April 27, 2010 - 4:58am, Mark Segraves, WTOP.COM

WASHINGTON - The federal government is refusing to pay millions of dollars in water bills, and that means the additional cost will trickle down to you.

In response to unfunded mandates by the Environmental Protection Agency, many local authorities are charging new fees.

The District of Columbia began itemizing the Impervious Area Charge on monthly bills in order to defray the costs of this mandate to clean up stormwater runoff that makes its way into the Anacostia River and then into the Potomac River. The Potomac runs into Chesapeake Bay, the nation's largest estuary.

Stormwater runoff is a leading cause of water pollution in the Chesapeake Bay Watershed.

George Hawkins, general manager of D.C.'s Water and Sewer Authority, tells WTOP if the federal government doesn't pay its bill, then someone will have to make up the difference.

"If we don't have the revenue we anticipate from the federal government, we will have to make up for it from other sources."

Nathan Gardner-Andrews, counsel for the National Association of Clean Water Agencies, says those other sources will be local residents and businesses.

"To the extent that the federal government refuses to pay its fair share, then the economic burden falls even more squarely on the shoulders of local rate payers," Gardner-Andrews says.

In the District, the fee is based on how much land you own, which means the average homeowner pays about $2.20 a month. The fee for the federal government -- which owns nearly 20 percent of the land and is WASA's biggest customer -- is more than $2 million a year.

Hawkins says it's ironic that one federal agency is imposing the requirements that necessitate the new fees while another agency is refusing to pay the fees.

"Particularly since the work that we are doing is a direct result of federal mandates. The federal government should step up and do its part since they are such a very significant landowner in the city."

Hawkins says the federal government owns more than 30 percent of the land that generates the stormwater runoff.

The federal government won't pay the fee because it says the fee is a tax. WTOP has obtained a letter sent to WASA and the U.S. Department of Treasury from Lynn Gibson, acting general counsel for the Government Accountability Office:

"The Impervious Surface Area charges adopted by the District appears to be a tax on property owners. If this is so, GAO's appropriated funds are not available to pay the assessment due on April 15, 2010," Gibson says.

"Accordingly, we are instructing the Department of Treasury not to make a payment to the District."

Susan A. Poling, managing associate general counsel for GSA, says "under the supremacy clause of the United States Constitution, the United States government is immune from taxation from states, cities and other municipalities."

The dispute comes down to whether the Impervious Area Charge is a tax or a fee.

Poling says that has yet to be determined in this case.

"Whether something is a tax or a fee requires a good look at the facts. The federal government can easily pay something that is a fee where we are getting some kind of service, like a water bill. But we are immune from taxation."

The dispute over stormwater fees is not limited to the District. The GAO has sent similar letters to local municipalities across the country:

In 2006, King County, Wash., was one of the first to get a letter. Four years later, King County and the GAO have still not resolved the problem.

In Seattle, taxpayers have had to make up more than $1.6 million in drainage fees the federal government has refused to pay. "We're pondering a wide range of solutions, including legal action," Assistant City Attorney Greg Narver says.

In Vancouver, Wash., the city attorney's office says the unpaid fees are costing local taxpayers about $8,000 per month.

In Gwinett County in Georgia, it's costing residents $160,000 a year.

The City of Cincinnati took the issue to court. In 2007, the federal government reached a settlement with Cincinnati over $100,000 in unpaid surface water management fees the departments of Health and Human Services and Veterans Affairs refused to pay the city. Uncle Sam agreed to pay $17,000.
According to a 2009 GAO opinion, the settlement has "no bearing" on the determination of other disputed fees.

Hawkins says he has a meeting scheduled with GAO to try and resolve the billing dispute, but says if that doesn't work he hasn't ruled out suing the federal government.

"There is a judgment call to be made here that's at a policy level." Hawkins says. "We can appeal to the Obama Administration and if that doesn't work then we'll take whatever legal steps we need to take."

(Copyright 2010 by WTOP. All Rights Reserved.)

Mark Segraves, wtop.com

WASHINGTON - The federal government is refusing to pay millions of dollars in water bills, and that means the additional cost will trickle down to you.

In response to unfunded mandates by the Environmental Protection Agency, many local authorities are charging new fees.

The District of Columbia began itemizing the Impervious Area Charge on monthly bills in order to defray the costs of this mandate to clean up stormwater runoff that makes its way into the Anacostia River and then into the Potomac River. The Potomac runs into Chesapeake Bay, the nation's largest estuary.

Stormwater runoff is a leading cause of water pollution in the Chesapeake Bay Watershed.

George Hawkins, general manager of D.C.'s Water and Sewer Authority, tells WTOP if the federal government doesn't pay its bill, then someone will have to make up the difference.

"If we don't have the revenue we anticipate from the federal government, we will have to make up for it from other sources."

Nathan Gardner-Andrews, counsel for the National Association of Clean Water Agencies, says those other sources will be local residents and businesses.

"To the extent that the federal government refuses to pay its fair share, then the economic burden falls even more squarely on the shoulders of local rate payers," Gardner-Andrews says.

In the District, the fee is based on how much land you own, which means the average homeowner pays about $2.20 a month. The fee for the federal government -- which owns nearly 20 percent of the land and is WASA's biggest customer -- is more than $2 million a year.

Hawkins says it's ironic that one federal agency is imposing the requirements that necessitate the new fees while another agency is refusing to pay the fees.

"Particularly since the work that we are doing is a direct result of federal mandates. The federal government should step up and do its part since they are such a very significant landowner in the city."

Hawkins says the federal government owns more than 30 percent of the land that generates the stormwater runoff.

The federal government won't pay the fee because it says the fee is a tax. WTOP has obtained a letter sent to WASA and the U.S. Department of Treasury from Lynn Gibson, acting general counsel for the Government Accountability Office:

"The Impervious Surface Area charges adopted by the District appears to be a tax on property owners. If this is so, GAO's appropriated funds are not available to pay the assessment due on April 15, 2010," Gibson says.

"Accordingly, we are instructing the Department of Treasury not to make a payment to the District."

Susan A. Poling, managing associate general counsel for GSA, says "under the supremacy clause of the United States Constitution, the United States government is immune from taxation from states, cities and other municipalities."

The dispute comes down to whether the Impervious Area Charge is a tax or a fee.

Poling says that has yet to be determined in this case.

"Whether something is a tax or a fee requires a good look at the facts. The federal government can easily pay something that is a fee where we are getting some kind of service, like a water bill. But we are immune from taxation."

The dispute over stormwater fees is not limited to the District. The GAO has sent similar letters to local municipalities across the country:

In 2006, King County, Wash., was one of the first to get a letter. Four years later, King County and the GAO have still not resolved the problem.

In Seattle, taxpayers have had to make up more than $1.6 million in drainage fees the federal government has refused to pay. "We're pondering a wide range of solutions, including legal action," Assistant City Attorney Greg Narver says.

In Vancouver, Wash., the city attorney's office says the unpaid fees are costing local taxpayers about $8,000 per month.

In Gwinett County in Georgia, it's costing residents $160,000 a year.

The City of Cincinnati took the issue to court. In 2007, the federal government reached a settlement with Cincinnati over $100,000 in unpaid surface water management fees the departments of Health and Human Services and Veterans Affairs refused to pay the city. Uncle Sam agreed to pay $17,000.
According to a 2009 GAO opinion, the settlement has "no bearing" on the determination of other disputed fees.

Hawkins says he has a meeting scheduled with GAO to try and resolve the billing dispute, but says if that doesn't work he hasn't ruled out suing the federal government.

"There is a judgment call to be made here that's at a policy level." Hawkins says. "We can appeal to the Obama Administration and if that doesn't work then we'll take whatever legal steps we need to take."

(Copyright 2010 by WTOP. All Rights Reserved.)