The Financial Impact of Different Stormwater Fee Types: A Case Study of Two Municipalities in Virginia

Abstract

Eight stormwater user fees (SUFs) were applied to the City of Roanoke and the Town of Blacksburg, Virginia, to determine the effect each has on how land use type impacts the sources of revenue. Roanoke is larger and includes more industrial areas, but less multifamily impervious areas than Blacksburg, which translates differently in the SUFs. Residential parcels comprise the highest percentage of the revenue in all eight SUFs in Blacksburg and four in Roanoke. For both municipalities, two specific SUFs consistently comprised the highest percentage burden for residential homeowners while three other SUFs demonstrated the highest burden for commercial parcels. Open space parcels contain little impervious area, yet account for up to 27% of the revenue in the Blacksburg Area fee structure. Industrial parcels comprise more revenue in Roanoke, averaging 10.1-4.5% in Blacksburg. Fee types that are easier to administer (e.g., Flat fees) may not fully represent the stormwater contribution from the parcels. SUF types that more accurately represent the stormwater burden on the municipality are also more administratively intensive and are more variable with fee factors.(KEY TERMS: stormwater; stormwater utility; stormwater management program; stormwater user fees; urban areas.) Fedorchak, Amanda, Randel Dymond, and Warren Campbell, 2017. The Financial Impact of Different Stormwater Fee Types: A Case Study of Two Municipalities in Virginia. Journal of the American Water Resources Association (JAWRA) 53 (6):

Stormwater Utility Fees and Credits: A Funding Strategy for Sustainability

“…Kea et al [25] analyze the relationship between location, population density, home value, and SUF characteristics, and identify trends and patterns in the establishment, funding mechanisms, and magnitude of SUFs. Fedorchak et al [5] analyze the application of eight SUFs in Virginia to determine the impact of land use on the sources of revenue. Other studies have focused on the use and economic efficacy of stormwater credits to incentivize users to adopt BMPs.…”

“…Several parameters, some of them directly related to the amount of runoff, may be used by the municipalities to determine the usage of the system including the impervious area, the percentage of imperviousness, the amount of runoff, the water consumption, and the intensity of development among others. The most commonly used parameter is the impervious area on a property [5,13,18].…”

“…There are several methods used for the calculation of the fee (see Table 1), but there are two methods that are more commonly used: the Equivalent Residential Unit (ERU) and Residential Equivalent Factor (REF). First, the Equivalent Residential Unit (ERU), also known as the Equivalent Surface Unit (ESU) method, is calculated based on the average impervious area on residential parcels in a municipality [5,34,35]. The cost for each parcel is calculated based on the parcel impervious area as a share of the ERU area.…”

“…According to Campbell [15], there were 786 ERU utilities identified in the country in 2018. Second, in the Residential Equivalent Factor (REF) method, fees are calculated based on the amount of runoff [5]. The REF is determined by the ratio of runoff volume generated by one acre of land to runoff volume generated by one acre of low-density residential land [36].…”

“…To address water pollution and protect water quality in the United States, the U.S. Congress passed the Clean Water Act (CWA) of 1972. This act focused primarily on wastewater and industrial discharge but did not specifically address stormwater [5]. In 1987, the CWA was amended through the Water Quality Act (WQA) that mandated the implementation of a comprehensive national program to address stormwater runoff (enacting implementation and funding).…”