Communities Get the OK to Assess Fees to Fund Stormwater Utilities

Opponents of new charges dismiss them as ‘rain tax,’ but advocates argue utilities will finally make it possible to address runoff, state’s biggest source of water pollution

stormwater runoff
A decade-long battle to give local governments a tool to deal with storm runoff — the state’s biggest source of pollution for streams, rivers, and bays — ended yesterday with Gov. Phil Murphy signing a bill without fanfare that will do just that.

The legislation (S-1073/A-2694) permits municipalities and other entities to set up utilities that could impose fees — dubbed a “rain tax” by opponents — on parking lots and other impervious surfaces to fund improvements to failing stormwater management systems.

Aging stormwater systems, typically poorly maintained, have long been recognized as the largest source of contamination of state waters. With heavy rains, the runoff from impervious areas mixes with pesticides, oils, and other pollutants to foul the water or exacerbate flooding.

A $16 billion problem

By creating stormwater utilities, local governments could use the funds to address a problem that has been projected to cost as much as $16 billion to fix. New Jersey becomes the 41st state to adopt this approach to widespread flooding and water-quality problems.

“With stormwater runoff becoming an increasingly prevalent problem, frequent flooding is polluting waterways and causing millions of dollars of damage, snarling traffic, threatening drinking water, and even endangering lives,’’ said Ed Potosnak, executive director of the New Jersey League of Conservation Voters.

But critics argued the bill adds another bureaucratic expense at the local level. Besides business lobbyists, most Republican lawmakers voted against the measure.

“This law adds yet another tax on our already overburdened residents and businesses, though there is no language to define how much people will be charged, how the funds will be collected, or how the funds generated by it will actually address stormwater systems,’’ said Raymond Cantor, a vice president of the New Jersey Business & Industry Association.

Assessing fees on impervious surfaces

The legislation allows a municipality, or in other cases, a country or regional authority, to assess a fee based on how much impervious surface, such as concrete or pavement, covers a property. The fee would be used to fix or replace stormwater systems, preferably by creating new buffers and green spaces to filter out pollutants and absorb runoff.

Chris Sturm, managing director of policy and water for New Jersey Future, called it a monumental step toward cleaner and healthier communities. “Towns and cities across the state struggle to manage flooding from stormwater and maintain clean waterways, but now they will have another tool to combat these issues,’’ she said.

For 21 New Jersey cities, the new law provides a means to address a problem long neglected — combined sewer-overflow systems. These systems allow raw sewage to flow into waterways during heavy rainfalls. The communities are under a mandate to finally fix the problem from the state Department of Environmental Protection.

Reluctant to move ahead

A bigger question is how many local governments will decide to set up the new utilities. In the past, previous bills mustered little support among local officials, even in Ocean County around Barnegat Bay, where runoff is a major reason for degradation of the bay.

“Only time will tell,’’ Sturm conceded, but noted a number of communities are expected to set up utilities to begin addressing problems, such as cities facing mandates to deal with combined sewer-overflow systems. Or places like Lake Hopatcong, where the water is too polluted for swimming, she said.

Potosnak agreed. “They are going to have an option they didn’t have before to deal with flooding and impaired waters,’’ he said. Nationwide, more than 1,800 communities are using this tool, he said.

Unlike drinking-water supply and wastewater plants, New Jersey lacks a dedicated funding source for stormwater systems, a failure that results in the infrastructure receiving few upgrades and little maintenance.

“Without regulation, we will continue to see a rise in pollution, flooding, and property damage,’’ said Assemblyman John McKeon (D-Essex), a sponsor of the bill. “This law enables towns and counties to take the next step in stemming the problems caused by stormwater.’’

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