Stacey Isaac Berahzer

Innovative Financing Approaches for Stormwater and Green Infrastructure - Elected & Appointed Officials Stormwater Lunch & Learn Stacey Isaac Berahzer Senior Project Director Environmental Finance Center at the University of North Carolina Anderson and Pickens Counties Stormwater Partners Tri County Technical College, Easley Campus, SC October 17th, 2016 http://efc.sog.unc.edu @EFCatUNC

Dedicated to enhancing the ability of governments and other organizations to provide environmental programs and services in fair, effective, and financially sustainable ways through: Applied Research Teaching and Outreach Program Design and Evaluation How you pay for it matters http://efc.sog.unc.edu @EFCatUNC 2

Outline Introduction What is stormwater? Financing Stormwater Management via a Stormwater Utility Green Infrastructure Methods of Financing Green Infrastructure Continuing the Discussion 3

INTRODUCTION

Which of the following best describes your role? 1. Elected Official 2. State Employee 3. City/County Stormwater 4. City/County Other 5. Nonprofit 24% 41% 22% 14% 0% 1. 2. 3. 4. 5.

What is stormwater? The term stormwater refers to the runoff that occurs when rain or snowmelt flows across the ground Impervious areas such as roofs, driveways and paved parking lots prevent stormwater from permeating into the ground As the stormwater flows across these impervious surfaces, it picks up pollutants such as oil, dirt and debris The stormwater transports these pollutants either directly into a waterbody, or indirectly to the waterbody through a storm sewer system Since these waterbodies are important for wildlife as well as human uses such as swimming, fishing and providing drinking water, increasing attention is being paid to protecting the quality of stormwater 10

What is a Stormwater Utility? To generate funds to treat stormwater, some communities have created stormwater utilities that charge a fee to residential, industrial and commercial water customers The revenue from the stormwater fees are then used by the utility to create best management practices such as wet detention ponds and rain gardens that slow the flow of stormwater, allowing it to soak into the ground and filter before entering a waterbody 11

What is a Stormwater Utility? Cont d Stormwater utilities are separate enterprise funds within a local government that are created to generate revenue for watershed and stormwater improvement projects/activities The main impetus to create stormwater utilities has come from the National Pollutant Discharge Elimination System (NPDES) permit program Some communities have opted for stormwater utilities in order to address local flooding problems. Projects to manage stormwater flow inherently address flooding problems 12

Evolution of Water Quality Management in the US Point source pollution management Examples: Wastewater treatments plants Factory outfalls 13

Evolution of Water Quality Management in the US Point source pollution management Examples: Wastewater treatments plants Factory outfalls Non-point source pollution (of larger, single-site projects) Examples: Detention ponds Constructed wetlands Examples: Rain gardens Permeable pavement 14

Evolution of Water Quality Management in the US Point source pollution management Examples: Wastewater treatments plants Factory outfalls Non-point source pollution (of larger, single-site projects) Examples: Detention ponds Constructed wetlands Non-point source pollution (of smaller, distributed sites) Examples: Rain gardens Permeable pavement Cisterns Photo by Stacey Isaac Berahzer: Cistern from 1890s, Grand Riviere, Trinidad 15

Green Infrastructure (GI) An array of products, technologies and practices that use natural systems or engineered systems that mimic natural processes to enhance overall environmental quality and provide utility services. - EPA Photo by Erin Weeks: Two cisterns located at the NC Botanical Gardens in Chapel Hill, NC

Challenges GI BMPs are by nature scattered across a jurisdiction Local governments have the main regulatory burden of addressing stormwater issues like Combined Sewer Overflows, but Many of the most ideal sites for GI will be on PRIVATE property

Private Investment Necessary U.S. communities are facing a total of $106 billion in needed stormwater management and combined sewer correction upgrades or improvements Source: American Rivers et al. 2012. Banking on Green: A Look at How Green Infrastructure Can Save Municipalities Money and Provide Economic Benefits Community-Wide.

Evolving Stormwater Finance 1. General government uses tax revenue to pay what it can to manage stormwater on public land 2. Regulations drive private property projects 3. Off-set fee programs/impact fees 4. Governments establish enterprises and stormwater fees to generate revenue 5. Rebates/cost share programs 6. Fees increase to level where crediting fees for on-site improvements becomes viable incentive 7. Loans 8. Tax incentives 9. Trading 10. Property Assessment Backed (e.g. PACE like)

STORMWATER UTILITIES

What is the first thing you think of when you hear stormwater fee? 1. An unfair disguised tax 2. An essential method of allocating stormwater costs 3. A device for encouraging private investment 4. Time to look for a new job 33% 61% 3% 3% 1. 2. 3. 4.

EXAMPLE OF GEORGIA STORMWATER DASHBOARD

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EPCOR NEOMSD Aqua America Loveland Denver Louisville Austin

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STORMWATER UTILITIES IN SOUTH CAROLINA

South Carolina Area Served by Stormwater Utility Stormwater Utility Linconlville Isle of Palms James Island Anderson Aiken Folly Beach North Myrtle Beach Conway North Augusta Sumter Hilton Head Island Bluffton North Charleston Charleston Charleston County Dorchester County Greenville County Georgetown County Horry County 0 200000 400000 600000 800000 Physical Area (acres) Data Source: SESWA 2015 Survey 27

South Carolina - Population Served by Utility Linconlville Folly Beach Isle of Palms James Island Bluffton North Myrtle Beach Conway Stormwater Utility North Augusta Anderson Aiken Hilton Head Island Sumter Georgetown County Charleston County North Charleston Charleston Dorchester County Horry County Greenville County 0 100000 200000 300000 400000 500000 Population Data Source: SESWA 2015 Survey 28

South Carolina - Monthly Stormwater Fee Dorchester County Greenville County Horry County Sumter Linconlville James Island Isle of Palms Stormwater Utility Folly Beach Charleston County Aiken North Charleston Georgetown County Anderson North Augusta Conway North Myrtle Beach Charleston Bluffton Hilton Head Island $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 $6.00 $7.00 $8.00 $9.00 $10.00 Monthly Fee ($) Data Source: SESWA 2015 Survey 29

There is a dashboard for South Carolina, but it s not for stormwater 30

STORMWATER CREDITS

Credit/Discount on Stormwater Utility Fees A reduction in (monthly) fee due to installation of BMPs BENEFITS: Allow rate payers to control and reduce their service fee Improve legality of a stormwater utility fee Encourage private property owner participation in both water quality and flood relief improvements Reduce public expenditures on the stormwater management program

Does Your Utility Have a Stormwater Credit Program? No, 31% Yes, 69% Source: EFC at UNC, 2012 Georgia Stormwater Survey; http://www.efc.sog.unc.edu/reslib/item/gastormwater-utility-dashboard Source: (National) 2012 Stormwater Utility Survey, Black and Veatch

RESOURCES ON FINANCING FOR STORMWATER

Capital Improvement Guide for Green Infrastructure A guide for budget officers or watershed proponents that provides tools for planning for certain key attributes of Green Infrastructure in the budget process.

Green Infrastructure Finance Strategy A report that identifies and describes the key components of financing mechanisms available to support green infrastructure investments, including potential sources of capital and revenue. The document references Durham, NC, and while some of the financing mechanisms are specific to state and local conditions, most of the ideas are applicable to communities beyond Durham.

Green Infrastructure Catalog A catalog of publications that describes the benefits of green infrastructure, highlighting the finance and economic aspects of these types of projects. The catalog analyzes the publications according to various other criteria, including location and audience.

Crafting Credit Systems for Stormwater and Green Infrastructure A whitepaper that provides guidance on designing credit systems to enhance subscription and participation rates. The document references Durham, NC, and while some of the recommendations are specific to local conditions, most of the ideas are applicable to communities beyond Durham.

CONTINUING THE DISCUSSION

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Stacey Isaac Berahzer berahzer@unc.edu 770-509-3887 twitter.com/staceyib_enviro Environmental Finance Center at the University of North Carolina School of Government, Knapp-Sanders Building CB #3330 Chapel Hill, NC 27599-3330 USA www.efc.unc.edu