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Proposed law to allow local stormwater utilities could spell new tax, opponents say

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Lawmakers advanced a measure that would enable local governments to establish their own stormwater utilities. But the proposal drew criticism from business advocates who said the measure could amount to more taxes.

Assembly Bill 2694 would allow municipalities and county governments to establish their own stormwater utilities to collect and manage runoff and excess rain. The Assembly Telecommunications and Utilities committee approved the measure in a 5-3 vote at its Tuesday meeting.

Proponents of the measure argue that the bill would help alleviate flooding in swathes of the state where the ground cannot adequately absorb the rain.

“The lack of regulation and management of stormwater has caused extensive problems for New Jersey,” Assemblyman John McKeon, D-27th District, said in a written statement. “Rainwater runoff carries with it debris, bacteria and chemicals which can lead to pollution of our waters and drinking water sources. Without regulation, we will continue to see a rise in pollution, flooding and property damage.”

Local governments would have to set aside 5 percent of the fees collected to go toward the New Jersey Department of Environmental Protection. The bill says that those governments can use the remaining money for the costs of maintenance, operations and upgrades to the stormwater system.

But Assemblyman Hal Wirths, R-24th District, said the measure amounted to a “rain tax” because of the fees which local governments could impose on the owners of whichever properties generate runoff.

“This is going to be a new tax that is going to make things more difficult for the businesses and the residents in the state,” Wirths said in a statement. “I’m concerned that there’s no cap on the amount of tax. It’s pretty much an unlimited tax.”

And the New Jersey Business & Industry Association in its committee testimony said the DEP already has an existing bureaucracy for stormwater runoff, whereby companies have to pay thousands of dollars for storm water permits.

“For many businesses the fees authorized in this bill would amount to double taxation,” NJBIA Vice President of Government Affairs Tony Bawidamann said Monday. “Companies would be assessed a fee by a local stormwater authority, even if they already have a permit. Furthermore, there is no guarantee that these fees will be used for their intended purposes.”

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Daniel J. Munoz

Daniel J. Munoz

Daniel Munoz covers politics and state government for NJBIZ. You can contact him at dmunoz@njbiz.com.

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