State officials have accepted a proposed resolution by Carroll County officials in the dispute over the county's refusal to implement the so-called "rain tax."
Under the proposal outlined in a letter from Carroll County Attorney Timothy Burke to state officials last week, there would be no additional fees or tax rate increases for residents to pay for a stormwater management fund, as called for in a 2012 state law commonly derided by critics as the "rain tax." Instead, the county would designate for the fund a portion of the revenues collected under the current tax rate each year based on the operational costs of the county's stormwater management program.
For instance, in Fiscal Year 2015, the county will likely use about 5 cents per $100 of the assessed value of Carroll County properties from the current tax rate - set at $1.018 per $100 of the assessed of Carroll County properties - to put into the fund, said Phil Hager, director of the county's Department of Land Use, Planning and Development. This will pay for the more than $900,000 in operational costs he expects for the stormwater program for the next fiscal year.
Operational costs account for the maintenance of current projects that have been completed by the county in addition to other costs, such planning, salaries and debt service.
Hager said the fund will not pay for the construction costs of new stormwater projects, which can run into the millions of dollars. However, if there is money that is not used in a given year for operational costs through the fund, it can be used to pay for new construction costs, Hager said.
New stormwater project construction costs will continue to be paid for through the issuance of bonds and money from the general fund, he said.
Hager said the proposal represents a significant shift from the current policy concerning the stormwater remediation fund, as it earmarks tax revenue solely for stormwater management.
In a response to the county's letter obtained by the Times, the Maryland Attorney General's Office said the fund as proposed would meet the requirements under the law. The response noted that officials with the office could not comment on other aspects of the county's compliance with stormwater regulations, however, since the county's letter only dealt with the fee requirement.
The response notes that the Maryland Department of the Environment also accepts the proposal.
Although the Times obtained a copy of the state's response from an MDE spokeswoman, Hager said he and Burke had not yet received the response from the MDE. Hager declined to comment on a description of the state's response.
The potential agreement could end the dispute between the county and the MDE over the required fee to pay for a watershed protection and restoration fund. The fund was to be used to pay for the costs associated with stormwater management, including the construction of stormwater remediation projects, maintenance, educational programs or planning.
The law was passed as means to protect local waters and the Chesapeake Bay from excess nutrients from stormwater runoff.
But the Carroll commissioners decided last year that a fee was unnecessary, because county officials were meeting the requirements of Carroll's current stormwater permit and had planned to pay for future stormwater projects through the county's Community Investment Plan. Under a resolution passed last year, the county created a stormwater fund that would use only general fund dollars.
MDE officials said this was an inadequate way to fund the stormwater management program, as the funding source did not comply with the law. This prompted MDE officials to refer the matter to the Attorney General's office, which sent a letter in October last year noting penalties that included a $10,000 per-day fine if the county did not implement a stormwater remediation fee. Since then, county staff and MDE officials have been in negotiations over the matter.
In order for the proposal to move forward, county commissioners would have to adopt the changes in the county's property tax rate ordinance, and pass the proposal as part of the budget process, Hager said.
Overall, he said the policy could be a good way to manage the operational costs of stormwater projects, because it creates a dedicated source for the funding, and any money that is not used in one year could roll over to the next year.
"It could be overall that it is actually a good planning tool for budgeting," Hager said.
