Storm clouds are gathering over the city's use of the Wastewater Enterprise Fund

Some people decorate their yards with garden gnomes, others use happy frog sculptures. Gertrude Cox has gargoyles. Four of the winged statues have the faces of cats; two feature the snouts of dogs. All of them guard the front walkway of her home in Athmar Park.

"People love them," Cox says of the three-foot-high metal beasts. "They're always making comments about them."

Cox installed the statues six years ago, around the time that she and her late husband, Ivan, decided to replace their front and back yards with decorative concrete — light pink, to match the roof of the house — so that they didn't have to deal with maintaining landscaping. "And it came in handy a few years ago with all the watering restrictions," she notes.

The gargoyles at Gertrude Cox's house can't protect her from storm drainage fees.
The gargoyles at Gertrude Cox's house can't protect her from storm drainage fees.
$42.5 million in storm fees are going to pay for a new Public Works campus at 1271 W Bayaud.
$42.5 million in storm fees are going to pay for a new Public Works campus at 1271 W Bayaud.

Though this extreme act of xeriscaping has allowed Cox to earmark a smaller portion of her fixed income to her water bill, she pays more to the City of Denver for Stormwater Utility — a fee that ostensibly assesses property owners for the amount of snow and rain that drains from their land into the municipal storm sewer system. Since nearly all of Cox's 9,320-square-foot lot is considered "impervious surface area," her Stormwater Utility rate is roughly double that of her neighbors with big, grassy lawns. Last year the bill was around $400, an increase of 211 percent over the 2001 charge.

Each of the city's 150,637 property owners must pay at least $10.26 a year for Stormwater Utility to the city. The result is at least $28 million annually for the Storm Drainage Enterprise Fund, which is supposed to be used solely for maintaining and updating Denver's rapidly aging storm-drainage sewer system.

But tough budgetary times have led to some tough choices for the Denver Department of Public Works, which includes Wastewater Management, the division that oversees the Storm Drainage Enterprise Fund. As money got tighter in recent years, city officials started dipping into the fund to help pay for such services as emergency snow removal and street repair. Over the past three years, in fact, nearly $29 million has been pulled from the fund to "reimburse" other agencies within Public Works, such as Street Maintenance. Another $9 million has paid for sweeping streets and paving alleyways. And $14.6 million went to buy land that Public Works plans to use for a new general facility; in March, $27.9 million was taken from the fund for the design and construction of a new campus with state-of-the-art offices, warehouses and maintenance garages for every Public Works agency but Wastewater.

This regular raiding of the Storm Drainage Enterprise Fund has occurred without the official approval of Denver City Council or city residents, leading some critics to call the practice a secret tax on property owners. And last week, the Denver Auditor's Office moved up its audit of this enterprise fund.

Cox, who lets her mortgage company handle her property taxes, doesn't pay much attention to the Stormwater Utility fee; as a lifelong Denver resident, she understands the importance of bringing the city's sewer system into the 21st century. Even so, she says, "If I'm going to pay more taxes, I'd like to know where the money is going. I don't think they should tell you that it's being used for the storm drains and then use it for something else."

Have a question about the city's Stormwater Utility fee? The Wastewater Management division of Public Works will point you to a circa 2006 brochure with the heading "Your stormwater utility rates have increased." Prior to 1970, the brochure explains, stormwater management was not considered a priority, which means that many of Denver's neighborhoods were not built with adequate storm sewers. So in the '80s, the city began charging property owners a storm drainage fee for the management of runoff. The money collected through this fee was put under the financial umbrella of the Wastewater Fund, alongside a pool of money from what residents were already paying for sanitary sewers, a separate bill based on metered water usage.

In the case of storm drainage, officials decided that the fee should be based on the amount of water that might flow from a particular property into the public stormwater system. Undeveloped land allows rain and melting snow to soak into the ground; rooftops and paved areas theoretically send water into city gutters. So the city established a ratio system that calculated how much of a property was "permeable surface" — brick walkways, garages, driveways, porches, etc. — and set the property's yearly fee accordingly. A 1989 master plan identified $100 million in needed improvements to Denver's stormwater system, all of which were supposed to be paid for through these fees.

In 1992, Colorado voters adopted the Taxpayer's Bill of Rights, which set constitutional limits on public spending at all levels of government, including state, counties, cities, school districts and special districts such as RTD. Among other provisions, TABOR requires that voters must approve any tax increases or the issuing of bonds to be paid off by public funds. The only public entities excluded from these restrictions are "enterprises," which TABOR defines as a "government-owned business" that receives less than 10 percent of its revenue from state and local taxes and is authorized to issue its own bonds.

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