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Current Legislative ActivitiesEnvironment    

SEMCOG is involved in various legislative and regulatory activities related to water resource protection. These include:

  • Utilizing stormwater utilities in Michigan
  • Phase II stormwater regulations
  • Limiting municipal liability from basement flooding
  • Sanitary sewer overflow control 

Utilizing stormwater utilities in Michigan
At the local level, the options for funding water quality programs are unstable. More specifically, the issues that surround using fees to support environmental programs have become quite complicated because of a Michigan Supreme Court case, Bolt v. City of Lansing. 

The case
In 1998, the Michigan Supreme Court ruled on this case (Bolt v. City of Lansing) involving the City of Lansing, which had passed an ordinance to help defray the cost of the administration, operation, maintenance, and construction of their stormwater system. The Court found that the stormwater charges within this ordinance were instead a tax and, therefore, unconstitutional. The court laid out a three-part test to use in distinguishing a fee from a tax:

          1) Does the fee serve a regulatory, rather than revenue-producing,
              purpose?

The ordinance must be for regulation only and not as a means primarily of producing revenue.

          2) Is the fee proportionate to the necessary costs of the service?

If the revenue to be derived from the charge is in excess of the direct and indirect costs of actually using the stormwater system and, therefore, is disproportionate to the costs of services provided and the benefits rendered, it constitutes a tax. The charges must be reasonably related to the cost of services rendered.

          3) Is the user able to refuse or limit use of the commodity or service?

There must be an element of volition. A tax is compulsory by law. However, user fees are only compulsory for those who use the service. Therefore, they have the ability to choose how much of the service to use, or whether to use it at all (and be subject to the fee).

For a detailed discussion of Bolt, see the SEMCOG report, State and Local Government Financing of Essential Services with User Fees. 

Potential impact
Water quality mandates continue, but they are no longer accompanied by funding to implement them. Institutions responsible for implementing these water quality programs are faced with the question of how to raise locally derived revenue to pay for the service provided.

SEMCOG’s efforts
Because of the potential impact of this issue to our members, SEMCOG is currently working on a legislative solution to this issue. The legislation needs to address the legitimate concerns the court raised in establishing the difference between a fee and a tax, so that communities are able to act without exposing themselves to financial risk.

Read SEMCOG's key messages on the issue.

Phase II Stormwater regulations
SEMCOG actively advocates on behalf of our members working with the Michigan Department of Environmental Quality (MDEQ) in developing and implementing the Phase II stormwater permit program. Read more on our efforts.  

Limiting municipal liability from basement flooding
A court decision in 1998 (CS&P, Inc. v City of Midland) altered the standard applied to municipalities in determining liability for sewer backups. Consequently, SEMCOG developed a series of reports addressing this new standard. As a result, Public Act 222 of 2001 clarifies when municipalities should be liable for sewer backups. This act also establishes a process for affected persons to seek compensation for such events.

Sanitary sewer overflow control
In May 2000, MDEQ developed the “Strategy for the Regulatory Control and Correction of Illegal Overflows from Separate Sanitary Sewer Systems in Michigan.” In response, SEMCOG created an action plan to provide guidance to communities on implementing this strategy. (Implementing Sanitary Sewer Overflow Corrections: An Action Strategy) SEMCOG also worked with MDEQ to improve the state’s policy on sanitary sewer overflow corrections resulting in the current SSO policy of Michigan. Implementing this new policy has put numerous water quality programs into action which reduce sanitary sewer overflows but at a much lower cost.