CLIENT ALERT!! – Attention Every Property Owner

September 29, 2015

» On September 15, 2015, the Ohio Supreme Court issued its decision in Northeast Ohio Regional Sewer Dist. v. Bath Twp., and found in favor of the Northeast Ohio Regional Sewer District (“NEORSD”). NEORSD is a regional sewer district that services 61 communities in and around Cuyahoga County. In 2010, it adopted a stormwater management program and filed an action in the Cuyahoga County Court of Common Pleas to confirm its authority to establish the program and assess fees on property owners. The trial court in Cleveland upheld NEORSD’s program and proposed fee structure. In connection with the stormwater management program, NEORSD assessed fees on every parcel of land within its service area based upon the amount of impervious surface located on each parcel. An impervious surface is one that does not permit the absorption of fluids; typically, artificial structures such as pavement covered by asphalt, concrete, brick and stone, as well as rooftops. Affected communities and several large property owners appealed, and the Ohio Court of Appeals overturned the trial court decision. Prior to the Court of Appeals’ reversal, NEORSD had already collected approximately $20 million in fees, which it placed into escrow pending its appeal to the Ohio Supreme Court. In upholding NEORSD’s authority to implement a stormwater management plan and assess fees on property owners, the Ohio Supreme Court adopted an expansive definition of wastewater that includes all stormwater, whether or not contaminated with pollutants or waste, and further provided rather broad authority under which fees could be collected. The court left the door open for future challenges, however, if NEORSD fails to use the fees it collects to acquire, construct or operate a facility that will be part of the regional stormwater management system.

Now that the Ohio Supreme Court has affirmed NEORSD’s authority to implement the stormwater management plan and assess related fees, NEORSD has indicated it will request that escrowed funds be released so it can begin implementing stormwater projects.  NEORSD further stated that it will take time to review the court’s decision and establish a plan for reorganizing and re-implementing its stormwater management plan before any fees are assessed against property owners in the future.

Initially, this decision only impacts property owners in the 61 communities that are part of NEORSD’s service area.  Those owning properties with large or multiple structures and large parking lots (e.g., medical facilities, shopping centers, office buildings, and apartment projects) will be most affected. However, now that the authority to implement such programs has been upheld by Ohio’s highest court, other regional sewer districts in the State may follow suit.

NEORSD has not indicated how long it will take to complete its review of the Ohio Supreme Court decision and re-implement the storm management program. We will be monitoring NEORSD’s progress with the program and fee assessments. As there are updates to either we will keep you informed.