Economic Development Issues for Local Governments and Developers

1. Economic Development Issues for Local Governments and Developers Wednesday, May 31, 2006

3. Economic Development Grant & Loan Programs

4. Outline Overview of loan & grant programs Federal Programs State Programs Local Programs Partner Programs Q&A

5. Programs cover many business & development needs Real Estate Acquisition Infrastructure Improvements Construction & Rehabilitation

6. Federal, State and Local Programs

7. Federal programs are limited and mostly for large projects

8. State programs are wide-ranging

9. DCED administers many types of programs

10. Several key DCED programs are most often utilized

11. Local programs provide financial assistance with project support

12. Business Development programs are funded mostly through CDBG

13. Local Redevelopment Authorities support large-scale development

14. Partner programs supplement public programs

15. Questions

17. TIFs, Tax Abatements, Transportation and Neighborhood Improvement Districts and Impact Fees Presented by Blaine A. Lucas

18. Tax Increment Financing

19. Tax Increment Financing Basics Purpose Provides for dedication of future increase in tax revenues attributable to development to secure debt for eligible �project costs� Taxes Eligible Real estate Payments in lieu Business use/occupancy County Sales

20. Tax Increment Financing Basics continued Allocation of tax increment Each taxing body keeps tax base Dedication of tax increment can range from 0-100% TIF District boundaries Established by sponsoring municipality (county or local)

21. Tax Increment Financing Basics continued Eligible project costs Construction of public works or improvements Residential, commercial or industrial development or revitalization New buildings, structures and fixtures Demolition, alteration, remodeling, repair or reconstruction of existing buildings, structure and fixtures

22. Tax Increment Financing Basics continued Eligible project costs include: Acquisition, upgrade or rehabilitation of machinery and equipment Acquisition, clearing and grading of land Publicly owned infrastructure improvements located outside district if direct benefit to project Financing costs, real property assembly costs, professional service costs, administrative costs, relocation costs and organizational costs

23. Tax Increment Financing Basics continued Limitations 20 years from creation of district Aggregate value of TIF districts cannot exceed 10% of total value of equalized taxable property within sponsoring municipality Debt issued by: Redevelopment authority Industrial and commercial development authority Municipal authority

24. Tax Increment Financing Steps Presentation by redevelopment authority or IDA Each taxing jurisdiction designates representative to meet with authority to discuss project plan Authority recommends boundaries of TIF district and submits recommendation to governing body of municipality which will create district Either county or local municipality can create district

25. Tax Increment Financing Steps continued Authority creates project plan setting forth: Proposed public works and improvements and residential, commercial or industrial development Economic feasibility study List of estimated projects Description of financing method Map showing existing uses and conditions Map showing proposed improvement and uses Proposed changes to zoning and other municipalordinances Estimated non-project costs Relocation

26. Tax Increment Financing Steps continued Public hearing By sponsoring municipality Notice at least 30 days prior to hearing

27. Tax Increment Financing Steps continued Ordinance/resolution creating district Boundaries Date Name Contiguous geographic area Finding of value enhancement of property within district Aggregate TIF district value not to exceed 10% of total taxable property within sponsoring municipality

28. Tax Increment Financing Steps continued Ordinance/resolution creating district District has not been subject to �adequate growth and development through investment by private enterprise or would not reasonably be anticipated to be adequately developed if further developed without the adoption of the plan.� Plan for compensation of displaced family/entities Conformance with municipal and county master plan Area is blighted as defined by the Urban Redevelopment Law and plan is necessary to eliminate blight

29. Tax Increment Financing Steps continued Participation by other taxing bodies Other municipality and school district may agree to participate or opt out by ordinance or resolution

30. Tax Increment Financing To TIF . . . .? Preliminary questions Does the municipality want the project and the growth associated with it? Willing to modify land use ordinances, if necessary to facilitate the project? Will the project occur without TIF financing?

31. Tax Increment Financing To TIF . . . .? continued Next Step Pre-development reimbursement agreement Covers engineering, legal and financial consultants Key Issues How will the project affect municipal service costs? Are these costs adequately addressed by the TIF plan or other documents?

32. Tax Increment Financing To TIF . . . .? continued Costs Streets Stormwater Sanitary sewers Water Police Fire & EMS Zoning and planning administration General municipal administration

33. Tax Increment Financing To TIF . . . .? continued Financial Structure What % of tax revenues will the municipality contribute to the TIF? Should a portion of the TIF revenues be paid to the municipality to defray increased costs? Which will have priority: the municipal payment or the bond debt service? Will the municipal payment be secured?

34. Tax Increment Financing To TIF . . . .? continued Consider a Project Cooperation Agreement Between municipality and developer only Different than taxing bodies� cooperation agreement Addresses issues beyond the TIF plan, such as: Environmental Traffic Street/utility ownership Street/utility maintenance and repair Permitting process Additional and/or interim payments by developer Insurance/indemnity/liability

35. Local Economic RevitalizationTax Assistance Act (LERTA)

36. Local Economic RevitalizationTax Assistance Act (LERTA) Basics Purpose Provides for exemption from real property taxes for increase in the assessed valuation attributable to new construction in deteriorating areas

37. Local Economic RevitalizationTax Assistance Act (LERTA) Basics continued Eligible Property Industrial Commercial Other business property Deteriorating Areas Established by municipality

38. Local Economic RevitalizationTax Assistance Act (LERTA) Basics continued Exemption Schedule Established by each taxing body 0-100% per year Maximum 10 years Commences year after occupancy permit issued

39. Local Economic RevitalizationTax Assistance Act (LERTA) Steps Creation of district By ordinance or resolution Boundaries set by municipal governing body After public hearing Recommendations from planning commission, redevelopment authority, other public and private agencies and individuals

40. Local Economic RevitalizationTax Assistance Act (LERTA) Steps continued Standards for creation �Blight� under Urban Redevelopment Law �Improvements� under Neighborhood Assistance Act Unsafe, unsanitary and crowded buildings Vacant, overgrown and unsightly lots Tax delinquent property Excessive land coverage, defective design or arrangement of buildings, streets or lots Economically and socially undesirable land use Adjacent properties may be included

41. Local Economic RevitalizationTax Assistance Act (LERTA) Steps continued Ordinance or resolution by each taxing body establishing exemption schedule Application for exemption by property owner Apply at the time of building permit application County assessment office provides separate assessment of new construction

42. New Home Construction Local Tax Abatement Law

43. New Home Construction Local Tax Abatement Law Basics Purpose Provides for exemption from real property taxes for assessed value of improvements to unimproved residential property within designated district Eligible property New residential construction in residentially zoned district

44. New Home Construction Local Tax Abatement Law Basics continued Eligible area Established by �local taxing authority� (Local municipality, school district or county) Exemption schedule Established by each taxing body. Assessment attributable to actual cost of improvements or up to uniform maximum cost Maximum two years

45. New Home Construction Local Tax Abatement Law Steps Creation of district By ordinance or resolution Boundaries set by local taxing authority After public hearing Recommendations by local taxing authorities, planning commission, redevelopment authority, other public and private agencies Standards for creation Very broad

46. New Home Construction Local Tax Abatement Law Steps continued Ordinance or resolution by each taxing body establishing exemption schedule Application for exemption by property owner Apply at the time of building permit application County shall not reassess until exemption period expires

47. Transportation Partnership Act

48. Basics Purpose Imposition of special assessments upon business property in order to finance transportation facility or transportation service projects Transportation development district Established by municipality or municipal authority with approval of municipality Transportation Partnership Act

49. Basics continued Eligible facility projects include Streets, sidewalks, traffic-control systems and structures Railroads, buses/trolleys and subways. Buildings and stations Terminals, docks, shelters, waterways and ferryboats Airports Parking Tunnels and rights-of-way Communication systems, equipment and furniture Transportation Partnership Act

50. Basics continued Eligible transportation service projects Debt issued by: Municipality; or Municipal authority Assessments to secure debt based on: Business Improvement District Act criteria Fair and reasonable assessment based on actual and projected usage No exception, exclusion or preference permitted Transportation Partnership Act

51. Basics continued Limitations Assessments shall only be used for new and improved transportation facilities or services Proceeds from financing activity cannot exceed total costs plus 10% Transportation Partnership Act

52. Steps Study Multi-Year Transportation Improvement Program (MYTIP) Approval by municipal, county, and regional planning commissions PennDOT approval/12 year plan Ordinance creating district 15 day public notice and written notice to affected property owners Public hearing Transportation Partnership Act

53. Steps continued Standard for creation All properties must have a substantial relationship to proposed facility or service Protest period 45 days Owners of more than 50% of the total assessed valuation in the district may veto Transportation Partnership Act

54. Steps continued Authority resolution Where applicable Imposition/liening of assessments Transportation Partnership Act

55. Neighborhood Improvement District Act

56. Neighborhood Improvement District Act Basics Purpose Imposition of special assessments upon real property in order to facilitate business improvements and neighborhood improvement district services

57. Neighborhood Improvement District Act Basics continued Neighborhood improvement district Established by municipality as part of NID plan

58. Neighborhood Improvement District Act Basics continued Eligible business improvement projects include: Sidewalks, pedestrian walks, retaining walls Street paving Parks, recreation equipment and facilities Open space Street lighting Parking lots and garages Trees and shrubbery Sewer and water lines Rest areas Acquisition, rehabilitation or demolition of blighted buildings or structures

59. Neighborhood Improvement District Act Basics continued Eligible NID services include: Sidewalks, pedestrian walks, retaining walls Free or reduced-fee parking Transportation-related expenses PR programs Group advertising District maintenance and security expenses Street lighting Street cleaning and maintenance Other services for parks, recreational equipment and facilities and open space

60. Neighborhood Improvement District Act Basics continued May include issuance of debt by municipality Assessments are: Made annually Based on cost of programs, improvements or services Weighted assessment based on type of use (business, residential, commercial, institutional) permitted

61. Neighborhood Improvement District Act Basics continued Assessments may be based on: Assessed value Benefit as determined by Board of Viewers Any method that equitably apportions costs among benefited properties Limitations Municipality must maintain same level of services provided within NID prior to NID designation

62. Neighborhood Improvement District Act Basics continued Administered by NIDMA Municipal authority, existing non-profit or non-profit economic development corporation Non-profit or non-profit economic development corporation established/authorized by municipality If active non-profit development corporation exists, municipality shall select unless vetoed by 40% or more of affected property owners

63. Neighborhood Improvement District Act Basics continued NIDMA board shall include: NID property owner NID business owner Each NID institution (or representative thereof) No residency requirement If non-profit, at least one municipal representative

64. Neighborhood Improvement District Act Basics continued NIDMA powers: Employ staff Own, construct, renovate, develop, operate, rehabilitate, manage, sell real estate Contract for services, including security Administer grants Impose assessments, with approval of municipal governing body Impose liens

65. Neighborhood Improvement District Act Steps Preparation of preliminary plan by municipality, including: Boundaries of proposed NID List of properties to be assessed Proposed improvements Budget Designate NIDMA and its responsibilities Assessment methodology Encourage in-kind services/contributions from tax-exempt owners Terms of agreement between municipality and NIDMA, including sunset provision Provisions for property owner veto of NID creation

66. Neighborhood Improvement District Act Steps continued Public hearing 30 day written notice to property owners 10 day public notice Final plan Incorporate changes based on public hearing 10 day public notice Final public hearing

67. Neighborhood Improvement District Act Steps continued Protest period 45 days 40% or more of affected property owners may veto Adoption of ordinance approving NID plan/district Creation/designation of NIDMA Imposition/liening of assessments

68. Transportation Impact Fees

69. Transportation Impact Fees Basics Purpose Provides for assessment of impact fee against new development for funding the cost of off-site transportation capital improvements necessitated and attributable to new development Transportation service area Established as part of transportation capital improvements plan and impact fee ordinance Maximum area 7 square miles

70. Transportation Impact Fees Basics continued New development Any commercial, industrial or residential or other project which involves new construction, enlargement, reconstruction, redevelopment, relocation or structural alteration expected to generate additional vehicular traffic within the transportation service area Off-site improvements Improvements other than those constructed on or abutting the applicant�s property required to be constructed by municipal land use ordinances and building codes

71. Transportation Impact Fees Basics continued Impact fee Based on total cost of improvements divided by anticipated number of peak hour trips generated by all new development Paid on per-trip basis at the time of building permit application Credit for land dedicated or value of road improvements made by applicant Special impact fee based on study for uses generating more than 1,000 peak hour trips

72. Transportation Impact Fees Basics continued Limitations Cannot be used to remedy existing deficiencies Municipality must commence improvements within 3 years of scheduled construction Refund if costs are less than 95% of fees paid for a roadway improvement project

73. Transportation Impact Fees Steps Impact Fee Advisory Committee 7-15 members Reside or conduct business in municipality At least 40% shall be representatives of real estate, commercial and residential development and building industries No municipal employees or officials May designate the planning commission Municipality may appoint transportation engineer or planner in consultation with committee

74. Transportation Impact Fees Steps continued Resolution of intent to adopt impact fee ordinance Land use assumptions Roadway sufficiency analysis Transportation capital improvements plan Adoption of impact fee ordinance May have retroactive effect for 18 months from date of resolution of intent; maximum $1,000 per trip Property owner right to appeal

75. Questions

76. Eminent Domain in the Aftermath of the Kelo Presented by Marcia L. Grimes

77. Overview Definition: The power to take, injure or destroy private property by authority of law for a public purpose, without the owner�s consent, upon payment of just compensation. Power is established in the statute under which the acquiring agency is formed. Limitations

78. Overview State vs. Federal Requirements PA Eminent Domain Code: �complete and exclusive procedure and law to govern all condemnations of property for public purposes and the assessment of damages.�

79. Overview Procedures for Condemnation Authorize condemnation File Declaration of Taking Bond without surety Record Notice of Condemnation File Declaration of Taking Memorandum Notify Condemnee within 30 days Condemnee has 30 days to file PO�s Right of possession only after payment Limited right of access for inspection pre-condemnation Battle over amount of compensation

80. Overview Relocation/Displacement Damages

81. Kelo vs. City of New London Facts Holding Rationale Legislative Reaction to Kelo - Nationwide

82. Pennsylvania Legislation Background Signed by Governor May 4 Effective 120 days after signing SB 881 and HB 2054 will constitute new Eminent Domain Code SB � substantive; HB � procedural Definition of �blight� � intended to replace subjective measures with quantitative measures

83. Pennsylvania Legislation Supporters Opposed or Recommending Caution/Changes

84. Pennsylvania Legislation Major Changes SB 881 Prohibits, with limited exceptions, an acquiring agency from taking private property for private enterprise (�Private enterprise� does not include �institutions of purely public charity�) Exceptions

85. Pennsylvania Legislation Major Changes (cont.) Definition of Blight Single property Multiple properties (blighted area) Expiration Limitations on taking land in another political subdivision

86. Pennsylvania Legislation Major Changes (cont.) HB 2054 Agricultural Lands Condemnation Approval Board Writ of possession pending disposition of PO�s Restrictions on disposition of property if project is abandoned Viewers proceedings Reimbursement of attorney, engineer and appraisal fees increased from $500 to $4,000 Loss of rentals due to imminence of condemnation, up to $30,000

87. Pennsylvania Legislation HB 2054 (cont.) Delay damages � interest rate changed from 6% to prime + 1% Damages for vacation of roads Increase in displacement damages and replacement housing payments Former Housing Replacement Act now incorporated into ED Code Article 9 Expedited appeals in matters of immediate public importance Statute of limitations

88. Redevelopment Matters Urban Redevelopment Law Procedure for Redevelopment Plan approval Planning Commission prepares �redevelopment plan,� designating blighted areas Redevelopment Authority prepares redevelopment proposal, submits to Planning Commission for review Proposal, with Planning Commission recommendations, certified to governing body Advertised public hearing, approve or reject proposal

89. Redevelopment Matters Urban Redevelopment Law (cont.) Procedure for removal of a blighted property Blighted Property Review Committee (�BPRC�) Definition of blight � amended by SB 831 only for purposes of eminent domain BPRC and Planning Commission must certify blight to Authority Requirements to certify

90. Code Enforcement Police/Power Alternative Ordinance Equity Action Criminal Penalties

91. Recent Case Law In re 1839 North Eighth Street � Redevelopment Authority of City of Philadelphia Commonwealth Court decision � 4/3 decision Issue Holding

92. Questions

93. Environmental Challenges to Brownfield Redevelopment Presented by Kevin J. Garber

94. Federal Brownfields Revitalization Act of 2002

95. 2002 Brownfields Act Defenses to Superfund liability: Innocent Landowner Acquire property after disposal No reason to know of contamination Bona Fide Prospective Purchaser Acquire property after 1/11/02 Conduct all appropriate inquiry Exercise appropriate care Contiguous Property Owner Conduct all appropriate inquiry Exercise appropriate care

96. 2002 Brownfields Act New �All Appropriate Inquiry� regulations Final regulations Issued � November 1, 2005 Effective date � November 1, 2006 If taking title after November 1, 2006 � Must use new standard ASTM 1527-05 � New ASTM standard that satisfies regulations

97. 2002 Brownfields Act Key Components of AAI Rule: Combined effort of User and Environmental Professional User responsibilities Specialized knowledge or experience Consider fair market value Recorded environmental liens and institutional controls Commonly known or reasonably ascertainable information User NOT required to provide information to environmental professional

98. 2002 Brownfields Act Key Components of AAI Rule: Environmental Professional responsibilities Site visit and inspections Interviews Records search Opinion regarding significance of data gaps Preparation of report Certifications EP Requirements: Inspections Mandatory inspection of subject property, unless �unusual circumstances� Visual inspection of adjoining properties Interviews Present owners, operators, and occupants Neighbors, past owners/occupants, other managers/employees as necessary Records Recorded environmental liens Past property uses � First structure or use Approximate minimum search distances Complete Final report Not enough to document results of EP�s inquiry; EP must include: Opinion as to whether AAI indicates release of HS Identification of data gaps Opinion as to significance of data gaps Opinion regarding additional investigation EP must sign report and certify: Meets qualifications of EP Performed AAI per regulations Make sure results of User�s inquiry are also documented Conduct AAI within 1 year before acquisition Acquisition = Taking title Conduct interviews, record searches and visual inspections within 180 days Can use previous Phase I�s if meet above requirements EP Requirements: Inspections Mandatory inspection of subject property, unless �unusual circumstances� Visual inspection of adjoining properties Interviews Present owners, operators, and occupants Neighbors, past owners/occupants, other managers/employees as necessary Records Recorded environmental liens Past property uses � First structure or use Approximate minimum search distances Complete Final report Not enough to document results of EP�s inquiry; EP must include: Opinion as to whether AAI indicates release of HS Identification of data gaps Opinion as to significance of data gaps Opinion regarding additional investigation EP must sign report and certify: Meets qualifications of EP Performed AAI per regulations Make sure results of User�s inquiry are also documented Conduct AAI within 1 year before acquisition Acquisition = Taking title Conduct interviews, record searches and visual inspections within 180 days Can use previous Phase I�s if meet above requirements

99. 2002 Brownfields Act Limitations of AAI: Not a shield, only a defense Limited historical litigation success Not all-inclusive Continuing obligations to maintain defense Exercise appropriate care, by taking �reasonable steps� Comply with institutional controls Comply with requests Cooperate with cleanup Provide necessary notices What AAI DOES provide: A possible defense to CERCLA cost recovery actions First step in obtaining CERCLA defense Still have other continuing obligations What AAI DOES NOT provide: An absolute �shield� from EPA/private actions Protection from other Federal laws Protection from state laws Information regarding: Permit compliance Safety issues Asbestos, lead-based paint, radon, mold, vapor intrusion, wetlands, etc. Fill and/or remediation issues affecting redevelopment Ability to ignore other contractual protections (indemnifications, warranties, etc.) What AAI DOES provide: A possible defense to CERCLA cost recovery actions First step in obtaining CERCLA defense Still have other continuing obligations What AAI DOES NOT provide: An absolute �shield� from EPA/private actions Protection from other Federal laws Protection from state laws Information regarding: Permit compliance Safety issues Asbestos, lead-based paint, radon, mold, vapor intrusion, wetlands, etc. Fill and/or remediation issues affecting redevelopment Ability to ignore other contractual protections (indemnifications, warranties, etc.)

100. 2002 Brownfields Act Federal Brownfields Revitalization Funding Federal grants: Site characterization - $200K/site NOTE: Must use AAI protocol to be eligible for grant Cleanup - $1M/eligible entity; potentially renewable annually

101. 2002 Brownfields Act Federal Brownfields Revitalization Funding Eligible entities � municipality, redevelopment agency, authority, governmental entity Eligible sites � sites where reuse is �complicated by� contamination; excluding Superfund sites Sites subject to enforcement under federal law Hazardous waste sites Estimated to be >450,000 brownfield sites in USEstimated to be >450,000 brownfield sites in US

102. 2002 Brownfields Act Program statistics for FY 2006: 184 grants for assessment ($37M) 96 grants for cleanup ($18M) Local examples: Pittsburgh URA - Herron Ave. site City of Butler � West End Core District Washington County Authority � Western Center maintenance shops Since 2002 program beginning: 883 assessment grants of $225M 238 cleanup grants of $43M Examples: Pittsburgh URA - $160K for old gas station on Herron Ave, Hill District (2004) Butler - $200K for assessment of industrial sites in West End core district, near Pullman Park (2005) Washington County Authority - $350K for 2 assessment grants for assessment and cleanup of maintenance shops at former Western Center, to develop retail and residentialSince 2002 program beginning: 883 assessment grants of $225M 238 cleanup grants of $43M Examples: Pittsburgh URA - $160K for old gas station on Herron Ave, Hill District (2004) Butler - $200K for assessment of industrial sites in West End core district, near Pullman Park (2005) Washington County Authority - $350K for 2 assessment grants for assessment and cleanup of maintenance shops at former Western Center, to develop retail and residential

103. Pennsylvania Brownfields Law and Assistance

104. Pennsylvania Act 2 Act 2 liability protection: Affirmative covenant not to sue from DEP if the site is taken through the Act 2 process. Threshold considerations: Time involved Regulatory issues with DEP Protection covers only what is revealed in the Act 2 reports

105. DEP Brownfield Programs DEP Brownfields Action Team Contact: Jill Gaito (DEP) jgaito@state.pa.us (717) 783-1566 DEP Office of Community Revitalization and Local Community Support Contact: Eugene DePasquale edepasqual@state.pa.us (717) 783-1566

106. DEP Brownfields Action Team Benefits are: Increased access to financial assistance Quicker progress through the Act 2 program Single point of contact in DEP for cleanup and permitting

107. DEP Brownfields Action Team Eligible Applicants � Pennsylvania municipalities Eligible Projects � sites located in: Brownfield Enterprise Zone KOZ or KIZ Mining (�grayfield�) site Experience to date Haven�t been many sites go through BAT Initial interest, then waned Lycoming Valley Site � Langan Good initial cooperation from DEP But then slacked off ? not impressed with DEPHaven�t been many sites go through BAT Initial interest, then waned Lycoming Valley Site � Langan Good initial cooperation from DEP But then slacked off ? not impressed with DEP

108. DEP Office of Community Revitalization Purpose: Guide local municipalities, EDAs and IDAs through the DCED and the Governor�s Office Coordinate and promote DEP programs to foster growth while balancing environmental issues

109. Industrial Sites Reuse Program Administered by DCED in conjunction with DEP Grant amounts: Site characterization - $200K/yr; (NOTE � regulatory AAI not required) Cleanup - $1M/site; potentially renewable annually Eligible entities � municipality, county, municipal or redevelopment authority, EDA, private entity (loan only) Process: LOI to DCED DCED completeness review; returns an application form Submit site characterization or cleanup plan to DEP for approval Don�t jump the gun! Costs incurred before grant made are ineligible Eligibility Projects located in DCED zones (e.g., KOZ) or 1st, 2d or 3d class cities � Municipalities, authorities and EDAs may apply on their own or on behalf of a private company or investor Projects owned by public entities � Public entities may apply regardless of the site location. Process: LOI to DCED DCED completeness review; returns an application form Submit site characterization or cleanup plan to DEP for approval Don�t jump the gun! Costs incurred before grant made are ineligible Eligibility Projects located in DCED zones (e.g., KOZ) or 1st, 2d or 3d class cities � Municipalities, authorities and EDAs may apply on their own or on behalf of a private company or investor Projects owned by public entities � Public entities may apply regardless of the site location.

110. Industrial Sites Reuse Program Eligibility limitations: Applicant did not contribute to contamination Industrial activity occurred before 7/18/95 Three examples: City of Beaver Falls Mahoning Township, Lawrence County City of Warren

111. Stormwater

112. Urban Stormwater Phase II MS4 permit requirement became effective March 2003. It forces development of: Post construction stormwater management practices, and Municipal stormwater ordinances

113. Urban Stormwater DEP Model Ordinance - Issues Municipality must approve E&S Control and BMP O&M Plans Normally the function of CCD or DEP Municipality must determine that developer will comply WQ How will this be done? Expertise?

114. Urban Stormwater Post-construction O&M Responsibility of municipality if project is dedicated Responsibility of private parties if not dedicated Must be an O&M Agreement signed with municipality if stormwater BMPs privately owned Recorded Subject to O&M funding for 10 years if dedicated to municipality Developer�s O&M Agreements: Landowner keeps BMPs in good working order Access for inspection granted to municipality Landowner reimbursement to municipality for corrective action CREATE LIABILITY FOR MUNICIPALITY??? Indemnity to municipalityDeveloper�s O&M Agreements: Landowner keeps BMPs in good working order Access for inspection granted to municipality Landowner reimbursement to municipality for corrective action CREATE LIABILITY FOR MUNICIPALITY??? Indemnity to municipality

115. Urban Stormwater Litigation Haven�t found any reported federal or Pennsylvania cases litigating the MS4 permit, But there is litigation over municipal stormwater ordinances

116. Urban Stormwater Litigation In re Cutler Group, Inc., 880 A.2d 39 (Commw. Ct. 7/8/05) Caco Three, Inc. v. Huntington Township, 845 A.2d 991 (Commw. Ct. 3/29/04) Frisch v. Penn Township, Perry County, 662 A. 2d 1166 (Commw Ct. 1995) In re Cutler Group Conditional use application for 155 acre tract to build 72 single family homes in East Vincent Twp, Chester Co. Stormwater Mgmt Ordinance: �Stormwater retention basis must be designed to promote the recharge of the groundwater system.� Developer�s expert had soil conductivity data to meet above criterion Twp�s expert challenged developer�s data that showed infiltration of 0.25 in/hr and 75 in/hr a few feet away. Twp Board of Supervisors accepted Twp�s expert; Commw Ct affirmed. Caco Three v. Huntington Twp Land development application for 235 acres in Huntington Twp, Adams County; mobile home park Stormwater Mgmt Ordinance: �Completeness of stormwater plan shall be reviewed by the Twp Engineer.� Developer�s plan had minor labeling deficiencies and did not state �release rates� from sediment basins Developer�s plan was disapproved because release rates not specified Commw Ct reversed; MPC requires twp to specify the release rates that developer must meet. Frisch v. Penn Township Township may lawfully stop access to a subdivision until the developer prepares and submits a stormwater management planIn re Cutler Group Conditional use application for 155 acre tract to build 72 single family homes in East Vincent Twp, Chester Co. Stormwater Mgmt Ordinance: �Stormwater retention basis must be designed to promote the recharge of the groundwater system.� Developer�s expert had soil conductivity data to meet above criterion Twp�s expert challenged developer�s data that showed infiltration of 0.25 in/hr and 75 in/hr a few feet away. Twp Board of Supervisors accepted Twp�s expert; Commw Ct affirmed. Caco Three v. Huntington Twp Land development application for 235 acres in Huntington Twp, Adams County; mobile home park Stormwater Mgmt Ordinance: �Completeness of stormwater plan shall be reviewed by the Twp Engineer.� Developer�s plan had minor labeling deficiencies and did not state �release rates� from sediment basins Developer�s plan was disapproved because release rates not specified Commw Ct reversed; MPC requires twp to specify the release rates that developer must meet. Frisch v. Penn Township Township may lawfully stop access to a subdivision until the developer prepares and submits a stormwater management plan

117.

122. Sewage Facilities Planning

123. Sewage Facilities Planning �I don�t know about EDUs, but I know that my dad is 80 and he uses the bathroom a lot.� Authority Board Member DEP defines an EDU as 400 gpd for single family residentialDEP defines an EDU as 400 gpd for single family residential

124. Tapping into a Municipal Sewerage System Submit a Planning Module To the municipality for collection and conveyance capacity certification To the POTW (if a separate entity) for treatment capacity certification Submit the completed Planning Module to the Department (or local delegated agency) for approval Obtain Part II construction permits Local plumbing permits may be needed As Overview, two steps: Approval for connection to sewage system (capacity, taps and sewer permits) Local building permits Municipality certifies to collection and conveyance capacity currently and for 5 yrs Treatment agency does same DEP reviews for consistency with the Official Plan and with Chapter 94. Then approves/disapproves If DEP approves, the municipality issues the permit to connect to the existing system KEY POINT � DEP�s APPROVAL OF THE EDUs via PLANNING MODULE APPROVAL IS NOT THE SAME AS MUNICIPALITY�s ISSUANCE OF THE SEWER CONNECTION PERMIT OR BUILDING PERMIT Developer still must get necessary Part II permits for construction of sewers/pump stations ? W/Associates and Collier Plumbing Permit: ACHD has plumbing permit requirementAs Overview, two steps: Approval for connection to sewage system (capacity, taps and sewer permits) Local building permits Municipality certifies to collection and conveyance capacity currently and for 5 yrs Treatment agency does same DEP reviews for consistency with the Official Plan and with Chapter 94. Then approves/disapproves If DEP approves, the municipality issues the permit to connect to the existing system KEY POINT � DEP�s APPROVAL OF THE EDUs via PLANNING MODULE APPROVAL IS NOT THE SAME AS MUNICIPALITY�s ISSUANCE OF THE SEWER CONNECTION PERMIT OR BUILDING PERMIT Developer still must get necessary Part II permits for construction of sewers/pump stations ? W/Associates and Collier Plumbing Permit: ACHD has plumbing permit requirement

125. Common Obstacles The municipal collection system is overloaded The POTW is overloaded There is an existing tap ban The municipal Act 537 plan is outdated or is being revised The Chesapeake Bay Initiative (central Pennsylvania)

126. The Tap Ban Municipality, authority or POTW must submit annual Chapter 94 reports to DEP (25 Pa. Code � 94.12) If the treatment plant, pump stations or sewer lines are overloaded, the municipality, authority or POTW must: Prepare a corrective action plan, or CAP Prohibit new connections Chap 94 reports must include: Actual flows and loading, with 5 yr projections Discussion of conveyance capacity in next 5 yrs There are some limited exceptions to tap bans: Elimination of public health hazards �Facilities of public need� � hospitals, schools, fire, police Building permit issued within 1 year of imposition of tap ban Replacement of discharge without greater volume or strength Commonwealth Court has upheld DEP�s authority to restrict new connections to an overloaded facility (Chateau Woods v. Lower Paxton Twp., 772 A.2d 122 (PA Commw. 2001); but recently held that a tap ban does not prohibit approval of a sewage facilities planning module � the tap ban prohibits new connections (Ainjar Trust v. DEP, 806 A.2d 482 (Pa Commw. 2002)Chap 94 reports must include: Actual flows and loading, with 5 yr projections Discussion of conveyance capacity in next 5 yrs There are some limited exceptions to tap bans: Elimination of public health hazards �Facilities of public need� � hospitals, schools, fire, police Building permit issued within 1 year of imposition of tap ban Replacement of discharge without greater volume or strength Commonwealth Court has upheld DEP�s authority to restrict new connections to an overloaded facility (Chateau Woods v. Lower Paxton Twp., 772 A.2d 122 (PA Commw. 2001); but recently held that a tap ban does not prohibit approval of a sewage facilities planning module � the tap ban prohibits new connections (Ainjar Trust v. DEP, 806 A.2d 482 (Pa Commw. 2002)

127. The Tap Ban CAPs and tap bans create several issues for developers: Municipalities/authorities may resist DEP�s approach to address overloads, e.g. CCTV 100% of system I&I removal vs. holding tanks End date for eliminating overflows Standard COA language may hinder resolution Developers can get caught in the middle Municipality/authority issues 100% CCTV of SSS � certainly not CSS � isn�t best use of resources I&I removal is the better long term solution because it removes volume � tanks do not Longer end date allows step wise I&I removal Longer end date allows gradual rate increases COA issues: Force majeure � no weather-related delays Admission of liability Allegheny County tap self-regulation in COAs: Municipality must comply with COA Cannot exacerbate existing overload COA replaces CAPs DEP/ACHD won�t impose future tap bans if municipality complies with COA Municipality/authority issues 100% CCTV of SSS � certainly not CSS � isn�t best use of resources I&I removal is the better long term solution because it removes volume � tanks do not Longer end date allows step wise I&I removal Longer end date allows gradual rate increases COA issues: Force majeure � no weather-related delays Admission of liability Allegheny County tap self-regulation in COAs: Municipality must comply with COA Cannot exacerbate existing overload COA replaces CAPs DEP/ACHD won�t impose future tap bans if municipality complies with COA

129. Questions

130. Thank You