Stormwater programs have contributed to significant improvement in our nation’s water quality. However, while very important, stormwater programs are also very costly. This paper describes the difficulty in adequately funding the stormwater program in Huntington Beach, CA with general funds. While water and wastewater fees have become the norm, stormwater fees have not, but are being developed in cities nationwide, and should be developed in Huntington Beach. A review and comparison of other cities that have developed dedicated funding determined that it requires a change in policy. Through implementing a utility fee the City of Huntington Beach will be able to acquire necessary funds to adequately fund its stormwater program.

1. Sustainability and the
Cost of Compliance with
the Clean Water Act
Implementing a Stormwater Utility Fee for the City of
Huntington Beach
Judith Keir
Applied Capstone Project
For
Master of Applied Science
April 30, 2012

2. The Problem
The City of Huntington Beach currently funds its stormwater program
using an unsustainable method of general funds.
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•
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General funds are unrestricted in nature, and not specifically allocated to any
particular program.
General funds are neither self-supporting, nor do they provide accountability
and transparency.
General funds are funded mainly by property taxes, and fluctuate with the
economy.
Stormwater programs must comply with requirements of the federal
Clean Water Act.
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To protect waterways
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To improve water quality
The City of Huntington Beach does not have sustainable funding in place
to meet these requirements.

3. A sustainable approach to funding
is needed.
Without a sustainable approach to
funding, the cost of compliance
with the Clean Water Act will
extend beyond the reach of
existing sources.
A sustainable approach to funding
a stormwater pollution
prevention program requires a
change in existing policy.
Existing funding methods of using
general funds from the City's
budget
are unrestricted in nature, and not
self-supporting.
A fee levied on properties for the
discharge of stormwater may help
the City to
(1) prevent further pollution,
(2) improve water quality
and
(3) promote sustainability
of the City.
By specifically allocating funding to
stormwater pollution prevention programs,
the stormwater program becomes sustainable.

4. The Clean Water Act mandates protection of
water quality.
Restrictive permits require states,
municipalities and other agencies to
reduce pollutant discharges to the
maximum extent practicable.
States issue permits to address point
and non-point source pollution.
Municipalities and other agencies are
mandated to develop stormwater
pollution prevention programs –
To reduce pollutant loadings
To restore and maintain water quality
To protect beneficial uses of water
Urbanization has
negative impacts on
water quality and its
associated economic and
intrinsic benefits.

5. Implementing a Stormwater Utility Fee
State-issued permits address
three major phases of
development, including
planning, construction, and
existing development.
The planning and construction
phases of development include
fees that are deposited in the
City’s general fund.
However, methods to address the
reduction of pollutant discharges in the
existing development phase currently are
not substantially addressed.
• Inspections of businesses incur a fee to
cover the cost of the inspection only.
• Many businesses do not meet the
parameters that require they be inspected.
• Residential areas of the city are not
inspected, and do not support the funding
of the stormwater program.
Implementing a user-based stormwater discharge fee will
improve the sustainability of the stormwater program
specifically and the City in general.

6. A sustainable stormwater program requires
a change in policy.
Current policy uses
general funds instead of
user-based utility fee.
Policy change is vital to
sustainability of the City.
City has fiduciary
responsibility to
taxpayers.
City has environmental
responsibility to protect
beneficial uses for all.
The discharge of stormwater should
be viewed as a utility, similar to
wastewater and water distribution.
Existing method of funding program
with general funds is not sustainable.
Costs of protecting water quality are
mandated by CWA, and grants and
loans may provide limited and
constrained supplemental value.

7. A user fee benefits users
Provides for use of storm drain system.
Provides incentive to reduce discharges.
Fees may be used to implement
additional measures to continue
improving water quality.
Provides long-term funding stability.
Restricted in nature to stormwater program.
Provides for accountability and transparency.
Forces properties to internalize program
management costs.
Allows for cap-and-trade of water quality credits in
market.
Attracts private investors and offsets retrofit costs.
Allows for increasing demands on overall water sector.
Provides potential support for conservation and
wastewater efforts.
Lessens downstream impacts.
Retrofits of properties may
benefit users by reducing fees
and protecting the environment.
Retrofit benefits include clean
waterways and green
communities.
Water quality trading market
attracts private investors and
offsets retrofit costs.

8. Recommendations
• Funding the stormwater program through a utility userbased fee will benefit improvements to water quality.
• Funding the program through a user fee will support a
sustainable city
• Controls stormwater runoff, reducing flooding and the rate
and volume of untreated runoff discharged to surface waters
• Contributes to a green municipality, mitigating greenhouse
effects, and providing for stormwater harvesting and
conservation
• Provides for business opportunities
• Retrofit incentives and benefits
• Water quality trading market
• Stormwater harvesting

9. Solution strengths
• Satisfies permit requirements
• Fiduciary responsibility to fund stormwater program
• Complies with efforts to improve water quality
• Reduces potential enforcement for non-compliance by federal,
state, or third parties
• Provides revenue from all development, including existing
• Takes advantage of citizens’ willingness-to-pay for water
quality
• Informs public of necessity of paying for utility of stormwater
• Provides harvesting, use, and conservation opportunities
• Provides energy savings
Solution weaknesses
• Apathy of municipal leaders
• Changes to policy necessary
• Necessitates public relations and new billing

10. Conclusion
Urbanization has negative impacts on water quality. The built
environment contributes pollutants to surrounding waterways. A
stormwater utility fee will help the City to comply with the
requirements of the Clean Water Act, and provides a mechanism to
control pollution at its source, within the existing developed
properties of the City.
General funds are unrestricted in nature, and not specifically
allocated to any particular program. Unlike general funds, a utility
fee would be self-supporting, provide accountability and
transparency, and would not fluctuate with the economy. A utility
fee would include all properties in funding the stormwater program,
and provide additional benefits in the market and environment.
The costs of protecting water quality are growing, and a sustainable
funding method is needed. The current funding method is not
sustainable and could cause the City to be non-compliant with its
permit. Non-compliance can be costly to the City, with costs passing
on to taxpayers.