With $765,000 in city Stormwater Enterprise fees still owed on 7,500 properties, the city is trying to persuade El Paso County to do its dirty work by placing liens on those properties.
No way, says County Clerk and Recorder Wayne Williams.
The stormwater fee was imposed in 2007 and became one of the most controversial issues at City Hall in the past decade. People called it a rain tax and voted to prohibit payments between enterprises and the city in a November 2009 vote on Issue 300. It essentially was a referendum on the stormwater fee, and City Council abolished the enterprise shortly thereafter.
It also ordered staff to try to collect the $1.8 million still owed, and a collection agency was hired. But some money is still owing: $765,000, in fact, city spokeswoman Mary Scott says.
But it was stuck with a bunch of unpaid bills city officials wanted to collect. At first, the city asked the county treasurer if the fees could be tacked onto a tax bill. The county resisted. Then, the city went to the Clerk and Recorder's Office to attach the bill to the property in the form of a lien, meaning whenever the property sells, the bill would have to be paid.
Williams said "no dice" and got backing today from County Commissioner Darryl Glenn, who formerly served on City Council and he opposed the stormwater fee. Glenn believed the public should have been asked to vote on the fees. (Williams and Glenn are political allies.)
Today, Williams put our a press release outlining the standoff between his office and the city, and Glenn was quoted in it:
“The people spoke loud and clear in 2009 that they did not like the way the City created the Stormwater fee. The City should have done the right thing in the beginning and brought the stormwater charge to a vote of the people. They shouldn’t have created an enterprise to circumvent the limits of TABOR. Now the City continues to bring this issue back to prove a point against its citizenry,” said County Commissioner Darryl Glenn. “I strongly disagreed with how the City went about implementing Stormwater and I believe the City should have trusted the people it is supposed to govern and put this matter to a vote. If they had done that we would not be in this situation. I opposed the idea of putting liens against homeowners when I was on City Council and I continue to oppose it as a County Commissioner. The City needs to find a better resolution than placing liens against their citizens’ property.”
Williams says in an interview with the Indy that he hopes the city will simply do what other businesses do when money is owed to it — file a lawsuit in court, get a court judgment and then bring the paperwork to Williams' office to file a lien.
"Hopefully they will decide to either file collection actions individually or write it off to the extent it makes sense to do so," Williams says. "My position has been very consistent. As a (county) commissioner, I said the same thing. The county chose not to pay the fee and instead made a voluntary contribution."
Williams notes that it's not the first time the city has wanted to use the county's statutory offices to collect money. Back when Pat Kelly was clerk and recorder, from 1997 to 2002, the city asked if the county would collect a city vehicle registration fee in its behalf. Kelly said no, that he had no authority to do so.
From Williams' release:
Currently the City and the El Paso County Clerk & Recorder’s Office are at odds over how to deal with these fees. The City believes that they can simply place a “Pre-Judgment” Lien against a homeowner’s property without going to court first. The El Paso County Clerk’s Office disagrees with this approach and believes that the City should have to go to court first and receive a judgment prior to filing the lien. The City and County Clerk’s Office are now at an impasse on how to resolve this issue. These documents titled “Notice of Lien” have been part of an ongoing dispute between the City and County governments. Clerk & Recorder Wayne Williams has refused to file these liens based on the statutory provision that the Clerk & Recorder in good faith can reject a document that he reasonably believes is “groundless, contains a ...false claim, or is otherwise patently invalid." CRS § 38-35-201(3).
“We have tried to work with the City and the Stormwater Enterprise. The City has failed to provide evidence and supporting statutory documentation that the Stormwater Enterprise has the authority to file a pre-judgment Notice of Lien against a homeowner’s property. Throughout the Stormwater Enterprise’s tumultuous history we were consistently told by the City that it was an Enterprise and that the stormwater charge was simply a fee and not a tax. When it comes time to collect the delinquent accounts, however, the Enterprise wants to use a statutory provision that is generally reserved for governments. In order for my office to record these documents, we need the question answered once and for all, is the stormwater charge a fee or is it a tax? The City can’t have it both ways. It cannot be a fee when you want to implement it and a tax when you want to collect it,” said Wayne Williams, El Paso County Clerk & Recorder.
Council President Scott Hente earlier this month wrote a letter to Williams saying the city didn't dissolve the enterprise, but only put it on ice and lowered the fees to zero in response to Issue 300.
City Council has clear legal authority to organize business operations as enterprises for administrative and accounting purposes, to create and impose fees and charges on behalf of those enterprise operations, to collect unpaid fees and charges, and to create priority liens for failure to pay enterprise fees and charges. City Council also has legal authority to seek the recording of Notices of lien as public notice of priority liens imposed by operation of our home rule ordinances.
Hente says in the letter he wants to avoid court action, but it might be the only solution. The city and county could seek a declaratory judgment, meaning they would ask a judge to say what the clerk and recorder can and can't do on the city's behalf.
In an interview, Hente says, "I'm disappointed." He wanted to work something out with Williams without making it a "media event," but Williams' press release blew that idea out of the water.
"Obviously, the city has to look at its options," Hente says, noting that the entire Council and City Attorney's Office will have to meet and decide what step to take.