St. Paul, Minn., Modernizes Stormwater Infrastructure
Source: Government Technology | Ben Levine | November 9, 2018
In this installment of the Innovation of the Month Series, we explore how St. Paul, Minn., is rethinking stormwater management through the use of green infrastructure.
MetroLab’s Executive Director Ben Levine spoke with Wes Saunders-Pearce, water resource coordinator, and Michael Solomon, treasurer, both from the city of St. Paul; and Jerry (Zhirong) Zhao, associate professor and director of the Institute for Urban and Regional Infrastructure Finance at the Humphrey School of Public Affairs at the University of Minnesota.
Ben Levine: Can you explain what green infrastructure is — how it works, what problems it solves and why it's an attractive tool?
Wes Saunders-Pearce: Green infrastructure uses vegetation, soils, and other elements and practices to restore some of the natural processes required to manage water and create healthier urban environments. It is a stormwater management approach that utilizes natural landscape features and hydrologic processes to treat stormwater by infiltrating, evapotranspiring and/or reusing runoff. Large-scale green infrastructure systems help address climate change impacts on local populations by reducing urban heat stress and improving air quality. Green infrastructure also achieves other environmental goals such as improved wildlife habitat and increased opportunities for outdoor recreation. Often green infrastructure programs are the result of federal requirements. But for St. Paul, where our sewer systems already meet federal code and are not mandated to change, shifting to using stormwater as a resource is completely voluntary. It is an act of departing from past practice to leave a better legacy that invests in our future.
Jerry Zhao: That’s right. In contrast to traditional “gray infrastructure” — with underground pipe networks — green infrastructure uses features such as rain gardens, permeable pavements and green roofs. You can imagine how those tools can offer benefits to residents and communities beyond the core water infrastructure functions.
Levine: How would green Infrastructure work in St. Paul? Are there unique characteristics to the city that make the use of green infrastructure particularly viable?
Saunders-Pearce: When redevelopment occurs in older, established urban communities like St. Paul, buildings, open space, surface parking, streets, alleys and stormwater facilities are all competing for limited and valuable space. In response, stormwater is typically being managed in costly underground facilities that are quite large in order to meet runoff control requirements. Most facilities do not integrate stormwater with other features that could provide more environmental value and impact. In addition, when stormwater facilities are placed below ground, community members lose their understanding and personal experience with natural systems. Our vision is for a “shared district” approach to stormwater management at our redevelopment sites. This vision is a departure from managing green infrastructure with, say, mandates on developers. Instead, a shared district seeks to address stormwater and placemaking needs in a coherent and coordinated way. This requires us to rethink our typical processes of funding infrastructure, assessing fees, recovering costs, conducting operations and maintenance, and more.
Levine: Tell me about the project underway between St. Paul and the University of Minnesota — the fee-in-lieu for shared stormwater management.
Zhao: The fee-in-lieu project is a research investigation that will inform the design of a shared green infrastructure district. It plans for a model in which, rather than building individual stormwater facilities onsite, property developers would pay a certain fee that would be pooled together by the city to develop district-based green infrastructure.
The project involves Wes Saunders-Pearce, Michael Solomon and Matt Larson from the city of St. Paul, as well as Camila Fonseca-Sarmiento and me from the Institute for Urban and Regional Infrastructure Finance at the Humphrey School of Public Affairs at the University of Minnesota.
Saunders-Pearce: The core effort is to identify what other cities have determined as a typical cost for parcels based for stormwater management. This new approach will serve as an alternative to the city’s traditional approach of regulating stormwater on a parcel-by-parcel, project-by-project basis. Our investigation has involved a multi-case study that considers different models for fee-in-lieu for on-site stormwater management.
Michael Solomon: As part of our broader sustainability goals, we want to think about how to use green infrastructure as a way to use “rain as a resource” in our community. As Wes mentioned, it will address urban heat islands, create great public spaces and restore some of the natural ecological characteristics of the region that have faded away with urbanization. To move it forward — especially on a district-wide scale — the city would take on some of the risk and upfront costs of infrastructure installation. We know we’ll be able recoup those capital, operational and maintenance costs. But of course, it needs to be set up correctly — we are using this research partnership to investigate the most equitable way for the fee to be set, the legal and technical mechanisms to do so, and finally the financial projections model of where the district approach ends up 10 or 20 years down the road.
Saunders-Pearce: That’s right. This project supports St. Paul’s efforts to develop a replicable model for implementing “shared, stacked green infrastructure.” This type of green infrastructure is emerging as a strategy to treat runoff on a neighborhood- or district-wide scale.
Zhao: The project focused on innovative ways to manage stormwater, particularly in understanding the different approaches that other cities have used. First, we looked at several localities that have used fee-in-lieu to fund stormwater. The focus was on (1) the methods used for the calculations of the fee, (2) the criteria that projects must meet to be able to pay into the fee-in-lieu structure, (3) the payment methods and (4) the use of the resources generated through the fee-in-lieu.
We analyzed different arrangements between private and public partners to understand how communities work together to finance, develop and manage stormwater projects, as well as the benefits and challenges of doing it.
In these case studies, we found the importance of fiscal subsidies as well as private contributions. Fiscal subsidies may be justified by the wide range of co-benefits that green infrastructure brings to the community. Private contributions are made possible with acknowledged benefits and organized efforts.
Researchers at UMN’s Institute for Urban and Regional Infrastructure Finance have been interested in exploring and understanding financial arrangements for infrastructure investments in the short- and long-term, as well as facilitating informed decision-making with data and analyses. This project allows us to do both. The project allows us to understand innovative funding for green infrastructure and gives an opportunity to provide feedback to the city of St. Paul, which is considering the use of these financial arrangements. In addition, this research helps raise awareness of urgent infrastructure needs and the associated consequences if we fail to take action.
Levine: How does this green infrastructure analysis interface with existing infrastructure plans in St. Paul? What mechanisms in local government are required to move toward your goals?
Saunders-Pearce: There are 450 miles of storm sewers and tunnels in St. Paul. They form the traditional infrastructure response to managing stormwater. Currently, stormwater management obligations during redevelopment are completed individually. Public- and private-sector responsibilities are strictly separate. City staff have identified a public-private shared “district” stormwater approach as a preferred alternative in order to attain higher-value infrastructure and more efficient redevelopment.
In 2016, St. Paul was selected to join Living Cities' City Accelerator 18-month Infrastructure Finance cohort to provide a focused effort to address the final remaining challenges to developing a replicable funding and financing model for stormwater district infrastructure. Our five-year development plan includes three priority large-scale brownfield urban redevelopment project areas. Intensive financial analysis informed the city’s approach to implementing green district infrastructure.
Solomon: This project should alleviate an obstacle that impacts projects moving from the planning and development to the implementation phase. Oftentimes plans are aspirational and include green elements without a plan to implement. Having this tool will allow planners to think big in their design process, knowing that innovative tools can and will be developed to see them to fruition in the finance, legal and technical domains.
Saunders-Pearce: The city is developing a funding framework — the Green Infrastructure Financing District concept— that captures development-related fees from future neighborhoods to pay for the comprehensive green infrastructure that will serve them and provide for increased flexibility in developing the surrounding property. The outcomes of such a policy approach will be to promote smarter land use to maximize density and flexibility, identify and pursue opportunities for water reuse and conservation, and create more vital and dynamic urban environments that include healthier habitat and open space amenities.
City staff have developed a proposed system to recover the costs of green infrastructure from the private development that benefits from shared, stacked-function green infrastructure systems. The capital costs will be recovered through connection fees imposed at the time building permits are issued, and the operation and maintenance costs will be recovered through dedication of stormwater system service charges and a special green infrastructure surcharge. The goal of this funding system is to assure sustainable funding to recognize the costs and value of green infrastructure within a defined district. It will be important to recognize that not every element of a green infrastructure system will serve every parcel within the district, but rather that every parcel will benefit from the planning, design and implementation of a comprehensive system to address the stormwater and green infrastructure needs of the district as a whole.
City ordinance amendments will implement this approach by amending the stormwater utility fee code to include a definition of “green infrastructure,” and to provide for a “green infrastructure connection charge” and a “green infrastructure operation and maintenance surcharge.” The green infrastructure surcharge area or district could be specifically created through a master plan (e.g., zoning and public realm plan), development agreement or property owner petition, as well as by council resolution. Staff have requested that the city attorney finalize the draft ordinance amendments.
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