Nov 29, 2007

Reaching Retrofit Goals One Step at a Time

City officials in Tallahassee, Fla., carefully considered cost projections and public input to develop and implement a storm water pollution reduction program (SPRP)

Water bodies and the quality of their water are an integral part of the quality of life enjoyed by Florida residents. In the city of Tallahassee, segments of the community began voicing concerns regarding the potential impact of untreated storm water runoff on local waters.

This resulted in the inclusion of policies within the storm water management element of the city’s then current comprehensive plan. The plan called for retrofitting all developed but untreated areas citywide in order to reduce the pollutants associated with storm water runoff. Despite these policies, the fiscal reality was that achieving such a broad retrofit goal would be extremely expensive, significantly exceeding the revenue capacity of the city’s existing storm water utility and the community’s willingness to allocate the necessary funding.

Establishing a Foundation

Consequently, the city reconsidered, and Tallahassee’s comprehensive plan was amended to establish a set of incremental steps for storm water retrofits, including milestone dates. The city commission directed its storm water management division (SMD) to initiate an SPRP to address the newly amended policies.

The objective of the SPRP was to provide a sound foundation of scientific, engineering and financial information related to water quality within the city’s lakes and streams. This foundation would form the basis for city commission policy decisions regarding realistic storm water quality retrofit goals. In summary, the basic goals and objectives of the SPRP were to:

  • Estimate annual pollutant loads to the city’s lakes and streams and identify viable storm water best management practices (BMPs) that could be implemented to reduce those loads;
  • Define and evaluate a series of BMP alternatives to reduce annual pollutant loads in targeted watersheds within Tallahassee, estimate their potential benefits/costs and develop citywide projections to achieve different levels of water quality treatment; and
  • Conduct a series of public outreach activities to educate the community, assess the public’s willingness to pay for water quality improvements, estimate the corresponding maximum possible service level and develop financial alternatives that account for the magnitude and timing of required capital investments.

Pollutant Loads

The study area for the SPRP encompassed 145 watersheds, covering approximately 140,000 acres. The pollutant load assessment resulted in estimated loads for each watershed. The loads were ranked based on their average ranked load value for nutrients (the average of nitrogen and phosphorous rank values), metals (the average of copper, zinc and lead rank values) and solids (the total suspended solids rank value). Comparison values were computed for both annual load rankings and annual specific yield rankings to identify priority watersheds.

BMP Alternatives

The next step was identifying conceptual BMP facilities at viable sites throughout Tallahassee to reduce annual pollutant loads. An inventory of BMPs suitable for implementation was compiled as the basis for assessing potential pollutant reduction alternatives. These included: concrete grid, modular and porous pavement; dry and wet retention basins; wetlands; chemical injection treatment systems; grass strips and swales; sand filter media; exfiltration trenches; and various combinations to form a treatment train.

Ranges of capital facility construction and annual operation and maintenance (O&M) costs (based on city records) were developed in order to provide a basis for estimating the cost of new storm water treatment facilities. These values vary with the type of BMP being considered.

A BMP implementation model (Figure 1) was developed for assessing the potential impact and costs of individual storm water facilities proposed in a watershed. The model was created using a series of spreadsheets, with each row representing a potential storm water facility for the watershed. Cost estimates for construction and O&M were developed based on unit values established for the type of BMP. Annualized costs for each facility were computed in the implementation spreadsheet as the total of the annualized construction, land and O&M costs.

The final value developed for each facility in the spreadsheet was the estimate of the relative cost efficiency for comparison among the various facilities and alternatives. This value was computed as the annualized cost divided by the increase in treated area provided by the facility (equivalent treatment cost) and was expressed in terms of dollars per acre per year.

Target Watersheds

A target watershed program using the 20 watersheds with the highest relative pollutant loadings within the city was developed as the basis for projecting the potential citywide benefits that could reasonably be expected.

A series of conceptual BMP facilities for each target watershed was developed using a spreadsheet based on three different strategies:

  • Strategy A. Use conventional BMPs on vacant, undeveloped property.
  • Strategy B. Retrofit existing storm water facilities or construct new ones with chemical treatment (alum injection).
  • Strategy C. Expand or construct new conventional facilities using privately owned property.

Suitable BMP facilities within each of the pilot watersheds were developed and evaluated relative to their watershed’s level of development, topography, soils and land uses in order to assure that the BMPs could actually be constructed, operated and properly maintained to achieve expected annual load reductions.

The implementation model was used to assess the potential impact and costs of the individual storm water facilities proposed under each of the three BMP strategies. The model estimated the capital construction and annual O&M costs for each facility to provide the basis for evaluating long-term financial impacts. A unit cost approach was selected for citywide cost projections. The spreadsheets for the pilot watersheds were sorted by treatment cost efficiency.

A selection model was set up to search down the list of facilities in each of the watershed spreadsheets until the desired treatment level was met or exceeded (or the bottom of the list was reached). The selection model was evaluated at different desired treatment levels, and the resulting costs were summarized to develop average unit costs for each strategy.

An important part of projecting citywide costs was recognizing a maximum level of treatment that could be obtained within any watershed since not all land would be suitable for placement of BMPs.

The watershed spreadsheets were then used to develop estimates of the maximum treatment level that could be achieved under each BMP strategy.

The data and results from the target program formed the basis for the projection of citywide costs. A desired treatment level module was set up to allow the desired treatment level (citywide) to vary, yielding a series of cost tables for each strategy. An example of the resulting citywide cost tables is shown in Figure 4.

Citywide Projections

The citywide cost tables for each strategy were combined using the desired treatment level module to develop a table of treatment level vs. costs for regression of a single cost curve. The resulting data were regressed against the square of the treatment level. The resulting regression had a coefficient of determination (R2) value of 97.7 percent, indicating a very strong fit to the data. The projected citywide costs and regression curve are shown in Figure 5.

Watershed Projections

The results of the citywide cost projections indicated that the cost of achieving a 75 percent citywide treatment level would be approximately $700,000,000 and was not considered a realistic possibility by the Tallahassee SMD. Since a citywide program was beyond what the community might be willing to fund, a lower cost strategy was developed to focused on retrofitting just the twenty target watersheds.

This approach covered approximately 43 percent of the city and would potentially provide a maximum level of service of 70 percent treatment across the pilot watersheds for an investment of approximately $275,000,000. Again, a regressed cost curve (Figure 6) relating total costs to treatment level for the pilot watersheds was developed and provided to the city commission as a basis for policy decisions.

Evaluating Funding Methods

The alternatives assessment produced quantified cost and treatment efficiency information for multiple alternatives, which served to guide the policy decisions necessary to establish the SPRP. The financial assessment addressed the relationship between revenue streams and the timing for implementation of projects, eventually resulting in a preferred funding method.

In a perfect world, the city could decide upon an appropriate citywide service level, assess the cost of achieving the selected pollutant removal and raise rates to accommodate this improved service level over an implementation period of 20 years. Citywide storm water treatment, however, is very expensive, and there is a limited amount of funding that the public is willing allocate to water quality management activities.

While a wide range of possible alternatives could be developed and presented to the city commission for implementation over many decades, an alternate strategy was selected that employed a back-casting methodology.

This analysis focused on the amount of funding the public might be willing to allocate for improvements to water quality in the community. The required potential revenue stream could then be projected and the corresponding level of treatment identified. This was deemed more likely to produce solutions that the community would be willing to fund.

Public Input

One of the more challenging aspects was evaluating the public’s willingness to pay for water quality improvements. The city conducted a series of one-on-one meetings with Tallahassee’s largest storm water utility rate payers, combined with a telephone opinion poll to establish the willingness of Tallahassee residents and businesses to pay for a water quality program. Key findings included:

  • A telephone survey of 407 randomly selected Tallahassee residents indicated that 63 percent supported some level of monthly fee increase—averaging approximately $3.50 for the 240 respondents—to address water quality issues.
  • More than half of the participants in the one-on-one meetings with the city’s largest storm water utility rate payers indicated support for the proposed water quality program, typically in the $1 to $2 range.
  • There was no indication that any of the larger commercial or institutional accounts would strongly oppose the need for a utility rate increase to support a water quality improvement program.

At the time the financial analyses were being conducted, Tallahassee’s storm water fee was $6.25 per month per equivalent residential unit (ERU), and each dollar of the base storm water fee generated approximately $1,800,000 in annual revenue. Based upon the assessment of the public’s willingness to pay for water quality program improvements, a practical threshold for a monthly fee increase of $1.70 per ERU was set to support the SPRP.

Funding Alternatives

The comparison of funding alternatives considered three factors: total funding required, annual funding capacity and the planning period for the program. Knowing any two of these factors enabled the determination of the third.

City staff developed a consensus to use a 20-year planning period. Consequently, a number of different funding alternatives were developed to provide varying levels of treatment over a 20-year plan. The range of alternatives for the target watersheds were reduced to a cost curve (Figure 7) that related the annualized cost of the 20-year program to the treatment level achieved in the target watersheds.

Establishing the public’s general willingness to pay an incrementally higher monthly storm water fee provided the basis for estimating the future revenue stream to support the water quality program. Assuming a monthly fee increase of $1.70 per ERU was realistic, the potential 20-year revenue stream was calculated at approximately $79,000,000.

Financial Analysis

The first component of the fiscal analysis was to establish the available funding stream that could be used for implementation. The basis for computing the revenue stream included baseline information about current funding, a number of enabling assumptions that addressed the vagaries of future economic conditions and several basic rules for projecting future revenue availability.

The second component of the fiscal analysis was to translate the target watershed projects into a capital investment schedule that systematically implemented the identified BMP facilities. The basis for the investment schedule was comprised of baseline information about funding availability and minimum balances, plus several basic rules for scheduling the different components of work in each watershed.

Evaluation of alternatives at an aggregate investment level could not provide the detail required to assess the level of service improvements in specific watersheds or determine which projects could be implemented in specific years. Consequently, a detailed financial model was developed to analyze the funding and phasing alternatives utilizing one-year time increments. A revenue projection and phased capital investment program consisting of detailed scheduling of the key components for each BMP project was developed to identify which facilities could be constructed and operated within the rate structure and implementation period constraints that were set for the alternative. A variety of intermediate alternatives were developed and presented to the SMD in a workshop.

Based upon screening of the funding and phasing alternatives and the city commission’s assessment, the city of Tallahassee ultimately selected a net monthly storm water fee increase of $1.70 per ERU. This would be implemented using annual increments of $0.34 per ERU over a five-year period to lessen economic impact on businesses and institutional customers. The resulting incremental revenue stream, shown in Figure 8, would generate approximately $78,800,000 over the 20-year period of fiscal year 2006 through fiscal year 2025.

Public Involvement

The city of Tallahassee recognized the need to provide public education and assess public opinion regarding water quality management needs and the willingness of the public to fund new water quality facilities as a critical component of their SPRP. To this end, officials developed a public involvement strategy that included the following components:

Peer review group. The membership of the group was selected to provide a broad base of information in storm water management practices, community water quality, local practices and innovative concepts. The SMD invited six city employees who were involved in ongoing storm water and water quality activities, four Leon County staff members with similar responsibilities and interests, as well as several members of Florida Department of Environmental Protection’s Total Maximum Daily Load (TMDL) program in recognition of the future potential for coordination between the city’s SPRP and the state’s evolving TMDL Program.

Strategic communication campaign. The Tallahassee SMD conducted a communication campaign to educate residents and business organizations about the storm water quality issues facing the local community and to measure the community’s response to a higher storm water fee addressing those issues. The results of the strategic communication campaign demonstrated that both residents and businesses want improved storm water quality.

Many residents indicated they did not realize the city was having storm water runoff pollution issues. Every commercial business contacted believed that storm water quality improvements were important; all the representatives said they would support a utility fee increase. Residents, businesses and institutions also expressed that continuing education regarding storm water pollution prevention was important, particularly to cleanup programs. All contacted parties mentioned and supported education programs geared toward children. And most organizations were thankful that the city invested time in sitting down and discussing storm water issues.

A public survey supported these conclusions and indicated that a significant percentage of people surveyed had heard about storm water quality programs and would consider supporting an increased fee to improve local storm water quality.

Results and Accomplishments

The SPRP implementation focused on the city commission’s decision regarding revisions to the water quality policies in the comprehensive Plan that would be required to achieve a reasonable level of water quality improvement. The results of the work activities completed in the pollutant loading assessment and alternatives evaluations were presented to the commission in strategic briefings. These briefings provided the basis upon which commissioners could explore the complexities and implications of the water quality management challenges facing Tallahassee.

As a result, they decided on a course of action to improve ambient water quality. To this end, using city commission guidance and direction, SMD staff has begun implementation of the SPRP with the following activities:

Amendment of comprehensive plan objectives. The city modified the water quality policies in the comprehensive plan to reflect the results of the SPRP investigations, the fiscal capabilities of the city’s storm water utility and the sensibilities of the community with respect to people's willingness to pay for a long-term water quality program.

Operational changes and projects. Based on direction received from the city commission, the SMD made a number of changes in its targeting of studies and designs and prioritization of capital investment projects related to flood control and water quality management.

Storm water utility revenue enhancement. In 2006, the city commission approved Resolution 05-R-06, which increased the monthly storm water fee by $0.34 per ERU. The monthly fee is scheduled to increase by $0.34 per ERU in each of the four subsequent fiscal years (2007 through 2010) for the purpose of funding the SPRP.

Expanded capital improvements program. Available funding, project priorities and financial planning guide the year-to-year implementation of the SPRP. The implementation order for projects is guided by the relative level of pollutant removal achieved by each individual project, with the intent of receiving the maximum benefit for each dollar expended.

Summary

The city of Tallahassee’s SPRP has provided the basis for the city commission to put into action its often-stated position that water quality protection must occur upstream in the watershed and not in the city’s lakes. The program emphasizes the use of a comprehensive watershed approach encompassing problem identification, storm water pollutant loading assessment, cost-effective solutions and the prioritization of resources.

Perhaps most importantly, the development and implementation of the SPRP recognized that the most crucial element in developing and implementing a viable water quality program is the public’s willingness to financially support it based upon the development of an affordable plan of action.

About the author

Jason Maze, P.E., D.WRE, is senior water resources engineer for URS Corp. Maze can be reached at 813.286.1711 or by e-mail at [email protected].

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