Okaloosa to further discuss possible stormwater utility

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TONY JUDNICH @Tonyjnwfdn

SHALIMAR — The Okaloosa County Commission on Tuesday unanimously approved holding a public hearing on April 17 to consider whether to approve the first reading of an ordinance to establish a stormwater utility.

The possible utility might be designated as an enterprise fund and be funded at least in part with stormwater fees charged to property owners in the unincorporated area. Revenue from the potential fees could help the county address a backlog of more than $70 million worth of unfunded stormwater infrastructure repairs.

The public hearing will be part of the commission’s regular meeting on April 17 at the County Administration Building in Shalimar.

The possible utility fee could be based on a property’s total square footage of impervious surfaces, such as roofs, driveways, parking lots and sidewalks that do not absorb rainwater.

According to county information, Okaloosa has a total of 49,129 “equivalent residential units” (ERUs). One unit is equal to an average single-family home that has 4,100 square feet of impervious surface.

A conceptual, annual stormwater utility fee of $31.90 per ERU would generate $1.5 million in annual revenue to pay for stormwater system expenses.

While the owner of an average single-family home — equal to one ERU — would conceptually be charged $31.09, the owners of larger buildings that have a greater amount of impervious surface (such as a roof or paved parking lot) would be charged higher fees.

Commissioner Trey Goodwin on Tuesday said he thinks “there is no doubt that we have a problem with stormwater in Okaloosa County,” but before approving a stormwater utility, he would like the potential ordinance to include a cap and sunset date on the possible utility fee.

Commission Vice Chairman Kelly Windes said the utility should have been established decades ago.

“It’s in the best interests of the county,” he said.

While agreeing to have the public hearing next month, Commission Chairman Graham Fountain said he is “concerned about the timing” of the possible establishment of the stormwater utility and potential fees.

Fountain noted that the county has already agreed to ask voters in the Nov. 6 general election to approve a five-year, local option half-cent sales tax.

If approved by a simple majority of voters, the tax would take effect Jan. 1, 2019, remain in place through Dec. 31, 2023 and generate an estimated $17 million annually.

Much of the potential tax revenue would help pay for infrastructure projects, such as road and stormwater work, in the unincorporated area and local municipalities.

Besides the possible sales-tax money, “We have also just received wonderful news from the (state) Legislature … that we’re going to have the option of being able to use some of our (county Tourist Development Department bed-tax) funds … to support infrastructure and transportation projects that may benefit our tourism people that travel down here,” Fountain said.

He was referring to a proposed state bill that would, under certain conditions, allow counties to spend a portion of bed-tax revenue on major capital improvements — including transportation, sanitary sewer and drainage projects — that support tourism businesses within tourist development tax districts.

Fountain said Gov. Rick Scott is expected to sign the bill into law. With Scott’s approval, the law would take effect July 1.

Fountain noted that County Administrator John Hofstad emphasized at Tuesday’s meeting that the commission has not approved a stormwater fee yet.

“But I assure you, the public already thinks we’re talking about another fee that we’re fixing to impose,” said Fountain, who suggested perhaps waiting to see if the sales-tax initiative passes before moving forward with the possible stormwater utility.

“I said it during (my commission) campaign. I’m going to say it now: We need to transition (some governmental costs) as much as we can to some of our visitors and our tourists and some of these other avenues we have before we start assessing fees,” he said.

But Commissioner Nathan Boyles said that statutorily, the county would not be able to use sales-tax revenue to pay for the reoccurring operational and maintenance expenses of its stormwater system.

“What this board made the decision to do several years ago to keep (property) taxes as low as possible during a recession is we began to eat a reserve account for operational expenses of our stormwater system today,” Boyles said. “We are now at the end of that reserve. The reserve is gone. This year, we will have to now subsidize the standard operating costs of that department — which by the way are inadequate even for the maintenance of the existing system — with our general revenue fund, which are tax dollars.

“The reality is, this is an existing cost that’s going to have to be paid. The question really is, how do we pay for it? And our sources of revenue are limited for that purpose. Sales tax (revenue) simply will not help in that regard.”

Commissioner Carolyn Ketchel said the county’s stormwater system cannot be fixed overnight, but is something the county government must plan for.

“We must have a way to pay for these systems,” she said.

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