Councilwoman Mary Pat Clarke

Baltimore City Councilwoman Mary Pat Clarke speaks at a council meeting. (Baltimore Sun photo by Algerina Perna / June 11, 2012)

A city councilwoman is challenging Baltimore's plan to charge businesses some of the highest stormwater fees in the state — and divert some of the money that had gone to Chesapeake Bay cleanup to help fund property tax cuts.

Councilwoman Mary Pat Clarke says the Rawlings-Blake administration's stormwater plan would create a financial hardship for many local businesses. And Clarke and environmental groups object to raising revenue intended for pollution abatement to help pay for property tax relief.

"With all due respect, that's really not the purpose of the fund," Clarke said.

Clarke, vice chairwoman of the committee considering the mayor's stormwater proposal, has introduced amendments that would phase in the fees — decreasing the charges for businesses by about 45 percent in the first year.

She says she's concerned that some businesses would otherwise have to pay tens of thousands of dollars and could be forced to lay off workers or move out of the city. To replace the money the city wouldn't collect from stormwater fees, Clarke has proposed about $12 million in budget cuts primarily to administrative and street-sweeping costs.

"We're dealing with a fee that, in some quarters, is of grave concern," Clarke said. "I'm extremely concerned that we stay comparable with other jurisdictions."

Stormwater fees — often pilloried as a "rain tax" — have been the subject of public debate in recent weeks. On the last day of the General Assembly session, some state legislators tried to postpone the entire program. Anne Arundel County Executive Laura Neuman vetoed her county's fee plan, only to have her decision overridden by the county council last week. Some Carroll County commissioners have said they are against creating a fee as well.

At issue is money to combat the pollution that comes from rainwater when it streams off buildings, pavement and roads. The water picks up pollutants from sewage, animal feces and other sources as it heads into waterways that flow into the Bay.

Maryland lawmakers last year passed legislation requiring 10 local governments, including Baltimore City and Baltimore, Howard, Anne Arundel, Carroll and Harford counties, to establish a stormwater program with dedicated fees by July 1.

The fees are meant to fund efforts such as planting trees along streams to soak up runoff or creating wetlands that capture the bay-fouling nutrients in the water. The fees also would pay for restoring streams degraded by development-induced erosion.

The law gives localities the flexibility to set their own rates.

Many local governments are basing fees on the amount of "impervious" surface — such as roofs, driveways and parking lots. The fees would be included in water or property tax bills or new stormwater bills.

Under the Rawlings-Blake administration's plan, single-family homes would be charged $48 to $144 a year, while larger properties would have to pay $72 per 1,050 square feet per year.

Some criticism in Baltimore has centered on the city's plan to use a portion of the money raised by the fees to help pay for tax cuts.

Baltimore currently spends about $10 million in general funds on stormwater management. The administration's new stormwater fee would raise $28 million next fiscal year. Instead of adding that to the $10 million, the city would take about $6.7 million of the general fund money and use it to help pay for property tax cuts, officials said.

The city's budget director, Andrew W. Kleine, emphasized the city's long-term $750 million structural deficit and the need to improve city finances while bolstering stormwater infrastructure.

"The whole concept of a utility is to pay for a service," he said. "To say we should continue to fund these services from the general fund, given the serious funding issues we have, to me that doesn't make a lot of sense."

Rawlings-Blake has said that by raising more money from nonprofits and companies, the city can lower property taxe rates and attract more people to live in Baltimore.

But the state law requiring municipalities to begin charging a stormwater fee says the money collected should be added to any money already being spent for the purpose.

"The funds disbursed under this subsection are intended to be in addition to any existing state or local expenditures for stormwater management," the law states. "Money in a local watershed and restoration fund may not revert or be transferred to the general fund of any county or municipality."