Committee reviews overhaul of stormwater credits and project funding; staff warns of revenue risks from homestead waiver

City stormwater staff outlined a package of proposed changes to the stormwater credit manual and related project updates in a lengthy presentation to the Public Works & Utilities Committee.

Mister Fountain, the presenting staff member, said the changes would preserve the existing homestead exemption waiver for qualifying primary‑residence owners while adding a set of targeted credits for nonresidential properties. "There are currently about 2,500 properties that receive this waiver," Fountain said, and estimated the cost at "about $330,000 per year." He described the presentation as a request for policy direction before staff drafts ordinance language for three readings.

Why it matters: The fee waivers and proposed credits directly affect revenue for the stormwater enterprise fund — the city’s dedicated source for stormwater maintenance and capital work. Chair (speaker 1) cautioned that the city’s changing demographics could shrink that revenue base: "As Charleston continues to become more of a retirement community, we're gonna have more and more people opting out of the stormwater fee," he said, urging the committee to consider partial discounts rather than full eliminations.

Key proposals and mechanics: Fountain said staff will propose a menu of credits and administrative rules including: backdating approved credits to Jan. 1 of the current billing year; five‑year reevaluations of credit eligibility; and a possible five‑year sunsetting process to phase credits toward new eligibility rules. Specific credit concepts discussed included:

- Flood‑reduction credits for nonresidential properties in mapped flood‑prone basins: moving design compliance from the current 4% annual exceedance standard toward 2% (25% discount) or 1% (50% discount) performance for larger discounts.

- Water‑quality credits: modest discounts (example figure discussed: 10%) for higher‑tier green‑infrastructure designs that treat a greater rainfall depth than the baseline requirement.

- Low‑impact development/multiuse path credits: substantial discounts (staff cited a 50% discount example) for vegetated walking paths and similar measures that demonstrably reduce runoff.

- Direct‑discharge and private‑road credits: proposed discounts (staff discussed 50% as a common approach) for properties that discharge outside the public system or are served by private streets; staff noted options to align discounts with existing flat‑rate residential billing to avoid loopholes.

Fiscal context and related projects: Fountain reviewed recent and planned capital work. The King Ujiji Drainage Improvement Project is approaching substantial completion for the pump station and staff sought approval for change order #6 (about $100,000) for hazardous‑materials disposal under the SJ Hamill contract. Fountain summarized the project cost across phases at roughly $20,000,000, with about $10,000,000 coming from state grants.

On the West Pawnee drainage project, Fountain said updated modeling and a parcel‑acquisition approach could reduce costs from about $2.5 million (original concept) to under $1 million. The committee moved to support the real‑estate committee’s recommendation to acquire that parcel for the project’s benefit.

County ARPA funds and immediate purchases: Fountain also described an intergovernmental agreement that would bring just over $790,000 in county ARPA funds to the project. Because the team identified lower mitigation needs, staff sought and the committee approved a short extension of the county deadline (to Oct. 31) to expend the funds. The committee also approved an authorization to purchase six large check valves at just over $348,000 to meet lead times and use the county funds while continuing design and construction.

Next steps: Fountain said staff will work with the legal department and the clerk’s office to prepare ordinance drafts reflecting the committee input and will return the draft language to the Public Works & Utilities Committee for further review and the formal three‑reading process.

Quotes: "We could do refunds or discounts towards future bills," Fountain said when describing backdating options. Chair noted the tradeoff between relief and revenue: "We would be shooting ourselves in the foot if we continue to do this as we go forward," he said about an outright elimination of fees for some homestead‑exempt properties.

What remains unresolved: Staff did not propose final adopted percentages or a single cumulative maximum discount; the committee requested that staff return with ordinance language and options (including income‑tiering and hardship clauses) for further discussion.

The committee approved the project change order, the ARPA time extension and the check‑valve purchase; staff will prepare ordinance drafts on the credit manual for future committee consideration.