The “rain tax” controversy in Maryland just won’t die.
The state’s largest localities were freed from having to levy unpopular stormwater remediation fees, and Gov. Larry Hogan said they’ve come up with “innovative plans” for financing the costly effort to reduce polluted runoff.
Environmentalists, though, contend that many of those plans are fundamentally flawed and that some localities are skimping on their obligation to meet stormwater cleanup requirements. Warning that the Bay’s restoration is in jeopardy, environmentalists are weighing legal action or going back to the legislature to revisit the issue.
“We’re still looking into what can be done,” said Alison Prost, Maryland director for the Chesapeake Bay Foundation. Without “clear and transparent plans” to reduce stormwater pollution, she said “it will be difficult to restore water quality” in the Bay.
The latest dispute arose in October, when the Maryland Department of the Environment said the “financial assurance plans” submitted by Baltimore city and the state’s nine largest counties showed adequate funding to curtail the pollution washing off their streets, parking lots, buildings and other hard surfaces.
Hogan issued a statement saying the finding “further illustrates what many Marylanders and local officials have already known for years: The state does not need to impose yet another burdensome tax on homeowners and job creators in order to successfully manage stormwater runoff.”
Stormwater is the fastest growing source of pollution in the Chesapeake watershed, according to the state-federal Bay Program. Modeling indicates it’s responsible for more than 20 percent of the nitrogen, 23 percent of the phosphorus and 41 percent of the sediment reaching the Bay from Maryland. But it’s one of the costliest types of pollution to curtail, especially when it involves shoehorning control measures into areas developed before runoff controls were enacted in recent decades.
A 2012 law required the state’s largest jurisdictions to collect stormwater fees from all property owners to ensure there was enough money to control polluted runoff. Before that, many localities had struggled to meet their stormwater regulatory requirements, often citing a lack of resources.
But the mandated fees proved controversial among homeowners and businesses. One county refused to levy the fee, while another adopted a token 1-cent annual charge. Hogan ran for governor on a pledge to eliminate the mandate, which critics derided as a tax on rain.
Lawmakers obliged Hogan last year by giving local officials the flexibility to decide how to pay for reducing polluted runoff in their communities, with or without fees. But they also required localities to publish five-year plans by July 1 showing how they would reduce stormwater — and pay for it.
Baltimore City and Anne Arundel, Baltimore, Carroll, Charles, Frederick, Harford, Howard, Montgomery and Prince George’s counties have been issued municipal stormwater permits, which, among other things, require that each captures or treats the runoff from 20 percent of their land that was developed before modern stormwater control programs were enacted. The financial plans were supposed to spell out how they would pay for at least 75 percent of what they had to do in the next two years.
A coalition of 18 environmental groups reviewed the plans, and in August wrote the MDE that they contained “significant procedural and substantive flaws.” The groups called on state regulators to reject deficient plans and make local officials fix them.
The MDE did not respond, and in fact missed the deadline for reporting on the plans to the legislature. But in mid-October, the department declared that each locality’s plan had laid out sufficient funding.
Taken together, MDE said the 10 localities have pledged to spend a total of $1 billion on stormwater projects over the next five years. MDE Secretary Ben Grumbles said the state’s largest jurisdictions “deserve credit for stepping forward to pay for these clean water projects — for the good of our environment and Maryland’s economy.”
But advocates say most plans show significant funding gaps. “Six of the county plans only commit to doing half the work that their stormwater permit requires,” Prost said.
Some rely on sizable grants from the state and other outside sources, which are not assured, to cover shortfalls. Baltimore County, for instance, anticipates $14 million in state aid for its runoff reduction efforts, while Harford County is counting on $8 million. Officials with both jurisdictions say they have not been promised such sums, but the figures are based on past grants. Both counties repealed their stormwater fees.
Some plans depend on programs of questionable runoff control value. Traditional methods for curbing runoff include installing vegetated swales, green roofs and rain gardens that can soak up rainfall before it reaches storm drains. But Baltimore city expects to achieve three-fourths of its pollution reductions through an aggressive street-sweeping program — something environmentalists question. Baltimore and Prince George’s counties also count on street sweeping, though to a lesser degree.
“We don’t see a more efficient way to meet our nutrient and trash reduction goals than street sweeping and storm drain inlet cleaning,” said Jeffrey Raymond, spokesman for the Baltimore city Department of Public Works.
But Tom Schueler, executive director of the Chesapeake Stormwater Network and co-chair of a Bay Program expert panel that reviewed the efficacy of street sweeping, said studies have found little water quality benefit from the practice.
“I think anyone who’s claiming to get more than 10 percent of their load reductions from street sweeping [should] look at their numbers very carefully,” he said.
At least half of the plans — those for Anne Arundel, Baltimore, Charles, Frederick and Harford counties — rely at least partially on “pollution trading,” a practice the state has yet to approve, to offset their projected stormwater reduction shortfalls.
A sixth — Howard County — doesn’t specifically count on trading but says it would be helpful in complying with its stormwater treatment requirements.
Maryland is developing a trading program under which an entity such as a wastewater plant that misses its pollution reduction goal could purchase “credits” from another entity — another wastewater plant, or a farm, perhaps — that exceeds its requirements. Pennsylvania and Virginia have similar trading programs, though they are not widely used.
Not all of the plans spell out how they would use trading, but a few say they intend to offset stormwater pollution shortfalls by taking credit for nutrient pollution reductions at their wastewater treatment plants that already exceed what’s required in discharge permits.
Local officials say they need the flexibility. “This issue at this point is not the funding, but the ability to get the projects in the ground fast enough to meet the requirement by the end of the permit, due to design delays, permitting and construction contracting,” said Steven Stewart, a manager in Baltimore County’s Department of Environmental Protection and Sustainability.
But environmentalists contend that it’s premature to count on trading to achieve stormwater treatment requirements, because the state has yet to adopt regulations allowing it.
And the U.S. Environmental Protection Agency has chimed in, saying that to allow trading, the state would have to revise localities’ stormwater permits, giving public notice and holding hearings on them — something that could take months or even years.
In letters to counties, the MDE told those relying on outside funding to cover shortfalls that they would have to find other revenue if that money does not materialize. And, the MDE said the same to those looking to use pollution trading, should the trades not pan out.
Environmentalists say that while none of the submitted plans is perfect, the localities that retained their stormwater management fees have submitted more robust blueprints for financing their needed projects.
“The ones that have the fees are a lot better at doing this stuff,” said Ben Alexandro, with the Maryland League of Conservation Voters.
As they mull their next move, advocates said that they hope that EPA will get involved.
“MDE must be held accountable for approving these flawed plans,” said the Bay Foundation’s Prost.