05-05-26 City Council Meeting Packet

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STAFF REPORT DATE: May 5, 2026 REGULAR TO: Mayor and Councilmembers FROM: Nicole Miller, City Administrator, Pete Tholen, Public Works Director, and Nate Stanley, City Engineer AGENDA ITEM: Stormwater Management Utility Code Review CORE STRATEGIES: ☐ Vibrant, inclusive, connected community ☐ Responsive, transparent, adaptive governance ☐ Managed Growth ☐ Efficient, reliable, innovative services ☒ Balanced Finances now and future ☐ Resilient Infrastructure BACKGROUND: As part of the City Council’s strategy for balancing finances for now and into the future, the goal of reviewing fees was added to the most recent strategic plan, and one such fee is the Stormwater Utility fee. Per City Code, this fee is used for preparation of a surface water management plan, maintenance of existing ditches, culverts, ponds, and storm sewers, capital improvement in developed areas, equipment, planning, inventories, and water quality improvements. The City Engineer has prepared a scope of services, at the request of the City Council, to review the calculation methodology of the ordinance to investigate if the fees are being charged in an equitable manner. ISSUE BEFORE COUNCIL: Does the City Council wish to proceed with the proposed scope for review of the Stormwater Utility fee? PROPOSAL DETAILS/ANALYSIS: At the direction of Council from the September 9, 2025 workshop, staff prepared a scope of services and cost estimate for an independent review of the City’s Stormwater Utility fee calculation methodology, associated land use categories, and appeal process. This item was formally brought forward to the City Council for review and discussion of the proposed scope of work at the March 3, 2026 City Council meeting. After discussion, the scope was rejected and council directed staff to expand the scope to include additional items and place an emphasis on equity. The scope has been revised per the direction of the City Council and is attached to this Agenda Item. The proposed scope of services includes review of the process to appeal a Stormwater Utility fee, as this is an item that has been coming before city staff recently. After the meeting, the City Attorney looked into this matter and determined that the City Council appeal process that is currently in place is not necessary, and that a staff-level administrative review would be sufficient to address a property owner’s appeal. The services provided in the scope for this item are primarily to understand how other communities are handling this issue, as it was noted by the City Attorney that while this process is not legally mandated, from a best practice perspective the city should have a process.