The City Council voted to refund stormwater fees to Grand Haven and some businesses — possibly back to 2004. Total bill: $3.3 million.
Grand Haven residents, and most commercial construction built under current codes, will be reimbursed for three years of wrongly charged stormwater fees after a 4-1 vote by the Palm Coast City Council Tuesday, March 1.
“I am terribly concerned that it has taken us three years to resolve this,” said Mayor Jon Netts, referring to the 2008 date when the city was put on notice that its 2004 stormwater ordinance was charging landowners illegally.
“If we have to defer this ordinance for two, three, four months, the problem doesn’t get any better,” he said.
The new ordinance exempts Grand Haven residents living east of Colbert Lane and all other properties that have their own stormwater systems that are not maintained by the city.
By reducing the fees and revising the ordinance, the city expects to have a yearly deficit of $700,000 in the stormwater fund, which is primarily used to maintain residential swales, as well as replace worn-out pipes under city streets — major priorities for the community, according to City Manager Jim Landon. The stormwater budget for 2010-2011 was $5.2 million.
In addition to the annual deficit, the city faces a one-time cost of about $1.8 million in refunds dating back to 2008. The city has been saving and preparing for that cost.
“What we’re trying to do is be fair,” Landon said. “We knew in 2008 to set money aside.”
Since 2008, the city has amassed $2.1 million in its bad-debt reserve.
However, the city is not prepared for the additional $1.5 million refund dating back to 2004, when the erroneous fee was instated. At a workshop next month, the City Council will discuss how to refund the rest of the $1.5 million and how to address the yearly shortfall.
City Council member Frank Meeker proposed repaying the rest of the debt incrementally, as it was billed to the residents.
“It wasn’t collected in a lump sum,” he said. “Let’s pay it back the same way.”
Although the Grand Haven residents will only receive a fraction of the total refund — just over $100,000, according to Palm Coast Finance Director Ray Britt — they made their wishes known at the Tuesday meeting.
With every seat filled, Capt. Mark Carman, of the Sheriff’s Office Palm Coast Substation, was forced to clear the fire exits before the meeting convened, moving the overflow into the Community Center’s lobby. From there, the crowd offered the occasional muffled hoot or boo to prove they hadn’t left.
Toby Tobin, of www.GoToby.com, wrote an article online that called Grand Haven residents to action and likely was the impetus for the crowd.
He said the city was obligated to repay the fees since 2004. When it was suggested that the city only pay back as far as 2008, he compared it to embezzlement.
“Let’s say I had an employee since 2004,” Tobin said. “Then it came to my attention that he’s been embezzling from me. Then here we are in 2011 — and what you’re saying is I can only collect the money ... from the time in which I caught (the embezzler), not when he started taking money out of my account.”
Grand Haven representative Tom Lawrence also spoke, inviting all in the crowd to raise their hands if they agreed that the 2004 date was more appropriate. Grand Haven residents appeared to agree unanimously.
In the end, they got what they wanted. One example of a commercial entity that will also benefit is Town Center Medical. Linda Jarosz, facility manager, said 50 doctors work on her property, which was charged more than $22,000 in stormwater fees in the last three years, despite having its own stormwater system.
Still, Jarosz acknowledged that a refund would likely mean an increase in fees to the rest of the residents in Palm Coast, many of whom are struggling with their bills already. She said there is no easy way to answer the city’s newest budget question.
“I’m glad it’s not my decision,” she said. “But I didn’t have it in my budget, either, to pay $22,000.”