My Side of the Fence

The danger isn't going too far. It's that we don't go far enough.

There’s a new tax coming…

As a forward let me say that some of my descriptions in here are a bit "general".  I'm trying to convey at least the sense, if not the actual facts, about what is going on.  This is a complicated issue and it is hard to explain some of this stuff in a short blog post.  So, if you're a surface water transport propeller head, don't start posting a bunch of crap about how I'm wrong because I'm not posting arcane facts.  In addition, also know that I'm a subsurface flow and transport guy so I'll lop you off at the knees.  This is a blog, not a science journal.

The never ending "cleanup" of the Chesapeake Bay is coming to Manassas!  (Fact Sheet from EPA) A couple of years ago the Feds decided that the cleanup of the Bay was going nowhere fast and that something different needed to be done.  After a bit of fiddling, they came

 up with a multi-state "model" of where surface water enters the bay.  It's really a computer model of the entire watershed which is 5 or 6 states I would guess.  The model also calculates where the contaminants are coming from and the volume of those contaminants.  In the case of the bay, the biggest pollutants are nitrogen, phosphorous and sediment.  The first two you might also recognize as "fertilizer" but both also come from animal (and human) waste.  Sediment comes from pretty much everywhere.

Is this case, they are using what are called TMDL's – which is short for "total maximum daily load".  See, the strategy is to put the bay on a "pollution diet".  In order to do this, the EPA and other Federal agencies developed this very large computer model that attempted to calculate where the pollution is coming from based on land uses in the model area.  From there, they assigned reductions in contaminants to every state in the watershed.  As I understand it, the states then assigned a required reduction in TMDL's to each jurisdiction.  

Manassas now has our number and the primary contaminant from the city would appear to be sediment.  Certainly others are present but it is mainly sediment (Interestingly, our number for existing pollution is based on the model.  Nobody appears to have gone into the field and tested to see whether it is indeed accurate!).  This being the case, we need to build more storm water retention ponds, do stream bank stabilization (Winters Branch comes to mind) and a bunch of other things.  In order to pay for the huge cost of this the City Council has elected to implement what is called a "Storm water Utility".  This is like our electric or water utilities.  Yes, it will be another bureaucracy with its own entrenched interest and, because it is mandated by the state and Feds, it will never go away….It is an independent fund that will raise its own money to fund operations.  Yes, that means you'll be getting another line item on your utility bill once a year.  The amount of this new tax hasn't been determined but it is likely to be between $50 and $100/year for homeowners.  Businesses will likely have to pay thousands per year and some large businesses could have bills in the tens of thousands of dollars – real money.   

The way the program has been setup by the state is a bit of a game.  We do certain things and we get "credits" for those things.  Street sweeping, for instance, reduces the sediment headed for the bay so we get a credit for that but it won't be much.  No, the big tamale's in sediment reduction are, as I understand it, water retention ponds that allow the seducement and other contaminants to settle out of the water.  These things cost millions to build and maintain.  We're getting ready to build one behind the Hospital in the next year or two.  Hopefully between that pond and some other activities we can meet our number or the City – in an extreme scenario – may have to take land from private property owners to build more ponds.

Please note that this is not the first of the expenses that have doled out to localities.  You might have noticed that your sewer bill has gone through the roof over the past couple of years?  That's because UOSA is building like mad in order to try to reduce the pollutants that pass downstream and increase capacity.  Look for your sewer bill to continue to go up.  The commission members I've chatted with expect the sewer bill to exceed power bills in the coming years.  The City is unable to build our own sewer treatment plant – the EPA mandates that we send our sewage to UOSA.

So, what do I think of all this?  Well, you can tell when the State or Feds get serious about something like this when it ends up on the local level.  They want it done but they also don't want to fool with it – so they send it to us!  I was the only Council member that voted against it (I suppose you could call it a principled stand, or just kinda crazy).  No, I don't hate the Chesapeake Bay, I hate that the Feds/State mandated it but don't have the stones to raise the money necessary to pay for it.  Can't be seen as "raising taxes" so we'll just make someone else do it.  The state (with our "conservative" leadership) has lately become quite adept at this stunt.  I'm sick of it so I voted against it.  I also hate that we're creating yet another bureaucracy that will never go away and impose ever more regulation on business.


  1. About your voting "no":  as I wrote previously, I applaud your doing it.  The mandate without any funding stream to at least put some impact on the cost stinks…just like that 50/50 grant from the State stinks in term of the ration – there should be more in this grant.
    Now, as to the street sweeping, ok, I can support that.  But as in past years, I am against the continued practice of "rake to the curb" for residential leaf collection.  There are many who do not pay attention to the schedule, rake out and then there are just piles sitting there slowly, slowly decomposing.  If it rains, it is a mess.  And guess what?  All that nice nitrogen flowing down into the sewer and on out.  And there are tons of studies out there about leaves in urban areas that contain heavy metals…adding more to the polluted Bay.
    With this new mandate, maybe it is time to take an HONEST HARD LOOK at the "rake to the curb"…have the someone other than collection crew ride around and survey the area for pick-up on a day, noting the number of people who followed the schedule, and the yards full of leaves waiting.  Then return in a couple of days to see if people raked out.  An HONEST survey done.  Then decide if the program that many scream if cut (although all mine either get mulched in my gardens or bagged to the curb) is truly effective going into the new mandate.

  2. It would appear that as this new charge is mandatory, I would think it should appear on the real estate tax bill as you currently do for the fire tax (levy). This way we could deduct the tax from our federal income taxes. If the tax is put on the city bill we won't be able to deduct it. 

  3. Mo has the right idea.  In the taxing world, a Local Government Service Charge/Fee is deductable if the purpose is related to improvement of the service (and the Fire Levy is one such Service Charge).  The IRS has a broad definition of what the government service is:  for instance, if the City charged me either a one-time fee or monthly charge for the recycle trash cart, and even as expanding on general trash cart in the City, I could deduct that fee since it is an "improvement" on the service. 
    The key to this "fee for service" is that the rate is uniform across the City as such proposed in the presentation:  Residential, business, et. al. the various categories have a uniform fee applied depending on category.
    Another example:  as the City moves along developing the Parking Districts, the goal is "improvement" in the parking situations we all know about, and subsequently through having permits, it also "improves" Police response to when cars are parked without permits.  That decal now is used to "improve" the service, and the fee for it is dedcutable.
    Government imposed "fee" is just a euphemism anyway….if there is a legal mandate behind imposing the fee, it is a tax upon the population.

  4. And with these additional retention ponds, come the "Non-Migratory Canadian Geese", unless they are constructed with RipRap, which the geese find displeasing. With all of the airtraffic coming into and out of Manassas Airport, the last thing we need are more geese, Migratory or otherwise. I suppose manufacturers like Micron, Lockheed-Martin, and BAE will have to pay big bucks in these EPA-mandated fees, which translate to higher production costs. Micron will be especially hard-hit, I would imagine. Meanwhile, China has no such restrictions on sediment. Heck, they'll dump cyanide into the water. Cheaper manufacturing costs result. I wonder how long until Micron is forced to pull out of Manassas, taking all of the jobs and pull-through tax dollars with them? Not ranting at the Council, as this is an EPA mandate. But this unverified quota-based/credit system sounds an aweful like the "Carbon Tax/Credit" garbage being pushed by the Left.

  5. andy

    November 6, 2013 at 8:15 am

    We had a pretty wide-ranging discussion about tax vs. fee.  If it's a tax would you exempt non-profits?  A big part of the fee/tax calculation for non-residential property is "impermeable area" – parking lots, building roofs, etc.  Churches have lots of both!  Should they pay as well?

    My own opinion is that, if we're going to do this, everybody should participate in the cost.  There are significant tax breaks already.  It is less than ideal that it isn't deductible if it is a fee though…

  6. About "impermeable area" – keep in mind as y'all are looking at this, there are a lot of homes which are different now than when built.  Driveways were expanded; large outbuildings/multiple sheds were added.  The City Code already has that rule about how much land can be covered, and I know several in my neighborhood were, when the final rates are determined, should be paying more since they have more of their property covered now than in the original build.
    Of course, that means the Assessment Database really needs a hard review too to make sure it is current once ordinances are created and approved.

  7. Stormwater improvements are a material benefit to all, so yes, everyone should pay.  Material benefit in my view is the key aspect when looking at the nonprofits – even though it is not money, their not participating in the mandate fee/tax could be viewed as inurement to the nonprofit respective stakeholders.
    For discussion, we need to seperate out the Churces & Religious Organizations from the other types of exempt organizations.  That really is the "crux" of the concerns expressed during the presentation to Councils.  The other types of nonprofits are required to file an Annual Return, and so this proposed fee/tax could be deducted on their return if a local tax.  If a fee, have not looked to see in terms if IRS language would allow deduction as a mandated fee as a business operation expense by a a non-stock, non-profit corporation.  Just add that thought as I am writing this.
    Churches & Religious Organizations:  keep in mind under IRS Code, these are two distinct, but related, entities.  "Church" is not specifically defined by the IRS as not all Distinct Faith Groups use the term.  It is generally considered to be a place of worship to include mosques and synagogues; and also includes conventions & associations of Chuches as well as their integrated auxillaries.  A "church" is generally considered exempt from MOST taxes – there are some they must pay  – and so do not have to do formal application for exemption to the IRS or file Annual Returns (although both things are encouraged by the IRS for them to do).
    Religious Organizations, on the other hand, may be in the public-eye a "Church", but under the IRS Code are not automatically tax exempt.  This group includes nondenominational ministries, interdenominational and ecumenical organizations, charitable trusts, and "other entities whose principal purpose is the study and advancement of religion".  These folks must apply for exemption and also file annual returns.
    I suppose what this all boils down to is if saying they are nonprofit, and "tax exempt" in a broad sense, what is the VALUE of their total tax exemption benefit in this City versus what they must pay for the Stormwater mandate.  The VALUE (yeah, capitalizing for emphasis) would include not only the RE Exemption on all of their physical property/properties (i.e. Church Building + School + Parsonage), but their SUTA and any other tax/fee exemption they are enjoying.  Take that total dollar amount which is the VALUE of their exempt status and then compare to the mandate.  As for the Churches, take the reading from the Gospels of Matthew or Mark or Luke:  "Render unto Caesar what is Caesar's and unto God what is God's".

  8. One more thing – nonprofits who are renting their facilities….I'll give you dollars to donuts their landlords are going to pass on the stormwater costs to them in the form of rent increase!!!!!

  9. My question regarding non-profits (churches, baseball leagues etc.) is who are you taxing? If you tax a church you are really taxing the church members. If you tax the baseball league, you are taxing the parents of the kids that play. Either way, the money comes from the same pockets.

  10. Mo, you just prompted me to realize I did not include an exclusion clause in my ramble:  The Vol. Fire and Rescue folks, or an other form of a nonprofit, which is performing an essenital government function. "Essential" means it is directly related to the statutory powers/internal sovereignty of government.  F&R definitely fit into those two areas.  These nonprofits should have an automatic exemption to the fee/tax unless, when sorting out the regulations, the City is going to have to pay for all its government-owned impermable areas (don't remember that being covered in Mike Moon's presentation).  That said, my thinking is the City should cover the bill for F&R vs. the volunteer members.
    Baseball or other sport leagues:  good point.  If a nonprofit holds no land or buildings on it, then it would not really apply.  But in terms of League Dues (such as GMBL and the ballfields), it seems there would almost have to be a fee set ONLY for the amount of land covered.  Thinking of the GMBL ballfields, there is not a whole lot on those acres that is actually covered.
    Andy, what are your thoughts on Mo's points and mine above?
    As for Churches, the IRS refers to the members as "stakeholders" – a generic way to cover the bases since different religions use different terms for the group of people who attend.  Yes, it will still come out of their pockets…same as the cost for operation of the church.  It's going to be a "rock and a hard place" any way you look at it.

  11. Unfortunately, in this day and age if there isn't a financial penalty there won't be compliance.  I've lived in the City almost 30 years now, and I've never heard of anyone being fined for "raking out" early.  Not saying it hasn't happened, but, if you want people to "rake out" in accordance with the schedule you have to back that up with enforcement, to include fines that are attached to the property.
    So as it is now, I see a dozen house within a block of mine whose curbs are full of leaves, most of which are blowing away with the winds.  Someone drive around, attach a flyer to these folks front door notifying them they have 48 hours to clear the gutters are there will be a $50 fine.  Otherwise, those of us who DO comply with the schedule are penalized by the many who don't.
    And sorry, not all of us have the wherewithall or desire to mulch our leaves on site.

  12. Ray, if the City doesn't exempt the GMVRS, the City is taxing itself.  Review the services agreement GMVRS and the City signed this past summer.

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