Osceola County deliberating how to implement new stormwater fee

Business owners in Osceola County will likely end up paying hundreds, if not thousands, of dollars each year as the county looks to implement a new stormwater fee.

It's unclear when it will happen, how much it will cost, or even how it would be charged. But one thing is certain: every property owner in unincorporated Osceola County should expect to pay.

Stormwater Director Susan Gosselin has been leading a series of outreach meetings this month to notify property owners of the potential fees, which would support the operation of a new stormwater utility.

Homeowners will likely be charged a flat amount based on the size of their home, driveway and other impervious surfaces -- potentially $120 per year for a typical home.

It gets more complicated for owners of non-residential properties.

"I haven't seen a formula, so I haven't even begun to try to figure out what it's going to cost," said Cheryl Schoolfield, vice president of Schoolfield Properties. "We don't how it's going to be assessed, if it's going to be monthly or once a year. There's just a lot of unanswered questions."

The key number for commercial property owners to know is 3,447. That's the square footage of impervious surface the county has determined to equal a single-family home, or Equivalent Residential Unit (ERU).

So for a commercial property owner, the county would calculate the square footage of the building rooftop, plus its parking lot, driveway, sidewalks, pool decks, patios, etc. If that number came to 34,470 square feet, the owner's base fee would be set at 10 ERUs, or $1,200 per year.

But if a Walmart has 22 acres of impervious surface, it could be looking at 278 ERUs, or an annual stormwater fee of roughly $33,000. That's the base rate.

All property owners would be eligible for credits of up to 45 percent of the base fee if they have a functioning stormwater management system, Gosselin said.

So assuming that same Walmart has a rentention pond and well-maintained drainage system, the fee would go down to $18,350.

Gosselin said that HOAs, CDDs and condo associations could also apply for the same 45-percent credit on behalf of all their members/residents.

Property owners would also be able to apply for up to 35 percent credits if they treat the stormwater to remove phosphorus and other pollutants before discharging it into the county's lake system.

Schoolfield said landlords will pass those costs on to tenants, either in the form of higher rents or end of year true-up. "As a landlord, you have the ability to go and collect at the end of the year -- depending on the lease," she said. "But if I'm the owner and I don't have a space leased, the owner will have to pay that charge."

Both Kissimmee and St. Cloud already charge stormwater fees.

Osceola County currently finances its stormwater division through a $5.7 million appropriation in the county's general fund. Gosselin said the current funding is inadequate to pay for the $100 million backlog of needed capital improvements.

Collecting a stormwater fee gives the utility a dedicated revenue source, which means the county can issue bonds to pay for capital improvements.

The fee schedule hasn't been determined, but it would be based on the level of service County Commissioners choose as the goal. The county's level of service now is rated a D- (just above a failing grade.)

To reach a "C" level of service, the county would need to virtually double its stormwater budget to $10.6 million. The examples cited above used the C level of service to calculate the fees.

If commissioners opted for "B" level of service, it would cost $16.4 million a year, almost three times the current funding.

Gosseling told GrowthSpotter the new policies and ordinance are still in draft form, and she doesn't know when they will go to the BOCC for a vote.

Also yet to be decided is how the fee would be collected. County officials have been in negotiations with Toho Water Authority (TWA) to apply the stormwater fee to customers' utility bills. The advantage of this method is that it spreads the cost over 12 months, and it could launch in 2018.

But some homeowners have said they would prefer the fee be added to their tax bill as a non-ad valorem assessment. The county would still have to pay the tax collector for the cost of collecting and transferring the funds. But it would be one collection per year instead of 12.

"If the BOCC chooses to place a stormwater non-ad valorem assessment on the tax roll, it would not show up until the 2018 tax bills as we have missed the deadlines for the 2017 bill," Gosselin said. "If the BOCC decides to continue with TWA, the assessment could be implemented at any time in the year after mailings are sent out informing citizens of the forthcoming assessment."

Have a tip about Central Florida development? Contact me at lkinsler@GrowthSpotter.com or (407) 420-6261, or tweet me at @LKinslerOGrowth. Follow GrowthSpotter on Facebook, Twitter and LinkedIn.