The Vero Beach City Council voted 4-1 to pay a consultant $93,000 to continue the engineering work needed to levy a stormwater utility tax on properties within the city for the 2021-22 tax year, with Mayor Robbie Brackett the only dissenting vote.
Supporters of the proposal say it will make paying for stormwater projects needed to meet state anti-pollution mandates fairer. Currently, those projects are funded out of property tax revenue.
The new tax, if enacted, would be assessed based on the estimated amount of runoff coming from a property and would impact shopping centers, apartment complexes, churches and government buildings – some of which are exempt from property taxes – more than single-family homeowners.
Mapping and survey work by Collective Water Resources is needed to determine the average impervious surface present on a residential lot in the city limits. The resulting Equivalent Residential Unit measurement or ERU will be the measure by which all property is taxed to pay for the management of stormwater runoff in the city. The more ERUs a property displays, including businesses with large roof areas or parking lots, the higher the tax will be.
The greater the paved area or area covered by buildings, patios and covered porches, the more the property owner would pay, because when it rains, impervious surfaces shed more water that could wash unwanted nutrients and pollutants into the Indian River Lagoon.
Vice Mayor Rey Neville said he was glad to finally make some progress on the stalled stormwater utility because he sees it as more equitable than the way the city has been funding drains, swales, baffle boxes and street sweeping with property taxes. Currently, parcels owned by churches, nonprofits and government are exempt and other properties with high runoff are taxed based on value – not impermeable surface area.
“One of the factors that makes the stormwater utility, frankly, very egalitarian, is if you think about the way our property is taxed, only 44 percent of the land area is taxed in the City of Vero Beach,” said Neville, adding that the rest of the properties that are exempt from property taxes would pay a fair share of stormwater project costs under the new arrangement.
“So in this case it seems to me that if we want to spread the load fairly amongst all of our community, among all of our taxpayers, this approach is probably the fairest, and it’s a direct correspondence with how much hard space you have, as opposed to the property value, which in most cases is not related to how much water you displace off your land,” Neville said.
All properties within the city limits would pay the tax, even if located far from the lagoon because runoff from the mainland goes into the city’s canals and drainage system, which empty into the lagoon.
Councilman Joe Graves said he agreed with Neville that the way the cost would be spread is fairer, but that he still worries about the public perception of a new tax burden during a pandemic. “Our business community needs to feel that we are supporting them, and however we do this it is going to will be viewed as an additional tax being imposed on businesses,” Graves said, pointing out that going ahead with the study does not obligate the council to voting to impose the tax next year.
City staff has tried to create a sense of urgency for the new tax by referencing new state mandates for maximum daily load of nitrogen and phosphorus nutrient runoff, but Vero is not under the gun to meet any regulatory caps for 2025, or even 2030. The city has already surpassed the state’s year 2025 benchmark goal for Vero, and when the proper credits come in for projects already completed, including STEP system installations, the city should be clear of what it needs to achieve by 2030 – without a new tax imposed on residents and businesses.
“Moving forward with anything additional would just be added benefit to the lagoon,” Falls said.
Brackett is not sold on imposing a new tax that would disproportionately impact local businesses, but city staff told the council they had to vote last week to meet the timeline for a fall 2021 launch of the stormwater utility. The council will also need to meet on Dec. 15 to vote on other matters related to the stormwater utility.
Vero must publicly advertise its intent to levy the new tax by the end of 2020 to comply with state legal publication requirements, even though the council could vote later not to institute the tax.
Brackett said he had, and still has, “a lot of unanswered questions” about how the fee would be implemented and about recurring costs for consultants and overhead.
Staff and the hired consultants put together a packet for each council member and City Manager Monte Falls and Collective Water Resources provided extensive information to bring the new council members to up to speed and that secured two more votes for the $93,000 consultant work order. Along with Neville’s endorsement, those votes provided the majority needed to move forward.
New Councilwoman Honey Minuse said she was “very impressed” with the packet and work order she was given and was in favor with continuing the study. Councilman Bob McCabe concurred, noting “the information and the data we’ve been presented is very favorable to moving forward.”
Hearing this, Brackett told his colleagues “I can count,” meaning he knew he’d be outvoted that day, but voiced his strong opposition anyway because businesses are hurting.
“We have a lot of not just businesses but individuals who are out of work, or have missed a substantial amount of work, and the idea of them having to be faced with an additional fee – you call it what you want, a fee, a tax, I don’t care what you call it – it’s money out of their pocket. I’m not in favor of it,” Brackett said.
“Is a stormwater utility a good thing? It might be, but if it is, it will be just as good next year, too,” Brackett added.
The council has no clear idea how much of a tax Falls and the staff will be asking for. Initial estimates given, back when the city considered tacking a monthly fee on utility bills instead of on the property tax bill, were about $60 to $100 per year for the typical single-family residence.
Since then, the staff has added vehicles, plus half of 17 employees’ salaries and one quarter of four employees’ salaries to the proposed stormwater budget. The latest published plan totaled more than $1.6 million – only about $200,000 of which was money for the physical materials and equipment needed to accomplish stormwater projects.
Neville said the city could set up the utility and only charge a fee the years that it needs to fund major projects, and charge “zero dollars” other years. But the way the staff has crafted the budget to include partial salaries for 21 employees, plus the purchase and upkeep of vehicles, a charge of zero any year is highly unlikely.
Brackett praised the staff for being proactive on projects already accomplished, saying the city is “way ahead of the game,” but he told Vero Beach 32963 after he was appointed mayor that he is concerned about the expansion of the scope of this budget to include personnel and recurring overhead and consultant costs, rather than just short-term, project-focused expenses.
Brackett is also investigating alternative means to fund the stormwater projects that would cost the city nothing, by capturing and marketing the stormwater as a commodity. He said the city “just needs to stop dumping stormwater into the lagoon.”
