Why Would Anyone Try To Create a Stormwater Utility in the Midst of a Recession? A Case Study in Salem, Oregon

In Salem, Oregon, the City's suite of stormwater programs has been conducted by the Public Works Department and funded by the wastewater ratepayers for more than 20 years. However, wastewater rates are primarily based on the volume of drinking water used during winter months and there is no relationship between drinking water used and a property's impacts on stormwater quality or quantity. In 1983 and again in 1987, Public Works staff recommended to City Council that a stormwater utility be created. In mid-1987, Council approved an ordinance establishing a stormwater utility, but repealed the ordinance in early 1988 as a result of the negative public reaction. In late 2009, Public Works began working again on a proposal to create a stormwater utility that would fund stormwater services (which in fiscal year 2009/2010 cost approximately $10M) with a separate stormwater fee. The primary purpose of forming a utility was to establish a fee that would more equitably link the cost of stormwater services with each customer's impacts on the stormwater system. A consequence of decoupling stormwater from wastewater rates would be that customers with large amounts of impervious surface and low water usage would be significantly impacted. This included many commercial properties, as well as churches, schools, and government offices. Early estimates showed that some customers could see increases of more than 500% in their utility bills. At the time Public Works staff were engaging the public in an outreach effort, the national recession was entering its third year, the unemployment rate in the Salem Metropolitan Service Area was 10.7%, the housing backlog was 12.8 months, and Oregon ranked 47th in the nation for job growth.On December 6, 2010, City Council voted to approve creation of a stormwater utility. The vote was the culmination of more than a year of collaborative efforts involving City staff, business organizations, and our customers. Led by staff from Public Works, the City made it a priority to go into the community to provide information and gather feedback. Over 60 meetings were conducted with property owners, neighborhood associations, business groups, nonprofit organizations, state agencies, school district staff, and others. There were two Council work sessions and the public hearing on the proposal spanned two Council meetings. It is noteworthy that the recommendation that went before City Council in December 2010 had changed significantly from the one that was originally presented to the public earlier in the year, and these changes were a direct result of feedback received while working with multiple stakeholders. In an editorial in the December 12, 2010, the Statesman Journal noted that, “Overall, taxpayers are the winner because, in many ways, the city's handling of this issue has exemplified local government at its best.” Salem was successful, in large measure, because of the public outreach effort that engaged staff with key stakeholders in a vigorous exchange of ideas and proposals.