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Some EC biz, agencies may see stormwater fee hike

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By Jon Hawley
Staff Writer

Monday, March 19, 2018

Elizabeth City's businesses and organizations with large lots may soon pay more in stormwater fees, according to city plans to update calculations for the size of those lots' “impervious” surface areas.

City officials are working to finalize those new calculations and submit them to Pasquotank County by the end of the month, City Manager Rich Olson reported last week. Doing so will allow the county to attach the revised stormwater fees to businesses' next property tax bills. The county collects property tax revenue for the city.

City officials have estimated the revised calculations could generate more than $100,000 in additional revenue for the city to help pay for improving stormwater infrastructure.

The city started its stormwater utility fund in 2006 to support infrastructure that handles storm runoff and reduces flooding. The fund also established fees for residential and commercial lots, the rationale being that properties with impervious surfaces, such as roofs and parking lots, should help pay for ways to handle all the water that runs off those surfaces.

The problem, city officials contend, is that the city's initial surface area calculations for many non-residential properties were inaccurate. Working with an outside firm, Raftelis Financial Consultants, the city reviewed all 1,000 or so commercial properties in the city to double-check their impervious surface areas.

Based on those new numbers, Public Utilities Director Joe Pearce advised council’s Finance Committee last month that the city has undercharged numerous property owners, including Elizabeth City State University. The campus now pays about $3,700 a year in stormwater fees but its fee could rise to as high as $13,780, he reported. Pearce noted that figure includes charging for roadways, which the city typically does not do. City Council recommended not charging for roadways, which should reduce ECSU’s increase some.

Other large changes Pearce cited include Tanglewood Lake Apartments, whose fee would go from $827 to $3,708 a year, and Adam's Landing, which would jump from $121 to $2,462.

Not all commercial properties will see an increase, both Pearce and City Manager Rich Olson noted, but the net impact of the changes would be almost $150,000 more in stormwater revenue for the city.

Both officials also stressed the change is not a rate increase, but instead application of the fee to more square footage. The city's stormwater fee is a flat $36 for residential lots and 1 cent per square foot for impervious commercial property. Notably, the rate schedule also includes a 25-percent credit for commercial properties that maintain their own stormwater retention ponds.

Pearce, who is leaving his job as utilities director for a private sector job at the end of this month, also asked council if the city should bill property owners for the amounts they should have paid in prior years. He recommended against such back-billing, arguing it was the city's fault, not property owners’, that they weren't charged correctly. Councilors agreed.

In a followup interview last week, Olson declined to say how the city might use the additional stormwater revenue.

Olson told council last week that there's limited revenue in the city's stormwater fund. Stormwater fees only generate about $450,000 a year for the city, and more than a fourth of that is tied up in debt for projects, he said.

Olson said any commercial property owner who disagrees with their revised stormwater fee should contact his office, at 337-6864.

As city officials start preparing the city’s 2018-19 budget, it's unclear how many other rates and fees might go up for the city's businesses and residents. Olson mentioned the city may face a 3-5 percent electrical rate increase, due to Duke Energy winning approval for an increase, and he plans to propose increasing the city's motor vehicle fee, currently $15. It could be raised as high as $30, he said.

As for property tax rates, the city doesn't have revenue projections yet for next year's budget. That makes it unclear if the current property tax rate will cover the increased personnel expenses the city is projecting, in addition to any projects City Council wishes to undertake. The tax rate will be set by council. It's currently 65.5 cents per $100 of valuation.

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