BOARD00961

• Board Meeting Date: 9/22/2003
• Description: Flood Section - Probable Maximum Precipitation Site-Specific Study for the Cherry Creek Reservoir-Study Findings and Recommendations
• Board Meetings - Doc Type: Memo

SECTIO.SEVEN

Funding Alternatives

7.1 INTRODUCTION

Existing and potential sources of funding were evaluated as part of this project. Section 2 of this
report summarized the existing sources and amounts of funding for storm water management for
the five entities included in the project. Existing funding for Fruita, Orand Junction, Mesa
County, and Palisade is primarily out of the "general funds," which are funded primarily by sales
and property taxes. Funding from the general funds is allocated year by year and can vary
depending on other needs in each municipality. Existing funding for the Orand Junction
Drainage District is from a dedicated property tax, and is therefore relatively constant from year
to year.

Possible additional funding sources for stormwater include sales and property taxes as well as
stormwater enterprise fees, development impact fees, permit fees, and grants.

The organizational structures considered in the previous sections can only implement certain
funding mechanisms under state law. Some organizations can levy taxes and some can only levy
enterprise fees. The funding options available to each altemative organization were part of the
evaluation process.

7.2 FUNDING IN OTHER COMMUNITIES

While many municipalities are still funding stonnwater programs out of general fund revenues,
there has been a recent state and nationwide trend to provide a dedicated funding source for
stormwater program needs. A primary driver behind this movement is the ever increasing costs
for mandated NPDES stormwater permitting and environmental compliance programs, and the
resulting need for a consistent, dedicated funding source. Dedicated funding sources include:

. Funding for projects in areas of existing development (can also fund operation expenses)

dedicated portions of property taxes and sales taxes,

stormwater utility enterprise fees.

. Activity specific funding for projects required because of new development

drainage impact fees,

permit fees,

plan review fees.

7.3 STORMWATER UTILITY (ENTERPRISE) FEES

A stormwater enterprise is the most popular funding source to meet stormwater needs. In the
state of Colorado the statutory authority for a governmental entity to implement a stormwater
enterprise is called the "Water Activity Enterprise." A description of the W AE statute is
provided below.

The most equitable and by far the most common dedicated funding source for municipal
stormwater needs utilizes a stormwater (enterprise) utility fee on each property. (During
implementation, a policy decision will be made regarding charges on undeveloped property.)
The reason the fee is the most equitable funding source is because it is based on and is

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