CITY COUNCIL – Stormwater rate increases heads for public vote

Mb stormwater graph. Courtesy City of Manhattan Beach

by Mark McDermott 

The Manhattan Beach City Council on Tuesday night moved to conduct an all-mail vote proposing rate hikes to both stormwater and wastewater fees paid by residents. 

The increases are intended to address ongoing General Fund subsidies to both programs that, if left unchanged, would erode all the reserves the City must, by law, set aside for economic uncertainties. 

The wastewater fee, which is projected to increase by $5.49 per single-family residence in its bi-monthly billing, has not been increased since 2014. If approved, this would represent a 15 percent increase. The fees pay for the operation of 81.6 miles of sewer pipelines that convey wastewater emanating from all properties in the city. 

“No one likes to pay more for government services,” said Councilperson David Lesser. “Conversely, nobody wants to have a failure of our infrastructure, particularly our wastewater infrastructure. I think our past councils have invested in our infrastructure precisely so there would not be a failure. I mean, what was the old adage? We want to be able to not have fear to flush. I think it’s been a responsible undertaking by councils before us to invest in our infrastructure to ensure that this core function of our city is operational and invested in, to ensure it remains so.” 

The stormwater fee, which is currently $19.12 per year, has not been increased since the City was required by law to implement a stormwater drainage system in 1996. If approved, the average single-family rate would increase from $19 to $70 per year. 

If the stormwater increase is drastic, so also is the deficit the current fee structure is creating. Since 2019, the stormwater system has required $6 million in General Fund subsidies, and that subsidy is projected to increase by $11.4 million over the next six years. 

“The forecast projects dipping into economic uncertainty reserves by Fiscal Year 2026, with the reserves fully unfunded by Fiscal Year 2027,” said Julie Bondarchuk, the City’s financial controller.  “The unreserved general fund balance is also projected to be fully depleted by Fiscal Year 2026….This current method of blending stormwater operations with general fund subsidies is unsustainable.” 

Bondarchuk noted that the main purpose of the fees are to fund systems to divert stormwater from streets and prevent flooding. 

“With rainfall,  trash is also carried into the storm drains along with the stormwater,” she said. “Therefore, an additional function of the stormwater fund is to prevent trash and debris from reaching surface waters like the ocean. The city created and currently maintains seven full capture systems to capture runoff debris carried into the storm drains. Additionally, mandates also limit the levels of bacteria and metals in runoff waters. Ideally, enterprise funds like the stormwater fund should be self-supporting where incoming revenues cover outgoing costs.” 

Public Works director Erick Lee said that stormwater regulations began with the federal Clean Water Act and have been amplified by state law, thus legally obligating the City to maintain its drainage systems to prevent overflow. 

“We’re at the front door to the beach, and 85 percent of all the stormwater in the city goes directly into the Santa Monica Bay very quickly,” Lee said. “The other 15 percent discharges into the Dominguez Channel, which takes a longer route that ultimately reaches the ocean as well. I think all of us here remember years and years ago when there were always alerts in Santa Monica Bay: don’t go in the water today. And fortunately, we don’t have those nearly as frequently, and a lot of that is due to these regulations that have been imposed on local agencies, for good reason.” 

Mayor Richard Montgomery said that from a financial standpoint alone the stormwater fee increase was a dire necessity. 

“The fact that anyone would come and tell you that you’re going to spend $11.4 million on something that hasn’t raised fees since 1996 should scare everyone in the room,” Montgomery said. “We are blowing money from the General Fund. If you look at the numbers, you are going to run dry into reserves in six years. That should get everyone concerned…This is a need, not a want.” 

“I would go further and say it’s a must,” said Councilperson Steve Napolitano. “It’s unsustainable. It will eat into other services — police, fire, parks and recreation. All those things that we hold dear and we want more of, we will have less if we do not adjust this picture and right this ship.” 

Napolitano said that the fee also represented an environmental necessity. 

“This is part of the invisible infrastructure that we all rely on,” he said. “Poll after poll that we’ve done, survey after survey of our own residents —  they show that a clean ocean is at the top of what they look for when living here in Manhattan Beach. This will help ensure that….And with climate change, it’s needed more now than ever, and it’s just unsustainable. It’s still going to be an election, and we still need to make the case.” 

A final engineering report for the stormwater fee will come back to the Council in August, after which there will be a 45 day period in which residents can file protests. A public hearing is tentatively scheduled for October 17, after which the ballots will go out, with a 45 day election window. 

If approved, one potential complication could still undermine the City’s efforts. A statewide ballot initiative proposes a change in election law that would require two-thirds approval of all fee increases rather than a simple majority. The ballot measure, called the Taxpayer Protection and Government Accountability Act, is scheduled for the November 2024 ballot but is written to retroactively apply to all fees imposed or increased after January 2022. It has been strongly opposed by the League of California Cities, who argue the measure is a corporate-backed measure intended to save large developers millions at the expense of residential taxpayers. 

“This far-reaching initiative would retroactively cancel measures that were already passed by local voters— effectively undermining their rights to decide what their communities need,” said Carolyn Coleman, executive director and CEO of the League of California Cities. “In many cases, this will result in devastating cuts to critical services like fire and emergency response, law enforcement, parks, libraries, and resources to support unhoused residents.” ER 


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