TO: Mayor and Members of City Council
THRU: Adam Lindsay, Assistant City Manager
FROM: Sheila Thomas-Ambat, Public Services Director
DATE: March 25, 2024
RE:
Title
Stormwater Ordinance Text Amendments, Sec. 23-33 Ownership & Maintenance of Stormwater Management Facilities & Sec. 23-35 Performance Guarantee for Installation
end
COUNCIL DISTRICT(S):
Council District(s)
All
b
Relationship To Strategic Plan:
Goal 3: High Quality Built Environment
Goal 4: Desirable Place to Live, Work and Recreate
Executive Summary:
At the March 4, 2024 City Council Work Session, staff discussed proposed changes to the City’s Stormwater Ordinance with respect to section 23-33(B). Section 23-33(B) outlines the conditions for single-family residential stormwater management facilities to be accepted by the City for functional maintenance. Council guidance was to remove the option for accepting functional maintenance of these facilities. In addition, Council directed staff to draft an amendment to Sec. 23-35 Performance Guarantee for Installation. To proposed amendment would do away with the City’s practice of holding performance securities for a period of one year after final approval of the stormwater management facilities.
Staff now seeks City Council action to amend the Ordinance to amend City Code Section 23-33 & 23-35 to end the process for turning over functional maintenance of residential of single-family residential SCMs to the City and to end the holding of performance securities for up to a year after final approval.
Background:
The City’s Stormwater Development Ordinance was adopted on October 27, 2008. Since its effective date of January 1, 2009, the ordinance has been amended on multiple occasions. The purpose of the Stormwater Control Ordinance is to protect, maintain, and enhance the public health, safety, and general welfare by establishing minimum requirements and procedures to control the adverse effects of the increase in stormwater quantity and the stormwater runoff quality associated with both future land development and consideration of existing developed land within the City of Fayetteville. Proper management of the quantity and quality of stormwater runoff will minimize damage to public and private property, prevent personal damage and bodily harm, ensure a functional drainage system, reduce the effects of development on land and stream channel erosion, promote the attainment and maintenance of water quality standards, enhance the local environment associated with the drainage system, reduce local flooding, and maintain as nearly as possible the pre-developed runoff characteristics of the area, and facilitate economic development while mitigating associated flooding and drainage impacts. Additionally, the purpose of this article is to comply with the post construction stormwater requirements as per the City's NPDES stormwater discharge permit.
Issues/Analysis:
Sec. 23-33 Ownership & Maintenance of Stormwater Management Facilities: Section 23-3 (B) of the Ordinance currently states that the City shall accept functional maintenance responsibility of structural stormwater management facilities that are installed in accordance with the ordinance, following a warranty period of one year from the date of record-drawing certification or from the date the facility ceases to function as an erosion control measure and starts to function as a stormwater management facility (conversion), whichever is later. Further, the City will only accept the stormwater management facility provided several specific conditions, including:
1. Only serves a single-family detached residential development or townhomes all of which have public street frontage;
2. Is satisfactorily maintained during the one-year warranty period by the owner or designee;
3. Meets all the requirements of this article;
4. Includes adequate and perpetual access and sufficient area, by easement or otherwise, for inspection, maintenance, repair, or reconstruction; and
With the passing of House Bill 488 / Session Law 2023-108 in August of 2023, General Statue 160D-95 Stormwater Control was amended. Requiring the payment into a maintenance fund is void as it conflicts with amended General Statute. Council amended the Ordinance to address this change in General Statue via Text Amendment at the February 26, 2024 Council Meeting.
Without the ability to require payment, upfront, into a maintenance fund, the Stormwater Enterprise Fund is not structured or set up to utilize revenues or support the additional service of providing functional maintenance to privately owned SCMs.
Additionally, there is significant risk, liability, and financial reasons to consider adjusting this policy. As functional maintenance responsibility for an SCM is transferred to the City, so too is the cost associated with that functional maintenance and periodic replacement. Functional maintenance activities include regular inspections, repairs, stabilizing slopes, and removing sediment, all as needed. Periodic replacement costs represent the cost to fully reconstruct the SCM once it has passed its useful life.
If the City continues with the current policy of taking over residential subdivision SCMs, it must also consider these growing costs and an appropriate mechanism for funding them.
A peer review of other communities both in North Carolina and other states nationally show how other utilities and communities address the maintenance of residential SCMs, and if so, how were these activities funded. A summary table below outlines the municipalities evaluated, if they maintain residential SCMs, the funding source, and the type of maintenance. Fayetteville is the only Phase I community in North Carolina that will accept functional responsibility of these types of SCMs.
Table 1. Peer Communities Responsibility
|
|
Does the utility maintain residential SCMs? |
Funding Source |
Type of Maintenance |
|
Charlotte-Mecklenburg Storm Water Services (City of Charlotte, NC) |
By Petition |
Stormwater utility fee |
Functional |
|
City of Austin (TX) |
Yes |
Stormwater utility fee |
Functional, aesthetic |
|
City of Durham (NC) |
No |
N/A |
N/A |
|
City of Raleigh (NC) |
No |
N/A |
N/A |
|
City of Greenville (NC) |
No |
N/A |
N/A |
|
El Paso Water (TX) |
Yes |
Stormwater utility fee |
Functional |
|
Lexington-Fayette Urban County Government (KY) |
Yes |
Stormwater utility fee |
Functional |
|
Metro Government of Nashville & Davidson County (TN) |
No |
N/A |
N/A |
|
New Hanover County (NC) |
No |
N/A |
N/A |
|
Sanitation District No. 1 of Northern Kentucky (KY) |
Yes |
Stormwater utility fee |
Functional |
Following the detailed peer review and change in statute, the proposed recommendation is to further amend Ordinance Sec. 23-33 to remove the option to transfer functional maintenance responsibility of residential SCMs over to the City. This recommendation was presented to the Stormwater Advisory Board (SWAB) at their monthly meeting in December and a majority consensus was obtained to affirm staff’s recommendation.
Sec. 23-35 Performance Guarantee for Installation:
Sec. 23-35 of the Stormwater Management Ordinance, requires a performance guarantee for the installation of Stormwater Control Measures (SCMs) on all privately developed projects. These projects can be broken into two categories - Commercial Developments and Single-family Residential Subdivisions.
For commercial developments, the performance security for installation is required prior to the issuance of the infrastructure permit. The amount of the performance security is 125% of the total construction cost of the SCM. Prior to the issuance of a Certificate of Occupancy (CO), the SCM is converted, if necessary, and inspected by City staff. If the SCM passes inspection, the warranty period begins and the performance guarantee must remain in place for a minimum of one year. When this one-year warranty period is complete, the applicant may petition the city to release the value of the performance guarantee. Upon receipt of such petition, the city engineer shall inspect the stormwater management facility to determine whether the controls are performing as designed and intend and if so, the performance security is refunded.
For residential subdivisions, the performance security for installation is required prior to the approval of the final plat. The amount of the performance security is 125% of the total estimated construction cost of converting from an erosion control measure (NCDEQ permit) to a final SCM. Once the SCM is converted it is inspected by City staff. If the SCM passes inspection, the warranty period begins and the performance guarantee must remain in place for a minimum of one year. When this one-year warranty period is complete, the applicant may petition the city to release the value of the performance guarantee. Upon receipt of such petition, the city engineer shall inspect the stormwater management facility to determine whether the controls are performing as designed and intend and if so, the performance security is refunded and the subdivision HOA or the City takes on functional maintenance responsibilities in perpetuity.
City staff recently reached out to our peer cities to inquire about their specific ordinance requirements for performance securities for both commercial and residential development. The below tables offer a comparison of requirements of these peer cities when compared to the City of Fayetteville.
Table 1. Peer City Comparisons for Performance Securities - Commercial Development SCMs
|
City |
Bond Required Prior to Permit Issuance |
Bond Required Prior to CO |
Bond Amount |
Warranty Period |
Bond Released |
|
Durham |
No |
Yes |
125% of remaining construction cost |
No |
Upon As-built acceptance |
|
Greensboro |
Yes |
Yes |
120 - 150% of remaining construction cost |
No |
Upon As-built acceptance |
|
Greenville |
No |
Yes |
100% of cost of remaining construction |
No |
Upon As-built acceptance |
|
Raleigh |
Yes |
Yes |
125% of estimated construction cost |
No |
Upon As-built acceptance |
|
Fayetteville |
Yes |
Yes |
125% of estimated construction cost |
Yes |
Completion of one year warranty period |
Table 2. Peer City Comparisons for Performance Securities - Residential Subdivision SCMs
|
City |
Bond Required Prior to Permit Issuance |
Bond Required Prior to Plat Recordation |
Bond Amount |
Warranty Period |
Bond Released |
|
Durham |
No |
Yes |
125% of remaining construction cost |
No |
Upon As-built acceptance |
|
Greensboro |
Yes |
Yes |
120 - 150% of remaining construction cost |
No |
Upon As-built acceptance |
|
Greenville |
No |
Yes |
Cost of remaining construction |
No |
Upon As-built acceptance |
|
Raleigh |
No |
Yes |
125% of remaining construction cost |
No |
Upon As-built acceptance |
|
Fayetteville |
No |
Yes |
125% of conversion cost |
Yes |
Completion of one year warranty period after conversion |
The City is currently the only one of the above group that requires the completion of a one-year warranty period prior to releasing the performance security back to the developer. Upon approving this text amendment, the City will no longer require the one-year warranty period and the performance security will be refunded after final approval that the stormwater management facilities are performing as designed and intended.
Budget Impact:
None
Options:
1. Adopt the proposed text amendments for Sec. 23-33 and Sec. 23-35 of the City’s Stormwater Ordinance as presented.
2. Remand text amendments back to staff for further consideration.
Recommended Action:
Staff recommends Council to adopt the proposed text amendments for Sec. 23-33 and Sec. 23-35 of the City’s Stormwater Ordinance as presented.
Attachments:
1. Sect 23-33 Ownership of Maintenance of SCMs_track change
2. Sec. 23-35 Performance Guarantee for Installation_track change
3. Sec. 23-33 & Sec. 23-35 Ordinance Amendment