
• Ongoing recognition of ongoing private
  investment for a public good
Stormwater Credits – Downsides
• Can be complex to administer
• May not be large enough to cause any
  change
• Mismatched to development – owner not
  developer gets them
• Zero sum game – the more you give away
  the higher everyone else’s bill is – not
  always an immediate program cost
  reduction
Stormwater Credits – Two Bases
1. I reduce my impact – the IA measure
 does not reflect my true impact
  – Often tied to meeting design criteria
  – % of fee can be subjective

2. I reduce the city’s cost through my
 private efforts
  – Take on a public responsibility such as
 education or maintenance
Credit should be given for
approved private investments or
actions commensurate with
reduced public cost, or which
produce a stormwater related
public good which is ongoing.
Impervious Area Impacts
• Four times the peak flow leading to
  potential flooding and Combined Sewer
  Overflows (CSO)
• Two to four times the volume and
  pollution leading to maintenance issues
  and pollution (including CSO)

• In Portland’s case – as volume and peak
  flow increase IA pollution increases too in
  combined sewer area
Design Standards
• Often tie credits to meeting design
  requirements
• Complex Six categories of standards –
  changed over time
  – Might be simplified to three:
 1. basic/general
 2. advanced (phosphorous & urban impaired)
 3. flood
  – Are sometimes waived – e.g. ocean
 discharge
Urban
Impaired
Streams
Combined
Sewer Area
Policy Question #1
Impact Reduction Credit Options
• Option 1 – Should Portland offer a peak flow credit?
• Option 2 – Should Portland offer a water quality
  credit of some type?
• Should we offer credits tied to design
  standards – what are your thoughts?
• Option 3 – Is there another kind of impact
  reduction credit that Portland should
  offer?
Credit Based on Cost Reduction
 • What does Portland spend money on
 that private investment can or does
 mitigate directly?
 – Education on water quality
 – Maintenance of larger areas
 – NPDES permit compliance
 – Others?
 Option 4 – Should Portland offer a cost
 reduction credit, and if so, for what
 activities?
Strength of Opinion
 Strength of Support
 NO! YES!
 -2 -1 0 1 2

• Education Credit

• Private Maintenance
  Credit

• NPDES Credit

• Other _________
Credit “Generosity”

 Encourage Give too
good behavior much away
  and private too easily
  investment too costly




 Most cap credits to some limit less than 100%
Reasons to Cap Credits
• Fixed costs – 5%±
 this cost will not decrease
• Irreducible and unrelated program costs –
  15%±
 this cost not tied to impervious area
• Roads – everybody should pay – 33%±
 this cost allocated to everyone now
• Limits on treatment effectiveness
 can’t eliminate all impacts of development

 You could justify a cap from 0% to maybe 50%
Policy Question #2: Should Portland Cap
Credit Amounts?
 10-20% Cap




 2 30-50% Cap
0% - 5% Cap

 1 3


 Other or no vote
 4

MINUTES
 Sustainable Storm Water Funding Task Force
 September 20, 2011
 City Hall, Room 209, 12:00 PM – 2:00 PM

1. Introductions of Task Force members and meeting attendees.

All members were present except for Ron Miller, Peter Gellerson, David E. Robinson, and John Cannell.
Tom Brigham came instead of Bill Bennett. Cathy Ramsdell came instead of Joe Payne. Staff present
included: Katherine Early, Mike Bobinsky, Doug Roncarati. Zach Henderson, Rich Niles, and Andy Reese,
Robin Sanders, and one person from the Cumberland County Soil and Water Conservation District also in
attendance.

2. Review and approval of the SSWFTF minutes from August 16, 2011.

Vernoneau made a motion to accept the minutes and Dillon seconded that motion. Acceptance of the
minutes passed unanimously.

3. Review of roadmap.

The group reviewed the roadmap (work plan) of what was discussed during the August meeting and
what would be discussed during this meeting. There were no comments on the road map. Andy Reese
of AMEC Environment & Infrastructure reiterated the preliminary policy recommendations that were
developed during the August meeting.

4. Review of Rate Methodology: How should the stormwater user fee be measured?
 a. Charge on the basis of impervious area only.
 b. Charge on the basis of impervious area plus total gross area.
 c. Charge on the basis of intensity of development.

As a preliminary recommendation the Task Force believes Portland should use an impervious area rate
methodology as the basis for its charge.

5. Review of Rate Structure: How should Portland charge single family residential properties?
 a. Flat rate for all residential properties.
 b. Several tiers (2‐3) or more.
 c. Individually measured charges.

As a preliminary recommendation the Task Force believes Portland should use a simplified charge for
single family residential charges consisting of two or three tiers of charges if an updated housing stock
analysis warrants more than two tiers.

6. Review of Exemptions:
 a. Should Portland charge for roads?

As a preliminary recommendation the Task Force believes Portland should not charge itself for its roads
or, if further study warrants it, charge a greatly reduced fee for roadway surfaces.
 b. Should Portland charge for public property?

The group began with the discussion of policy considerations for charging Public Buildings that was not
addressed at the August meeting. Reese provided some brief statistics for Portland’s public buildings to
facilitate the discussion of whether to charge for public buildings and the associated revenue impacts.
The City’s buildings comprise 7.2% of the total impervious area, which accounts for $288,000 of the total
revenue under a stormwater utility. Reese explained that most cities do charge for public buildings and
those that do not charge must account for the revenue across the rate base, thereby increasing the fee.
Reese noted that if the City did not charge for buildings, it may be difficult to justify charging for state
and federally‐owned buildings, resulting in additional lost revenue of the same rough order of
magnitude and possibly legal challenges from other building land use‐types.

During discussion it was noted that the City already pays for stormwater per building or property
through their water/sewer bill and it makes sense to charge a stormwater fee for buildings and pay for
the fee through tax revenue. It was also noted that the stormwater costs are increasing significantly and
it is difficult to raise additional revenue through taxes. One member noted that not charging for public
buildings would be more consistent with the preliminary policy that was developed to not charge for
roads. Another noted that if you charged for public buildings then they could potentially reduce their
fee through credits. It was noted that the rate payers would pay roughly 14% more if the City decided
not to charge for public buildings (City, state, federal combined) and they were in favor of charging for
public buildings. A task force member noted that roads and buildings are different: everyone benefits
from roads so it makes sense to share that cost across the rate payers; not every benefits the same from
public buildings. A task force member noted that if buildings were not charged, then there was less
incentive to reduce their stormwater impact.

Votes were tallied as:
Option 1 (Charge) – 11 votes
Option 2 (Reduced Property Charge) – 0 votes
Option 3 (No Property Charge) – 0 votes
Option 4 (No Vote) – 0 votes

Preliminary Policy Recommendation: Portland should charge a stormwater fee for public buildings and
property.

7. Presentation and Discussion of Credits
 a. What private actions and investments should qualify for a credit?

Reese presented an overview of stormwater credits and explained how they are a legal “requirement”
for a user‐fee system in the sense that they help to legally distinguish a tax from a fee. Reese also noted
that credits are earned and they are not an exemption or incentive; rather they are a reduction in fee
due to an ongoing private investment for a public good (i.e., reduced stormwater impact or reduced
stormwater management cost to the City). Reese presented the downsides of credits and noted that
they typically do not have a significant impact on revenue (~5%). Reese also emphasized the value of
developing credits that are simple to understand and easy to administer.

Reese explained that credits to reduce the impact from impervious areas are most often tied to design
criteria that can be reviewed and approved in the normal process of development. Examples of credit‐
worthy activities might include: green roofs, on‐site detention for peak flows and volume, LID practices
and BMPs to attenuate pollutants. Although the City has six stormwater design standards any of which
may be applied to an individual property, those eligible for credits could be simplified to three major
categories: basic and general, advanced and flood control. These each reflect significant investment
related to development impacts and state and local design standards.

Reese asked the group what types of credits they thought made sense and should be considered to
recognize better stormwater management at individual properties. A member asked about whether it
made sense to have enhanced credits for CSO areas since it helps address a larger problem. Others
noted that it may be challenging to differentiate between the benefit of better stormwater
management in CSO areas; additionally, the CSO objectives are driven by a different program. A
member asked whether a credit should be considered for non‐CSO areas and Reese replied that it would
be more appropriate to address this in the fee structure since it is strictly associated with location and
not a private investment or action.

The group began discussing the applicability of Chapter 500 and projects that already meet this criteria
and whether they should get a credit for what they already meet or only for some measure beyond this
criteria. Members noted that the City should message the value of credits with respect to actual
stormwater impact and if sites were meeting Chapter 500, they should get some credit since they have
less impact than others. A member asked about how detailed the credits should be and how to address
older (legacy) properties. Reese noted that older properties could be addressed using a sliding scale of
credits (e.g., %) tied to design standards. A member asked about the cost for managing the credit
system, noting that cost would increase with the complexity and number of options for credits.
Members that were familiar with the Long Creek project noted that the credits for non‐structural BMPs
were initially cumbersome to establish but were relatively streamlined thereafter to maintain the
system. As a follow‐up to this thought, a member noted that the Long Creek program is a subwatershed
scale and a much greater effort would be required for the City.

A member asked about the impact to credits as design standards change. Reese noted that the credits
can be grandfathered or adjusted over time. A member emphasized that the credits should be
simplified and City staff noted that the administrative costs need to be considered, as well as an audit
policy to address the burden for continued compliance (i.e., inspection). Some members noted that it
would be difficult to administer a credit program for rain barrels (for example) at residential properties
and the credit would likely be relatively small.

The following policy recommendation was developed and supported by the majority of the group: The
group did not identify another kind of impact reduction credit. Portland should match credits
(associated with impervious area impact reduction) to local design criteria and Chapter 500 and develop
a program for administration of the credit system that is simple for property owners and the City. Staff
would come back with a credit proposal at the next meeting.

Reese providing examples of credits that reduce the City’s cost for stormwater management such as:
education on water quality; maintenance of larger areas and NPDES permit compliance. The City would
recognize a credit for private investment in such activities that directly mitigate costs that the City would
normally bear. Reese noted that a credit for stormwater education made the most sense since it was
the easiest to recognize and build upon existing programs in schools, for example. Reese explained that
the maintenance of larger areas could entail cleaning of public parking lots or catch basins that are
adjacent to a private facility. Reese also noted that credits for non‐structural practices are not very
common.
A member agreed that a credit for stormwater education was a good idea. A member asked about the
actual number of properties that would potentially be eligible for a credit for “maintenance of larger
areas.” The airport and USM properties were discussed as the most likely properties for such a credit
and it made sense to consider credits for these properties. NPDES permitted facilities were discussed
and one member noted that these facilities already have to meet stricter stormwater requirements to
reduce pollution. However, one could argue that these facilities have a greater actual or potential
pollutant exposure and such controls are necessary to normalize the impact. A member was concerned
about the ability of the City to verify compliance with NPDES requirements and another member noted
that a credit for these facilities may encourage better compliance.

It was noted by staff that they already worked through local non‐profits and governmental agencies to
provide education in many schools and that the program seemed to work well – though a shift could be
made to more school involvement.

Credits for residential activities were discussed and City staff provided the example of the residential
pilot program in the Capisic Brook watershed for “green” lawn care. Residents get trash bags for
participation in the program. Members noted that the credit(s) for residential activities needs to be
simple and it may be necessary to poll residents to gauge the types of activities that they are most
interested in participating to receive a credit. Most members felt that a one‐time activity should be
recognized as an incentive and it was too difficult to administer a credit for residential activities on an
ongoing basis.

Portland might consider offering credits for stormwater education if it makes sense from the
perspective of the current education program and it was generally agreed that Portland should offer
minimal or no credit to flat‐rated residential properties but rather focus on one‐time incentives for
activities that support the City’s stormwater program objectives.

 b. How much of the stormwater program should be available for crediting?

Reese asked the group to consider how generous credits should be or how much of the stormwater fee
should properties be able to reduce. Although you want to encourage good behavior and private
investment in better stormwater management, most communities cap the amount of credit a property
can receive for the following reasons:
  Some costs are fixed (e.g. billing) and would not be reduced no matter the level of credit‐worthy
 structures;
  Some costs are unrelated to impacts of new development (e.g. education) and would not be
 reduced no matter the level of credit‐worthy structures;
  Everybody shares the benefit of roads and if someone gets 100% credit their share of the
 benefit is spread to others; and
  No matter the level of treatment no property can make itself totally impact‐free and thus some
 cost accrues to developed property.

The group took a quick poll was taken. Most members spoke that the credits should not be too
generous, limiting the amount of a credit between 0% and 25%. However, as the discussion continued
and members considered what would be a more effective credit program. One member noted that the
impact to CSOs is directly tied to impervious area and the credit should be very generous (60‐70%) since
it accomplishes two program objectives. However, other members cautioned that the generosity of
credits should be considered based on an evaluation of properties that would be eligible for credits and
the allocation of CSO costs to stormwater costs under a user‐fee system. This would help the group
better understand the nexus between costs to the CSO program and stormwater fee reduction, thereby
allowing properties to evaluate their return on investment. A member noted that they have property in
the Long Creek watershed and they evaluated the credit that was offered for reduction of stormwater
impacts and it was much cheaper to simply pay the fee than to invest in BMP retrofits.
Overall, many members felt that the credit would have to be greater than 25% to get attention and
incentivize property owners to participate. The group was not able to fine tune the % cap without
further consideration of revenue impacts; however, voting was tallied:

  0‐25% Cap – 2 votes
  25‐50% Cap – 10 votes
  No Vote – 2 votes

Preliminary Recommendation: Based on balancing consideration of equity, impact of credits, and actual
ability to reduce impacts Portland should cap credits somewhere between 25% and 50%, the final value
to be determined during detailed rate study.

8. Discussion of public outreach plan.

This item was not discussed.

9. Confirm Date for Next Meeting: The next meeting is currently scheduled for October 18, 2011

10. Adjourn