Stormwater Fees in PA - What You Need to Know

Property Owners in PA looking to challenge their stormwater fees need to understand the requirements regarding how they are structured and assessed.

If you’ve read local newspapers or attended local government meetings in Pennsylvania over the past few years, you’re aware of the controversy over stormwater fees. Disgruntled landowners may call the fees “rain taxes,” but these fees are necessary to comply with the Environmental Protection Agency’s unfunded mandates on state and local governments.

What is a stormwater fee?

A stormwater fee is an assessment charged to property owners within a municipality’s service area in order to finance the costs of local stormwater programs. The amount of the fee for each individual property is usually determined based on its total impervious area (all surfaces that do not allow infiltration of water, including building coverage and surfaces made of materials like concrete and asphalt).

Why are stormwater fees imposed?

The short answer is that federal and state law have mandated a decrease in the amount of pollutants in waterways. Stormwater runoff is a major source of pollutants. Major projects will be necessary to reduce stormwater flow and the funds for these projects will come from municipalities. Most municipalities view stormwater fees as a more palatable and fairer alternative than taxation. .

The federal Clean Water Act sets stormwater requirements that the states administer under federal supervision. The Pennsylvania Department of Environmental Protection (DEP) administers stormwater matters under the MS4 (Municipal Separate Storm Sewer System) Program. The MS4 program applies to municipalities (or large institutions like universities and prisons) that have separate systems for sanitary sewer and stormwater management.

As of 2018, all municipalities in the MS4 program must meet specific pollutant load reduction targets by 2023, with penalties for noncompliance. Compliance will require significant improvements in most municipalities, from regular street and drain cleanings to construction of new retention basins and storm pipe infrastructure.

Why is there a stormwater fee and not a tax?

This mandate is not funded by EPA or DEP, so the costs of compliance fall to the local municipalities. Stormwater management fees are the least burdensome way for local governments to pay for compliance. The alternative of tax increases would be unpopular and would impose costs on the population as a whole rather than target those who generate stormwater. And ignoring the requirements would be even more costly, leading to penalties that would increase over time and also would be paid by all taxpayers. Stormwater fees are also fairer than taxes, because tax-exempt entities like government and nonprofit organizations that often generate significant stormwater runoff will pay stormwater fees.

What municipalities are or will be affected by stormwater fees?

Municipalities or large institutions regulated as MS4s, especially in watersheds designated as “impaired,” will be most affected by stormwater fees. MS4s gather stormwater through storm pipes, drains, or swales and discharge stormwater into local streams and rivers without any treatment.

The DEP manages the MS4 Program, issuing permits and ensuring compliance with federal mandates under the Clean Water Act. Specifically, DEP issues NPDES (National Pollution Discharge Elimination System) permits, authorizing MS4s to discharge stormwater into local waterways. To comply with NPDES permits, MS4 communities must develop a Stormwater Management Program (SWMP). Communities that discharge into watersheds classified by DEP as “impaired” must also develop Pollutant Reduction Plans (PRP).

DEP also requires minimum standards for stormwater controls in local ordinances, and has drafted a model ordinance that MS4s will have to implement by September 30, 2022 to remain compliant. There are over 1059 MS4s at the time of publication. Dep provides a list of these regulated MS4s, organized by county, on the its website, along with many other useful resources.

How are stormwater fees determined?

Municipalities can choose from several options to cover the costs of stormwater compliance. Some municipalities will assess fees directly. Others will create municipal authorities or join regional municipal authorities. Since 2013, the Municipality Authorities Act has permitted municipal authorities for stormwater management planning and projects. These municipal authorities have the authority to impose fees at “reasonable and uniform rates.” (See our earlier blog on municipal authorities for more info).

There are many variations in fee structures among municipalities and municipal authorities because fee calculation is left to the individual municipality or authority. Fees will be deemed reasonable if levied on property owners based on some calculation of the property’s potential to generate runoff. Some of the largest fees will come from properties that are exempt from real estate taxation under Pennsylvania law, such as schools, large churches, and authorities that own large tracts of real estate. The budget effect for these exempt entities may be significant.

A municipality or authority can choose from various methods of measurement as a basis for stormwater fees. Possible methods include the Equivalent Residential Unit (ERU) based on the average impervious area of a residential parcel in the community or a tiered system with several subcategories based on impervious area. More complex calculations include “Intensity of Development Factors (IDF)” or “Equivalent Hydraulic Areas (EHA),” that account for and weight both pervious and impervious area, to scientific and highly-tailored methods like the “Residential Equivalent Factor (REF)”. There is no uniform solution for determining stormwater fees, and the proper method will depend on many factors, including the overall land use characteristics, size, resources, and feedback from constituents and stakeholders. The Overview of Municipal Stormwater Fee Programs, published by the Pennsylvania Environmental Council, provides useful explanations of each method.

How do you get help if you have issues related to stormwater fees?

If you represent a municipal client that needs to comply with a current EPA mandate or a municipality wishing to establish a stormwater authority preventatively, before being mandated to do so, High Swartz can help. We provide counsel to help “thread the needle” of compliance, avoidance of large penalties, and limiting exposure to litigation from property owners.

If instead you are a property owner in a municipality that is implementing or planning for a stormwater fee, High Swartz can help ensure that the fees are based on accurate information, and levied in a “reasonable and uniform” manner, as required by law.

Our experienced municipal government team at High Swartz has in-depth knowledge and experience in all aspects of stormwater management and municipal law and can aid you in navigating this complex area of law and asserting and protecting your interests. Call us at 610-275-0700 or use the contact form found on this page.

U.S. Supreme Court Further Defines Title VII Protection to Include LGBT

Yesterday, the Supreme Court, in a 6 to 3 decision, ruled that Title VII of the Civil Rights Act of 1964 prohibits discrimination in employment against LGBT individuals. In a single day, millions of Americans were provided with protection under Title VII and employers must modify their conduct.

Before June 15, 2020, the rights of LGBT (lesbian, gay, bisexual, transgender) employees were governed by a patchwork of local ordinances, a handful of state laws and Federal Circuit Court decisions. Now, for all employers that employ fifteen (15) or more employees there is certainty.

Justice Neil Gorsuch, a Trump appointee, began the majority’s opinion as follows:

“Sometimes small gestures can have unexpected consequences. Major initiatives practically guarantee them. In our time, few pieces of federal legislation rank in significance with the Civil Rights Act of 1964. There, in Title VII, Congress outlawed discrimination in the workplace on the basis of race, color, religion, sex, or national origin. Today, we must decide whether an employer can fire someone simply for being homosexual or transgender. The answer is clear. An employer who fires an individual for being homosexual or transgender fires that person for traits or actions it would not have questioned in members of a different sex. Sex plays a necessary and undisguisable role in the decision, exactly what Title VII forbids.”

The basis of the majority’s opinion will be subject to debate in scholarly articles and in law schools for years to come. As for employers, however, there is nothing to debate, only action to be taken, because unless Congress passes a law, which a President signs, that explicitly excludes LGBT individuals from protection under Title VII, yesterday’s decision is the law.

What must employers with 15 or more employees do immediately:

  • Stop discriminating against LGBT individuals/employees – this includes all aspects of the employment relationship, including hiring, promotion, discipline and termination. LGBT individuals are entitled to the same protection as any other protected class under Title VII.
  • Train HR staff and front-line supervisors to identify discrimination in the workplace based on LGBT and to investigate any such complaints based on investigatory procedures already in place.
  • Audit the workplace environment to ensure that there are no latent illustrations of LGBT discrimination, such as posters, stickers, pictures, etc…

What must employers do over the next several weeks:

  • Update employee manuals and policies and procedures to include protection for LGBT employees.
  • Hold a training session with employees and front-line supervisors to advise them of the LGBT protection and what is expected from the employees.

For employers with less than 15 employees, who were not already subject to a local/state law prohibiting LGBT discrimination, you should anticipate that the ruling will apply to you. Most state-based anti-discrimination statutes apply to smaller employers, e.g., the Pennsylvania Human Relations Act (“PHRA”) applies to employers with 4 or more employees. And, most courts that apply state-based anti-discrimination statutes look to the federal courts (and the U.S. Supreme Court) on how to apply the state statutes.

In PA, for instance, Pennsylvania courts apply the PHRA in accordance with Title VII. As such, any Pennsylvania business with between 4 and 14 employees should presume LGBT protections apply to their business.

Employers Can Now Use After-Acquired Evidence in Court to Show Employee Wasn’t Qualified For the Job

The Anthony decision provides welcome support for employers who find that a discrimination plaintiff has concealed a lack of basic credentials to hold a job.

In April 2020, the Ninth Circuit Court of Appeals ruled that an employer can defeat an Americans with Disabilities Act (ADA) claim with after-acquired evidence that the ex-employee lacked a required college degree. Anthony v. Trax International Corp., 955 F.3d 1123 (9th Cir. April 17, 2020).

Legal History

In 1995, the United States Supreme Court limited employers’ use of evidence of misconduct acquired after a plaintiff was terminated from a job. In an age discrimination case, McKennon v. Nashville Banner, 513 U.S. 852, 115 S. Ct. 879 (1995), the Court said that employers could not use after-acquired evidence to eliminate the employer’s liability to a discrimination plaintiff. The most that employers could do with after-acquired evidence was cut off an employee’s damage recovery as of the date of discovery of the misconduct.

McKennon did not address an employer’s ability to defeat an employee’s entire claim when the after-acquired evidence showed that the employee lacked the basic qualifications for the job, such as a degree or license.

The Facts of the Anthony Case

Anthony’s facts are simple. Trax employed Anthony as a technical writer. Trax required technical writers to have a bachelor’s degree from a four-year college. Anthony misrepresented that she had this degree in her job application. She later asked to work from home because of a disability. Trax refused the request and terminated Anthony.

Anthony sued, claiming discrimination under the ADA because the employer failed to offer her a reasonable accommodation for her disabilities. During the litigation, the employer became aware that Anthony had no degree. The degree was not just a prerequisite for Anthony’s job; the employer had billed the government a contract rate that assumed that Anthony had a degree.

The employer moved for summary judgment on the ground that Anthony was not a qualified individual entitled to the ADA’s protection against employment discrimination. The ADA prohibits discrimination against individuals who are “qualified to perform the essential functions of the job”.

In 2018, the Arizona United States District Court granted summary judgment to the employer and dismissed Anthony’s case. Anthony appealed to the Ninth Circuit.

The Ninth Circuit panel unanimously upheld the lower court’s ruling in favor of the employer.. The Ninth Circuit noted that the plaintiff had the burden of showing that she was a “qualified individual” as part of her prima facie disability case. Since the plaintiff could not show that she had the basic qualifications for the job, her case failed.

What does the ADA define as a “qualified individual”?

The ADA defines a “qualified individual” as someone who “with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds or desires.” The Court said that the Equal Employment Opportunity Commission (EEOC) had established a two-step inquiry on an individual’s qualifications. The first step was to ascertain whether the individual satisfies the prerequisites for the job- i.e., the “requisite skill, experience, education and other job-related requirements of the employment position such individual holds or desired.” The second step was the inquiry into the individual’s ability to perform the essential functions of the position, with or without reasonable accommodation.

The Court then held, “At no time did Anthony satisfy the prerequisites of the qualified individual element of an ADA prima facie case: it is undisputed that she never possessed the requisite bachelor’s degree and …[under] Trax’s government contract, the bachelor’s degree was an actual requirement of the … position that could not be satisfied by any functional equivalent.” The Court dismissed the EEOC’s contention that the employer could not use after-acquired evidence, discovered during the suit, to defeat Anthony’s prima facie case.

The Court also dismissed Anthony’s contention that McKennon v. Nashville Banner precluded the use of after-acquired evidence. The Court distinguished between the ADA, which protects only qualified individuals, and the Age Discrimination in Employment Act in McKennon, whose protections extend to any individual employee subjected to age discrimination.

Further, in McKennon, the employer sought to use the after-acquired evidence to show a legitimate non-discriminatory reason for the employee’s discharge. In Trax, the after-acquired evidence defeated the plaintiff’s claim at an earlier stage in the case- the stage where plaintiff had to show that she had the minimum qualifications for the job. The Court held that employers could look to the employee’s ability to satisfy the basic job prerequisites before addressing whether reasonable accommodation could enable the employee to perform essential job functions.

In Summary

The Ninth Circuit’s decision in Anthony v. Trax allows employers to look into an ex-employee’s ability to meet threshold job qualifications after the ex-employee makes an ADA discrimination claim. The decision is consistent with the relatively few decisions from other circuits on this issue. The decision is also consistent with logic. An employee lacking the basic credentials for a job cannot, by definition, have the qualifications to perform the job.

It is still open to question whether an employer can use after-acquired evidence to challenge an ex-employee’s qualifications where a statute does not state that an employee must be qualified to perform a job. But the requirement of qualification for a job position is not unique to the ADA; the requirement is one element of the test that an employee must satisfy to go forward with a prima facie case of discrimination. So the ability to use after-acquired evidence in this threshold area may arise again.

Business Owners in PA – Your Reopening Questions Answered

As PA counties move into the green phase of reopening and non-essential business commences, employers and business owners in PA have many questions. We have compiled and answered some the most important questions below.

by Employment Attorneys James B. Shrimp and Thomas D. Rees

1. My business has reopened and I have an employee that HAS tested positive for COVID-19. What are my options?

The legal answer to this question depends upon the size of your business. You should also look to CDC guidelines regarding additional cleaning of the workplace and any contact tracing and additional quarantine of employees that is recommended. The answers below can also apply to employees that have recently been exposed to another person who has the coronavirus.

A. Businesses with 500 or more employees

There are no enhanced paid leave benefits. Your HR department should apply its PTO and unpaid time off policies, with the understanding that CDC guidelines likely require a period of quarantine for the employee. It would not be advisable to terminate the employee during this period of quarantine.

B. Businesses with Under 500 employees

The employee may be entitled to two (2) weeks of paid sick leave.

The Families First Coronavirus Response Act (“Act”) was the first coronavirus related legislation passed by Congress. The Act seeks to address the impact of coronavirus in a number of areas – including certain employee benefits.

The Act applies to employers with under 500 employees. Employers with under 50 employees are entitled to seek an exemption from the Department of Labor, if providing the benefits provided by the Act would put the employer out of business.

The Act provides two new paid benefits which expire on December 31, 2020:

  • A two-week paid sick leave for coronavirus related illness; and
  • Up to 12 weeks of paid Family and Medical Leave for caring for a child whose school or child care provider has closed.

Who Can Take advantage of the two-week paid sick leave?

  1. This benefit is for employees who are unable to work (or telework) because the employee is subject to a governmentally mandated quarantine or isolation order;
  2. has been advised by a health care provider to self-quarantine;
  3. has symptoms of being infected with coronavirus and is seeking a medical diagnosis;
  4. is caring for an individual who is quarantined or self-quarantining;
  5. is caring for a son or daughter if the school or place of care has been closed.

If any of the circumstances above apply, the employee is eligible for two (2) weeks of full pay, based on his/her typically schedule. There is a maximum benefit of $511 per day.

If the employee has employer based sick time/PTO, the employer is required to apply the government emergency leave, before applying the employer based benefit.

The employer is reimbursed via a payroll tax credit, which will be provided by the Federal government within 3 months. If the employer pays more in paid benefits and health insurance premiums than the payroll tax, the government will send the employer an “overpayment” check for the difference.

C. Other Employees

The employer is entitled to screen employees for Covid related symptoms. See EEOC Guidance - “What You Should Know About COVID-19 and the ADA, the Rehabilitation Act, and Other EEO Laws,” (April 23, 2020).

2. My business has re-opened and I have an employee that HAD COVID-19. What steps should I take?

You are entitled to require a return to work note from the employee’s physician. Once you receive the return to work note, that employee is permitted to return to work and should be treated like all other employees.

3. Due to Schools and Childcare Centers being closed, my employees cannot get into work. What are my options?

The answer to this question depends upon the size of your business.

A. 500 or more employees

There are no enhanced paid leave benefits. Your HR department should apply its PTO and unpaid time off policies. If the employee’s PTO has exhausted and there is no unpaid time off policy that would apply, the employee has no right to continued employment. Ensure that terminations made under these circumstances are done in a non-discriminatory fashion.

B. Under 500 employees

The employee may be entitled to twelve (12) weeks of Family and Medical Leave.

The Families First Coronavirus Response Act (“Act”) was the first coronavirus related legislation passed by Congress. The Act seeks to address the impact of coronavirus in a number of areas – including certain employee benefits.

The Act applies to employers with under 500 employees. Employers with under 50 employees are entitled to seek an exemption from the Department of Labor, if providing the benefits provided by the Act would put the employer out of business.

The Act provides two new paid benefits which expire on December 31, 2020:

  • A two-week paid sick leave for coronavirus related illness; and
  • Up to 12 weeks of paid Family and Medical Leave for caring for a child whose school or child care provider has closed.

Pertinent to the question posed is the twelve weeks of paid Family and Medical Leave.

This benefit is available for employees who are unable to work (or telework) because the employee must care for children (up to 18 years old) whose schools or child care facilities have closed because of the coronavirus.

The employee is eligible for up to 12 weeks of two-thirds pay, with health insurance. The maximum benefit is $200 per day and $10,000 total. The first two weeks of this leave may be unpaid (that gap is filled by the Paid Sick Leave benefit).

The employer is reimbursed via a payroll tax credit, which will be provided by the Federal government within 3 months. If the employer pays more in paid benefits and health insurance premiums than the payroll tax, the government will send the employer an “overpayment” check for the difference.

4. My business is ready to reopen but I several employees tell me that they have underlying health conditions; what are my options?

If the health condition qualifies as a disability under the Americans with Disabilities Act, you need to provide the employee with a reasonable accommodation to returning to work, so long as the accommodation does not create undue difficulty or cost for you.

The first step is to find out whether the employee’s condition interferes with the employee’s ability to perform major life activities (e.g., asthma impairs breathing). The next step is to discuss various accommodations, since the ADA requires employer and employee to engage in an interactive process. The type of accommodation depends on the nature of the employee’s job. Possible accommodations include continued work from home; work in a protected area (either a separate part of the office or work behind shielding); work when others are not present (staggered hours); or a reasonable modification of duties, including a possible exchange of duties with other employees.

Reasonable accommodation does not require an employer to fundamentally alter the basic qualifications for a job (minimum skills, licensure). Be sure to document all discussions with the employee and all steps taken to accommodate the employee.

5. My business is ready to reopen but have an employee who feels uncomfortable returning to the workplace because of COVID-19; what are my options?

It is wise to ask the employee the reasons for discomfort. A refusal to come to work just because someone feels uncomfortable is not a legitimate excuse. But the discomfort may have underlying causes that may constitute a disability under the Americans with Disabilities Act. You may ask the employee for medical reasons for the discomfort; this inquiry is job related and consistent with business necessity under the ADA. The inquiry may uncover a psychological reason for the employee’s concerns, such as generalized anxiety disorder or post traumatic stress syndrome. Or there may be a medical reason for the concern, such as an underlying condition that makes the employee susceptible to COVID-19. If the employee can document a condition that constitutes a disability, then you should try to work out a reasonable accommodation that allows the person to work with some degree of separation from the office. However, if the employee cannot document the condition, you may require the employee to come into work, and you may treat the refusal to come to work as a voluntary quit that precludes the employee’s receipt of unemployment compensation

6. We are ready to reopen but the nature of my business makes social distancing very difficult; what can I do?

Many businesses face this issue, particularly stores that have inventory in small spaces (drugstores, coffee shops, bookstores). The first step is of course to require the wearing of masks at all times. State governments have already imposed this requirement. The second step would be to take whatever steps can reasonably be taken to increase social distancing. These could include such steps as staggered hours; staggered breaks; setting up one-way corridors or spaces in the office; setting up zones in the office that specific individuals would cover; and having plenty of disinfecting wipes and hand sanitizers around. Some businesses may be able to transact customer business through a window opening onto the street or to use curbside delivery. You may need to be extra careful to require any employee with any illness to stay away from work. Each business has its own different needs. It will be wise to establish written guidelines to minimize close social contact and to post those guidelines for both employers and employees. Remember that you have the duty to have a safe workplace and written guidelines will help you show that you have fulfilled this duty.

7. I am re-opening my business - do I need to offer masks to my employees?

In Pennsylvania, employers are required to provide non-medical masks to employees and are required to ensure that customers wear masks as well.

8. Do I need to update my employee manuals with Covid (general pandemic) information before hiring new employees?

No. As an employer, you can update your employee manuals/policies at any time. Therefore, if you are re-opening and you need additional staff, do not slow hiring to get additional policies in place.

With that said, once your business is up and running at all cylinders, it is worth sitting down with your business lawyer to discuss what revisions and additions you might want to make to your employee manual.

9. My employee refuses to come back to work because they are receiving more money on unemployment compensation as a result of the $600 per week federal supplement. Can employees do this?

An employee “can” do this, but he/she will lose the entitlement to future unemployment benefits. The employee should know that the $600 per week federal supplement expires at the end of July and currently there is no appetite in the United States Senate to extend this supplement, for the very reasons stated in the question.

If an employee refuses to come back to work, you should advise the employee in writing that since he/she has refused to return to work, that he/she is being terminated for job abandonment. You should then notify the bureau of unemployment compensation that the employee refused to return to work and was terminated for job abandonment.

10. Employees have asked me whether the shelter in place order counts against my sick or vacation time; what should my response be?

A shelter in place order will almost never count against preexisting leave entitlements offered by an employer. A shelter in place order will qualify an employee for paid sick leave if the order prevents the employee from doing work that the employer has for the employee. This means that if the shelter in place order keeps an employee from being able to work or telework, and the you have work for the employee, the employee may get paid sick leave. If either of these requirements are not met, either because the employee can telework or you have no work for the employee, then the shutdown will not enable the employee to receive paid sick leave.

Paid sick leave is additional to whatever leave your employee has under your business’ leave policies. In rare situations, an employer and employee may agree to combine paid sick leave under the Emergency Paid Sick Leave Act and paid leave under the employer’s policies, where the addition will increase the employee’s compensation. The rules for family leave under the Emergency Family and Medical Leave Expansion Act give employers a little more flexibility. Employers may require employees to use up paid regular paid vacation and personal leave (but not sick or medical leave) concurrently with family leave; again, this helps to close the compensation gap between paid family leave (maxing out at $200 per day and $10,000 aggregate) and full paid leave under the employer’s plans.

If you are are a business owner and have more questions during the Pandemic, please reach out to the employment attorneys at High Swartz and call 610-275-0700 or fill out our contact form.