Title
A Resolution to increase the Stormwater Service Fees effective July 1, 2021
Presenter:
Richard Mulledy, Stormwater Enterprise Manager
Body
Summary:
The Stormwater Enterprise is requesting approval of a Resolution to adjust the Stormwater fees and amend City Code as authorized pursuant to City Code Section 14.8.107(E) to meet the financial obligations of the Stormwater Enterprise (SWENT). The proposed fee increases are intended to generate additional yearly revenue necessary to meet increasing Stormwater Enterprise obligations.
The proposed fee options are estimated to produce revenues necessary to meet the financial obligations of SWENT through the year 2035.
The rate increases are proposed to be implemented beginning July 1, 2021.
Background:
On November 7, 2017, the citizens of Colorado Springs passed Ballot Initiative 2A approving the implementation of a stormwater service fee per Ordinance 17-19 beginning July 1, 2018. The fees were established at a residential rate of $5 per dwelling unit/month and a non-residential rate of $30 per acre/month on developed or improved properties. The resulting revenue for 2021 is estimated at $16.25M.
The City of Colorado Springs, Colorado Springs Utilities (CSU), and Pueblo County entered into an Inter-Governmental Agreement (IGA) on April 28, 2016, committing to improvements for stormwater infrastructure, operations, maintenance, and MS4 compliance programs in the amount of $460 million over 20 years. The IGA requires a five-year average of expenditures and capital projects of $22M for the 2021-2025 time period. The CSU Sanitary Sewer Creek Crossing Stabilization Program is committed to approximately $3.3M per year of the $22M expenditure. This constitutes a $2M per year average increase with $1.7M increase coming from SWENT and $300,000 increase coming from CSU. The current stormwater fees do not provide the necessary revenue to meet the 2021-2025 SWENT minimum expenditure requirements.
On January 11, 2021 a Consent Decree (CD) (ECF #181, Case 1:16-cv-02745-JLK USA et al v. City of Colorado Springs) was signed which mandates that the Stormwater Enterprise spend an additional $45M over the next 15 years, an average of $2.9M year. The additional expenditures are necessary to meet CD mandated stormwater program improvements, capital project construction, and state and federal reporting requirements.
In addition, the implementation of the Colorado State mandated 811 locator program increased SWENT program costs by approximately $250,000 per year.
Previous Council Action:
On August 22, 2017, City Council approved Resolution 89-17 submitting the 2A ballot language to the registered qualified electors of the City of Colorado Springs regarding approval of Ordinance 17-19 authorizing the collection of stormwater service fees to be assessed on all developed and improved real property within the City of Colorado Springs. The voter-approved stormwater service fees went into effect July 1, 2018.
Financial Implications:
The proposed fee increases do not impact the general fund and therefore there is no TABOR impact.
The proposed fee options are estimated to produce the revenues necessary to meet the financial obligations of SWENT through the year 2035.
The attached Exhibit A details the options for proposed SWENT rates beginning July 1, 2021.
City Council Appointed Board/Commission/Committee Recommendation:
The City Council Budget Committee recommends Option 2 as detailed on Exhibit A.
Stakeholder Process:
N/A
Alternatives:
1. Approve the resolution with one of the options as presented;
2. Modify the resolution;
3. Refer the resolution back to staff for further consideration.
Recommended Action
Proposed Motion:
Move approval of the resolution to adjust the stormwater fees as presented.
Summary of Ordinance Language
N/A