During the past three months, discussion about the proposed stormwater rate increase for Port Orchard has been a topic of city council committee and regular meetings, a public hearing and citizen comments.

Under the proposal, rates would increase Jan. 1 from $7 to $14 per Impervious Surface Unit (ISU), which is based on 3,000 square feet, according to Public Work Director Mark Dorsey.

The proposed ordinance states that all single-family residential accounts, including mobile homes, and all duplexes and triplexes would be charged $14 per month per month.

It also states that for all other developed property, including but not limited to multi-family and commercial accounts, would be charged $14 per month multiplied by the number of ISUs based on 3,000 square feet per ISU.

The extra money above the recommended step increases would be applied toward Capital Improvement Program. In 2015, $4.30 per ISU per month would go to improvements, and in 2016, 80 cents per ISU per month. During the two-year period, the city would collect more than $600,000 for improvements.

Dorsey said according to the city’s code, impervious surfaces are roofs, driveways (gravel, paved or concrete) patios and sidewalks. 3,000 square feet of impervious surface are assumed for all single-family residential through triplex residential. He said all single-family residents are charged for one ISU, once they are developed.

“A triplex on a parcel would be assessed three ISUs,” explained Dorsey. “For four-plexes and up, apartments and commercial, the ISUs are based upon either 85 percent assumed impervious or by actual field assessment/confirmation.”

He said his staff is still confirming and finalizing the roll eliminate for assumed valuations.

Dorsey noted that 3,000 square feet ISU is an “averaged” rate.

“There are single-family residences in the city that have less than 3,000 square feet of impervious surface or lot, and single-family residences that have more than 3,000 square feet impervious/lot.” he said.

Dorsey said the city doesn’t have the resources to audit impervious surfaces for every single-family residence and continually update if someone builds a shed in their backyard.

He added that large homes in McCormick Woods would not be effected by the proposed increase and charged one ISU, unless they are operating a commercial business in their home.

Concerns arise from committee meeting

Some residents feel that home-based businesses would be effected.

During citizen comments on Sept. 23, resident Nick Whittleton said his concerns about business license and commercial property regarding the proposed stormwater increase rate came from a Jan. 20 Utilities Committee meeting, which Councilmembers Rob Putaansuu, John Clauson and Cindy Lucarelli are members.

He referenced his concern from a nearly 35-second exchange during the meeting. He noted an exchange was from the 17:55 to 18:29 mark on the audio. Whittleton later stated in an email it was actually from the 13:55 to 14:30 mark. The date of the meeting was June 20, not Jan. 20 as Whittleton stated during citizen comments.

“There was an exchange that specifically stated that home business were not only considered as, but in some cases charged as commercial for stormwater rates,” he remarked.

Whittleton said the council should include the definition that “commercial is all properties on commercial.”

In reference to Whittleton’s concern from the audio, Archer-Parsons said, “The thing is the way the code is set up, and they way that we handle the accounts, is if you hold a business license — even if it is a home-based business — you are technically commercial.

But she added the city accesses business based on impervious surface unit (3,000 square feet).

“Most cases, such as a single-family residence if they are doing a home-based business, will not see a change and if they did, it would be just for one ISU,” Archer-Parsons said. “Most of them are under 3,000 square feet.”

During the Aug. 26 meeting, resident Elissa Littleton said she is concerned about anyone holding a business license may be considered “commercial” under the present ordinance regarding stormwater.

“Impervious surface is impervious surface and should be accounted for accordingly,” said Littleton, who noted she has a business license for her home-based business.

“Someone having a home-based business, do they have 3,000 square feet or less? It has nothing to do with having a business license. I’m not sure where the ‘misnomer’ came from,” said Dorsey.

There is no mention of business licenses in the proposed changes to the ordinance.

“If the home-based business operates within the confines of the house operation (like a beauty salon that schedules appointments to not require additional parking), then it’s assessed as a single-family residence,” Dorsey said. “If the business is a barber shop that serves drop-ins and expands the parking area to accommodate the business, that the use would not be consistent with a home-based business — rather commercial — and therefore not assessed as a single-family residence.”

Rate increase will effect large B&Bs

In July, city staff discovered that three bed-and-breakfast businesses located inside Port Orchard have been billed as residential instead of as commercial businesses for stormwater rates after a review of the stormwater roll.

Staff determined that the bed and breakfast businesses were operating in residential, but not billed as commercial businesses.

At the June 20 Utilities Committee meeting, Public Works Director Mark Dorsey and Assistant City Engineer Andrea Archer-Parsons summarized the proposed billing change to the  Storm Drainage Utility, being a change from “residential to commercial” assessment for bed and breakfast (B&B) uses. The proposed change aligns B&B’s with other uses that are licensed for commercial use. It was noted that the impervious surface for most B&B’s similar to a single-family residence and will not be impacted by the change, given the 3,000 square-foot ISU billing standard.

At the June 20 Utilities Committee meeting, Dorsey tells the committee that in 2008, the city considered B&Bs as residential for sewer.

Before the 35-second audio exchange — which Whittleton referenced — Dorsey told the committee that the city had to add B&Bs “not as a residence getting one ISU.”

“There are two (B&Bs) that are very minimally impacted,” said Archer-Parsons. She noted that Cedar Cove Inn would be impacted the most by the rate change.

She noted that Cedar Cove Inn, which is accessed at 14,000 square feet, would see “a significant increase from one ISU to five ISU.”

Gary Chrey, an attorney representing Gil and Kathy Michael who own the Cedar Cove Inn, requested the council delay action so his clients could have more time to review changes to the ordinance to provide a detail response.

Commercial rates based on ISUs

At the July 18 meeting Utilities Committee meeting,  Archer-Parsons said commercial rates are based on an ISU and a single-family residence is a flat rate.

“If you’re doing a commercial business for income, we value that as commercial,” she said. “Home-based businesses are also billed as commercial.”

Dorsey said it a home is over 3,000 square feet, the resident would only be charged for one ISU.

Archer-Parson said there is a case where a home-based business was in a 4,500 square feet home.

“By the time I added sidewalks and driveways, they went up to two ISUs because they decided to do a home-based business,” she said. “On a case like that, as long as they are not doing a home-based business and they have a very large home, they will pay for only one ISU.”

At the August council work study session, Archer-Parsons told the council in order to remain consistent with the Municipal Code, the businesses need to be reassessed as commercial businesses.

Rates forced by unfunded state mandates

Putaansuu, Utilities Committee chair, said he doesn’t like increasing the stormwater rate, but that the city has an unfunded mandate by the state.

“When we form this utility at $7 (per ISU per month), we were in the middle of an economic recession and we made an effort to do no more than to fund the state’s compliance,” Putaansuu said. “Our utility rates do nothing more than sweep the streets, clean out catch basins and report to the state that we done those activities. If we don’t, we are fined very heavily by the state.”

The fine for not complying with Department of Ecology requirement is $35,000 per day, according to the Clean Water Act.

In 2008, the city began steps to establish a stormwater utility to bring the city into compliance with state regulations that enforced the federal Clean Water Act of 1972.

The city implemented the current stormwater fee in 2009.

Stormwater is typically rain that runs off rooftops, paved streets, highways and parking lots. Along the way, it can pick up pollution from oil, fertilizers, pesticides, soil, trash and animal waste. Then the water might flow untreated directly into a local stream, bay, lake or waterway.

Dorsey noted items funded by the stormwater utility include contracts for cleaning out the roadside ditch along State Highway 166 and a storm drainage catch basin and pipe maintenance and stormwater retention pond maintenance.

On Aug. 26, the council voted 5-0 to delay action until October on an ordinance that would double the stormwater rates residents currently pay.

A public hearing is scheduled at the Oct. 28 meeting.