Stormwater Utility City of Rowlett November 15, 2016 INNOVATIVE APPROACHES…PRACTICAL RESULTS…OUTSTANDING SERVICE

STORMwater utility fee evaluation Current Approach Fee Structure Flat rate $5.50/residential water meter 13.50/non-residential water meter LGC 552 requires non-discriminatory, reasonable and equitable Revenue: $1,350,000

CURRENT STORMwater utility fee TYPICAL RESIDENTIAL TYPICAL COMMERCIAL (SMALL) TYPICAL COMMERCIAL (LARGE) 1 residential meter 1 commercial meter 1 commercial meter $5.50/month $13.50/month $13.50/month

STORMwater utility FEE EVALUATION Current Services CIP Projects Improvements to existing stormwater facilities Operations and Maintenance

STORMwater utility fee evaluation Modified Approach Fee Structure Measure of storm system use Impervious area basis Equivalent residential unit (ERU) (4,000 sq ft impervious area) $5.50 per ERU for all properties Revenue: $1,700,000 Pervious Impervious Pervious Impervious

MoDIFIED STORMwater utility fee TYPICAL RESIDENTIAL TYPICAL COMMERCIAL (SMALL) TYPICAL COMMERCIAL (LARGE) 4,000 sf IA = 1 ERU 25,228 sf IA = 7 ERU 154,526 sf IA = 39 ERU 1 ERU = $5.50/mo. 7 ERU = $38.50/mo. 39 ERU = $214.50/mo.

STORMwater utility fee evaluation Potential Service Enhancements Stormwater Staff Floodplain Manager Erosion Control Technician (MS4 Program) Infrastructure Asset Inventory and Condition Assessment Storm system survey, GIS data collection/management CCTV inspection of sewer lines Strategic Planning Master Drainage Studies Floodplain Studies CIP Projects Public Outreach Program

Residential Stormwater Utility Monthly ChargeS IN North Texas

COMMERCIAL STORMWATER UTILITY MONTHLY CHARGES IN NORTH TEXAS

Revenue Comparison

ERU Based Rate Structure Projected Stormwater Utility Fee Revenue by Impervious Area Basis Property Type Estimated Impervious Area (Sq. Ft.) Estimated Impervious Area (ERUs) % of Customers % of Run-Off Projected Annual Revenue Residential 81,000,000 18,804 91.4% 73.1% $1,241,064 Non-Residential 28,000,000 6,900 8.6% 26.9% 455,433 Totals 109,000,000 25,704 $1,696,497 1 ERU = 4,000 square feet impervious area

Annual Revenue Breakdown Impervious Area-based Fee Structure

STORMwater utility fee EXEMPTIONS Required to Exempt Allowed to Exempt No Legal Basis to Exempt (unless also fits category to left) Undeveloped property City property Federal property Property with no impact to City’s storm system County property Businesses (i.e., recruitment incentives) Institutions of higher education School district property Properties with no water/sewer/trash service Subdivided lot under construction Tax-exempt religious institution property Disabled State property Cemeteries no longer accepting “customers” Veterans Senior citizens Low/fixed income Other property types not specified in LGC 552 C per Texas Local Government Code (LGC) 552 Subchapter C, LGC 580.003

So why go to an ERU Basis? If the revenue structure is designed around the impervious area basis, it better meets the State requirement of being “reasonable, equitable, and non- discriminatory.” This revenue structure ensures that… The impacts to the stormwater system are dealt with within the guidelines of state law It addresses equitable distribution of the impacts to the system (currently 8.6% of the customers generate 26.9% of the run-off) It results in an augmentation of the existing potential revenue source consistent with practices in other cities and regions.

Next Steps Council direction for modified equitable fee structure Minimum of 30 days of public notice for modified fee structure Public outreach Public hearing Council vote (date to be determined) Utility billing update Establish effective date to bill updated rates

QUESTIONS/Direction Is there a Council consensus on Revenue? Option A – Adopt the ERU standards maintaining the current residential fee structure of $5.50 per month that would generate about $300,000 more per year. Option B – Adopt the ERU standards and lower the current residential fee structure of $5.50 per month to match the current total fee revenue of about $1.3 million annually. About $4.50 per month

QUESTIONS/Direction Is there consensus from Council on Option A or B regarding implementation? Option A – Implement the new fee structure beginning on October 1, 2017 after appropriate community education. Option B – implement the new fee structure earlier (i.e. April 1, 2017 or July 1, 2017) after appropriate community education.

QUESTIONS/Direction Is there consensus from Council on Option A or B regarding agency exemptions (City, ISDs, and church properties)? Option A – Exempt City, GISD/RISD, and church properties reducing annual revenues by about $125,000. Option B – Do not exempt City, GISD/RISD, and church properties.

Annual Revenue Breakdown Impervious Area-based Fee Structure