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Stormwater Fees

The City of Ann Arbor charges a stormwater fee, not millage. That fee is found in the City Code at Article II (Utilities and Services), Chapter 29 (Water, Sewer and Stormwater Rates), Section 2:69 (Stormwater rates). In pertinent part section 2:69 says:

Stormwater Discharge Rate. Each property shall be billed at a quarterly stormwater discharge rate of $342.00 per acre multiplied by the representative impervious area of the property. The representative impervious area of the property shall be the measured impervious area, rounded to the nearest 0.01 acre, of the portion of the property discharging to the City's stormwater system, except for single-family and two-family residential properties and properties considered residential for storm and sewer.

A Michigan Municipal League newsletter described Ann Arbor's program:
Project Snapshot
In 2006, the City of Ann Arbor updated the rate structure for its stormwater utility to charge property owners based on the amount of impervious surface on their property. The new, more equitable rate structure includes incentives to manage stormwater onsite. The utility, which generates over $5 million per year, funds operations and maintenance projects for the stormwater system, water qualityimprovement projects, stormwater education, implementation of environmental regulatory or remediation plans, and green infrastructure projects that reduce strain on the stormwater system.
Utility Details
Until 2006, the City of Ann Arbor’s stormwater utility, which began in 1984, charged residential property owners a flat rate. The City looked to update the utility in order to meet expanding service needs, employ new technologies to improve the system, and comply with evolving regulatory requirements. Specifically, in Bolt v City of Lansing (1998), the Michigan Supreme Court struck down Lansing’s stormwater utility and established three utility rate design requirements:
1) Fees must serve a regulatory and not revenue-generating purpose.
2) Fees must be proportionate to the necessary cost of service.
3) Property owners must be able to refuse or limit their use of the service.
Ann Arbor’s utility and rate structures are designed to meet these criteria. First, all services are regulatory and fulfill National Pollutant Discharge Elimination System (NPDES) permit and National Flood Insurance Program (NFIP) obligations. Second, cost allocation and rate-setting processes ensure that costs are proportional to the fees charged. Third, residents and businesses can reduce their use of the service(and therefore their rates) by reducing the amount of impervious area on their properties. Properties that flow directly into the river are exempt because they do not use the City’s stormwater system.
In addition, the City offers a series of credits that reduce rates. Achieving “RiverSafe Home” certification or installing rain barrels, rain gardens, or detention basins lead to lower rates for property owners. Commercial credits include installing detention basins, following water quality best management practices, and achieving “Community Partners for Clean Streams” designation.

Link to the Michigan Municipal League newsletter

The link to the Michigan Supreme Court decision Bolt v. Lansing, 459 Mich 152 (1998).

A recent Michigan Court of Appeals case found a similar stormwater fee charged by the City of Jackson to be illegal under the Headlee Amendment. County of Jackson v. City of Jackson, 302 Mich. App. 90 (2013) or:
http://www.michbar.org/opinions/appeals/2013/080113/55193.pdf

mLive coverage of the Jackson stormwater dispute:

September 24, 2014 - http://www.mlive.com/news/jackson/index.ssf/2014/09/jackson_residents_to_be_repaid.html#incart_river_news

August 13, 2013 - http://www.mlive.com/news/jackson/index.ssf/2013/0... 

June 4, 2011 -
http://www.mlive.com/news/jackson/index.ssf/2011/06/storm_water_fee_creating_flood.html

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