Hoping to overcome lawmakers' qualms, the O'Malley administration has revamped its proposal to increase the Bay Restoration Fund, seeking a straight increase in the "flush fee" paid by all households from $30 to $75 annually.
Environment Secretary Robert M. Summers said the administration has backed off its original plan to double the fee on average but make it progressive, so that what each household and business pays would depend on how much water they use. Instead, the administration now is asking lawmakers in Annapolis to approve a straight increase in the fee, albeit a bigger one than initially requested.
Gov. Martin O'Malley had proposed doubling the "flush fee" to address a looming $400 million shortfall in funds needed to finish upgrading pollution controls at the state's 67 largest sewage plants. Some revenues from the fee, which is also levied on all septic system users, help pay for replacing failing septic systems and for farmers to plant pollution-absorbing "cover crops" in the winter.
Some small businesses, including restaurants, had complained they'd wind up paying much more than double under the governor's progressive fee scheme. Local officials also had griped that it would be too costly and cumbersome to have to calculate each utility customer's fee individually.
"We would prefer to stick with the progressive fee," Summers said, "but given the testimony and feedback from the legislature, it seemed too unwieldy and too much of an impact on small businesses."
Under the administration's new proposal, businesses would still pay based on how much water they use - just as they do now under the current fee schedule. But they would pay in increments of $6.25 a month for every 250 gallons of water consumed daily - the average household's use, according to the state. And no matter how much water consumed, the fee would be capped at $10,000 per month, a ceiling Summers said is now hit by only a handful of industrial and commercial utility customers.
To ease the burden on low-income households, the MDE secretary said the administration is proposing to exempt any utility customer receiving government assistance. Such waivers are now granted at the discretion of local government, but would be mandatory under the administration's new proposal. Summers estimated that the provision would mean perhaps 10 percent of households would not have to pay the fee at all, up from 2 or 3 percent now.
While dropping the progressive fee scheme, the administration has opted to at least partially embrace the recommendation of a task force that had called for more than doubling the fee to finance more bay-restoration projects.
Increasing the fee 150 percent is projected to raise about $124 million a year - enough, Summers said, to ensure that the state has enough money to finish overhauling its largest sewage treatment plants, while also raising some funds to help pay for other bay-restoration measures.
Local officials have been complaining about the pricetag imposed on their communities for complying with Chesapeake Bay restoration efforts prescribed under a "pollution diet" imposed by the Environmental Protection Agency. Some counties have projected needing to spend upwards of $1 billion or more to reduce pollution from septic systems and storm-water runoff. A state advisory group also had warned that merely doubling the fee would still leave a $90 million shortfall for the sewage plant projects, a gap the administration has said it plans to fill in future years with general tax-revenue funds.
The extra fee increase would leave $15 - 20 million annually left over after paying for all the sewage projects, Summers said, which could be spent retrofitting storm drains, planting rain gardens and installing other runoff-controlling projects. Once all the big sewage plant projects are finished around 2018, he noted, the bulk of the fee could go toward paying for other pollution control efforts.
Environmental activists said they hoped dropping the progressive fee idea would enhance the flush-fee proposal's chances of passage in a legislature grown skittish over all the tax and fee increases they've been asked to approve.
But Jenn Aiosa of the Chesapeake Bay Foundation said activists were wary of the administration's request for an extra bump in the "flush fee," worried that it wouldn't raise anywhere near enough money for all the bay restoration work needed.
"We don't want to inadvertently send a message that that would be sufficient to solve our problems," she said. The foundation and other environmental groups have warned that Maryland's plan for restoring the bay's water quality is seriously under-funded.