Council workshop: town faces $42 million in stormwater work; staff to pursue master plan, borrowing and a small public-works unit

Hilton Head Island — Town staff told the council at a workshop that the stormwater utility has identified more than $42 million in needed projects and a five-year list of priorities that outpaces current collections.

Jeff Netzinger, the town presenter on stormwater, said the FY26 stormwater CIP includes just over $6.35 million for projects this year and emphasized that “we're over, we're $42,000,000 worth of work in front of us right now” as the reason the town needs a longer-term plan. He listed 17 active projects for FY26 (planning, design or construction) and outlined immediate needs such as Moonshale Road (Folly Field neighborhood), Helmsman's Way (a multi-jurisdictional corridor), Bryant Road pond restoration and multiple outfall fixes.

Why it matters: Council members repeatedly pressed staff on who must pay for fixes and how fast the town can move. Several council members said aging infrastructure, denser redevelopment and maintenance shortfalls have made the town reactive rather than proactive.

Finance context: John Troyer described the revenue picture and rate mechanics: “The stormwater utility collects a fee — it’s square footage times a rate,” he said, noting the single-family unit (SFU) base rate is $150 and the fee model ties to impervious-area units. Troyer and other staff explained that recent additions to revenue include a 2024 permit fee and interest income; they cautioned that FY26 spending draws on fund balance and that borrowing should be coordinated with the FY27 budget process.

Policy and implementation choices: Council members and staff discussed three linked steps: 1) complete a stormwater master plan and rate study (staff estimated 6–12 months for a robust plan), 2) use the master plan to justify any rate changes or borrowing and 3) consider a small public-works capability to handle recurring, smaller repairs in-house rather than relying entirely on external contractors. A staff member said the town currently can allocate roughly $2.5 million annually for capital without new borrowing and noted capacity will grow as existing bonds are paid down.

Private systems and easements: Staff emphasized a persistent constraint: many problems require permanent easements or agreements with private communities, and the ownership of adjacent roads (state, county or town) affects who is responsible for maintenance. Staff said the town cannot spend public dollars to alter private property without easements or legal authority.

Next steps: Council members directed staff to develop a timeline for a stormwater master plan and to present options during FY27 budget preparations for targeted borrowing and a proposed, small public-works unit to accelerate prioritized repairs and maintenance. The council adopted the evening’s agenda at the start of the meeting; no formal rate change or borrowing decision was taken at the workshop.