Council adopts new drainage fee structure

If all goes according to the city’s plan, Austin residents can expect some significant changes to their monthly drainage fees in October. While City Council has adopted a new underlying methodology for that fee, it still has to decide exactly how it will impact customers next year.

Council adopted the Watershed Protection Department’s proposed changes Thursday with several amendments initiated by Council Member Ann Kitchen, the most significant of which is a percentage cap on how much the fee for a single-family residential property can increase in the first year of implementation.

“This is a phase-in so people would have a chance to plan for an increase,” said Kitchen. “It’s particularly important for those that may be on a fixed income, where the amount of an increase can be difficult, initially.”

What the percentage cap will be and how Council will make up for the revenue loss associated with the cap — if it chooses to do so at all — will be a major part of the budget discussions that will begin at the end of July.

Kitchen said that, according to recent data that staff has collected, there are more than 12,500 properties that would see at least a 100 percent increase in their assessed drainage fees. Some of these properties, she added, would see as much as a 300 percent increase.

It should be noted that all of staff’s projections are based on figures for the current fiscal year. These figures could change based on the rate that Council chooses to adopt, among other factors.

Watershed Protection Department Engineer Saul Nuccitelli outlined one way in which Council could implement a 50 percent cap on increases in the first year for residents of single-family homes that would not impact the budget for drainage infrastructure.

While Nuccitelli’s proposal would cap the projected increase for single-family homes, it would mean that multifamily residents would hypothetically see a less dramatic decrease in their bills. Nonresidential customers — such as commercial property owners — would likely see a greater increase with the cap.

The proposal, Nuccitelli told the Austin Monitor, would also require a “slight” rate increase for all customers. “It is revenue-neutral in the sense that … the total amount of revenue captured is the same, but the rate has to be adjusted because of that decrease,” he said.

It is not yet clear whether Council will move forward with Nuccitelli’s recommendation.

Council also incorporated amendments that will allow the city to consider multiple land parcels as one in certain situations when calculating their drainage fee, request that staff report annually on ways in which customers might benefit from maintaining beneficial green infrastructure, and clarify that only the discount element of the Customer Assistance Program applies to the drainage fee.

The amendment for considering multiple properties together only applies if they are all part of one condominium complex or were legally developed originally as one site.

Under the new structure, residents of multifamily properties — buildings with five or more units — will no longer be eligible for discounts under the Customer Assistance Program because they will not be receiving the drainage fee bill directly. Instead, the city will bill the owners of those properties, who will likely pass the cost on to residents.

The change does not apply to duplexes, triplexes and fourplexes.

Although Council has been looking at how the new structure would impact different categories of customers, that is not a factor involved in calculating the fees. This is likely a response to District Judge Amy Clark Meachum’s June 2014 ruling that the structure Council has voted to replace violates Texas law because it treats customers differently based on land use.

“The state law does require (that) calculation of the charge be directly related to drainage,” Kitchen said.

The formula Council adopted is based primarily on a property’s lot size, the amount of impervious cover on the lot, the proportion of a lot that includes impervious cover and citywide figures for impervious cover and lot sizes.

Impervious cover is material on a piece of property through which rainwater cannot penetrate.

The city has filed an appeal to Meachum’s ruling, and the courts have halted any further action until Oct. 22. If staff is able to implement the new structure by the start of the fiscal year on Oct. 1, the legal proceedings might not resume.

All Council members present voted in favor of the measure. Mayor Steve Adler and Council Member Ora Houston were not present for the vote.

“Storm Drain” by Robert Lawton – Robert Lawton. Licensed under CC BY-SA 2.5 via Wikimedia Commons.